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Committee advances SB 1333 to let smaller counties use state tax surcharge revenues for housing and transportation, extend surcharge sunset
Summary
SB 1333 passed the Housing Committee Feb. 6 with amendments to allow counties with populations of 500,000 or less to use county surcharge revenues for housing and transportation infrastructure, to extend a surcharge collection deadline to Dec. 31, 2047 in some cases, and to authorize cost sharing with private developers; DOTAX and others provided
The Senate Committee on Housing voted Feb. 6 to pass SB 1333, a measure that would authorize counties with populations of 500,000 or less to use county surcharge revenues on state tax for transportation and housing infrastructure. The bill also authorizes counties that previously adopted a surcharge ordinance after July 1, 2015 to amend the allowed uses of the surcharge, extends the period in which a county may collect the surcharge under certain conditions to Dec. 31, 2047, and authorizes cost sharing with private or other public developers for housing infrastructure projects funded by surcharge revenues.
Multiple state and county agencies testified in support, including DBEDT, OPSD, HCDA, DOTAX (with comments), and several county offices. The Office of Planning and Sustainable Development summarized that the measure recognizes the high upfront infrastructure costs for transit‑oriented development and that Maui already allows use of the GET surcharge for housing; supporters urged parity for other neighbor‑island counties.
Jade McMillan of the Tax Foundation of Hawaii submitted comments cautioning about repeatedly extending what began as temporary surcharges and the risk that temporary taxes become effectively permanent. During decision making the vice chair expressed concern that the surcharge had not demonstrably delivered housing projects in Maui as intended and said the measure may be premature; the committee noted that concern in the record.
Outcome: Passed with technical amendments. The committee’s recommendation to pass with amendments was adopted and will be noted in the committee report, including the vice chair’s concerns and DOTAX comments about administration.
Next steps: The bill continues through the legislative process with committee amendments recorded for further consideration.
