Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committees on Business and Economic Development and Transportation and Government Operations, to which was referred H.B. No. 994, H.D. 2, entitled:

beg leave to report as follows:

The purpose of this measure is to establish an investment tax credit for taxpayers that invest in the development of the motor sports recreation, public safety training, educational, and medical facility at Kalaeloa, parcel 9.

Your Committees received testimony in support of this measure from the Honolulu Police Department, Race Events Hawaii, LLC, Hawaii Motorsports Center, and fourteen individuals. Your Committees received testimony in opposition to this measure from the Department of Taxation and the Chamber of Commerce of Hawaii. Your Committees also received comments from the Department of Business, Economic Development, and Tourism; the Hawaii Community Development Authority; and the Tax Foundation of Hawaii.

Your Committees find that the existing motor sports facility in Leeward Oahu was built over forty years ago and meets the minimum safety standards for facilities of its kind. The facility, however, does not include many of the more desirable safety standards that are part of modern motor sports facilities. A new motor sports facility will not only provide a modern and safe racing environment for racing motorists, but will also provide a temporary boost in construction activity and permanent jobs after the new facility is completed.

This measure provides the incentive to raise the necessary capital to build a new motor sports recreation and public safety training and educational facility at Kalaeloa, parcel 9.

Your Committees believe that S.B. No. 1734, S.D. 2, which earlier was passed by the Senate, addresses the concerns raised in subsequent hearings on this measure by:

Accordingly, your Committees have amended this measure by replacing its contents with the contents of S.B. 1734, S.D. 2.

As affirmed by the records of votes of the members of your Committees on Business and Economic Development and Transportation and Government Operations that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 994, H.D. 2, as amended herein, and recommend that it pass Second Reading in the form attached hereto as H.B. No. 994, H.D. 2, S.D. 1, and be referred to the Committee on Ways and Means.