STAND. COM. REP. NO. 3225

                                   Honolulu, Hawaii
                                                     , 2000

                                   RE:  H.B. No. 2955
                                        H.D. 1
                                        S.D. 1




Honorable Norman Mizuguchi
President of the Senate
Twentieth State Legislature
Regular Session of 2000
State of Hawaii

Sir:

     Your Committee on Ways and Means, to which was referred
H.B. No. 2955, H.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO NEW ECONOMY SKILLS TRAINING,"

begs leave to report as follows:

     The purpose of this measure is to support the growth and
development of technology in Hawaii by providing an income tax
credit for the cost of training the taxpayer or the taxpayer's
employees to upgrade their technology-related skills.

     Your Committee finds that tax credits are an efficient way
for Hawaii to provide incentives to businesses and individuals to
capitalize on the growth of technology-related industries.  By
requiring the creation or acquisition of a new job, the proposed
tax credit isolates the total cost of this program and gives
incentives for continuing education in areas where the skills are
in demand.

     Upon further consideration, your Committee amended section 2
of measure regarding the proposed new section for chapter 235,
Hawaii Revised Statutes, as follows:

     (1)  Indicating that technology training for the new
          technology-related job be provided by the taxpayer;

     (2)  Creating a new subsection (b) to:


 
a                                                     HB2955 SD1
                                   STAND. COM. REP. NO. 3225
                                   Page 2


          (A)  Clarify that the credit shall be equal to the
               costs of either training employees to fill a newly
               created technology job or training incurred by an
               individual taxpayer but retain the blank dollar
               cap; and

          (B)  Add a proviso that deductions may not be taken for
               income tax purposes by a taxpayer for the cost of
               training if a credit is claimed under this
               proposed new section for chapter 235, HRS;

     (3)  Renumbering subsections (b), (c), and (d) to (c), (d),
          and (f), respectively;

     (4)  Adding a subsection (e) allowing the director to:

          (A)  Adopt rules and forms necessary to carry out this
               section; and

          (B)  Require the taxpayer to furnish reasonable
               information to ascertain the validity of the claim
               for credit under this section; and

     (5)  Making technical nonsubstantive amendments for clarity.

     As affirmed by the record of votes of the members of your
Committee on Ways and Means that is attached to this report, your
Committee is in accord with the intent and purpose of
H.B. No. 2955, H.D. 1, as amended herein, and recommends that it
pass Third Reading in the form attached hereto as H.B. No. 2955,
H.D. 1, S.D. 1.

                                 Respectfully submitted on behalf
                                 of the members of the Committee
                                 on Ways and Means,



                                 ________________________________
                                 CAROL FUKUNAGA, Co-Chair



                                 ________________________________
                                 ANDREW LEVIN, Co-Chair

 
a                                                     HB2955 SD1