Hawaii's 'Green Fee' Projects Face Funding Dilemma

Governor proposes using debt instead of new tax revenue to pay for initial environmental improvement projects

Published on Feb. 16, 2026

Got story updates? Submit your updates here. ›

Hawaii Governor Josh Green is proposing to use debt instead of new special tax revenue to pay for an initial 18 'Green Fee' environmental improvement projects costing $42.2 million. This plan has aggravated some state lawmakers, who argue it would increase project costs due to interest on the debt and divert the new tax revenue to potentially fund other state needs instead of the intended Green Fee projects.

Why it matters

The Green Fee program was established in 2025 to fund environmental projects across Hawaii, financed by an expansion and increase in the state's transient accommodations tax. The governor's proposal to use debt financing rather than the new tax revenue has raised concerns about transparency and proper use of the funds as intended by the law.

The details

The administration's plan calls for using $42.2 million in bond proceeds to fund Green Fee projects in the current fiscal year, as well as half the projects for the next fiscal year amounting to an additional $43.5 million. Officials say this provides more time to spend the funding before it lapses, but some lawmakers argue it is misleading and improper, characterizing it as a 'shell game' that makes it difficult to track the actual use of the new tax revenue.

  • The Green Fee program was established in 2025 through legislation approved by the state legislature.
  • The additional transient accommodations tax revenue began being collected on January 1, 2026.
  • The current fiscal year ends on June 30, 2026.

The players

Gov. Josh Green

The governor of Hawaii who is proposing to use debt financing instead of the new tax revenue to pay for the initial Green Fee projects.

Sen. Donovan Dela Cruz

The chair of the Senate Ways and Means Committee, who has criticized the administration's debt financing plan as misleading and improper.

Sabrina Nasir

The deputy director of the Hawaii Department of Budget and Finance, who presented the administration's mixed funding plan to lawmakers.

Seth Colby

The recently appointed director of the Hawaii Department of Budget and Finance.

Rep. Chris Todd

The chair of the House Finance Committee, which will be the first to consider the governor's requested Green Fee project appropriations.

Got photos? Submit your photos here. ›

What they’re saying

“It's like they're labeling it (Green Fee funding), but that's not any Green Fee money. Why would you be misleading like that?”

— Sen. Donovan Dela Cruz, Chair, Senate Ways and Means Committee (Hawaii Tribune-Herald)

“You're just taking the cash then and putting it somewhere else.”

— Sen. Troy Hashimoto, Senator (Hawaii Tribune-Herald)

What’s next

The House Finance Committee will be the first to consider the governor's requested Green Fee project appropriations as part of drafting the supplemental budget bill. The Senate Ways and Means Committee will then review the proposals.

The takeaway

The debate over funding the initial Green Fee projects highlights the challenges of implementing a new environmental program and ensuring transparency in the use of the dedicated tax revenue. Lawmakers will need to carefully weigh the pros and cons of debt financing versus direct cash appropriations to uphold the intent of the Green Fee law.