STAND. COM. REP. NO. 2027

Honolulu, Hawaii

RE:    S.B. No. 2816

       S.D. 1

Honorable Colleen Hanabusa

President of the Senate

Twenty-Fourth State Legislature

Regular Session of 2008

State of Hawaii

Madam:

     Your Committee on Transportation and International Affairs, to which was referred S.B. No. 2816 entitled:

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

begs leave to report as follows:

     The purpose of this measure is to provide priority assignment of mooring space for a new ferry route from Ma‘alaea Harbor to Lahaina and to provide an exemption from the fuel tax for fuel purchases for the ferry service.

     The Department of Taxation and the Tax Foundation of Hawaii submitted comments on this measure.

     Your Committee finds that this measure would provide an alternative emergency transportation system should the only highway in West Maui be closed, as well as more convenient travel for residents of Lana‘i and West Maui.  To succeed, any ferry route to and from Ma‘alaea Harbor and Lahaina requires priority assignment of mooring space, and the added fuel costs of the route would require an exemption from the fuel tax for the ferry service.

     The Department of Taxation testified that the legislation will result in a revenue loss of approximately $13,500, beginning in fiscal year 2009.

     Your Committee has amended this measure by:

     (1)  Clarifying the subject matter of section 243-4, Hawaii Revised Statutes, by adding the phrase "rates and exemptions" to the section title; and

     (2)  Changing references to place names and making a technical, nonsubstantive amendment.

     As affirmed by the record of votes of the members of your Committee on Transportation and International Affairs that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2816, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 2816, S.D. 1, and be referred to the Committee on Economic Development and Taxation.

Respectfully submitted on behalf of the members of the Committee on Transportation and International Affairs,

____________________________

J. KALANI ENGLISH, Chair