Monthly Archives: September 2011

Read this before paying your property tax bill with a credit card

13 Replies

This question came in an email from retired Star-Bulletin editor, Chuck Frankel.

Kokua Line on Sept. 19 raised some interesting questions (which were not answered) about credit cards and real property taxes.

Why doesn’t the Honolulu real property tax bill say that the “conveniewwnce fee” is 2.49 percent?

What is the Official Payments Corp.? Local or mainland? Was this plan put out to bid? Do any the principals of this corporation or their spouses work for the present city administration, or the Mufi administration? If this 2.49 per cent what Zippy’s or other local businesses pay to Visa or other credit cards?

I would like to link to that Kokua Line column, but I can’t. One down side of the S-A’s digital edition is that it has been blocking some subscribers by mistake. I’m now one of those. Although they send me the daily e-edition via email, I can’t log on to read the online edition. It rejects my account, hence, no link.

Suffice it to say that answers given by the city were, well, unsatisfying. There is a 2.45% fee when using a credit card to pay real property taxes, although you can use the same credit card to pay your motor vehicle registration without any fee.

One part of the answer:

..while credit card payments for real property taxes are allowed for customer convenience, credit card payments for registering motor vehicles “was institute for efficiency and cost considerations.”

What a great dodge that was!

In any case, the credit card payment system was adopted in resonse to the City Council’s Resolution 08-176, which called for a report on progress towards implementing a credit card payment system.

That report was filed by the city’s Dept. of Budget and Fiscal Services on December 23, 2008.

The Budget and Fiscal Services Director believes there are more efficient and cost effective alternatives to the use of credit and debit cards for the payment of real property tax assessments. Most (if not all) financial institutions offer online and telephone bill payment services at no cost. Taxpayers would be afforded comparable convenience to paying their real property taxes by card on a City sponsored website free of charge and the City would save on administrative costs by avoiding the need to develop, implement and administer procedures for a new payment source. In contrast, the City would probably engage a third party service provider to administer payments by card. Such a provider would charge a convenience fee of, on average, 2.49%, not including any City administrative costs, of the payment amount. That convenience fee would either be passed on
to the taxpayer or absorbed by the City.

The electronic payment program was finally implemented in January 2010, according to a description filed with the council.

One way to avoid paying a percentage fee is to pay with “electronic check,” which has a flat fee of $3.30 for any amount up to $10,000. The same $10,000 payment by credit card would rack up a fee of $249.

Ah, and here’s an interesting nugget of information:

• The Program is coordinated with the City’s current credit card processing contract with
First Hawaiian Bank.

• Official Payment Corporation (OPC), an authorized vendor of First Hawaiian Bank, will process the electronic payments.

OPC is described as “a leader in e-payment processing and collects payments for the IRS, TurboTax, 3,000 municipalities, and 27 states.”

According to the company web site:

Official Payments is a wholly owned subsidiary of Tier Technologies, of Reston, VA. Tier is a leading provider of transaction processing, business process outsourcing, and related solutions.

Tier Technologies is a publicly traded corporation (TIER). Here’s a list of its largest shareholders.

It isn’t clear how the payments are “coordinated” with the First Hawaiian Bank contract, or how much of the 2.49% fee ends up with First Hawaiian, if any.

Also still unanswered is the question of how the motor vehicle registration payments manage to be processed without charging a “convenience fee.”

Of course, credit card fees charged by banks have been controversial, as has federal legislation to regulate those fees. First Hawaiian Bank is a member of the Electronic Payments Coalition, set up to fight regulation.

Lost & Found Stuff

4 Replies

Actually, in this case, mostly found.

Three items dredged up yesterday afternoon.

First…a flashback to being in the JPOs at Kahala Elementary School. At least we always just referred to ourselves as JPOs (Junior Police Officers), not Junior Traffic Police as the card indicates.

