Tax collections needed to build Honolulu’s planned $5.5 billion elevated train fell 30 percent in October from a year earlier. The total collected last month was $8.9 million. That’s the lowest amount since February 2007, when just $2.2 million was collected during the second month after the surcharge was enacted.

Through the first four months of the fiscal year transit tax collections are down nearly 6 percent from the year-ago period to $52 million, based on figures provided by the state Department of Taxation. Tax collections have fallen amid declining visitor arrivals and rising unemployment.
That’s taking a toll on tax collections needed to build Honolulu’s planned 20-mile train from East Kapolei to Ala Moana. The sluggish economy forced city officials earlier this year to sharply lower transit tax collection forecasts from $16.5 million a month to $13.7 million a month.
Through the first four months of the current fiscal year collections are averaging about $13 million a month under a half-percentage-point surcharge that was added to the general excise tax in Honolulu in January 2007 to fund the rail. All transit tax collection figures in this story exclude a 10 percent administrative fee retained by the state, which collects the taxes.
City Transportation Director Wayne Yoshioka was unavailable for comment on the drop in tax collections. City officials have said that they expect lower transit tax collections to be offset by lower construction costs and a future economic rebound.
The city also plans to rely on increased federal funds — including diverting $305 million in federal money intended for TheBus — to help make up for the lower-than-anticipated tax revenue.
The city expects transit tax revenues to raise an inflation-adjusted $3.69 billion through 2022 when the surcharge expires, under an August-dated version of the city’s financial plan. In the spring of 2011 the federal government is expected to announce that it will give the city $1.55 billion to help pay for the project.