Hawaii
Hawaii tax credits scrutinized by state lawmakers | Honolulu Star-Advertiser
Hawaii lawmakers have been busy this year assessing whether there should be more or fewer ways to earn state income tax credits, a year after approving historic tax cuts that ramp up through 2031.
At least two dozen bills were introduced this year to establish new tax credits, alter existing ones and abolish others.
Most bills were rather quickly ignored or rejected, though a few still pending would benefit family caregivers, help start hog farms and increase credits for film productions.
The longer list of shelved bills would have established new tax credits for things including hurricane-resistant safe rooms in homes, aquaculture investments, cesspool replacements, telework, electric garbage truck purchases and water delivery service.
There also were rejected bills that would have given credits to residents who pay the state’s hotel room tax, to Hawaii National Guard retirees, to businesses that pay public transportation costs for employees, and to businesses with certain “food and beverage supply chain costs.”
Perhaps the most heavily contested piece of tax credit legislation this year has been House Bill 1369, introduced by Rep. Kyle Yamashita, chair of the House Finance Committee, in an effort to explore eliminating or phasing out many existing tax credits, deductions and exemptions.
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Broad review
HB 1369 aims to simplify the state tax system and enhance revenue sustainability by getting rid of close to 20 tax breaks.
Many companies and organizations oppose the bill, which received 351 pages of written testimony for a Feb. 24 hearing. The committee then advanced the measure to the 51-member House of Representatives, where a vote four days later was 40-7 to send the bill to the Senate for consideration.
Among things slated for elimination under the original version of the bill were credits for renewable energy technologies, including rooftop solar systems, and film productions.
The bill also proposed to repeal state general excise tax exemptions for industries and operations including petroleum refiners, independent sugar cane producers, business conducted in an enterprise zone and aircraft maintenance.
Yamashita (D, Pukalani-Makawao-Ulupalakua) said at the outset of the hearing that his aim is to look at the list of tax benefits, most of which were identified by the state auditor for possible repeal, and determine whether they are achieving their intended purposes. Yamashita said he added the film and renewable energy tax credit programs — the two biggest tax credits promoting economic activity — on top of the auditor’s list for review.
“In general, where I’d like to see us move to is to use the tax code primarily to bring money in,” he said, adding that it may be better to provide grants or appropriations, subject to oversight and measurement, as incentives for certain things.
The nonprofit Tax Foundation of Hawaii for years has espoused a similar view, calling tax credits the expenditure of public money “out the back door” that can be hard to quantify before claims are submitted and approved.
“If, in fact, these dollars were subject to the appropriation process, would taxpayers be as generous about the expenditure of these funds when we need money to support victims of natural disasters like the Maui wildfires, there isn’t enough money for social service programs, or our state hospitals are on the verge of collapse?” the foundation said in written testimony on multiple tax credit bills.
Focus on film
Much of the opposing testimony on HB 1369 was concentrated on the film tax credit program, which has existed since 1997 and currently has a $50 million cap for credits after the industry claimed a record $68 million in credits in 2022. Productions, which can include movies, TV shows and commercials, are eligible for credits as a partial rebate on certain spending, and can receive payment for credits exceeding tax liability.
The film tax credit program has long been contentious over whether a financial incentive, or how much of an incentive, is needed to draw film productions to Hawaii, where natural attractions exist.
James Tokioka, director of the state Department of Business, Economic Development and Tourism, which oversees the film tax credit program, said in written testimony that the program is crucial to attract more industry productions after reductions due to the coronavirus pandemic and industry strikes.
“Reducing the program’s impact would collapse the ability to attract new productions, develop our workforce and justify the demand for additional studio infrastructure investment,” he said. “If the incentive is eliminated, so too will the jobs and livelihoods of our talented crew and acting pool.”
The Motion Picture Association estimates that more than $260 million is paid annually in wages to people working on film, television and streaming produc- tions in Hawaii, and said in written testimony that repealing the tax credit program puts those jobs at risk.
Some supporters of the program encouraged raising the credit cap, including Sally “Kalei” Davis, who said she has worked in Hawaii’s film industry for 40 years. Davis suggested raising the cap to $100 million to avoid having shows depicting Hawaii being filmed in New Zealand or Atlanta.
“If this (bill) passes, it will be the nail in coffin for our Hawaii Film Industry!” Davis said in written testimony. “Why would anyone want that?”
The House Finance Committee amended the bill to exclude the film tax credit from being repealed.
At least a half-dozen other bills were introduced this year to alter the film tax credit program, mostly by increasing benefits, and one is still being considered for enactment.
