STAND. COM. REP. NO. 208

Honolulu, Hawaii

RE:    S.B. No. 1411

       S.D. 1

Honorable Shan S. Tsutsui

President of the Senate

Twenty-Sixth State Legislature

Regular Session of 2011

State of Hawaii

Sir:

     Your Committee on Economic Development and Technology, to which was referred S.B. No. 1411 entitled:

"A BILL FOR AN ACT RELATING TO TAXATION,"

begs leave to report as follows:

     The purpose of this measure is to provide tax credits for the investment, transportation expenditures, and certain payroll costs associated with a qualified live musical or theatrical production or qualified musical or theatrical facility infrastructure project.  The intent of this measure is to establish Hawaii as a primary location in which to debut a live musical or theatrical production and in which to base a production company.

     Your Committee received testimony in support of this measure from the International Alliance of Theatrical and Stage Employees Local 665 and two individuals.  Your Committee received comments on this measure from the Department of Business, Economic Development, and Tourism; Department of Taxation; and the Tax Foundation of Hawaii.

     Your Committee finds that the lingering economic downturn has had a profound effect on Hawaii's arts, music, and creative community as funding sources have disappeared or been significantly reduced.  The essential support that this measure would provide through a tax credit for qualified live musical or theatrical productions or musical or theatrical facility infrastructure projects would help to stem these losses, while establishing Hawaii as an esteemed venue for musical and theatrical productions.

     Your Committee has heard a number of related measures and believes the merits of all require further deliberation.  Your Committee has amended this measure accordingly, by:

     (1)  Inserting an effective date of July 1, 2050, to allow for further discussion; and

     (2)  Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

     As affirmed by the record of votes of the members of your Committee on Economic Development and Technology that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1411, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 1411, S.D. 1, and be referred to the Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committee on Economic Development and Technology,

____________________________

CAROL FUKUNAGA, Chair