JPO card

I have sort of indistinct memories of being marched around and being sent off to “compete” with other schools marching in some kind of drill formation. I don’t think I did very well at that “just obey orders” stuff, even then. I have more distinct memories of how the guys felt when a “girl” (or was it two girls?) was put in charge. Ouch! There was a lot of quiet resentment, as I recall. Grade school boys in 1958 weren’t ready for feminism. How far we’ve come, I hope.

I wish I could remember the name(s). If I look at one of my old class pictures, it will probably come back to me. Or maybe not.

Then, still on a police theme, there was a copy of a June 24, 1965 memo from Lt. Colonel E.W. Corcoran, commander of the Hawaiian Armed Services Police, concerning the employment of military personnel as security guards at Matson terminals. The off-duty military personnel were brought in by Burns Detective Agency, replacing unionized civilian guards represented by the ILWU. The situation apparently led to a labor dispute with the ILWU and a complaint to the military.

Corcoran reports that he met with a Mr. Hitchcock, Burns’ manager, who said the agency employed about 200 guards, half of them military personnel. It was “agreed” that at midnight of the same day, “he would remove all military personnel from the disputed area.”

Just a small glimpse into labor relations during that period.

Finally, I dug out a yellowed newspaper clipping, a “Prep Parade” column by longtime Star-Bulletin sports writer, Bill Kwon. It dates from the Spring of 1965. The second part of the column comments on the first “Class B” State Basketball Tournament, won by what was then University High School. I was co-captain of the team, although in retrospect I don’t think I was ever a very good basketball player. The last paragraph of Kwon’s column mentions me, although I think he stretched the facts to describe me as “one of the UH stars.”

I recall that we used to read Bill Kwon’s reporting religiously during basketball season, getting info on teams we would be playing. How weird it was to find myself as one of Kwon’s co-workers at the Star-Bulletin 30 years later! Round and round.

1st Amendment notes from the National Security Archives, Knight Foundation, and the 9th Circuit

6 Replies

Three items today all deal with the 1st Amendment in some fashion.

From the National Security Archives comes word of the availability of all published editions of the Pentagon Papers in a searchable format that “allows for a unique side-by-side comparison, showing readers exactly what the U.S. government tried to hide for 40 years by means of deletions from the original text.”

Today’s posting includes the full texts of the “Gravel” edition entered into Congressional proceedings in 1971 by Sen. Mike Gravel (D-Alaska) and later published by the Beacon Press, the authorized 1971 declassified version issued by the House Armed Services Committee with deletions insisted on by the Nixon administration, and the new 2011 “complete” edition released in June by the National Archives and Records Administration (NARA).

Accompanying the posting is the National Security Archive’s invitation for readers to identify their own favorite nominees for the “11 words” that securocrats attempted to delete during the declassification process for the Papers earlier this year, until alert NARA staffers realized those words actually had been declassified back in 1971. Best submissions for the “11 words” — as judged by National Security Archive experts — will appear in the Archive’s blog, Unredacted, and on the Archive’s Facebook page.

There’s also a new report from the Knight Foundation, “The Future of the First Amendment,” which examines the relationship of social media use to support for the 1st Amendment.

According to the foundation’s press release:

Both social media use and First Amendment appreciation are growing among high school students. More than three-quarters of students use social media several times a week to get news and information. Meanwhile, the percentage of students who believe “the First Amendment goes too far” in protecting the rights of citizens has dropped to a quarter (24 percent) in 2011 from nearly half (45 percent) in 2006.

There is a clear, positive relationship between social media use and appreciation of the First Amendment. Fully 91 percent of students who use social networking daily to get news and information agree that “people should be allowed to express unpopular opinions.” But only 77 percent of those who never use social networks to get news agree that unpopular opinions should be allowed.

Still, many teachers believe social media harms education. Most teachers also do not support free expression for students. Only 35 percent, for example, agree that “high school students should be allowed to report controversial issues in their student newspapers without the approval of school authorities.” In addition, teachers are more inclined to think that the emergence of the newest forms of digital media have harmed (49 percent) rather than helped (39 percent) student learning.

