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TAX MAN: Gov. Josh Green’s 2023 intent to veto list

On June 23, Gov. Josh Green issued his intent to veto list. Any bill that is now pending before him and not on the list will become law. Any bill that is on the list may or not be vetoed; the governor has until July 11 to make a final decision.

None of the tax bills we have been following are on the list. But some very interesting bills are on the list.

There’s House Bill 999. We mentioned that bill when we covered the state’s “shadow budget” last month because the budget included some $50 million for a first responders’ training facility in central Oahu that HPD and the House didn’t like, but the Senate slipped the millions in anyway.

And, for good measure, the conference committee on that bill overhauled it to effectively kick one person, who happened to be critical of the first responders’ park, off the board of the High Technology Development Corporation that was tasked with building said park. The Governor wasn’t having any of this, however.

This bill made the list because the proposed modifications to the board were “too substantial.” And by the way, the governor also gave notice of intent to line-item veto the $50 million appropriation. Bully for him! Revenge and retribution don’t properly have a place in moving our state forward.

Then there is Senate Bill 1518. It gives the Department of Education (DOE) several procurement exemptions. Why? According to the bill’s preamble, the DOE is a big honkin’ department and doesn’t have time to be bogged down with such silly things as procurement laws.

And, by the way, it says the state’s electronic procurement system is “complicated and onerous,” placing a heavy burden on school administrators who need to comply with the law. The governor’s answer?

We have a system of procurement laws that is supposed to give us an open and transparent process.

Carving out exceptions to it would decrease efficiency, create administrative burdens, limit competition and open unfair advantages to certain vendors. In my book, I chalk up one point for the governor and zero for cronyism.

Another interesting one is House Bill 475. That one would create a pilot program for monetizing art. The state, through a set-aside program administered by the state Foundation on Culture and the Arts, has a lot of very significant artwork.

So, the bill proposes to loan out the art to private individuals, businesses or entities — for “reasonable financial consideration.” That way, we make the art available for a lot more people to enjoy, and the state gets some money for it. Win-win situation, right?

The governor doesn’t think so. His veto rationale is that property bought with taxpayer money should be used for a public purpose, and the pilot program looks more like money-grubbing, which could get the state into all kinds of trouble such as compromising the state’s tax-exempt bond program, increasing debt service costs and tarnishing the state’s financial reputation.

If there are technical, federal tax and constitutional concerns about the bill, however, why didn’t someone from the Attorney General’s Office make them known in testimony? This bill’s history makes me worried that someone has been sandbagging.

And last but not least, there is Senate Bill 945, relating to special purpose digital currency licensure. It would have Hawai‘i start to regulate cryptocurrency. The 80-plus page bill contains a lot of words, but no money for DCCA to turn those words into action. Clearly, if Hawai‘i wants to play in this space it needs to put some money where its mouth is.


Tom Yamachika is president of the Tax Foundation of Hawai‘i.
Source: The Garden Island

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