On Wednesday, June 22, Governor David Ige signed two measures passed by the state legislature earlier this year to help working families and individuals in Hawaii.
Ige signed House Bill 2510, regarding the state’s minimum wage, and Senate Bill 514, which deals with refunds for state taxpayers, during a live ceremony at the state capitol in Honolulu.
“I am excited to be able to sign two bills that are really focused on helping working families and people who need help most,” Ige said during the ceremony, adding that he appreciated the commitment and leadership of lawmakers to support the state’s most vulnerable residents in a real way.
The governor said that state families faced many challenges during the COVID-19 pandemic, and never imagined the demands and burdens they would face as the pandemic dragged on.
“I think the measures we sign today can have a huge impact and help families in a tangible way, especially our working families,” Iggy said.
HB2510 increases the state’s minimum wage for the first time since 2018, from $10.10 an hour to $12 an hour starting Oct. 2026 and to $18 on January 1, 2028.
The state’s last minimum wage increase was in 2018, when it was raised to $10.10 per hour thanks to legislation approved in 2014. Ige said Wednesday that another increase is long overdue. About 190,000 workers in Hawaii have a minimum wage.
“So raising the minimum wage will help these individuals earn more income so that they can pay for the necessities — food, housing, shelter and other necessary expenses,” the governor said.
He also expects the state’s general economy to see a boost due to the increase, saying that many of those who earn the minimum wage are living off their paychecks and will surely spend the extra money they earn from the increase, putting them back into the economy, which will also help create More job opportunities.
The HB2510 also makes the earned income tax credit permanent and refundable.
“This will increase incomes for working families and will lead to greater stability in the workforce,” Ige said during the signing ceremony about the earned income tax credit move. “This is also a much-needed support for our community.”
“This is a happy day for me, as we are finally able to increase our minimum wage after four years of effort,” said Senator Brian Taniguchi, who spoke Wednesday during the signing ceremony. After thanking the many people involved in passing this measure, he added, “Let’s all celebrate this great law.”
Representative Sylvia Locke also spoke at the event and thanked everyone who has patiently worked on the minimum wage issue for many years. She said that pairing the minimum wage increase with changes to the earned income tax credit is key to helping working families in the state.
“And to make the (earned income tax credit) refundable and permanent, it provides hope for the many people who work just to make ends meet,” Locke said.
SB514 provides a tax refund of $300 for individuals who earn less than $100,000 per year and spouses who earn less than $200,000, and $100 to taxpayers who earn $100,000 or more and spouses who earn $200,000 or more per year.
The state tax department expects it will begin issuing tax refunds during the last week of August and will provide additional details in the coming days.
“I’m glad we’re able to return dollars to taxpayers to pay for things like gas and other necessities that are getting more priced,” Ige said on Wednesday. “We know that this measure will put money directly in the pockets of our residents and will certainly help go a long way.”
The action also allocates $500 million to the Rainy State Fund and advances $300 million in retirement obligations.
“I think these two investments really help ensure that we, as policy makers, can deliver on our promises to public officials and a lot in our community who are definitely dependent on government services, especially during these times of emergency,” said Egg.
Locke said Wednesday that the last time the state granted a rebate to taxpayers was in 2009 — a “huge” $1 per exemption. Ige proposed a tax refund in his 2022 state letter earlier this year due to strong revenue expectations, and the state legislature was able to increase that amount.
Luke said she and Ige discussed potential tax cuts throughout this year’s state legislative session, and agreed that if there was an opportunity for lawmakers to do more for the hard-working people of the state, they should.
“This year, if you raise your taxes, a family of four will probably get $1,200, which is amazing,” she said. “This could be used for gas, it could go to food, it could go to childcare, the things that people in this state struggle to meet and struggle to take care of.”
Locke added that the combination of raising the minimum wage, making the earned income tax credit refundable and permanent, and granting tax cuts would allow the state not only to take care of working families this year, but for the future as well.
Senator Lauren Inoue, who represents the state’s 4th state Senate district on the Big Island, echoed much of what the governor and her legislative colleagues had to say during the law-signing ceremony.
She agreed that the state’s minimum wage increase is long overdue, and while the first additional step won’t take effect until October, it will certainly help as inflation continues to drive up prices for goods and services across the board.
She said it will help those returning to work two years into the pandemic and hopes it will encourage more people to return to the workforce to help small businesses and restaurants in the state.
“It’s a step in the right direction now,” Inouye told Big Island Now on Wednesday. “Of course, it won’t happen until October, but I hope it will be in time for the holidays as well.”
She said the tax refund is also timely.
“It’s perfect timing because things are very expensive right now with inflation,” Inoue said. “Everything weighs on families. It is pretty much unsustainable now. People live from paycheck to paycheck.”
“At the start of the 2022 legislative session, we pledged to support programs and policies that will help our residents get back on their feet,” Ige said in a press release after the law signing ceremony on Wednesday. “Both projects represent a collaborative effort to provide some relief to the residents of Hawaii as we continue to recover from the two-year pandemic.”
Representative Nicole Lewin, who represents State House District 6 on the Big Island, also had his weight.
When the minimum wage doesn’t cover rent, food, and gas, that’s a problem,” Lowen said in a statement to Big Island Now via email on Wednesday. “The minimum wage hike is long overdue. There is still a lot of work to be done to address Hawaii’s cost of living issues, but the legislature showed in this session that it can represent workers in Hawaii and generate financial gain – with an increase in the minimum wage, This makes the (earned income tax credit) refundable and permanent and provides tax rebates.”
Thank you to the governor and our lawmakers for prioritizing people,” Juhu Rosales, who earns the state’s current minimum wage of $10.10 an hour, said in a joint news release from the Raise Up Hawaii and Hawaii Tax Fairness coalitions. “This bill will help my family make ends meet here in Hawaii by helping us pay rent, food, and other necessities.”
Officials with other organizations in the state agreed with Lewin that more was needed.
“This landmark legislation represents an important and meaningful step toward transforming our economy so that it works for all, but there is still much to be done,” Gavin Thornton, executive director of the Hawaii Appleseed Center for Law and Economic Justice, said in the joint press release. From the Raise Up Hawaii and Hawaii Tax Fairness consortiums.
At $10.10 an hour, or just $21,000 a year, a Hawaii resident without dependents receiving minimum wage, which employee-sponsored health insurance is provided, would need to work approximately 114 hours a week — three full-time jobs — to afford one. bedroom, according to the press release. At $18 an hour, the same minimum wage would need to work 62 hours a week.
“The state must continue to push legislation that brings us closer to a real living wage for all workers by continuing to raise the minimum wage beyond 2028,” said Nate Hicks, director of Living Wage Hawaii, in the joint press release. “If we can do that, and end the shortage of affordable housing, we can strengthen the working class that is the backbone of Hawaii’s economy.”
“Research consistently shows that when families can pay for their basic needs, the benefits reach deep into our community,” added Nicole Wu, director of economic research and policy at the Hawaii Child Labor Network, in the joint press release.
In addition to the proven economic benefits, she said, the bills Ige signed on Wednesday will help reduce poverty and inequality in the state, and improve health outcomes and educational attainment for children in working families.
To watch the video of the bill signing ceremony on the Governor’s Facebook page, click here.