Hawaiʻi has made history by becoming the first state in the United States to enact a “green fee,” aimed at mitigating the impacts of climate change and preserving the local environment.
Governor Josh Green signed the legislation into law on Tuesday, marking a significant achievement after years of efforts to gain legislative approval.
Beginning next year, the green fee is projected to generate approximately $100 million annually, some of which will be allocated to disaster response efforts, particularly in light of events like the devastating 2023 Lahaina wildfire.
“This is a historic piece of legislation. No other state has done anything of this magnitude to create an impact fee directly addressing climate change,” Governor Green stated prior to the bill’s final approval.
The fee introduces a .75% increase in the state’s transient accommodations tax (TAT), raising the total tax on hotel and short-term rentals to 10%.
In addition to the state tax, visitors already incur an extra 3% TAT collected by the counties.
The main goal of the initiative is to enhance the resilience of Hawaiʻi’s ecosystems, including its beaches, reefs, and mountains, in face of increasingly severe weather patterns and other climate-related challenges.
Furthermore, the legislation aims to ensure that local residents do not bear the brunt of the costs associated with environmental degradation.
Proponents argue that the fee imposed on short-term rentals, hotels, and cruise ships is justified, given the connection between the approximately 10 million annual visitors to Hawaiʻi and the local environmental issues tied to climate change.
While the measure faced opposition from some local rental owners and members of the hotel industry concerned that rising costs could deter visitors, key stakeholders from the hotel sector showed their support during the bill’s signing ceremony.
Despite lingering worries about a potential decline in tourism, these industry members recognized the pressing need to restore Hawaii’s natural attractions and combat invasive species to ensure continued visitor interest.
Although the specific allocation of the raised funds and the organizations that will manage them are yet to be determined, there is strong backing from numerous local conservation organizations for a dedicated source of revenue focused on climate and conservation efforts.
A coalition comprising several of these organizations, Care For ʻĀina Now, had previously documented a significant annual funding shortfall for conservation in Hawaiʻi, estimating a gap of at least $560 million.
In dire circumstances, that deficit could reach as high as $1.69 billion according to their findings.
Earlier proposals regarding the green fee included alternative methods such as implementing an arrival fee at airports or a mobile-payment-based park usage fee, but the practicality and legality of these options raised concerns among lawmakers.
There were also considerations for utilizing interest accrued from the state’s rainy-day fund or imposing a flat fee for access to natural attractions and tourism activities.
Ultimately, the state legislature determined that adjusting the TAT represented the most straightforward approach to introduce the green fee, resulting in Hawaiʻi’s landmark legislation.
This initiative draws parallels to similar fees adopted in other popular tourist destinations, including Palau and New Zealand.
Civil Beat’s reporting on climate change initiatives is made possible by the generous support of The Healy Foundation, the Marisla Fund of the Hawai‘i Community Foundation, and the Frost Family Foundation.
image source from：https://www.civilbeat.org/2025/05/hawaii-becomes-first-state-to-charge-tourists-to-protect-the-environment/
