Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred H.B. No. 2454, S.D. 1, entitled:

begs leave to report as follows:

The purpose of this measure is to ease the qualifications for firms enrolled in the enterprise zone partnership as a result of the September 11^th terrorist attacks, by altering the method of calculating the number of employees needed to meet the annual hiring requirements of the enterprise zone program. Additionally, this measure eliminates the use tax exemption for enterprise zone-qualified firms.

Testimony supporting this measure was received from the Department of Business, Economic Development, and Tourism.

Your Committee finds that these changes to the enterprise zone program could help minimize business failures and layoffs in the State. The elimination of the use tax exemption for enterprise zone-qualified firms removes the incentive to purchase supplies and equipment from out-of-state vendors, and is intended to encourage purchases from local vendors.

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. 2454, S.D. 1, and recommends that it pass Third Reading.