The Tax Foundation of Hawaii is making an appeal for more members and support, saying it could close if more money doesn't materialize.

The independent tax research group says its directors have set a June 30 deadline for raising or getting commitments for its about $225,000 budget and that it has raised about $100,000 so far.

If it falls short, the board will either come up with a plan to wind down the Tax Foundation's operations or have to come up with a plan to make up the difference, said Lowell Kalapa, president of the 55-year-old organization.

"We still have a lot of money we have to raise," said Kalapa. "We've got about 3 1/2 months to raise $120,000 or get it pledged."

The Tax Foundation has faced money woes previously, notably in 2002 when the group also faced a shutdown because of falling membership. The group has been a familiar source of tax analysis on legislative proposals at the state and county levels, and Kalapa is frequently quoted by the media as a knowledgeable source on tax policy matters.

Kalapa said there are several reasons for the membership decline, including the dwindling number of large local corporations and stances the nonprofit organization has taken against tax proposals that would favor specific companies or groups.

"We step on people's toes," said Kalapa. He said the Tax Foundation advocates sound tax policy and has periodically come out against tax proposals favored by some of its members.

"It is not an easy task to maintain that objective perception of what is good tax policy because it means criticizing special-interest legislation that comes at a cost to all other taxpayers," said Kalapa in an appeal on the organization's Web site.

"But that is what the Tax Foundation is all about."

Membership also has declined because many companies that were locally owned such as Hawaiian Telcom and Liberty House have been absorbed by Mainland corporations.

At its peak about 20 years ago, the group had about 300 to 350 members, Kalapa said. It now has 225 to 250 members. Individual supporters pay $100 for membership while businesses are charged $500. Members who receive the foundation's legislative tax bill service must pay a minimum of $1,000.

In recent months the Tax Foundation has been asking supporters to increase their support by 50 percent and to bring in new members. While that has helped, Kalapa said the fundraising still has a way to go.

"The foundation is still not out of the woods," he said.

Reach Greg Wiles at gwiles@honoluluadvertiser.com.