The forecast also said Hawaii is gradually recovering from the tourism slump triggered by last year’s Maui wildfires, while the construction industry is booming.
The state will collect about $125 million less this fiscal year than lawmakers expected when they approved the state budget last spring, mostly because of a massive state income tax cut legislators approved in the final days of the last session.
The state Council on Revenues, a panel of experts tasked with projecting state tax collections each year, concluded Thursday that Hawaii is gradually recovering from the tourism slump triggered by the Aug. 8, 2023, Maui wildfires, while the construction industry is booming.
But the council maintained that state general fund tax collections will grow by a modest 3.5% this fiscal year and 2.2% next year because of the unprecedented tax cuts lawmakers approved in May.
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New projections made public by the state Tax Department Thursday show the income tax cut in Act 46 will reduce state tax collections by more than $240 million in the fiscal year that began July 1, and will reduce collections by nearly $597 million the following year.
Tax cuts included in the state budget approved by Hawaii lawmakers earlier this year were widely praised, but may make it more difficult for lawmakers to balance the budget in the future. (Chad Blair/Civil Beat/2024)
Another tax measure approved in the spring, Act 47, will reduce excise tax collections by an additional $33 million next year. That new law eliminates the state excise tax on medical and dental care services provided under Medicare, Medicaid and the military’s TRICARE.
The bottom line is that while the council projected in March the state general fund would collect $10.027 billion in taxes this fiscal year, the experts now expect actual collections to be slightly more than $9.902 billion.
The tax cut won praise from council Chairman Kurt Kawafuchi, who said it is a “really good policy of the administration and the Legislature to pass the tax relief.” He cited the increasing cost of essentials such as food and gasoline.
But the impact on tax collections may make it more difficult for Gov. Josh Green and state lawmakers to balance the state budget when the Legislature reconvenes in January. The amounts the state will forgo because of those tax cuts are scheduled to increase each year.
That may be creating a new normal for state government, experts said.
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“Essentially, to make all of this pencil out, the state government spending — actual spending — needs to remain relatively flat for the next decade,” said economist Carl Bonham, also a member of the council.
He suggested that can be done in part by eliminating funding for vacant jobs in state government, an idea that Green has said he plans to pursue. But the council also briefly noted some hefty expenses that state government will have to pay in the near future.
Data provided by the Tax Department suggested the state must pay $537 million in hazard pay to unionized public employees who were required to work during the Covid pandemic, and the state faces major costs in the future to resolve lawsuits and help Maui recover from the wildfire.
Almost all of the public worker union contracts expire next year, and the unions certainly will be pressing for wage increases to offset the impact of inflation, Bonham said.
Green has said state budgets in the years ahead may be tight, but he expects the state will be able to pay its bills without raising taxes.
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However, he has said he plans to once again ask lawmakers to impose a so-called “Green Fee” on visitors to help finance state efforts to cope with climate change.
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Steam rises from Kilauea Volcano, just a few miles from Volcano Golf Course on the Big Island of Hawaii.
Matty Lee, Volcano Golf Course
For travelers willing to venture beyond the familiar resort corridors on the Big Island of Hawaii, Volcano Golf Course offers a truly memorable detour and golf experience.
Located about 4,000 feet above sea level in the cool uplands of Volcano Village – several hours from resorts like Mauna Lani and Mauna Kea on the sunny Kohala Coast — the more-than-100-year-old course sits across the street from Hawaii Volcanoes National Park and just a few miles from the active Kīlauea volcano. With sweeping mountain views and a setting shaped by volcanic terrain and rainforest, Volcano delivers a side of Hawaiian golf that feels unpolished, far removed from lush resort fare, and deeply connected to its surroundings.
Just outside Hawaii Volcanoes National Park on the Big Island, Volcano Golf Course is a 100-year-old+ layout at 4,000 feet above sea level that offers a fun, pure golf experience in a unique setting.
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Erik Matuszewski
The setting alone makes Volcano Golf Course quite possibly the most unique golf facility in the Hawaiian Islands. Few courses anywhere can claim proximity to one of the planet’s most active volcanoes, and even fewer allow golfers to play a round in the cooler mountain air before getting a chance to witness glowing lava flows after dark.
While Volcano Golf Course isn’t affiliated with a resort, it now offers a special stay-and-play opportunity through a partnership with nearby Kīlauea Lodge & Restaurant, a cozy inn nestled in the heart of Volcano Village less than five miles down the road. The Kīlauea Stay & Play Package combines three nights at the lodge with two rounds of golf, carts, range balls and even a full-size rental car, creating an easy and immersive way to experience this special part of the island.
