Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred S.B. No. 2413 entitled:

begs leave to report as follows:

The purpose of this measure is to allow more agricultural businesses the opportunity to participate in the state enterprise zone program.

Your Committee acknowledges that agriculture is a vital component of Hawaii's economy. One way of encouraging more agricultural activities is to allow agricultural businesses to participate in and enjoy the incentives of the State's enterprise zone program. However, the existing requirement relating to a ten per cent increase in the number of employees at the end of the first year of participation is a difficult hurdle for an agricultural business due to the nature of the activity and its reliance on factors beyond its control, including national and international markets and weather conditions.

This measure will allow an agricultural business to continue to participate in the enterprise zone program if its business is interrupted by any acts of God. Further, it exempts an agricultural business from the increased employment requirement and instead requires the agricultural business to increase its cumulative average annual gross revenues by two per cent by the end of the first year for continued participation in the program.

Your Committee has made technical, nonsubstantive changes to this measure for clarity and consistency.

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 S.B. No. 2413, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 2413, S.D. 1.