STAND

STAND. COM. REP. NO. 900-04

Honolulu, Hawaii

, 2004

RE: S.B. No. 2269

S.D. 2

H.D. 1

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Sir:

Your Committee on Economic Development and Business Concerns, to which was referred S.B. No. 2269, S.D. 2, entitled:

"A BILL FOR AN ACT RELATING TO ENTERPRISE ZONES,"

begs leave to report as follows:

The purpose of this bill is to remove provisions that prevent certain telecommunications business activity from being designated as a qualified business under the Enterprise Zone (EZ) Program by:

(1) Amending the definition of "telecommunication services"; and

(2) Clarifying that a qualified service business does not have to deliver services in the same EZ in which they are sold.

The Department of Hawaiian Home Lands, Sandwich Isles Communications, Inc., Ho'akea LLC, and Nanakuli Housing Corporation testified in support of this bill. The Department of Business, Economic Development, and Tourism supported this measure with amendments. The Department of Taxation offered comments.

Your Committee has amended this bill by:

(1) Adding a definition for "broad band distributed network" rather than amending the definitions of "telecommunication services" and "qualified business";

(2) Adding a new provision that exempts broad band distributed networks from the requirement that services must be delivered in the same EZ in which the services are sold, rather than amending the requirement; and

(3) Making technical, nonsubstantive amendments for clarity, consistency, and style.

As affirmed by the record of votes of the members of your Committee on Economic Development and Business Concerns that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2269, S.D. 2, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 2269, S.D. 2, H.D. 1, and be referred to the Committee on Finance.

Respectfully submitted on behalf of the members of the Committee on Economic Development and Business Concerns,

		____________________________ BRIAN SCHATZ, Chair