Senate Bill 732 originally proposed to raise the $50 million annual cap to $60 million. Subsequent drafts don’t specify an increase amount. The Senate passed the bill unanimously March 4, and the measure is pending in the House.
Other additions
A few bills also still pending would provide tax credits for other things.
One of these, HB 701, would establish a tax credit for unpaid family caregivers to essentially recover up to $5,000 in annual caregiving expenses. The bill cited a 2023 AARP report that found 154,000 Hawaii residents provide unpaid caregiving services for a loved one.
The state Department of Taxation estimated that such a credit could reduce state tax collections by $397 million annually.
Another pending bill would provide tax credits on 50% of an investment to convert a dairy farm into a hog farm.
Supporters of this measure, SB 328, included DBEDT and the Hawaii Farm Bureau but no one seeking to use the proposed credit, capped at $1 million. The state Department of Agriculture suggested broadening the credit so it could apply to the transformation of farms and ranches in general.
The Tax Foundation of Hawaii was more critical in its written testimony that said, “The bill appears to be too narrow to be an industry incentive, and smells more like a benefit to a specific taxpayer. If so, the law would be unfair to other taxpayers, especially those in competition with the taxpayer seeking this benefit.”
It’s not uncommon for bills to get introduced on behalf of companies or industries. One piece of legislation introduced this year was promoted by Corteva Agriscience in an effort to undo a change lawmakers made in 2024 to a tax credit for research.
The Legislature in 2024 restricted eligibility for the research tax credit, which is limited to $5 million annually, to businesses with no more than 500 employees.
Corteva has about 22,500 employees and had $16.9 billion in sales in 2024. The company has five seed crop farms in Hawaii.
HB 92 proposed to undo the tax credit’s employee condition. Corteva said in written testimony that it proposed a “fix” to include larger companies, and that 2024’s change threatens growth and sustainability of high-paying research and development jobs and innovation in Hawaii.
The bill stalled in the House after being advanced by one committee.
Because it can be difficult to determine whether a tax credit program serves a public purpose well, Yamashita took another tack this year by introducing a bill he said was aimed at exploring the issue by putting restraints on new or renewed tax credits.
This measure, HB 796, would impose an automatic five-year sunset on every income tax credit established or renewed after the end of this year, or phase out such credits over three years.
HB 796 was widely opposed by several stakeholders, including some organizations that feared it could affect income tax credits available to low-income households.
During a Feb. 24 hearing on the bill, Yamashita asked whether the state Tax Review Commission, which meets every five years, would be better able to analyze merits of existing tax credits.
The commission is expected to convene later this year, and a Tax Department official told Yamashita that the department could suggest to the commission that tax credits are an area of interest for possible review.
Hawaii
Hawaii pilot program aims to curb evictions | Honolulu Star-Advertiser
A new statewide pre-eviction mediation law that went into effect last month has already had success in keeping Hawaii tenants in their homes.
The two-year pilot program requires landlords to participate in mediation talks before filing residential eviction notices for nonpayment of rent. It’s intended to prevent unnecessary evictions and help ease court congestion by resolving landlord-tenant disputes before they escalate.
The legal basis for the program comes from Hawaii State Legislature Act 278 passed last year and was signed into law on July 2.
This builds on the success of earlier mediation initiatives in Hawaii like Act 57, which was passed by the state House of Representatives in 2021 during the height of the COVID-19 pandemic to curtail a surge in eviction cases. That law required landlords to engage in mandatory, pre-eviction mediation with their tenants and attempt to find mutually agreeable solutions to settle rent disputes before going to court.
Act 57 ran out of funding and subsequently expired in August 2022. But while it was on the books it boasted an impressive success rate: Out of 1,379 rent mediations conducted by the Mediation Centers of Hawaii (MCH) — an Oahu-based umbrella organization directing cases to local mediation centers — 87% of parties reached an agreement. It is credited with diverting more than 1,200 eviction cases away from the court system.
State lawmakers have praised the new pilot program as an offshoot of the most effective parts of the now-defunct COVID-era bill.
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“We are taking the lessons learned during COVID and testing a professionalized, pre-eviction framework through this pilot program,” state Sen. Troy Hashimoto of Maui said in a news release. “Instead of relying on limited resources in the courts, this data-driven approach encourages early dialogue and allows us to measure how effectively professional mediation can reduce court backlog and resolve disputes.”
Under the new program rules, landlords must give tenants a 10 calendar-day window to seek mediation services before starting eviction proceedings, and must upload eviction notices to MCH’s website. The organization will then direct cases to one of five local mediation centers in Honolulu, Kailua-Kona, Hilo, Lihue (Kauai) or Wailuku (Maui).
