Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committees on Tourism and Culture and Economic Development and Business Concerns, to which was referred H.B. No. 1400 entitled:

beg leave to report as follows:

The purpose of this bill is to stimulate construction and promote tourism by extending the hotel construction and remodeling tax credit (tax credit) for construction and renovations costs incurred up to July 1, 2008, and making this tax credit refundable to the taxpayer if the tax credit exceeds the taxpayer's income tax liability. In addition this bill:

Testimony in support of this bill was submitted by the Hawaii Tourism Authority, Hawaii Hotel Association, Waikiki Improvement Association, Outrigger Hotels, Ko Olina Resort & Marina, Cendant Corporation/Fairfield Resorts, The Chamber of Commerce of Hawaii, Land Use Research Foundation of Hawaii, and the Hawaii Business Roundtable. The Department of Taxation opposed this bill. The Tax Foundation of Hawaii offered comments.

Your Committees recognize the importance of supporting the construction and tourism industries in Hawaii, as they form the linchpin of our economy. Extending the availability of the tax credit and making it refundable will provide valuable incentives for both industries, especially in light of the current uncertain economic and political conditions.

As affirmed by the records of votes of the members of your Committees on Tourism and Culture and Economic Development and Business Concerns that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 1400 and recommend that it pass Second Reading and be referred to the Committee on Finance.