January 29, 2025. An additional fee of $3/day on Maui's car rentals would be imposed if a new bill passes in Hawaii's State Legislature. The new bill titled SB 1659 was submitted for review by committee on January 27, 2025. The scope of the bill is to fund the extension of the Lahaina highway by-pass, a roadway that the bill deems a critical piece of Hawaii's state infrastructure. Legislators have until the end of their current biennial session on May 1 to review and vote on the bill. If approved, the added fee would take effect on July 1.

Maui is not the only island where car rental costs would be affected. Under the current version of the bill, an added fee of $3/day is to be collected on car rentals in Kauai, while $5/day would be applied to car rentals in Oahu and Hawaii island.

This new fee on Rental Vehicles and Tour Vehicles is just one of many sources of funding being proposed under this bill for the highway construction. Other sources are ear-marked transient accommodation and hotel taxes collected in West Maui, plus some form of Public-Private Partnership funding (with "ghost tolling" based on traffic estimates to re-imburse the private sector partners), and funding from the issuance of bonds in the amount of $70 million.

HOW MUCH DOES THE PROPOSED FEE AFFECT MAUI CAR RENTAL COST

Simply put, the effect of the proposed fee on Maui car rental prices would be relatively small. Below is the itemized breakdown of the actual cost for the cheapest car currently available to rent from Kahului Airport (OGG), for a one-week rental beginning this coming Monday February 3.

AMOUNT ITEM
$361.79 Base Rate
$40.19 CONCESSION RECOVERY FEE 11.11%
$31.50 CUSTOMER FACILITY CHARGE $4.50/DAY
$49.00 RENTAL VEHICLE TAX $7/DAY
$7.98 VEHICLE LICENSING FEE
$20.80 LOCAL TAX
$149.47 TOTAL TAXES & FEES
$511.26 TOTAL RENTAL AMOUNT

A $3/day surcharge over seven days would add $21, increasing the cost for the rental from $511.26 currently to $532.26 with the added fee included. The $21 increase would represent less than 4% of the total rental amount. For typical vehicles like SUV's, Jeeps, convertibles, and minivans, all of which rent for hundreds of dollars per week more than an economy car, the increase would represent an even smaller percentage of the total amount of rental.

HOW MUCH DOES THE PROPOSED FEE REALLY MATTER?

Maui car rental prices are subject to huge price swings from week to week, both up and down, due to many factors that we frequently discuss in this blog. The week-to-week changes in the price of a one-week rental can be in the hundreds of dollars per week upward or downward on many vehicle types. We document these price movements every week and they are available for review on the weekly edition of this blog. Compared to these price movements that occur unpredictably and spontaneously, $3/day is a small drop in the bucket that would probably go un-noticed by most rental car customers.

ARE THERE ANY EXEMPTIONS FROM THE NEW FEE?

As with the current Rental Vehicle Tax, and as noted in the proposed bill, Hawaii state residents whose vehicles are incapacitated due to mechanical issue, or stolen, or totaled, are exempted from paying the fee when renting a car, if they provide substantial proof to support their eligibility for the exemption.