Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Finance, to which was referred H.R. No. 126 entitled:

begs leave to report as follows:

The purpose of this resolution is to request the Department of Taxation, with the assistance of the Attorney General, to consider the legality, equity, and feasibility of the imposition of a tax on the fair market value of all improvements on a leasehold property that revert to the ownership of the lessor upon the termination of a commercial or industrial lease.

Numerous concerned individuals provided testimony in support of this measure. The Department of Taxation, the Land Use Research Foundation of Hawaii, and Kamehameha Schools provided testimony in opposition.

As affirmed by the record of votes of the members of your Committee on Finance that is attached to this report, your Committee concurs with the intent and purpose of H.R. No. 126 and recommends its adoption.