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2 ousted from House Finance Committee

By Kevin Dayton; Star-Advertiser; August 28, 2017

Two members of the powerful House Finance Committee were abruptly replaced Sunday in a partial House reorganization launched just a day before the start of a high-stakes special session to try to bail out the financially troubled Honolulu rail project.

State Reps. James Tokioka and Isaac Choy, who have both been publicly critical of House leaders’ proposals for funding rail, were notified by Vice Speaker Della Au Belatti on Sunday morning that they will no longer serve on the Finance Committee.

Choy (D, Manoa-­Puna­hou-Moiliili) contends he and Tokioka were removed to grease the tracks for the controversial rail bailout bill, and to minimize discussion and criticism of the measure this week.

“I think they want the hearing to go very, very smoothly and quietly without any debate or discussion, or any kind of thought,” Choy said.

The five-day special session of the state Legislature convenes today in an effort to provide billions of dollars in additional funding to rescue the city’s partially built, 20-mile rail project.

Lawmakers will formally introduce Senate Bill 4 to raise the statewide hotel room tax by 1 percentage point for 13 years to raise $1.04 billion, and to extend the half-percent excise tax surcharge on Oahu for another three years to raise another $1.32 billion.

In all the bill would raise $2.37 billion in new tax revenue for the rail line. The House and Senate are scheduled to open the special session at 10 a.m., and legislators have scheduled the first public hearing for the rail measure for 3 p.m. today at the state Capitol auditorium.

Lawmakers will also consider separate measures to fund negotiated raises for several public worker unions, and senators will hold public hearings to consider testimony on Gov. David Ige’s nominees to several positions, including a seat on the Public Utilities Commission.

There will be hearings in both the House and Senate to allow the public to testify on the rail bailout bill, but lawmakers said it took them months to negotiate the new rail bailout package, and it would be difficult to make any major changes now.

The city has a Sept. 15 deadline to show the Federal Transit Administration how it plans to raise the money to cover the project’s budget shortfall. House Speaker Scott Saiki said it is “very unlikely” lawmakers could negotiate a new version of the bill that makes significant changes to the bailout package and have it approved in time to meet that deadline.

Belatti said there will be ample opportunity for debate on the rail bill during the special session this week, and said Tokioka and Choy were removed as part of a larger reshuffling of some House committees. She said state Reps. Beth Fukumoto (D, Mililani) and Sam Satoru Kong (D, Aiea) will now be assigned to the Finance Committee.

The new funding package for rail is similar to a House proposal that failed in May when the House and Senate deadlocked over rail funding, and both Tokioka and Choy opposed that bill in a House floor vote May 2. Fukumoto and Kong both voted in favor of the House rail proposal.

Fukumoto earlier this year quit the Republican Party and became a Democrat, and House leaders needed to assign her to new committees, Belatti said. The larger House reorganization that will be voted on today will also consolidate the former House Health Committee and Human Services Committee into one, with Rep. John Mizuno as chairman, she said.

“I think that the leadership changes in the committees overall are separate and apart from this argument that we’re trying to quash dissent,” Belatti said. “We fully expect that this bill is going to be fully vetted and discussed, and I think it’s unfortunate that some people would characterize it as otherwise.”

She said the House leadership made sure there was an informational briefing earlier this month to allow people to testify on the various rail options, and hearings will be held during the special session to allow for comment on the new rail funding package.

Tokioka (D, Wailua-Hanamaulu-Lihue) said he has served on that committee for 11 years, making him the longest continuously serving member.

“I do understand that leadership has the right to do what they want to do, but I just find it very suspect that they chose to do it in the middle of a rail hearing and special session,” he said.

Choy said he opposes the use of the state hotel room tax to pay for rail because it is not a “tested” or stable source of funding for the project. He contends it would be better to extend the half-percent excise tax surcharge on Oahu to fund rail.

The FTA has not said it would accept the hotel room tax as a way of financing rail, and lawmakers may be overestimating how much money would be generated by a 1-percentage-point increase in the hotel room tax, Choy said.

The rail project is vastly over budget, and its estimated price tag has increased from $5.26 billion in late 2014 to nearly $10 billion, including financing costs.

City officials estimate the project now has a budget deficit of about $3 billion, and Honolulu Mayor Kirk Caldwell this year asked the Legislature to extend the excise tax surcharge on Oahu to cover the shortfall.

That surcharge generates about $300 million a year and now pays most of the construction costs for rail. Lawmakers already extended the surcharge once, in 2015, to provide more funding for the project.

During the regular legislative session this spring, lawmakers deadlocked on how to provide the billions of dollars in additional funding needed to complete the project.

Lawmakers then called what is expected to be a five-day special session this week in a new effort to provide the additional money for rail.

Caldwell has said the latest rail package still leaves the city with a shortfall of $600 million to $900 million, and is lobbying legislators for more money. If lawmakers refuse, Caldwell says, the city will be forced to raise taxes or cut services.

During the special session this week, lawmakers will also consider Senate Bill 2 to appropriate more than $43 million to fund raises and fringe benefits for this year and next year for United Public Workers members under newly negotiated contracts.

Those new contracts cover nonsupervisory blue-collar employees, and institutional, health and correctional workers who are represented by the union.

Legislators will also consider Senate Bill 3, which would appropriate more than $31 million for raises and fringe benefits for this year and next year for unionized University of Hawaii and community college faculty.

Senators will also use this week to consider and vote on a number of appointments by Ige to boards and commissions.

Those include the appointments of James Griffin to the Public Utilities Commission and Douglas T. Shinsato to the UH Board of Regents, representing Hawaii island.

Also under consideration will be Ige’s appointments of Robert Masuda as deputy director of the Department of Land and Natural Resources and Gary Okuda, Lee Ohigashi, Linda Estes and Nancy Cabral to the state Land Use Commission.

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