Lawmakers May Ban Side Hustles For State and County Executives

Mar 10, 2020

Both chambers of the state Legislature have passed some form of a prohibition on the governor and county mayors earning income from employment other than their elected office.

It’s increasingly common for American workers with a full-time job to moonlight at a separate moneymaking venture. The practice, often referred to as a side hustle, has become ubiquitous with the economic uncertainty for workers in the gig economy.

The numbers are striking: 48% of millennials and 28% of baby boomers earn income from a side job, according to a survey by Bankrate.

Three in 10 respondents to the survey said they needed the extra cash to pay for basic living expenses.

That probably isn’t the case for Honolulu Mayor Kirk Caldwell. Oahu’s second-term executive, who is widely expected to run for governor, made at least $155,000 from his side hustle in 2019.

According to his financial disclosure form filed at the beginning of 2020, Caldwell earned $130,638 from stock options and between $25,000 and $49,999 in cash compensation for serving on the board of directors of Territorial Savings Bank.

That was on top of the $182,000 salary he earns as mayor.

Side hustles like that may soon be a thing of the past for some office holders.

Both the state House and Senate passed versions of a bill that would prohibit Hawaii’s governor and the four county mayors from maintaining outside employment or a controlling stake in a business.

The prohibition was originally passed by the House during the 2019 legislative session. Senators approved their own version of the measure on Thursday.

Honolulu Sen. Karl Rhoads told HPR he supported the measure not because of any particular behavior by current office holders, but because of allegations that President Donald Trump has used his office to benefit his businesses financially.

“At the state level, it's not really all that different. Right now, there's no prohibition against a mayor or governor or any of us from working a second job,” Rhoads said.

Neither version of the proposed ban would apply to state legislators or members of county councils.

It is common for state lawmakers, who are in session for just over four months, to hold second jobs. Lawmakers are currently paid $62,000 per year, although the state’s Salary Commission recommended increasing that figure last year.

The proposed ban on second jobs also doesn’t cover the lieutenant governor.

Hawaii Lt. Gov. Josh Green declared at least $275,000 dollars in his most recent financial disclosure, for work as a practicing emergency room physician and medical consultant.

Gov. David Ige’s only extra source of income was from renting his personal home while residing in Washington Place, a practice which would still be allowed.

The House and Senate disagreed on the exact language of the bill, meaning its fate will likely be decided at a joint conference committee near the end of the 2020 session.