Archive for March 2011

Will a higher threshold make the pension tax palatable?

March 9, 2011

It’ll be interesting to see if the proposal in the Legislature to tax pensions continues to draw the political ire of seniors now that the House has set the income threshold at nearly three times higher than originally proposed by Gov. Neil Abercrombie.

Hawai‘i  is one of only 10 states that don’t tax employer-provided pensions, and Abercrombie raised a fair point about whether that should change given the state’s precarious financial situation.

But he set the income threshold way too low at $37,500 for singles and $75,000 for married couples, which would have taken a big chunk out of the anticipated retirement income of middle-class citizens who could ill afford the loss.

The governor also failed to properly index the tax, which would have placed an unfair burden on those who fell just over the limit.

The House removed a lot of the immediate sting by raising the income threshold to $100,000 for singles and $200,000 for marrieds.

Rep. Isaac Choy, an accountant who is respected for his facility with numbers, estimated the tax will apply at this point to only 3,000 high-income taxpayers who can afford it, and the rest will have 15 to 20 years to prepare before inflation pulls them into the grip of the tax.

What remains to be seen as the measure moves to the Senate is whether nervous retirees and those soon to retire — a politically potent bunch — will be relieved by the reprieve or if they’ll continue to view any new tax on pension income as an ominous threat.

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Senators fight for the right to freeload

March 8, 2011

Update: Final reading on SB 671 was delayed 48 hours after the Senate amended it again today to limit the free tickets public officials can accept to fundraisers of IRS 501(c)(3) organizations (public charities and private foundations). Language was deleted that would have also allowed free admission to events sponsored by non-charitable tax-exempt groups such as chambers of commerce, trade associations and labor unions.

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The hearty appetite of Hawai‘i legislators for free meals and other goodies is an issue that won’t seem to die this session.

Common Cause put out an alert that a new version of SB 671, which it dubs the “Gifts Law,” is up for final reading in the Senate today.

The latest draft strips out language that would have allowed lawmakers and other public officials to accept or even solicit gifts worth up to $200 from just about anybody seeking to influence their actions.

But the new version would still allow legislators to accept free admission to charitable events, even if the provider of the gift isn’t the host of the event.

Presumably, the freebies would apply not only to the ubiquitous fundraising dinners, but also to charitable events such as golf tournaments, wine tastings and fashion shows.

And the legislation broadly defines a “charitable entity” to go well beyond the social service organizations we usually think of charities to include business groups such as the Chamber of Commerce, trade associations and labor unions — all of which have lobbying interests before the Legislature that are far from charitable.

It’s a back door that allows special interests of virtually all kinds to wine and dine legislators from whom they are seeking officials favors, and there’s no credible argument that it’s in the public interest to allow such freebies to be offered or accepted.

Also difficult to swallow is the aversion our lawmakers have to paying their own way into charitable events like everybody else.

It doesn’t even have to come out of their own pockets; they pushed a campaign spending law amendment a few years years ago to allow elected officials to cover charitable donations from their campaign funds.

Don’t cross Abercrombie with independent thought

March 7, 2011

Gov. Neil Abercrombie’s ham-handed dismissal of Cathy Takase as acting director of the Office of Information Practices smells like the kind of petty political vindictiveness Abercrombie pledged would be absent from his administration.

Takase, who had applied for the permanent job, was dumped a month after she crossed the governor with an opinion — ignored by Abercrombie — that he must make public the lists candidates given him by the Judicial Selection Commission for appointing judges.

It’s Abercrombie’s right to bring in his own OIP director, but where it gets vindictive is that the governor’s office also filled Takase’s previous position of staff attorney for the OIP, preventing her from going back to her old job as customarily happens when an acting director is passed over for permanent appointment.

Ian Lind makes a pretty solid case that the governor overstepped his legal authority by meddling in the office to make a staff appointment below the director’s level.

Takase displayed courage by standing up for the public’s right to know against Abercrombie’s determination to return to a secretive ward healer system of judicial selection, fully aware that it would diminish her chances of permanent appointment to the job.

She didn’t deserve to be treated like trash for doing what she believed the law required of her, and it reflects poorly on the administration to stoop to petty retribution.

It also raises alarms that the governor intends to turn the office charged with assuring that the public has fair access to government information into a rubber stamp for the new administration’s penchant for secrecy.

As Abercrombie was fond of lecturing Mufi Hannemann during the campaign: “This is not how a governor acts. This is not what a governor does.”

The Clayton Hee show always entertains

March 4, 2011

The drama over William Aila Jr.’s confirmation as director of the Department of Land and Natural Resources was classic Clayton Hee.

The Senate Judiciary chairman single-handedly delayed the vote on the popular Waianae harbormaster and Hawaiian activist, causing a flurry of letter-writing by Aila’s friends, family and co-workers in support of the nomination.

