West Maui Taxpayers Association
  • HOME
  • Olowalu Fire Station
  • WMTAPAC22
  • Affordable Housing
  • West Maui Lifesavers
  • Wall of Honor
  • Support WMTA
    • Membership - One Time Payment
    • Membership - Recurring Payment
    • Donations
    • Wills & Trusts
    • Charity Walk
  • Newsletter
  • Emergency Planning
  • News Blog
  • About Us
    • Goals & Objectives
    • Accomplishments
    • Board of Directors
    • WMTA vs WMIF
  • Contact
  • Subscribe

Bride of Frankenbill!

4/12/2021

0 Comments

 
WMTA Shares these commentaries, without taking a position unless otherwise noted, to bring information to our readers ​to view the archives of the Tax Foundation of Hawaii's commentary click here.
Picture
Bride of Frankenbill!
 
We wrote last week about House Bill 58, a “Frankenbill” made from bits and pieces of other bills.  By putting those pieces into a bill that is still alive at the Legislature, those pieces are given new life.

It turns out that our lawmakers are not stopping at just one Frankenbill.  Let’s look at House Bill 468.
This bill is called “Relating to the Hawaii Employer-Union Health Benefits Trust Fund.”  In its present form (House Draft 1), it would take away Medicare Part B reimbursement for employee spouses for employees hired on or after July 1, 2021.  At least one of the public worker unions testified against it.  So, although it passed the House, the bill languished in the Senate.

At the same time, an Administration bill from the Department of Budget and Finance, Senate Bill 1087 / House Bill 933, would have suspended existing laws calling for annual required contributions to the Employer-Union Trust Fund for fiscal years 2024 and 2025.  House Bill 933 received no hearing in the House and died relatively early in the session.  The Senate bill sailed through the Senate and crossed over to the House, where it received no hearing and died.

Now, the Senate has published a proposed Senate Draft 1 of House Bill 468 that looks a whole lot like Senate Bill 1087 without any of the material that House Bill 468 used to have.  By the time this article goes to press, the Senate Committees on Labor, Culture and the Arts and Ways and Means would have heard the bill and made the switcheroo.

Some of you may have heard the term “gut and replace.”  That term is used to describe how a bill’s contents are entirely replaced with material bearing little if any resemblance to what the bill used to say.  It is one form of Frankenbill, and that is indeed what we have here.

Why is this bill so critical?  Imagine what would happen if you had a mortgage and then stopped making payments on it for a couple of years.  When you finally got around to making payments again, the debt would still be there and the interest would have racked up.  Paying off the mortgage would probably take quite a bit longer than the two years that were deferred.  If, for example, you had a $500,000 mortgage at a 30-year fixed rate of 4%, you would be making principal and interest payments of $2,387.  If you stopped making payments after year 5 and took a break for 2 years, your balance due would grow from $451,000 to $487,000, after which you would need 340 more monthly payments at the same amount, or 28-1/3 years, to pay off the loan. That would mean you would have to make 3 years and 3 months of extra monthly payments.

What is EUTF?  The State of Hawaii has promised to provide health benefits to its long-time employees for the rest of their lives.  EUTF is a fund set up to fulfill that promise.  According to the most recent actuarial report from EUTF’s website, the present value of the benefits the State has promised to its eligible retirees exceeds the expected value of the plan’s assets by $11.5 billion.  The $11.5 billion is like a debt that the State and its taxpayers must pay. 
The Medicare Part B benefits, which House Bill 468 addressed before being turned into Bride of Frankenbill, accounted for $3.23 billion out of the $15.4 billion in actuarial accrued liability.

Lawmakers, we ask again – what can we afford to do, or not do?
0 Comments

Your comment will be posted after it is approved.


Leave a Reply.

    Picture

    RSS Feed


    If you wish to further discuss blog posts, please contat our office directly or contact us via Contact page.

    Categories

    All
    Affordable Housing & Homelessness
    Board
    Capital Improvements
    Charity Walk
    Commentaries
    Community Events
    Community Resources
    CON
    COVID 19
    Educational
    Emergency Planning
    Health & Safety
    HHARP
    Housing
    Infrastructure In West Maui
    In The News
    Kapalua Airport Runway Lights
    Kapalua Coastal Trail
    Lahaina Bypass
    Legislature Newsletters
    LLC
    Long Range Transportation Plan 2040
    Long-Range Transportation Plan 2040
    Makila
    MAUI CANCER CENTER
    Maui Cancer Center Llc
    Maui County
    Maui County Budget
    Maui County Dept Of Environmental Management
    Maui County - Dept Of Water
    Maui Destination Management Plan
    Press
    Public Safety In West Maui
    Real Property Tax
    Recycling Info
    TAT
    Tax
    Tourism
    Traffic & Roadways
    Transportation
    Video
    Vote
    Voting
    West Maui Community Plan
    West Maui Hospital
    West Maui Skate Park
    WMTA Annual Meeting
    WMTA Breakfast Events
    WMTA Candidates Night
    WMTA Disaster Preparedness
    WMTA Fundraisers
    WMTA Hot Topics
    Wmta Hot Topics Replay
    WMTA Membership
    WMTA PAC
    WMTA Sunset Sail
    WMTA Whale Watch

Quick Links: 

Home

News

About Us

Wall of Honor

Newsletter

Support WMTA
Emergency Planning

Contact

Copyright © 2021
Photo used under Creative Commons from wolfsavard
  • HOME
  • Olowalu Fire Station
  • WMTAPAC22
  • Affordable Housing
  • West Maui Lifesavers
  • Wall of Honor
  • Support WMTA
    • Membership - One Time Payment
    • Membership - Recurring Payment
    • Donations
    • Wills & Trusts
    • Charity Walk
  • Newsletter
  • Emergency Planning
  • News Blog
  • About Us
    • Goals & Objectives
    • Accomplishments
    • Board of Directors
    • WMTA vs WMIF
  • Contact
  • Subscribe