SB3213

SECTION 1. The legislature finds that Act 247, Session Laws of Hawaii 2005, authorized the counties to levy, by ordinance adopted no later than December 31, 2005, a county surcharge on state tax to fund public transportation systems. For those counties that met this requirement the surcharge became effective January 1, 2007. The city and county of Honolulu complied with this requirement with the adoption of Ordinance No. 05-027, and the surcharge became effective on January 1, 2007.

Subsequently, the city and county of Honolulu adopted Ordinance No. 07-001, which states that the locally preferred alternative for the Honolulu high-capacity transit corridor project shall be a fixed guideway system between Kapolei and the University of Hawaii at Manoa. Ordinance No. 07-001 further states that the Honolulu city council reserves the right to select the technology of the fixed guideway system for the locally preferred alternative through passage of a subsequent ordinance.

The city and county of Honolulu has not, however, made the final decision on the technology of the fixed guideway system for the locally preferred alternative, for which the moneys will be directed for operating and capital costs. As of November 30, 2007, nearly $135,000,000 has been distributed to the city and county of Honolulu as a result of the county surcharge – money that could be used for other critical transportation projects in the county.

The purpose of this Act is to suspend the assessment and collection of the county surcharge on state tax until the city and county of Honolulu has made the decisions necessary to fully proceed with the locally preferred alternative for a mass transit project.

SECTION 2. Section 46-16.8, Hawaii Revised Statutes, is amended by amending subsection (c) to read as follows:

"(c) Each county with a population greater than five hundred thousand that adopts a county surcharge on state tax ordinance pursuant to subsection (a) shall use the surcharges received from the State for:

(1) Operating or capital costs of a locally preferred alternative for a mass transit project; and

(2) Expenses in complying with the Americans with Disabilities Act of 1990 with respect to paragraph (1)[.];

provided that if the county has not made a decision by June 30, 2008, on the technology of the fixed guideway system for the locally preferred alternative for a mass transit project, the surcharge shall be suspended effective July 1, 2008, for that county. If by December 31, 2008, the county has not made a decision and awarded any related contracts for the technology of the fixed guideway system for the locally preferred alternative for a mass transit project, the county shall return any unexpended moneys to the State for deposit into the state highway fund for expenditure pursuant to section 248‑9(c).

[~~The~~] Any county surcharge on state tax [~~shall not~~], which is returned to the State for deposit in the state highway fund may be used to build or repair public roads or highways, bicycle paths, or support public transportation systems already in existence prior to July 12, 2005[.]; pursuant to section 248‑9(c)."

SECTION 3. Section 248-9, Hawaii Revised Statutes, is amended to read as follows:

"§248-9 State highway fund. (a) [~~Moneys~~] Except as provided in subsection (c), moneys in the state highway fund may be expended for the following purposes:

(1) To pay the costs of operation, maintenance, and repair of the state highway system, including without limitation, the cost of equipment and general administrative overhead;

(2) To pay the costs of acquisition (including real property and interests therein), planning, designing, construction, and reconstruction of the state highway system and bikeways, including, without limitation, the cost of equipment and general administrative overhead;

(3) To reimburse the general fund for interest on and principal of general obligation bonds issued to finance highway projects where the bonds are designated to be reimbursable out of the state highway fund; and

(4) To pay the costs of construction, maintenance, and repair of county roads; provided that none of the funds expended on a county road or program shall be federal funds when such expenditure would cause a violation of federal law or a federal grant agreement.

(b) At any time, the director of transportation may transfer from the state highway fund all or any portion of available moneys determined by the director of transportation to exceed one hundred thirty-five per cent of the requirements for the ensuing twelve months for the state highway fund as permitted by and in accordance with section 37-53. For purposes of the determination, the director of transportation shall take into consideration:

(1) The amount of federal funds and bond funds on deposit in, and budgeted to be expended from, the state highway fund during the period;

(2) Amounts on deposit in the state highway fund that are encumbered or otherwise obligated;

(3) Budgeted amounts payable from the state highway fund during the period;

(4) Revenues anticipated to be received by and expenditures to be made from the state highway fund during the period based on existing agreements and other information for the ensuing twelve months; and

(5) Any other factors as the director of transportation shall deem appropriate.

(c) Any county surcharge on state tax, which is returned to the State pursuant to section 46-16.8(c), shall be deposited into the state highway fund and shall be expended, as deemed appropriate by the legislature, for transportation projects in the county for which the surcharge was collected."

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect on July 1, 2008; provided that section 3 of this Act shall be repealed on July 1, , and section 248-9, Hawaii Revised Statutes, shall be reenacted in the form in which it read on June 30, 2008.

INTRODUCED BY:	_____________________________

THE SENATE	S.B. NO.	3213
TWENTY-FOURTH LEGISLATURE, 2008
STATE OF HAWAII