Requires counties to adopt zoning ordinance to require a minimum per cent of all roof tops on structures in multi-family, hotel, and industrial districts to be landscaped; provides tax credit for added cost of roof top landscaping for taxable years beginning after 12/31/07.

A BILL FOR AN ACT

SECTION 1. Many acres of roof tops in the urban districts of the State are covered with roof top space that is more often than not covered with tar paper, tar and gravel, or some other equally unsightly material. Very few examples are available in the State, one being a portion of the parking structure of the Topa Financial Center in downtown Honolulu, where a roof top or portion thereof is landscaped for purely aesthetic purposes or for use as a social amenity.

The purpose of this Act is to:

SECTION 2. Chapter 46, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§46-A Roof top landscaping. (a) Each county shall adopt ordinances to require a developer, as a condition of obtaining a building permit for a structure in a commercial, hotel, multi-family, industrial, or other mixed use district with a commercial component, to develop the structure in such a manner that at least per cent of the roof top of the structure is developed and maintained as a landscaped amenity.

(b) The permitted uses of the landscaped portion of the roof top may include, in the following order of priority:

(c) The owner of the structure shall be responsible for maintaining the required roof top landscaping for the life of the structure.

(d) These ordinances shall be adopted within twenty–four months of the effective date of this Act; provided that the ordinances shall provide that any structures that received a building permit after the effective date of this Act that would have been required to comply with the ordinance, had it been in effect at the effective date of this Act, shall be required to retro-fit the structure to comply with the ordinance."

SECTION 3. Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§235-    Roof top landscaping tax credit. (a) There shall be allowed to each taxpayer who is the owner, developer, or lessee of any structure that is required to develop a roof top landscaping amenity required by section 46-A, subject to the taxes imposed by this chapter, a roof top landscaping tax credit that shall be deductible from the taxpayer's net income tax liability, if any, imposed by this chapter for the taxable year in which the credit is properly claimed. The amount of the tax credit claimed under this section by the taxpayer in all years for which the credit is available shall be limited to per cent of the added landscaping costs incurred during the taxable year for which the credit is claimed; provided that the costs shall not exceed $ in the aggregate for each structure.

In the case of a partnership, S corporation, estate, trust, or association of apartment owners, the tax credit allowable is for the added landscaping costs incurred by the entity for the taxable year. The cost upon which the tax credit is computed shall be determined at the entity level. Distribution and share of credit shall be determined pursuant to section 235-110.7(a).

If a deduction is taken under section 179 (with respect to election to expense depreciable business assets) of the Internal Revenue Code, no tax credit shall be allowed for that portion of the added landscaping costs for which the deduction is taken.

The basis of eligible property for depreciation or accelerated cost recovery system purposes for state income taxes shall be reduced by the amount of credit allowable and claimed. In the alternative, the taxpayer shall treat the amount of the credit allowable and claimed as a taxable income item for the taxable year in which it is properly recognized under the method of accounting used to compute taxable income.

(b) The credit allowed under this section shall be claimed against the net income tax liability, if any, imposed by this chapter for the taxable year in which the tax credit is properly claimed.

(c) If the tax credit under this section exceeds the taxpayer's income tax liability, the excess of credit over liability may be used as a credit against the taxpayer's income tax liability in subsequent years until exhausted. All claims, including amended claims, for a tax credit under this section shall be filed on or before the end of the twelfth month following the close of the taxable year for which the credit may be claimed. Failure to comply with the foregoing provision shall constitute a waiver of the right to claim the credit.

(d) The director of taxation shall prepare any forms that may be necessary to claim a credit under this section. The director may also require the taxpayer to furnish information to ascertain the validity of the claim for credit made under this section and may adopt rules necessary to effectuate the purposes of this section pursuant to chapter 91.

(e) The tax credit allowed under this section shall be available for taxable years beginning after December 31, 2007.

(f) To qualify for the income tax credit, the taxpayer shall be in compliance with all applicable federal, state, and county statutes, rules, and regulations.

(g) As used in this section, "added landscaping costs" means any additional costs incurred in the planning, design, and construction of a structure in order to comply with a county ordinance requiring roof top landscaping, adopted pursuant to section 46-A, including costs for plans, design, construction, supplies, and equipment that is permanently affixed to the structure related to the development of the roof top landscaping and shall not include any costs for which another credit was claimed under this chapter. Added landscaping costs shall also include added costs incurred to ensure that the structure is constructed in such a manner that it can bear the weight of the added landscaping amenity on its roof top.

"Net income tax liability" means income tax liability reduced by all other credits allowed under this chapter."

SECTION 4. New statutory material is underscored.

SECTION 5. This Act, upon its approval, shall apply to taxable years beginning after December 31, 2007.