Posted on: Wednesday, February 12, 2003

Payroll tax plan makes headway

By B.J. Reyes
Associated Press

As House and Senate committees each approved measures to pay for long-term care through a $10 monthly tax, Gov. Linda Lingle said yesterday that any such measure reaching her desk will be vetoed.

"That program cannot work," Lingle said at a news conference. "It's a tax on all the people of Hawai'i for no immediate benefit."

Lingle said she prefers her idea of providing tax credits to people who purchase long-term care insurance or services to provide for elderly relatives.

While House and Senate committees also approved measures to provide such tax breaks, the Lingle administration's bill is scheduled to be taken up in House committee today.

When asked if she would veto the proposed payroll deduction, Lingle replied: "Yes."

"The governor certainly is entitled to her opinion, but that's not going to deter the Legislature from trying to find the best solution to this very important issue," said Sen. Rosalyn Baker, D-5th (W. Maui, S. Maui), chairwoman of the Senate Health Committee. "We believe that in terms of a comprehensive approach to dealing with long-term care, the best program is one that includes everyone — that provides a basic coverage."

Rep. Dennis Arakaki, chairman of the House Health Committee, said he hopes caregivers and others will testify at hearings to try to convince the governor that the financing mechanism is needed.

State policy-makers and others have been struggling with the long-term care issue for years in their efforts to deal with Hawai'i's rapidly aging population. According to the state Executive Office on Aging, by 2020 one in four Hawaii residents will be 60 or older.

Last year, a similar bill calling for a $10 monthly payroll deduction was pushed by former first lady Vicky Cayetano. That bill died as lawmakers instead created the temporary board of trustees for the Long-Term Care Financing Act to review options and make recommendations to the Legislature this year.