State lawmakers worked right up until their midnight deadline on Friday to get hundreds of bills ready for final votes next week.

Many of the advancing bills contain tax and fee increases, but lawmakers rejected a gas tax and fee hike that could have cost residents nearly $170 in taxes annually.

The tax-heavy proposal was introduced by Gov. Linda Lingle in January to help pay for needed highway improvements, but she was unhappy when lawmaker Joe Souki changed the wording of the bill to allow the tax hikes to kick in almost immediately.

Other Democrats were unhappy too, and late last night they turned down the bill.

The bill would have been particularly costly to Hawaii drivers, as it would have hiked taxes on each gallon of gas by 10 cents. It also would have increased the vehicle weight tax and raised registration tax rates from $25 to $45.

"I think the public -- at this time -- is not ready for the increase in the fees and the taxes on top of everything else," said Sen. Donna Kim, chairwoman of the Senate Ways and Means.

In the late hours at the capitol, House Transportation Chairman Joe Souki said he was disappointed lawmakers decided to reject the bill, saying the taxes would have helped jumpstart highway improvements. Opponents said tax hikes would have hit too many drivers.

"The tough part for legislators is the tax hikes," said Rep. Tom Brower. "We have seen the fee increases that the city has imposed and now think state lawmakers are concerned about additional increases that consumers may have to pay."

Yet, even with those taxes averted, lawmakers did reach an agreement on another bill that will raise the price of gas.

The bill imposes a tax on Oahu's refineries and amounts to a dollar on each barrel of oil coming into the state. Under that proposal, Hawaii customers will end up paying an estimated extra $20 a year for gas and electricity.

The tax hike is meant to promote clean energy initiatives, like solar and wind power.