State Aid to Local Governments: How Hawaii’s State Government Shares Transient Accommodation Tax Revenues With Its Local Governments

by James Mak, UHERO, May 12, 2016

Many states in the U.S. give unrestricted financial support to their local governments. The reasons some state governments provide aid and others do not, and why a particular mode of revenue sharing is adopted remain unclear.

This paper examines Hawaii’s recent effort at developing a model to allocate the state’s transient accommodation tax revenues between the State and the county governments. The paper documents the process and explains the rationale behind the model.

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