A new cigarette tax designed to raise up to $40 million a year for cancer research and other health services in Hawai'i could be vetoed by Gov. Linda Lingle because of technical problems, officials said yesterday.

Lingle is considering whether to sign or veto the legislation that, among other things, would benefit the Cancer Research Center of Hawai'i. The governor has until Monday to notify the Legislature about bills she is considering vetoing.

"It's still under review," Lingle spokesman Russell Pang said yesterday.

The bill has technical flaws that could make it difficult to administer, officials said.

Part of the bill (SB2961) designates "1.0 cent" of the tax increase in the first year for a new cancer research fund. Lawmakers intended to have the bill say one cent per cigarette. Similar problems arise as the bill progresses through four more years of increases that ultimately would raise the tax to 13 cents on each cigarette sold in the state by 2011.

A veto of the measure could jeopardize the start of a new research facility for the cancer center in Kaka'ako, said center director Carl-Wilhelm Vogel.

"It's very important to move forward now, because the development is ready to go, and the cigarette tax is the funding stream that will allow it to immediately go forward," Vogel said.

"If the bill does not pass, the whole cancer center development could be put on hold for the foreseeable future. And the entire progress we're making in Kaka'ako could be jeopardized. The developer has been waiting for more than a year to get the go-ahead. If we don't move now, they may just say forget about it and pull out."

Sen. Rosalyn Baker, chairwoman of the Senate Health Committee, said she hopes Lingle will sign the bill and have the state begin collecting the first tax increase as planned on Sept. 30. The Legislature could address the problems on how the money is allocated next session, she said.

"It's got some flaws, but they aren't fatal," Baker said. "The bill had overwhelming support, and the legislative record and reports clearly show the intent of the legislation. There's really nothing that can't be fixed right now. But, if necessary, we can begin collecting the tax right away and go back and address the other problems next year."

People emphasizing flaws in the bill are those who are against any tax increase at all, Baker said.

The bill calls for the current tax of $1.40 per cigarette pack to be gradually increased to $2.60 by 2011, raising more than $40 million a year for health-related needs.

About half of the money raised would go to the cancer center. The rest would go into new special funds to benefit community health centers, emergency medical services and a special trauma system fund.

"With this bill, we have a chance to really do cutting-edge research, help people who have cancer deal with it locally, and help many other people in the community with medical problems," Baker said. "I'm optimistic that the governor will see that and either sign the bill or let it become law without her signature."

Reach Mike Leidemann at mleidemann@honoluluadvertiser.com.