 Welcome to Talking Tax on Think Tech Hawaii on a given Thursday at 10 o'clock in the morning, our time. I am Tom Yamachika with the Tax Foundation of Hawaii. J-Five help we usually host this show is off for the day lucky him. And we are talking tax today. But we're concentrating on we've got bills. Sometimes we wonder just how lucky we are to live in Hawaii. We know it's a pricey place, but sometimes it takes raw statistics to drive that home. This, this week we're looking at statistics from doxodoxo, which is a bill payment network that boasts that they have seven million subscribers throughout the United States, covering 97% of us zip codes and with 120,000 unique billers. And that's that's a doxo.com. In a recently released report and you see the report URL flashing at the bottom of the screen. That company followed the 10 most common household bills. And they account for $4.6 trillion in economic activity annually. These include mortgage, rent, auto loans, utilities which include electric gas, water and sewer, waste and recycling. They also took a look at auto insurance, cable, internet and phone, health insurance, mobile phone, alarm and security and life insurance. Those are the 10 most common household bills. In the report, the average US household spends $2,003 monthly and $24,032 a year on these bills. The biggest ones of course are mortgage, rent and auto loan. So about 40% of households pay mortgage at a cost of $47 monthly rent with 35% of households at 395. And 73% of households have an auto loan with an average cost per month of $316. So these bills cover an average of 22% of US household spending. Now how does that stack up with what we experienced here in Hawaii. In this study, Hawaii wins first prize and by a wide margin. Average bill costs in Hawaii are $2,911 per month, 45% above the national average, and taking up a whopping 44% of household income. I'm going to show you kind of graphically how the different categories of bills shake out. So let's take a look at slide number one. So these are the top five bills by volume in terms of dollar volume. With the Hawaii average compared with the US average and 80% of households versus US percent of households. So we have like, you know, differing amounts, but the percentage of households for which the bill applies is not that much different from the national average. So we have some interesting little interesting little comparisons to make over here. And we're going to see that in any percentage in just a moment, but let's go on now to the second slide, which is the other five categories. So we've got mobile phones, cable health insurance alarm and life insurance. These are the smaller bills. But as you can see, at least for the first three rows, there's a lot of penetration. 100% of households in Hawaii have mobile phones, 94% of US households do and the prices are a bit higher, but it's not that. The communication, thankfully, is a little bit better for cable internet and satellite, more on par with the national average. With health insurance, we have a lot more probably because of our prepaid Health Care Act. But it doesn't seem that the prices have gone down. And matter of fact, it's kind of the opposite direction with health prices being $250 per month as opposed to $120 something dollars as the US average. So what we're going to do in slide number three is we take a look at the percentage comparison. And then let's leave that up for a while. So we can go through some of these categories and kind of try to figure out what's going on. In our state, the biggest difference between us and the national averages in the category of health insurance, where we're basically double what the US average is. And we have to kind of wonder why the medical professionals here in short supply, and they say they're not getting a chance to make ends meet. And I hear them at the legislature all the time, saying, you know, we've got a horrible business environment. We have a horrible tax environment. And so what, what is it that is making the health insurance double the US average. If it's not what the physicians are getting paid. Is it because always sicker than the average US person. That can't be true either because we hear reports all the time saying always one of the healthiest places in the United States. So maybe what we got to do is take a look at the insurers. What they are bringing, you know, pulling down out of the Hawaii market. You know, we, it's probably not a coincidence that health insurers are in a regulated industry is controlled by the government. So health insurers, you know, put in proposals and they need approval from in our case the insurance commissioner and charge the rates of the absolute. So there's some government involvement here in getting or establishing health insurance rates. I mean, you would think that the rates would be lower comparatively because there's more market penetration due to the fact that we have our prepaid health care act from I think 1974. And most households here in Hawaii are required to have health insurance through their employer but you know. But as we all know, you know, the employer pays it, but there's a cost to all of us anyway. And not only from the monthly premium but also from the co pays. Why is it that health insurance is so much higher than the national average that's kind of one thing that policy makers should take, you know, take a look at. Let's go back to slide three and see what else we've got. Alarm and security is the next outlier followed followed by utilities now let's let's look at utilities for a second. Let's look at mortgage and rent. They're both 50% higher than the national average, but I think that's explainable by property values. You have a larger piece of property, or a more costly piece of property that larger, but a more costly piece of