And there’s a new 9th Circuit Court of Appeals decision regarding use of public sidewalks that has implications for the city’s citation of two women for their part in a protest in support of gender equality on a Waikiki sidewalk. The ACLU announced last week that it is defending them in court.

The two were charged with failing to obtain a parks department permit for “meetings or gatherings or other similar activity held by organizations, associations or groups.”

In the 9th Circuit decision:

A pair of day-laborer organizations challenge a City of Redondo Beach (Redondo Beach or the City) anti-solicitation ordinance that bars individuals from “stand[ing] on a street or highway and solicit[ing], or attempt[ing] to solicit, employment, business, or contributions from an occupant of any motor vehicle.” Redondo Beach Municipal Code §3- 7.1601(a) (the Ordinance). We agree with the day laborers that the Ordinance is a facially unconstitutional restriction on speech.

Our analysis is guided by certain well-established principles of First Amendment law. In public places such as streets and sidewalks, “the State [may] enforce a content-based exclusion” on speech if the “regulation is necessary to serve a compelling state interest and that it is narrowly drawn to achieve that end.” Perry Educ. Ass’n v. Perry Local Educators’ Ass’n, 460 U.S. 37, 45 (1983). For content-neutral regulations, the State may limit “the time, place, and manner of expression” if the regulations are “narrowly tailored to serve a significant government interest, and leave open ample alternative channels of communication.” Id.

We conclude that the Ordinance fails to satisfy the narrow tailoring element of the Supreme Court’s “time, place, and manner” test. The Ordinance is not narrowly tailored because it regulates significantly more speech than is necessary to achieve the City’s purpose of improving traffic safety and traffic flow at two major Redondo Beach intersections, and the City could have achieved these goals through less restrictive measures, such as the enforcement of existing traffic laws and regulations. Because the Ordinance does not constitute a reasonable regulation of the time, place, or manner of speaking, it is facially unconstitutional.

It looks to me like the ACLU has a very strong case, which the 9th Circuit has just reinforced.

UHPA again highlights challenge to HSTA, health benefits controversy

7 Replies

The UH Professional Assembly sent another special letter to its members earlier this month, expanding on its reasons for opposing much of HSTA’s pending complaint before the Hawaii Labor Relations Board.

HSTA went to the labor board in an attempt to block the state from imposing the terms of its “last, best, and final offer.”

The 6-page letter is signed by UHPA President Adrienne Valdez and Executive Director J.N. Musto.

Simply put, the approach the HSTA has chosen to achieve its goals in bargaining is totally unnecessary. It delays the ability to yield an expedient resolution on behalf of the teachers it represents. In addition, it can lead to decisions from the HLRB that erode our rights under HRS Chapter 89 and invite legislative proposals that diminish collective bargaining for the public sector. Finally, because HST’s approach promises to be long and protracted, UHPA and HGEA both worry that it will undermine the public’s support of public sector collective bargaining.

UHPA notes that HSTA issued subpoenas to force testimony by leaders of HGEA and UHPA without first seeking their voluntary participation, and has not explained what information it is seeking.

However, UHPA believes HSTA is “seeking the unfettered right to gain disclosure of confidential discussions that have occurred between other public sector unions and the employer during periods of bargaining.”

In the case of HGEA, HSTA has even subpoenaed “the individual notes of members of HGEA’s bargaining team during their private caucuses.”

UHPA aims several barbs at HSTA attorney Herb Takahashi, more familiar as lead attorney for UPW.

To intervene in a case is not out of the ordinary, and HSTA attorney Mr. Herb Takahashi has intervened, usually on behalf of his other client, the UPW, in complaints brought to the HLRB by UHPA in University-related matters. Mr. Takahashi has never been shy in encouraging his clients to intervene in cases brought by other unions. However, he didn’t hesitate to immediately object to UHPA being allowed as an intervening party, stating that he could protect UHPA’s interests in the case.

