b'2019 State Report Hawaii AlohaMinimum Wage Increases and Other Legislation Fall ShortHIon May 2nd. Following a 2018 legisla- In other legislation, several bills designed to increase fuel The 30th Legislature of the State of Hawaiiadjourned quietly taxes all failed. Measures intent on squashing tobacco sales if tive session that House and Senate leaders proclaimed asa retail establishment is located within 750 feet of a school, progressive and constructive, it was the Hawaii businesspre-school or public playground, or prohibiting the sale of community that came together this session to oppose legisla- flavored tobacco products all died. The lone exception was tion to increase the state minimum wage and other issues. Senate Bill 1405. It was originally intended to regulate online sales of e-liquid tobacco products, but was amended into Working in coordination with the Chamber of Commercea requirement for educators to confiscate e-cigarettes from Hawaii, Retail Merchants of Hawaii, Hawaii Food Industryunderage students.Association, National Federal of Independent Business andOther measures that are awaiting the Hawaii governors sig-many other pro-business groups, HPMA vigorously opposednature include decriminalizing the possession of three ounces increases in Hawaiis minimum wage. HPMAs testimonyor less of marijuana, conducting voting exclusively via mail, noted the compression on other employees wages and ben- disallowing the dividend-paid deduction for Real Estate efits that results from increasing minimum wage rates, andInvestment Trusts, requiring issuers of gift certificates to raised concerns that proponents of the increases are equatingrefund the remaining value if less than $5, and restructuring the minimum wage to a living wage. the State Energy Office to be more accountable to the States Business trade organizations dug-in their heels and declinedenergy needs. to give an inch on any increase$1 an hour or otherwise.In the meantime, House and Senate lawmakers found them-selves at a philosophical crossroad as the bills entered theHiRUC Making Trackscrucial conference committee phase. The Houses position was to increase the minimum wagein Hawaiito $11 per hour in 2020, and by $1 per hour more each year until it reached $15 per hour in 2024. Acknowledging thatThrough a grant from the Federal Highway businesses must comply with Hawaiis Pre-Paid Health CareAdministration,Hawaii has joined several other states Act, the House offered a reduced hourly increase of 50 centsin studying whether the State Fuel Tax can be replaced with each year to an employee who receives health benefits froma more equitable tax for funding highway maintenance and his/her employer. repairs. Termed the Hawaii Road Usage Charge (HiRUC) The Senatealso in favor of a $15 per hour minimumstudy, the state Department of Transportation is already a wagefelt it should come in two major steps: $12 per houryear into its four-year program to investigate the matter. in 2020 and $15 per hour in 2023. The Senate reasoned thatRecently, DOT officials held community meetings across the small businesses would struggle more to comply than largestate to allow residents the opportunity to provide input on businesses. Therefore, the Senates position was to lessenthe concept of a fee on road usage. A groundswell of frustra-the brunt of the increases by offering businesses with fewertion from members of the public appeared to take the Hawaii than 50 employees an income tax credit. The Senate alsoDOT by surprise.generously offered State government workers a $17 per hour minimum wage, subject to collective bargaining. Fundamentals about how the current fuel tax works, how a As the session rolled into conference committee, the Senateroad usage charge would work, and, interestingly, inquiries gutted the Houses bill and inserted language from its bill.about the types of freebies that EV owners would receive Not to be outdone, the House amended the Senates versionfrom the new assessment were not clearly understood by by inserting its language. House Bill 1191, Senate Draft 2 be- audiences. That led to heated diatribes being recited by driv-came the Senates preferred bill, and Senate Bill 789, Houseers who pay a lot in fuel taxes due to the type of vehicle they Draft 1 became the Houses vehicle. Conferees eventuallyuse in their occupation (i.e., pickup trucks), and the nature of decided against advancing either bill. These and other similartheir business (i.e., construction) which takes them to many measures are expected to return next session. parts of the island. This was set in stark contrast to the busi-ness executive who works in downtown Honolulu and drives just a few miles to and from his/her residence in a Tesla.24 www.wpma.com / Summer 2019'