property you have the bigger alone you got to check out. And the more you're paying as on the mortgage or for rent as a result. So, so those two, perhaps depend upon property values. And yeah, yeah, we're on an island. So naturally, property values are fine. The interesting part about this is utilities, which come, which, you know, everybody's to pay for like water sewer and so forth. There's 68% higher than the national average and the question is why. Maybe. Again, it's because of government involvement. Utilities are monopolies that are regulated by the government. In particular, and that's, and that's why they get a chance to charge you perhaps more than the market would have given them off their own. Typically utility is allowed a specific rate of return by law. But that rate of return may not comport with what the rest of the economy is facing. So, you know, like the rest of our, you know, the rest of the businesses here in Hawaii can get killed in the utilities will still be making a statutory rate of return. So, one of the, perhaps one of the reasons for our high cost of living here in Hawaii is regulation utilities come to mind health insurance comes to mind. Health insurance at 50% higher than the national average also comes to mind. Alarm and security is kind of an outlier I think because it's not really a regulated industry and yet it's 71% higher than the national average. So we got to wonder about that. The other. But there are other categories, such as auto loans, cable internet and satellite where we're pretty much on far with the rest of the nation. Auto insurance is a little bit higher but not that much. So, I mean, yes we have, you know, higher transportation costs for things like gasoline. But that doesn't go into the price of an auto loan or auto insurance. And I think our accident rate is probably comparable with other jurisdictions on the mainland. So, so we're kind of on par with those jurisdictions as well. Okay. So, so at least we've got some categories of bills here that are not with the out of control, though we are kind of suspicious about the regular industries, like health insurance and utilities, and, you know, perhaps some action. To address these at a government level, maybe, maybe helpful for all of us. Now, I've been notified that it's about time for our mid session break so we're going to do that. And we'll come back into talking tax in about one minute. To talking tax, we've been talking about bills, bills and bills here in Hawaii, as compared with the national average. We have been talking about a report from doxodoxo at doxodocom.com. They are a nationwide organization that deals with bills and facilitates bill payment. We've been looking at a report that's been followed by that company. I have mentioned that we are the most expensive state for household bills. There are others. And let me kind of give you the lineup of the 10 most expensive states. The most expensive state is New Hampshire with the 2256 monthly bill expense per household covering 35% of household income. You got to wonder what New Hampshire because they don't have sales tax. So they don't have problems with the GT like we do. Washington states next at number nine with 2277. That's $2,277 per month. And 37% of household income taken up with that. Alaska, which has almost no tax but has other geographic challenges is that $2,334 per month and 36% of household income. New York is next at number six. And I'm sorry, number seven. There are 2361 at 39% Connecticut at 2380 and 35% Maryland, taking its cue from DC, which is kind of a pricey place. There are two 456 at 34%. Then there's tax, Massachusetts. 2511 and 36%. New Jersey also a very high tax state at 2610 and 36%. And of course, number two is what you would expect California. They clock in at $2,649 and these bills per month at 41% of household income. And they are beaten only by one state and that would be us. Now the 10 least expensive states for household bills are perhaps what you would expect, it would be Nebraska. The 10th least expensive Alabama at ninth New Mexico, which interestingly enough has a gross receipts taxes like ours, but they come in at 1663 and 41% of household income. They're the eighth least expensive states for household bills. Then there's South Dakota, Oklahoma, and Kentucky, so it looks like some more red states are coming in there. Indiana, Mississippi, Arkansas, that's a deep south, and the least expensive state for household bills is West Virginia. And that mere $1400 per month per household and 38% of household income. So those are the top 10 and the bottom 10. And the question then becomes, well, is it that is causing all of these anomalies? Is it the red state versus blue state problem? Is it the incidence of taxes? That's probably not true because you have Alaska and Washington with no income tax being a way to heck up there. Washington does have a kind of hefty sales tax as does California and their way up there too. You do see that the highest tax states being represented in the most expensive states for household bills. So California, New Jersey, Massachusetts, New York, Connecticut, those are all famously high tax states. And then, in contrast, some of the states with no tax, or at least no income tax, are showing up on the bottom, but not as many as you would expect. South Dakota's there, Florida's not, Delaware's not. Other states that you typically think of, and Nevada's not, as having no income tax for normal people, they're not showing up on this list. There must be something else than taxes that's causing this anomaly. We are ending a little bit early today, and I'm sure Jay would have given me a lot more stuff to react to if he were on the show, but again, he has the day off the lucky guy. We thank you for your attention today here on Top New Tax at Think Tech Hawaii.