STAND

STAND. COM. REP. NO. 853

Honolulu, Hawaii

, 2005

RE: H.B. No. 1200

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 H.B. No. 1200, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO STATE ENTERPRISE ZONES,"

begs leave to report as follows:

The purpose of this bill is to address specific concerns of agricultural businesses operating under the State Enterprise Zone (EZ)Program by providing that agricultural businesses shall remain eligible for all EZ tax incentives during any period of interruption or inability to meet the EZ requirements caused by a force majeure event, such as pest outbreaks or damaging weather. This bill also:

(1) Extends the eligibility period for agricultural businesses under the EZ Program by the duration, in months, of the force majeure event; and

(2) Allows an agricultural business to meet annual gross revenue requirements if the business is unable to meet the annual full-time employee requirements of the EZ Program.

The Department of Business, Economic Development, and Tourism, the Department of Agriculture, Hawaii Agriculture Research Center, Hawaii Farm Bureau Federation, Big Island Farm Bureau, Kauai County Farm Bureau, Maui County Farm Bureau, Hawaii Aquaculture Association, Hawaii Crop Improvement Association, Hawaii Cattlemen's Council, and a member of the Maui County Council testified in support of this bill. The Department of Taxation supported the intent of this measure.

Your Committee has amended this bill by:

(1) Changing the effective date to July 1, 2010, to encourage continuing discussion; and

(2) Making technical, nonsubstantive amendments for style 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 H.B. No. 1200, H.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 1200, H.D. 2.

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

		____________________________ DWIGHT TAKAMINE, Chair