STAND. COM. REP. NO. 1608

Honolulu, Hawaii

, 2005

RE: S.B. No. 1729

S.D. 2

H.D. 2

 

 

 

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 S.B. No. 1729, S.D. 2, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO TOURISM,"

begs leave to report as follows:

The purpose of this bill is to improve the management of the Hawaii Tourism Authority (HTA) and to increase funding for tourism-related programs by:

(1) Adding the Executive Director of the Hawaii State Foundation on Culture and the Arts (HSFCA), as an ex officio nonvoting member, to the Board of Directors of HTA (Board);

(2) Clarifying that HTA is authorized, through its Executive Director, to provide for the appointment of officers, agents, and employees, subject to the approval of the Board; provided that:

(A) The Governor and executive agencies shall limit their oversight of HTA's hiring of personnel to those times when HTA receives general funds from the State; and

 

(B) There is no anticipated revenue shortfall in the Tourism Special Fund (TSF) and that funds have been appropriated by the Legislature and allotted as provided by law;

(3) Placing the TSF and Convention Center Enterprise Special Fund (CCESF) outside the state treasury;

(4) Allowing funds in the TSF and CCESF to be placed in interest-bearing accounts or otherwise invested by HTA until needed, subject to certain limitations;

(5) Increasing the allocation of transient accommodations tax (TAT) collections to the TSF to 35.4 percent and requiring that 0.5 percent of this allocation be used to provide funding for an Aloha Aina Patrol and a visitor assistance program established in each county;

(6) Increasing the limit on funds deposited in the CCESF to $35,000,000;

(7) Repealing the TAT Trust Fund;

(8) Repealing the existing allocation of TAT collections to the State Parks Special Fund (SPSF) and the Special Land and Development Fund (SLDF) and allocating one percent of TAT collections as follows:

(A) Ninety percent to be deposited into the SPSF; and

(B) Ten percent to be deposited into the SLDF for the Hawaii Statewide Trail and Access Program;

to be expended by the Department of Land and Natural Resources (DLNR) as designated by a plan approved by HTA; and

(9) Depositing 1.5 percent of TAT collections into the general fund.

HTA, HSFCA, and the Hawaii Hotel & Lodging Association supported this bill. DLNR supported the intent of this measure. The Department of Budget and Finance and the Department of Business, Economic Development, and Tourism opposed this bill. The Department of Taxation, Attorney General, and the Tax Foundation of Hawaii offered comments.

Your Committee has amended this bill by:

(1) Changing the limit on funds deposited in the CCESF to an unspecified amount;

(2) Changing the percentage allocations of TAT collections to the TSF, Aloha Aina patrol and visitor assistance program for each county, SPSF, SLDF, and the general fund to unspecified amounts;

(3) Changing its effective date to July 1, 2010, to promote further discussion; and

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

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. 1729, 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. 1729, S.D. 2, H.D. 2.

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

 

____________________________

DWIGHT TAKAMINE, Chair