A photo from the walking trails and botanical gardens behind the Kilauea Lodge just a few minutes down the road from Volcano Golf Course and Hawaii Volcanoes National Park.
Erik Matuszewski
Tucked into rainforest surrounds, the lodge mirrors the spirit of the course — intimate, warm, historic, and deeply local. There are guest rooms with stained glass windows, fireplaces and local artwork, along with an award-winning restaurant. The property is a perfect jumping-off spot for trips to Volcanoes National Park, which not only has a spectacularly active summit caldera – the Halema’uma’u crater – but more than 150 miles of hiking trails, lava tubes, steam vents and dramatic volcanic rock landscapes.
It’s possible to see steam rising from the volcano on certain parts of the nearby golf course. And with its brisk breezes, cooler temperatures, occasional misty conditions and cloudy skies, and turf that’s more seasonal than always a lush green, Volcano Golf Course at times can feel less like Hawaii and more like a rustic linksland in Ireland.
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At times, Volcano Golf Course has a feel more akin to a links-style layout in the U.K. than to Hawaii’s typical resort courses.
Erik Matuszewski
The conditions even tend toward fast and firm, rewarding creativity on what is an immensely fun layout. There’s no luxurious clubhouse, no greens on the ocean, no overdone landscaping, and really no intent to be anything other than it is — a pure golf experience in a unique setting.
The wide fairways are framed by dense vegetation and native ‘ōhi‘a trees bloom with bright red blossoms. The Nēnē goose, Hawaii’s state bird, is a frequent companion for local and adventurously itinerant golfers alike.
Nene and golfers share the fairways at Volcano Golf Course.
Erik Matuszewski
For a time, Volcano’s future was uncertain.
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The course was closed in 2020 when the then-operator abruptly ceased operations. Kamehameha Schools, which owns the 156-acre parcel of land the golf course is on, would later step in to regain control of the facility and reopened it in 2022 after two years of dormancy.
Troon’s Indigo Sports arm was brought in to manage day-to-day operations and the course today continues to only get better as it embraces its unique place in not only the Hawaii golf environs but even more broadly. Matty Lee was recently appointed as the property’s head professional and is excited about the opportunity at Volcano, including plans for a new, permanent clubhouse.
Hitting a shot at Volcano Golf Course with steam rising from the active Kilauea Volcano in the background.
Matty Lee, Volcano Golf Course
Part of the commitment for Volcano, which is a 45-minute drive from Hilo and about two hours from Kona, is a stewardship, and responsibility to care for, the local environment. The unique setting is the biggest reason Volcano Golf Course stands out from the dozens of other Hawaii courses.
In a state known for tourism and escapist luxury, Volcano is authentic and pure – a golf experience set in one of the most dramatic natural environments in the game.
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Several hours from the resorts on the Big Island’s Kohala Coast, Volcano Golf Course has sweeping mountain views and a setting shaped by volcanic terrain and rainforest.
UH kicker Kansei Matsuzawa reacted after making a game-winning field goal to beat the Stanford Cardinal at Clarence T.C. Ching Athletics Complex in the Warriors’ opener on Aug. 23.
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Kicker Kansei Matsuzawa today became the University of Hawaii football program’s first consensus All-American.
Matsuzawa, 26, earned the distinction after being selected today to the American Football Coaches Association’s All-America first team.
The NCAA recognizes five All-America teams. A “consensus” All-American is selected to three of those organizations’ first teams. Matsuzawa previously was named to the All-America first teams by the Walter Camp Foundation and the Associated Press. The Sporting News and the Football Writers Association of America will announce their All-America teams this week.
“This is a result of my teammates and coaches,” Matsuzawa said, noting without them “I couldn’t have done this. I appreciate my family, and the state of Hawaii and Japan.”
Matsuzawa is a self-taught kicker from Chiba, Japan. The school-promoted “Tokyo Toe” converted his first 25 field-goal attempts this season to tie an FBS record for best start. The streak ended when he was wide right on a 30-yard attempt in the fourth quarter of the regular-season finale against Wyoming.
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Last week, UH special teams coordinator Thomas Sheffield declared Matsuzawa as “the best kicker in the country. And I’ll stand on the tallest mountain and scream it from the tallest mountain until the cows come home.”
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The Rainbow Warriors will play Cal in the Dec. 24 Sheraton Hawaii Bowl at the Ching Complex.