But it’s the inter-union fight over health benefits that appears to be the central issue. Teachers are being integrated back into coverage provided by the Hawaii Employer-Union Health Benefits Trust Fund, after having a temporary exemption for several years. During that period, teachers were covered by their own health plan. HSTA says teachers benefited. Leaders of other unions don’t disagree, but say it came at the expense of all other public employees, who benefit from the largest insurance pool of covered employees.

In an op-ed published yesterday in the Star-Advertiser, retired union executive Van Horn Diamond speculates that the series of HSTA actions is designed as part of a political plan to get legislators and the Abercrombie administration to approve the renewal the exemption in exchange for ratifying the state’s contract offer.

I think it’s important to keep in mind that this involves more than teacher benefits and costs. State Auditor Marion Higa reported that in 2009, HSTA’s separate health plan or VEBA (voluntary employees beneficiary association) collected $2.4 million in fees from the state, and racked up an additional $1 million in administrative expenses.

The majority of the HSTA VEBA trust’s administrative expenses were comprised of the costs of its third party administrator, consultant, and attorneys, as well as other expenses such as bank fees, office supplies, postage and printing.

Higa said HSTA administrative costs paralleled those of the EUTF, a situation which she found “unnecessary, costly, and duplicative.”

In addition, experience has shown that these pockets of money within the public employee unions can allow for mischief. It was union insurance contracts that gave former UPW executive director Gary Rodrigues leverage to arrange kickbacks in the form of consulting gigs for his daughter from companies he selected to provide union coverage. And when one of my early articles for the Star-Bulletin called attention to payments she was receiving from PGMA, which provided union health coverage at the time, Rodrigues arranged to have the consulting payments routed through a Royal State Insurance subsidiary. Rodrigues, and other union leaders, had served as directors of various Royal State companies.

The following is from my entry back on October 24, 2002, where I wrote:

Yesterday’s main witness was Lilia Yu-Lum, who heads VEBAH, the Voluntary Employees Benefit Association of Hawaii, one of these Royal State companies. A number of the charges in this case relate to a contract awarded to Rodrigues’ daughter, Robin Sabatini, for consulting as part of Vebah’s servicing of the union’s insurance plans. How Robin was selected to do the work, as well as what work she actually performed, are central issues.

Yu-Lum testified that Sabatini was chosen because she was qualified. However, she also testified that no one else was considered. Yu-Lum said she knew at the time that Sabatini was Rodrigues daughter because she was told by her boss, Mel Higa, the central figure in the Royal State companies.

Prosecutors painfully elicited testimony on the makeup of the tight little network of companies, all located at 819 S. Beretania. For years, Rodrigues served as a director of several Royal State companies alongside Higa and Yu-Lum. Both testified that their relation with Rodrigues was not a factor in hiring his daughter, but failed to provide any other rationale to explain why she was the only candidate considered for the UPW-related work.

According to testimony yesterday, Sabatini initially received a percentage of the UPW business which amounted to around $11,000 a month, which was later reduced to a flat monthly fee of $6,000.

Garrett Ing, who heads Management Applied Programming, the Vebah/Royal State affiliate that actually contracted with Sabatini, testified that he had little contact with Sabatini, was not part of her hiring, never received reports from her, and only met her during public meetings held annually to sign up new members for the UPW insurance plans.

The bankruptcy of the HSTA Member Benefits Corporation was another warning of problems behind the scenes involving health insurance premiums and fees (also check their statement of financial affairs filed with bankruptcy court).

All this is a long way of wondering why HSTA is going so far, spending so much, and squandering good will of other public employee unions, the legislature, and the public, to fight against a contract that had received the approval of its bargaining committee. I can’t help feeling there’s more there in the background that has not yet become apparent.