STAND. COM. REP. NO.  1214-08

Honolulu, Hawaii

                , 2008

RE:   S.B. No. 2816

      S.D. 1

      H.D. 1

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Fourth State Legislature

Regular Session of 2008

State of Hawaii

Sir:

     Your Committees on Transportation and Water, Land, Ocean Resources & Hawaiian Affairs, to which was referred S.B. No. 2816, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO INTRA-COUNTY FERRY SERVICE,"

beg leave to report as follows:

     The purpose of this bill is to improve ferry service within Maui County by:

     (1)  Requiring the Department of Land and Natural Resources (DLNR) to assign priority mooring space to intra-county ferries serving Maui County; and

     (2)  Exempting fuel sold for use by an intra-county ferry service from the fuel tax.

     DLNR and the Department of Taxation (DoTAX) provided comments on this bill.

     Currently, ferry service is available within the County of Maui, providing an additional mode of transportation for Maui residents, commuting workers, and visitors alike.  Providing priority assignment of mooring space, as well as fuel tax exemptions for an intra-county ferry service, will result in a more reliable ferry service and will allow for this low-cost mode of transportation to continue in the County of Maui.

     However, your Committees understand the concerns raised by DoTAX regarding the placement of the tax exemption in the license tax section of the fuel tax law, rather than in the section specifying when the fuel tax is not applicable.  Accordingly, your Committees have amended this measure by placing the fuel tax exemption in the section of the fuel tax law that specifies when the fuel tax is not applicable.  Other technical, nonsubstantive amendments were made for clarity, consistency, and style.

     As affirmed by the records of votes of the members of your Committees on Transportation and Water, Land, Ocean Resources & Hawaiian Affairs that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 2816, S.D. 1, as amended herein, and recommend that it pass Second Reading in the form attached hereto as S.B. No. 2816, S.D. 1, H.D. 1, and be referred to the Committee on Finance.

Respectfully submitted on behalf of the members of the Committees on Transportation and Water, Land, Ocean Resources & Hawaiian Affairs,

____________________________ KEN ITO, Chair

____________________________ JOSEPH M. SOUKI, Chair