In a recent Publisher’s Point of View column, I reported that Hawaii’s governor intended to sign SB1396, creating the climate impact fee, or “green fee,” that will help the islands to mitigate the impacts of climate change and the roughly 10 million annual visitors it welcomes to its shores. According to AP, that legislation was signed by Hawaii Governor Josh Green yesterday.
The legislation boosts a tax imposed on hotel room and vacation rental stays in order to raise money to address eroding shorelines, wildfires and other consequences of climate change.
The measure adds an additional 0.75 percent to the daily room rate tax starting January 1. Green said this amounts to an extra $3 tax on a $400 hotel room rate. It also levies a new 11 percent tax on cruise ship bills starting July 2026, prorated for the number of days the vessels are in Hawaii ports, to bring cruise ship taxes in line with room taxes on land.
AP reports that travelers to Hawaii already pay a significant room tax. With the new law, the state’s existing 10.25 percent tax on short-term accommodations will climb to 11 percent. Together with other state and county taxes, visitors will pay a nearly 19 percent levy on their accommodations.
According to HawaiiNewsNow, it is estimated the fee will raise $100 million annually to provide disaster mitigation for the Aloha State. The green fee will fund projects like coral reef protections, replenishing sand on eroding beaches and clearing flammable invasive grasses like those that fed the Lahaina wildfires.
AP reports that the signing marks the nation’s first such levy to help cope with a warming planet.
Green said other states and nations will need to act similarly to address climate disasters roiling the planet.
Hawaii’s hotels ultimately supported the bill, saying it would help improve the visitor experience. Green said the industry looked at “the greater good” for tourism, Hawaii and the planet.
State Rep. Adrian Tam, the chairperson of the House tourism committee, said the state must earn the public’s trust that it will spend the money transparently and in the best way possible. He noted Hawaii’s tourism economy relies on a brand that’s in part dependent on a pristine natural environment.
“The visitor industry will struggle if we do not take action now,” said Tam said. “There will be nothing left for them to showcase to the rest of the world if our beaches are decimated, wildfires have taken over our towns and hikes left unmanaged.”