If the tenant opts to schedule mediation within that 10-day period, an additional 10 days is afforded for talks to take place before the case can be brought to court. Mediation services are free for both parties, funded with state money appropriated in Act 278 and directed to organizations like MCH.
However, attorney costs accrued by landlords or tenants will not be funded by the state, and if a tenant cancels or fails to attend a scheduled mediation, landlords are allowed to request tenants pay for their attorney fees.
The mediation center contracted to provide services to East Hawaii Island landlords and tenants is Ku‘ikahi Mediation Center, where Executive Director Julie Mitchell has seen the efficacy of the new program firsthand.
Data is slim because the law has only been in effect for one month, but even early on Mitchell has seen four out of four cases assigned to the center thus far be successfully resolved, with three tenants able to stay in their rentals and one moving out without eviction. The West Hawaii Mediation Center serving Kona-side has successfully mediated five tenants to stay, and one amicable move-out.
Part of this success, Mitchell believes, is commencing talks between parties before back rent builds up and animosity and hopelessness start to grow.
“The idea behind this program is having early conversation and early communication,” she said. “It’s trying to prevent eviction as a preventative measure, to preserve housing, to prevent homelessness. It’s much easier to have a conversation when you’re one month behind on rent than when you’re 10 months behind on rent.”
Although these types of initiatives are often assumed to be more beneficial to tenants, Mitchell contends that landlords have also expressed appreciation at having access to mediation.
“I think it’s a sense of relief,” she said. “For landlords, they usually are a business and want to make sure they can get the money they need to live, oftentimes to pay a mortgage. Eviction is obviously not good for the tenant … but it’s also not good for landlords. It’s very costly to take people to court and to have to renovate and get the property ready for the next person.”
Ideally, she said, negotiations that the center facilitates will be a win-win for everyone, including the courts.
“When I’m reading the agreements, it seems like it’s advantageous to both parties,” she said. “If the landlords are trying to recoup back rent, they can do that. We want to find solutions that are going to be best for everybody … and the courts are swamped, the judges have a lot of cases on the docket, so this is a way to alleviate those impacts on the courts as well.”
The pilot program will track its success through annual reports to the Hawaii State Judiciary, supplying data that will influence other statewide eviction prevention measures in the future.
Hawaii
Hawaii to see ‘potentially life-threatening weather’ with massive rain, flooding
The National Weather Service warns of a “high-impact and potentially life-threatening weather pattern” in Hawaii this week, with torrential rainfall, flash flooding, strong winds, severe thunderstorms and mountain snow.
Through Saturday, “we could easily see over 20 inches in the harder-hit areas, but that’s just a ballpark estimate,” said Laura Farris, a meteorologist at the weather service office in Hawaii.
Greater totals are possible atop the state’s volcanoes, which can measure feet of rain from the biggest storms.
The cause is a strong low-pressure system that will bring two rounds of stormy weather to the state Tuesday through Saturday. These systems are locally referred to as ‘Kona lows,’ and are responsible for Hawaii’s most extreme weather during winter months.
“The high-end potential of this Kona storm is significantly outside the realm of ‘normal’ wet season weather,” the weather service said.
Heavy rain will begin over Kauai on Tuesday morning before reaching Oahu on Tuesday night, prompting the weather service to issue a flood watch for those islands, which is in effect through Saturday afternoon.
A lull in storminess Thursday won’t last long, as “an even stronger disturbance is expected Friday into Saturday with major flooding and damaging winds,” the weather service said. That storm is likely to prompt additional flood watches and warnings for Maui and other Hawaiian islands. About 10 inches of rain is predicted in Honolulu, with 30-plus inches of rain possible atop the state’s volcanoes, through Saturday.
Severe thunderstorms could generate hail and damaging winds, with isolated tornadoes even possible Friday and Saturday. Thunderstorm chances are highest for Kauai and Oahu initially, but the second disturbance over the weekend will raise odds for hail, wind and tornadoes across all islands. Significant snow accumulations are forecast for the summits of the Big Islands.
Hawaii is no stranger to heavy rain, as Mount Waialeale, on Kauai, is one of the wettest spots on Earth and averages nearly 40 feet of rain each year, according to NASA. But rainfall rates are expected to approach 2 to 3 inches per hour within the heaviest bands, too much for even tropical islands to handle without flooding.
This Kona low will have an abundance of moisture to work with. The low’s counterclockwise motion, in tandem with an anomalous clockwise-spinning high-pressure system to the east, will work to draw abundant moisture toward Hawaii from the south. It’s the same area of high pressure responsible for the spring heat wave that’s forecast to grip the Western U.S.
