Sen. Sam Slom - Photo courtesy of Mel Ah Ching Productions
Sen. Sam Slom - Photo courtesy of Mel Ah Ching Productions

BY SEN. SAM SLOM – Anyone who has heard me speak about  taxes, fees  and surcharges and how they affect the cost of living, and standard of living, for Hawaii taxpayers, has heard me say, “check your own bills monthly!”

Unfortunately, we are a Nation—and State—of economic “illiterates.”

We don’t understand numbers, taxes and “gross” vs. “net” and that plays right into the hands of those who tax us and take our money. That’s why when a worker is asked how much he or she earns, they automatically list the net amount after all taxes and fees are taken out first.

Now, more than ever, you should be akamai about how much you are REALLY paying for the products and services you use regularly and how it adds up.

A few cents here, and a few dollars there, add up to real money; your money. Remember how every time government wants to raise your General Excise Tax (not a sales tax), they argue, “it’s ONLY 1/2¢?”

Well, that ½¢ surcharge on O’ahu for the $9.03 billion rail, nets close to $300 million a year. That’s a lot of half-pennies.

Or, starting September 1, 2012, another ½¢ tax increase per container on the Hawaii Beverage Deposit tax. This tax of course has nothing to do with recycling or the environment; it is a naked tax grab from your family.

No matter how hard you try to cut down or use less of a product or service, you see your costs escalating.

Use less electricity, and your rates go up.  Cut down on your water usage, and your water rates climb. Use restraint, and still your sewer rates increase. Tune in your cable television and see fee driven rate hikes.  Then there are those airline baggage fees. Don’t get me started!

I thought I would make it a little more graphic by including some of these charges that almost all of us pay every month. Here are a few, selected bills of mine for August, 2012.

Let’s examine telephone use. I guess I’m one of the few dinosaurs who still have a land line plus cell phone. Look at the cost of service PLUS surcharges.

1. Home Telephone – Hawaiian Telcom

Basic Telephone Service (“Go Local Plus”)               $28.95

  • + Surcharges: Access Recovery Charge               $0.12
  • Federal Excise Tax                                                         1.20
  • Fed Universal Service Fee                                             1.03
  • General Excise Tax                                                         0.36 }                                    $12.86
  • Intrastate Surcharge                                                       3.25
  • PUC Fee                                                                              0.07
  • Statewide 911 Emergency Surcharge                           0.27
  • Telecommunications Relay Service                             0.06
  • Subscriber Line Charge                                                   6.50

TOTAL Phone Bill (NO Long Distance)                      $41.81

 

That $12.86 in surcharges equals 44.4% more than the basic rate for your telephone. And if you look closely at the individual uses of those surcharges you will find out among other things they are used to give “free” or heavily subsidized telephones to selected groups of people.

 

Next look at my cell phone bill. Many of you have more bells and whistles and higher usage charges, like data, text, and added minutes. My basic service for one of two lines, is a net $65.99. But surcharges add another $6.91 (or 10.4%) PER LINE. My total bill is $130.55. And, see that “0.66¢ for 9-1-1 Service Fee?” That was added years ago, and the emergency 9-1-1 service has long been implemented, yet the monthly charge continues. But it’s only 66¢, right?

 

2. Cell Phone – AT&T

  • Family Talk with rollover                                    $59.99
  • Data Plus 200 mb (IPhone)                                $15.00
  • Less: National Discount Credit                            – 9.00
  • Cell Phone Bill Total (Single Line)            $65.99
  •             + Surcharges: Fed Universal Service   $2.39
  • HI State Telecom Relay Service                                0.05
  • Public Service Surcharge                                           $2.38
  • Regulatory Cost Recovery Charge                             0.46 }            $ 6.91
  • State Public Utility Surcharge                                    0.26
  • 9-1-1 Service Fee                                                            0.66
  • County Sales Tax                                                           0.09
  • HI State Sales Tax                                                         0.68

TOTAL Phone Bill*                                                           $72.90

Cost for primary line only; total for 2 lines= $130.55)

 

My favorite utility, the HECO monopoly, is the champ of surcharges. Our family use averages 800 kwh per month. We have solar for heating. Nevertheless, our basic cost of electric use is $80.19 for August, BUT another electrifying $238.19 in surcharges and fees. When we turn off the lights, computers, tvs, or are even away on a trip, we still get charged more. And if HECO gets its way on wind turbines (not free) and an undersea electric cable, your rates and their guaranteed profits, will both soar. We desperately need a new utility model and deregulation.

 

3. Hawaiian Electric (Avg. 800 KWH) with SOLAR Water Heating

  • Basic Fuel Energy – Electrical usage                      $80.19
  • + Surcharges: Customer Charge                                      $8.00
  • Non-Fuel Energy                                                                       71.90
  • Energy Cost Adjustment                                                         115.67
  • IRP Cost Recovery                                                                       0.72 }            $238.17
  • PBF Surcharge                                                                              5.98
  • Purchased Power Agreement                                                  24.88
  • RBA Rate Adjustment                                                                  3.44
  • Interim Increase (2011)                                                               7.65
  • Refund: 2011 Interim Increase                                                 -0.07

TOTAL HECO Bill (with SOLAR)                                             $318.36

 

Finally, we all buy beverages—and Lord help us if we have to bring the drinks to the party, Little League or soccer events—because the beverage tax is horrific. The tax on a carton of soda is 23.3% PLUS GET of 4.712% so that your $9.29 soda actually costs you $11.99. Drink water instead? The 35-pack of KS water is $6.99 but the beverage tax adds another $2.10 or 32.9%, plus GET, equals $8.89.

 

4. Beverage Cost – COSTCO

  • 1- 36 pack Pepsi                                                                                   $9.29
  • HI Beverage Tax                                                                                     2.16
  • 1- 35 Pack KS Water                                                                              6.39
  • HI Beverage Tax                                                                                     2.10
  • Sub-Total                                                                                              $19.94
  • Plus General Excise Tax of 4.712%                                                    0.94

TOTAL for 1 Soda + 1 Water                                                                 $20.88

 

Are you surprised? Is this of value to you? Yes, you can do something about it. When you elect your representatives, ask them how they voted on tax and fee increases, or on the agencies that set these rates, and how they will vote in the future.

In the meantime, “check your own bills monthly!”

 

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