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Just When You Thought They Got the Message

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By Lowell L. Kalapa

     Kudos must be given to the Economic Revitalization Task force despite its penchant to raise the general excise tax as it raised the level of awareness of the public as well as of the legislature on the importance of the economy.  

 

 

While some argue that Hawaii is just a victim of the global economy, and in particular a victim of the Asian flu, something needs to be said about the business climate in Hawaii.

       Even as late as 1997, lawmakers doubted the prolonged downturn of the economy, with many hoping that the rebound was just over the horizon. For example, when the measure to reduce the general excise tax rate on real property leasing was under consideration in the House Finance Committee, lawmakers were more concerned about the revenue loss than how the bill could help the economy.

What the Task Force did was to put a spotlight on the fact that Hawaii’s economy has been in the doldrums for the past seven years and it doesn’t appear that there will be a turn around any time too soon. It also highlighted the fact that Hawaii is the only state which has not benefitted from the robust economy that is sweeping the rest of the nation. While some argue that Hawaii is just a victim of the global economy, and in particular a victim of the Asian flu, something needs to be said about the business climate in Hawaii.

Although many believe elected officials got the message, the actions of some indicate that we are still a long way from driving home the point that government needs to change its attitude toward businesses and entrepreneurs. Take for example a measure approved by this year’s legislature affecting the inspection of elevators and boilers.

Although the bill was originally introduced by the department of labor and industrial relations to allow private industry to perform the required inspections of elevators and related equipment in order to reduce the cost of operating the inspection program, the bill that finally gained legislative approval was a far cry from that original intent.

Today, the inspection of elevators and boilers is required on an annual basis, and the fees that are charged for these inspections are deposited to the credit of the general fund. That seems fair enough when one considers that the public employees who perform these inspections are paid out of the general fund.

 
 
Do you think the legislature got the message that the cost of doing business is too high in Hawaii?
 
However, under the bill, beginning on July 1, 2000, owners of elevators and boilers will now have to have their equipment inspected once every six-months instead of annually. Further, the legislature created a brand new revolving fund into which the fees charged for elevator and boiler inspections will now be placed. Of course, the materials, salaries and equipment necessary to conduct elevator and boiler inspections will be paid out of this new revolving fund.

All of these changes were adopted in the name of making the elevator and boiler inspection program self-sufficient and to

 
 
provide the public with greater reassurances that the . . . equipment is in proper working order and safe for use.
 
 
But look at what has happened. Instead of one inspection per year, businesses, as well as multi-family residential buildings, will have to have two inspections. That means with two inspections, the cost allotted to those inspections will double.

Setting up a revolving fund that will keep up to $1.2 million in that fund will take this public program out from under the review of the legislature as it will have its own funding. So much for accountability.

True, the bill will sunset the revolving fund in the year 2003, but guess what, the six-month inspections will continue indefinitely. Thanks to the legislature, the cost of doing business will double if you have an elevator.

Do you think the legislature got the message that the cost of doing business is too high in Hawaii?

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