The moisture transport won’t stop upon reaching the island state. It will continue northeastward toward the Pacific Northwest, where a strong Pineapple Express may raise flood danger early next week.
Hawaii
Hawaii Keeps Adding Fees And Rules. This Park Is Still Free.
We were in Hilo for a story that had zero to do with the parks. Visiting Volcanoes National Park again, together with the coconut bridge problem, had sent us across the island from Kona, and the plan was straightforward enough: After our long-awaited volcano visit ended, we planned to do the remaining reporting, get something to eat, and head back out to Kauai via wonderful Hilo Airport. We had not flown through Hilo in years and wanted to check it out, too, and we were glad we did. And we were not expecting Hilo itself to change anything about the day. But it did.
Hilo gave us something we weren’t expecting.
What changed it was not a museum, any paid admission attraction, or some “must-see” visitor stop. It was a public park near the airport that we could have very easily passed by.
Liliuokalani Gardens does not look that impressive from the road. There was no gate, no fee, no reservation sign, and none of the now-familiar friction that can come with so many Hawaii stops. You did not have to plan for it, book it, or have any special reason for just being there. We just showed up. And almost immediately, we had the same thought that many other locals and visitors probably would: how is this still free?
Liliuokalani Gardens still feels generous and opulent.
Not free in the sense of being modest or “nice for what it is.” Free in the sense that if this were packaged somewhere else as a formal attraction, people would pay for it without much hesitation. The gardens are spacious, beautifully kept up, and full of details that only really register once you show up and slow down. The ponds, the bridges, the stonework, the open lawns, the beautiful trees, the way the paths keep opening up to new views. Nothing about it feels slapped together or reduced to the bare minimum.
What impressed us was just how easy it felt spending time there. People were wandering, stopping, sitting, talking, exercising, and taking their time. Some sat on benches and picnicked, as we did, while others strolled along the paths without any clear destination. Nobody seemed rushed. It was clearly Hilo at its best.
More often than not, the Hawaii experience starts before you even arrive. There is planning, the fee, the booking window, the parking issues, the time slot, the shuttle, the warning signs, the whole uncomfortable low-grade sense that you are entering something managed as tightly as Hawaii deems necessary. Some of that is understandable. Some of it is probably unavoidable. But it changes the feeling of a place in Hawaii. And it turns too many stops into logistics first and enjoyment second. But not here.
Liliuokalani Gardens felt like the opposite. We could hear planes not far off landing and taking off, and still see how close we were to the airport and town, but inside the gardens, all of that fell away. What took over instead was the sound of water, the stillness around the ponds, the nesting nenes, the bridges, and the rare feeling that nobody was trying to move us along.
After we left the park and before returning to Hilo Airport, we also stopped at Rainbow Falls. That stop turned out to be a whole different story. More on that soon.
Liliuokalani Gardens dates back to 1917.
The Territorial Legislature set aside land in Hilo for a public park dedicated to Queen Liliuokalani. The gardens’ own history says the park grew out of an early Hilo push to create a Japanese garden and tea house, influenced by Hawaii’s large Japanese immigrant community and by Laura Kennedy’s 1914 trip to Japan. That history helps explain why the place feels so substantial today: it now spans 24.67 acres, including the Japanese-style garden, Moku Ola, and other connected park areas.
What Hilo exposed about Hawaii.
These places are not good only because they are free. They are just good, period. The fact that they are free only sharpens the comparison. In a state where more visitor experiences now come wrapped in fees, reservations, restrictions, and various bottlenecks, Hilo can still find ways to offer places that feel open.
That does not mean every site in Hawaii can or should work this way. Some places are too fragile, too much in demand, or too small. But Hilo is a reminder that not everything meaningful in Hawaii has to be turned into a managed product. Not every worthwhile thing needs a layer of hassle between the visitor and Hawaii itself.
We did not go to Hilo looking for a parks story at all. We were nearby because of the coconut bridge problem.
Hawaii visitors are paying more, planning more, and dealing with infinitely more rules than they used to. Sometimes that is the price of preserving what visitors came for in the first place. Sometimes, however, it reflects a broader shift in how the state now handles access, demand, and public spaces.
Hilo offered exceptional beauty without a transaction attached and access without any conditions. We could just arrive spontaneously, stay as long as we wanted, look around, and then leave on our own terms. After so many Hawaii stops built around fees, timing, and control, this is one place where the welcome doesn’t come with a price tag.
For more information, visit the Friends of Lili’uokalani Gardens website or Facebook page.
Lead Photo: © Beat of Hawaii.
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