Comments on: Court shuts down legislative tax scam

By: charles

charles — Sun, 20 Apr 2008 22:37:28 +0000

If it’s a legislative “scam,” why is the AG considering an appeal? The Lingle-Aiona administration opposes special funds so why not just issue a press release applauding the ICA’s decision and stick it to the legislature?

By: zz

zz — Fri, 18 Apr 2008 02:28:47 +0000

The court says the state can’t collect more tax than it needs? Interesting. I wonder what the court thinks of the “fees” paid by the city to the state to help collect the half-percent general excise tax? Would those fees be considered “tax,” too? Last I heard, the state was running a magnificent surplus in that fund.

By: Koauka

Koauka — Thu, 17 Apr 2008 19:47:27 +0000

Sounds like some guy named Mufi. Wonder how much transit tax the state collected for him? The story of Hawaii government, always hiding stuff, then poof!, money appears to cover a deficit.

By: Jammer

Jammer — Thu, 17 Apr 2008 18:41:09 +0000

Earl..I have to disagree. I pay some of those fees collected by DCCA as a business owner. However, we, along with Director Rechtenwald, went to the Leg numerous times over the past 6 years asking, in fact begging, that the Leg allow DCCA to reduce its fees because of excessive balances in these funds. Each time bills introduced by Rep. Bob Nakasone were shot down by the Finance Committee in the House and the Ways and Means Committee in the Senate. Many of the fees charged by DCCA are statutorily established and can only be acted upon by the Legislature.

In fact DCCA proposed a bill that would allow the Director to lower fees whenever the balance in the special fund reached an amount established by the Legislature that the Legislature felt was adequate to sustain the fund. Unfortunately, that bill was held as well. So, the Legislature does have a hand in this whole deal, as well as the administration.

By: Forward Observer

Forward Observer — Thu, 17 Apr 2008 17:56:25 +0000

Earl may be confusing two special funds within the DCCA. The one in the court case was the Insurance Compliance Resolution Fund, which is funded by insurance companies who sell insurance in the state. That fund is supposed to be used to pay for the costs of keeping them honest e.g. audits of the company’s books. The DCCA has another special fund which holds the proceeds from document filing fees. Over the years, to their credit, they have managed to improve service and reduce the cost of processing various forms and filings, e.g. corporate registration, trade name registrations, etc. that the fund had accumulated a great surplus. I believe that is the fund you are referring to and not the insurance regulator’s fund.

By: Earl of Sandwich

Earl of Sandwich — Thu, 17 Apr 2008 17:24:43 +0000

Dave,

Sorry, but you’re out of line calling this a “legislative” tax scam. Executive’s Department of Commerce and Consumer Affairs was and is at the middle of this thing - they were the impetus for the suit filed by Hawaii Insurer’s Council, and it was their fees that the Intermediate Court of Appeals opined on. They had built up so much of a reserve that they could buy a whole new building, complete with new furniture. It was the Legislature that investigated the surplus and required the department to LOWER fees back in 2003. If I recall correctly, the Legislature provided for another lowering of fees either the next year or the year after. Give credit where credit (or discredit!) is due!

By: Too Many Spec Funds

Too Many Spec Funds — Thu, 17 Apr 2008 16:30:58 +0000

Our legislature along with our duplicitous executive have “locked up” far too much funding in excessively numerous special funds. The improper delegation of tax powers to the departments has been just one aspect of this debacle. Illegal taxation, separation of powers, due process are bust some of the additional elements (but not equal protection).

Entire departments have abused this (not just the one under this lawsuit; DOE comes to mind), in an effort to secure pet programs at the expense of overall efficiency and fairness. In general, special funds should be designation where needed to obligate federal and other funds or conditions- not at somebody’s pet project. The DOE has been rewarded for their inefficiency and incompetence in the past by spec funds and the overgenerous forgiving of lapsing triggers, lapsing would promote more accountability and efficiency and penalize the incompetent.