Hawaii's new green fee, aimed at offsetting the environmental impact of tourism, has caught the attention of a Trump administration that has become increasingly hostile to efforts to combat climate change.
The US Department of Justice proposed to intervene in the situation Cruise Lines International lawsuit against the state and county was ruled earlier this month, just a day before federal Judge Jill Otake held her first hearing in the case.
The tax was declared historical when it was passed by the Legislature last April. It will apply to hotel guests and other short-term visitors from January 1, and in a concession aimed at winning support for the hotel industry, it was expanded during the session to also include cruise ships.
In his motion, Assistant Attorney General Stanley Woodward calls Green Fee, the first of its kind in the country, “a scheme to extort American citizens and businesses solely for the benefit of Hawaii.”
The court's decision could determine how big of a green fee actually will be in Hawaii — and whether cruise ships that dock and disembark passengers in the country's lone island nation will be treated and taxed the same as hotel rooms and visitor rooms on land.
It's unclear what percentage the tourism industry accounts for of the $100 million in estimated annual golf course fees.
My Paste / Honolulu Cheat Beat Cheat Beat
Richard Wallsgrove, co-director of the environmental law program at the William S. Richardson School of Law, characterized the Justice Department's bid to join the case as an ideologically motivated abuse of power to call climate change a hoax.
Dozens of plaintiffs across the country regularly argue in court that the U.S. Constitution is being violated without the Justice Department intervening, Wallsgrove said.
“You have to wonder: Why this lawsuit and why now?” – he said. “It is because of this idea that the federal government must protect U.S. citizens from the climate change hoax, which you know couldn’t be more bullshit.”
The Trump administration also sued Hawaii earlier this year try to stop the government from holding fossil fuel companies accountable in court for the consequences of climate change.
U.S. Attorney General Pam Bondi heads the Justice Department, and under her leadership, the department got the court to roll back Trump's climate initiatives. Her brother, Bradley Bondi, is the lead attorney representing Cruise Lines International in the lawsuit against the state.
Typically, Wallsgrove said, such a family connection to a case would not raise any ethical red flags. But given all the norms that have been broken during the first year of President Donald Trump's second term, he said it is “not inappropriate at this particular point in history” to wonder whether the Justice Department is stepping in to do the bidding of someone connected to the attorney general.
$2 Billion Demand
Starting next year, the transient occupancy tax that visitors pay for overnight hotel stays and short-term rentals will increase by 0.75 percent — to 14 percent, including county fees — to cover the new fee. Cruise ship passengers will begin paying a full tourist tax for the first time next year, which will represent a new 14 percent fee for the time those passengers stay in Hawaiian ports.
Government officials estimate it will raise about $100 million annually to fund projects to address climate change and environmental degradation on the islands.
During a webinar last week, Jeff Mikulina, chairman of Gov. Josh Green's Green Fee Advisory Council, downplayed the impact of the lawsuit. He said if the cruise industry wins, it would only apply to cruise ship cabins and would “slightly” reduce the total amount of Green Fee fee revenue collected.
Mikulina said a group of volunteers is evaluating 620 projects that would benefit from the new fund, with a total cost of about $2 billion. He said the council intends to make its recommendations to Greene on project selection as soon as possible, and then make those recommendations public before the next legislative session begins in January.
Competing interests
Jim McCarthy, a spokesman for Cruise Lines International, said in a statement Friday that the group “remains focused on ensuring clear, consistent laws that support Hawaii communities, protect the environment and support responsible ocean travel.”
The cruise industry generates $1 billion in annual economic impact for Hawaii, he said, and “we are working to ensure that success continues in a legal and sustainable manner.”
Industry representatives argue that government-imposed green fees violate the Constitution. Tonnage clause And Rivers and Harbors Actwhich limit the ability of states to charge ships for entering ports and sailing through their waters.
Before the federal government tried to intervene, state Attorney General Anna Lopez's office filed a motion to dismiss the case, which Otake has yet to rule on. The judge will also have to approve the Justice Department's entry into the case.
In a statement Friday, Lopez's office said it “vigorously defends the legality” of the green fee but declined further comment due to the ongoing litigation.
Waikiki state Rep. Adrian Tam, who chairs the House Tourism Committee and helped add cruise ships to the tax base, said Friday he has every confidence Lopez can “protect Hawaii's interests here.”
He added, “I just want the Department of Justice to protect our interests as well.”
Civil Beat's coverage of climate change and the environment is supported by the Healey Foundation, the Hawaii Community Foundation's Marisla Fund and the Frost Family Foundation.
