The Latest: Mayors ask for extended session to fund rail

HONOLULU – The Latest on efforts to fund Honolulu’s financially troubled rail project (all times local):

11:50 a.m.

Mayors of all four Hawaii counties are asking Gov. David Ige to extend the legislative session to find funding for rail.

Lawmakers in the House and Senate did not agree on a financial plan for the troubled rail transit project in time to pass a bill before the session ends Thursday.

The rail is planned for Oahu, but mayors on neighbour islands are concerned about how various tax proposals could impact their coffers.

According to the Hawaii Constitution the governor can order the Legislature to extend the session or two-thirds of the House and Senate can vote to do so.

A spokesman for Honolulu Mayor Kirk Caldwell says the federal government could withhold future money without an adequate funding plan. He says they also can ask Honolulu to return money already spent.

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9:15 a.m.

Hawaii lawmakers have yet to agree on a funding deal for Honolulu’s multibillion-dollar rail project.

The House rejected a Senate proposal Tuesday that called for extending the excise tax surcharge for rail for another decade to help fund the project. Meanwhile, the Senate rejected a proposal to boost hotel taxes by 2.5 per cent.

House Transportation Committee Chairman Henry Aquino is now proposing increasing the hotel room tax by 1 per cent for 11 years. He says the plan to put up more than $1.7 billion for the partially built project would provide more rail funding than any other proposal brought forward so far.

“I feel this is a responsible floor amendment, and it addresses many of the concerns that we received,” Aquino said.

But other House lawmakers said the new proposal would result in Honolulu losing $45 million a year in hotel room taxes the city now receives from the state. That money would go toward the rail project under Aquino’s proposal.

Tourism industry officials issued a statement Tuesday in opposition of using hotel taxes for rail.

“We are opposed to tapping into the (hotel room tax) as a funding mechanism for Honolulu’s rail project and continue to believe that the (excise tax surcharge) is the more appropriate funding mechanism,” the Hawaii Lodging & Tourism Association said.

Cost estimates for the rail project have gone from about $5 billion in 2014 to nearly $10 billion.

If the House and Senate can’t agree on a funding bill, the city of Honolulu will have to find its own funding solution for the rail project. The 2017 legislative session is scheduled to end Thursday.