Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2006

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred H.B. No. 1033, H.D. 1, S.D. 1, entitled:

begs leave to report as follows:

The purpose of this measure is to provide a tax credit to farmers who do not have access to a state irrigation system and who are forced to purchase water from a county at higher rates.

The amount of the tax credit would be equal to the difference between the amount paid by a farmer for water purchased from the county, and the amount that the farmer would have paid for water had the farmer had access to a state irrigation system.

Your Committee finds that state irrigation systems provide water to many farmers throughout the State. However, they do not provide water to all farmers, and as a result, many farmers are forced to purchase water at higher rates from the counties.

Your Committee has amended this measure by:

Your Committee believes that establishing a tax credit for farmers who must purchase county water would provide equitable treatment to all farmers with regard to procuring access to water resources.

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 H.B. No. 1033, H.D. 1, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 1033, H.D. 1, S.D. 2.