STAND. COM. REP. NO. 870-00

                                 Honolulu, Hawaii
                                                   , 2000

                                 RE: S.B. No. 2056
                                     S.D. 1
                                     H.D. 1




Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 2000
State of Hawaii

Sir:

     Your Committee on Human Services and Housing, to which was
referred S.B. No. 2056, S.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO INDIVIDUAL DEVELOPMENT
     ACCOUNT CONTRIBUTION TAX CREDITS,"

begs leave to report as follows:

     The purpose of this bill is to encourage low-income persons
to save by establishing a tax credit of 50 percent of the amount
contributed to an Individual Development Account (IDA).

     The Departments of Human Services and Taxation and the
Office of Hawaiian Affairs testified in support of this measure.

     After careful consideration, your Committee has amended this
measure by deleting its substance and inserting language
reflected in a similar bill, H.B. No. 1908, H.D. 1.  This bill
was reported earlier from your Committee on Finance.  As amended,
the purpose of this bill is to:

     (1)  Establish an IDA contribution tax credit equal to 50
          percent of the contribution for a five-year period
          beginning after December 31, 1999, until December 31,
          2004;

     (2)  Prohibit the tax credit for the portion of the
          contribution for which a charitable deduction was
          already taken;

 
 
                                 STAND. COM. REP. NO. 870-00
                                 Page 2

 
     (3)  Limit the contribution tax credit to $1,000,000 in the
          aggregate; and

     (4)  Give retroactive application to chapter 257, Hawaii
          Revised Statutes.

Minor, technical revisions were also made for purposes of style
and clarity.

     As affirmed by the record of votes of the members of your
Committee on Human Services and Housing that is attached to this
report, your Committee is in accord with the intent and purpose
of S.B. No. 2056, S.D. 1, as amended herein, and recommends that
it pass Second Reading in the form attached hereto as S.B. No.
2056, S.D. 1, H.D. 1, and be referred to the Committee on
Finance.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Human Services
                                   and Housing,



                                   ______________________________
                                   DENNIS A. ARAKAKI, Chair