Need to Make Everyone Pay Their Fair Share for Roads

by Lowell L. Kalapa, Tax Foundation of Hawaii

Honolulu’s Mayor was rebuffed by the City Council earlier this year when he submitted a proposal to raise the county gas tax by five cents a gallon. For most of us observers, the proposal was almost dead on arrival, if not completely dead, as the proposal seemed to be insensitive to the fact that consumers are already angry about the high cost of fuel and Hawaii seems to have the highest prices in the nation.

But what would have been more irritating is if Honolulu highway users remembered that the proceeds of the county fuel tax already subsidize the cost of a bus ride in Honolulu. And although the Mayor rationalized his request to hike the fuel tax as necessary to rehabilitate Oahu’s roads, not a mention was made about the fact that the fuel tax subsidizes the transit fare box. And when the Mayor made a second attempt to embarrass the City Council into considering the fuel tax hike, he tied the issue so that it would prevent the City from paying wage increases for the county’s first responders.

Now it is one thing to insult the beleaguered highway user to use the hike in the fuel tax to subsidize the bus rider, but it goes far beyond acceptable to say the county needs to hike the cost of fuel for your car so it can pay public employee wage increases. It’s like saying we are going to take money from your pocket, highway user, so we can pay city employees more so they can afford the hike in the gas tax. Politically, that just doesn’t fly.

Then again, it is not unusual for elected officials to find ways to make highway users subsidize projects that are a stretch in figuring out how those projects benefit the highway user. For example, there is the highway beautification fee which sounds like such a noble cause, but it is nothing more than maintenance of the highways. Highway beautification could have and should have been paid out of the existing highway financing structure of the fuel and motor vehicle weight taxes and registration fees, but that would have required a hike in the rate. This way, calling it a highway beautification fee probably made it more politically acceptable to the highway user.

Then, let’s not forget that $5 of the vehicle registration fee is designated for the emergency medical services program. This additional $5 charge was tacked on when the annual vehicle registration fee was only $20 and the rationale was that emergency medical services were necessary whenever there were motor vehicle accidents. Never mind that emergency medical services respond to heart attacks in the home, hikers falling off treacherous mountain trails, or a slip and fall in a local fast food restaurant. In other words, the nexus drawn in this argument to increase the vehicle registration fee was tenuous at best. But somehow lawmakers were able to convince highway users, and the public in general, that this was a good way to pay for the emergency medical services program.

Only when lawmakers later came up against the fact that the state highway fund was running short of funds did they realize that the additional $5 in the vehicle registration fee rate made their decision to raise additional highway funds from the weight, fuel and vehicle registration fees all that more difficult. In fact, it is that realization that has made it all the more difficult for the office that administers the parking disability program - the Disability and Communication Access Board - to persuade lawmakers to increase the vehicle registration fee by one dollar to fund the program rather than paying for it out of the general fund. It was interesting to note that despite the administrator’s attempt to rationalize the additional dollar by saying it would save the general fund a half million dollars, one committee member pointed out that there are over a million registered vehicles in the state and that the proposed dollar would have doubled the amount of revenue available for the program.

Then again, it should be noted that this is the same office that was authorized last year to collect fees to defray the expense of reviewing construction plans to ensure compliance with state and federal laws relating to accessibility for the disabled. Apparently not wanting to miss an opportunity to generate more money for their program, the Disability and Communication Access Board will now review and approve those plans for a mere $5,000 each. These are plans that probably were drawn up and already reviewed by licensed architects and engineers. Lawmakers need to question the appropriateness of the fee and whether or not it is just another way to generate revenues for yet another state program. Eventually that cost will be passed on to the users of those facilities, being it a parking lot or any building that is required to have disability access.

These are but a few ways that various public agencies have been able to pass additional taxes on to highway users and taxpayers in general.

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