STAND

STAND. COM. REP. 1495

Honolulu, Hawaii

, 2003

RE: S.B. No. 1172

S.D. 2

H.D. 2

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committee on Finance, to which was referred S.B. No. 1172, S.D. 2, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO AIRLINES,"

begs leave to report as follows:

The purpose of this bill is to support commercial airlines that service Hawaii during this period of unprecedented financial challenges by:

(1) Providing a tax credit for an unspecified percentage of landing fees imposed on airlines with Hawaii-based operations; and

(2) Authorizing the Director of Transportation, on a one-time basis, to:

(a) Waive the airport landing fees, joint use charge fees, and exclusive use terminal rental fees for a thirty-day period; and

(b) Defer these same fees for a subsequent sixty-day period,

in the event of a substantial decrease in in-bound passengers due to an armed conflict or war.

Four concerned individuals testified in support of this measure. The Airlines Committee of Hawaii and the Chamber of Commerce of Hawaii supported the intent of this bill. The Tax Foundation of Hawaii offered comments, and the Departments of Taxation, Transportation, and Budget and Finance opposed this measure.

Your Committee has amended this bill by:

(1) Removing the airport landing fees tax credit;

(2) Clarifying that the emergency program shall only be implemented on a one-time basis;

(3) Changing the effective date to July 1, 2010, for the purpose of continued discussion; and

(4) Making technical, nonsubstantive amendments for purposes of style and clarity.

As affirmed by the record of votes of the members of your Committee on Finance that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1172, S.D. 2, H.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 1172, S.D. 2, H.D. 2.

Respectfully submitted on behalf of the members of the Committee on Finance,

		____________________________ DWIGHT Y. TAKAMINE, Chair