Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Third State Legislature

Regular Session of 2006

State of Hawaii

Sir:

Your Committee on Consumer Protection & Commerce, to which was referred S.B. No. 2076, S.D. 2, H.D. 1, entitled:

begs leave to report as follows:

The purpose of this bill is to encourage lessors of residential properties to sell their fee interest by providing an income tax exemption for 100 percent of the gain realized from the sale.

Hawaii Independent Condominium & Cooperative Owners, Hawaii Council of Associations of Apartment Owners, and Hawaii Association of Realtors supported this bill. The Department of Taxation and Tax Foundation of Hawaii commented.

Your Committee finds that this bill addresses the repeal of chapter 38 of the Revised Ordinances of Honolulu in 2005, which allowed the City and County to mandate leasehold conversion of multi-family residential leasehold units.

As affirmed by the record of votes of the members of your Committee on Consumer Protection & Commerce that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2076, S.D. 2, H.D. 1, and recommends that it be referred to the Committee on Finance.