Hee attacked Aila’s character and integrity on the Senate floor because he didn’t disclose his commercial fishing license and signed off on O’ahu rail despite concerns about Hawaiian burials. Interest groups involved in those issues mostly supported Aila to be chief custodian of Hawai‘i’s  environmental resources.

When the emotional speechifying was done, Hee joined the other 22 senators present in voting unanimously to confirm Aila and then engaged in an extended hugfest with the nominee.

You have to like Hee for the passion of his beliefs and the showmanship he brings to Senate deliberations, but it can be hard to figure his logic and motivations.

Sometimes, he seems to just have a need to throw his weight around. In this case, there was speculation after his friend Neil Abercrombie was elected governor that he wanted the top DLNR job for himself.

Hee’s passions have brought him down in flames twice before as Judiciary chairman. It’ll be interesting to see if he’s learned to keep tightly enough bolted to the deck to hold onto the job this time.

Akaka leaves a political void

March 3, 2011

Give U.S. Sen. Daniel Akaka credit for a graceful announcement of his retirement after getting a less-than-gentle shove from his Democratic colleagues.

Akaka announced months ago that he planned to run for re-election in 2012 at 88, but he’d raised a paltry $66,000 for a likely formidable challenge from former Gov. Linda Lingle in a race that could cost $3 million to $6 million.

Fellow senators gave him their first hint that they didn’t think he was their best chance at beating Lingle when they dropped him as chairman of the Veteran Affairs Committee, which embarrassed him and cost him political capital at home.

Then a week ago, fellow Hawai‘i Sen. Daniel Inouye said pointedly that Akaka shouldn’t expect the outpouring of financial and and moral support he received from colleagues in 2006 when he faced a primary challenge from former Rep. Ed Case.

Now that Akaka has gotten the message and announced he’ll step down after finishing his term, the big question is whether the Democrats who nudged him out were right that they can find a stronger candidate to take on Lingle.

Though his age and failure to pass his signature Akaka bill for native Hawaiian political recognition were becoming liabilities, Akaka has been one of the nicest people you’ll ever meet in politics during his more than 30 years in Washington and enjoys a deep well of aloha among local voters. He hasn’t lost an election since 1974.

The four Democrats most likely to run for the seat — U.S. Reps. Mazie Hirono and Colleen Hanabusa, former Honolulu Mayor Mufi Hannemann and Case — all have spotty records with voters and have lost as many or more big races as they’ve won.

In listing potential candidates, Inouye mentioned a couple of intriguing younger and fresher possibilities in Lt. Gov. Brian Schatz and Tammy Duckworth, a McKinley grad who is assistant secretary of the U.S. Department of Veterans Affairs, but a crowded primary might be politically problematic for either.

Guv’s campaign promises upended by reality

March 2, 2011

When Gov. Neil Abercrombie was pressed during last year’s campaign by opponents Mufi Hannemann and James “Duke” Aiona on how he was going pay for his proposals, he’d typically answer, “Why do you it assume it will cost more?”

He said he’d cover the state deficit and pay for new programs by re-prioritizing, reallocating and tapping federal funds that he claimed the state wasn’t taking advantage of.

Abercrombie derided Aiona’s proposal for an audit of the Department of Education and Hannemann’s call for a comprehensive audit of state finances, saying he was ready to hit the ground running and didn’t need any audit to tell him the score.

Well, now that he’s finally coughed up a budget four months into his administration, it seems that his opponents were correct that his plans are going to cost more; he wants to spend several hundred million dollars more than proposed by the previous administration.

Abercrombie is relying mainly on tax increases of various kinds to finance his plans, with relatively little sign of re-prioritizing and reallocating. There have been few announcements of new federal funds coming Hawai‘i’s way.

He not only made big campaign promises, but was especially cocky in purporting to know it all as to where we stood and what needed to be done.

If truth in advertising has any meaning anymore in political campaigning, the governor owes us a better accounting of how his proposals stack up against what he promised.

Hawai‘i lawmakers hunger for free meals

March 1, 2011

Ethics laws governing Hawai‘i public officials are so lax that I didn’t think further loosening was possible.

But cutting themselves ethical slack is one of our legislators’ special areas of creativity, and they’ve done it again with a bill up for hearing before the Senate Judiciary Committee at 9 a.m. today that would allow lawmakers and other state officials to accept wining and dining from special interests with virtual impunity.

The original version of SB 671, introduced by Democratic Sen. Les Ihara and Republican Sen. Sam Slom, was a noble attempt to tighten reporting requirements on those who seek to influence legislators by requiring monthly disclosures from lobbyists and their clients when the Legislature is in session.

The amended version being heard today is a gut-and-replace job that weakens a current law barring acceptance of any gift intended to influence or reward official action with a more liberal rule that allows gifts of up to $200 from special interests, even if they are intended to influence and reward.

The amended measure allows legislators to accept and even solicit from lobbying interests food and beverages, travel and free tickets to charity, cultural, political or community events.

It’s pretty pathetic when our senators’ brightest idea for better government in the public interest is more freebies for themselves.


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