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Committee replaces tourism-tax bill with House draft, advances plan to dedicate visitor fees for climate resilience
Summary
The House committee substituted House Bill 504 language into Senate Bill 1396 and voted to advance a revised measure to dedicate transient accommodations tax revenue for climate mitigation, natural-resource stewardship and visitor management.
The House Committee on Energy and Environmental Protection on March 13 replaced the contents of Senate Bill 1396 SD3 with language from House Bill 504 and advanced the measure with amendments to create a pathway for dedicating transient accommodations tax (TAT) revenue to climate-mitigation and visitor-management projects.
The committee’s action follows more than two hours of testimony in which conservation groups, climate advisers and the governor’s representatives supported dedicated funding for resilience and stewardship programs while the hotel and attractions industries and some business groups opposed increasing the TAT.
Supporters included Will Cain from the Office of the Governor, Luke Myers from the Governor’s Resilience Unit, Daniel Naho of the Hawaii Tourism Authority, Elizabeth Beneshek of The Nature Conservancy and Jeff Micolina of the Climate Advisory Team. Jeff Micolina said the Climate Advisory Team had identified roughly $500 million in needs and that the governor sought a target of about $200 million per year; he called a dedicated source of tourism revenue a top recommendation.
Environmental groups and coalitions including Care for the Aina Now, the Nature Conservancy, Hawaii State Energy Office staff and the Ocean Legislative Task Force urged the committee to create a durable funding source for natural-resource stewardship and resilience projects. Elizabeth Beneshek cited polling showing majority visitor support for a fee to protect the environment and said some visitors would be more likely to return if a fee funded conservation work.
Opponents included the Hawaii Hotel Alliance and the Activities and Attractions Association. Keikoa McClellan of the Hawaii Hotel Alliance urged the committee not to raise the TAT, arguing increases would fall on local staycationers and employees and that the state should instead collect unpaid TAT from short-term rental operators and cruise operators. The Activities and Attractions Association warned higher accommodations taxes can reduce discretionary visitor spending that local businesses rely on.
Other testimony highlighted how the bill currently lacked a specified rate and would need clearer spending criteria. The Tax Foundation of Hawaii said the bill could not be scored without a clear rate and urged lawmakers to avoid mandatory appropriation directives that might violate separation of powers. Dr. Keoni Dudley urged the committee to add a $100 million appropriation for hurricane shelters, citing climate-driven increases in storm risk.
At decision-making, the committee replaced the bill’s contents with language from HB 504, adjusted the purpose clause to emphasize the link between economic development and environmental stewardship, and passed the measure with amendments. The committee recorded the action as “pass with amendments.”
What’s next: The amended measure will move forward with the committee’s changes; specifics such as the exact TAT increase and allocation details were left to subsequent drafting and appropriation processes.
