STAND. COM. REP. NO. 4

Honolulu, Hawaii

RE:    S.B. No. 726

       S.D. 1

Honorable Donna Mercado Kim

President of the Senate

Twenty-Seventh State Legislature

Regular Session of 2013

State of Hawaii

Madam:

     Your Committee on Transportation and International Affairs, to which was referred S.B. No. 726 entitled:

"A BILL FOR AN ACT RELATING TO RENTAL MOTOR VEHICLE SURCHARGE TAX,"

begs leave to report as follows:

     The purpose and intent of this measure is to require the rental motor vehicle surcharge tax for car-sharing organizations to be prorated at 12.5 cents per hour for rentals of less than six hours and at existing per day rates for each rental of six hours or longer.

     Your Committee received testimony in support of this measure from the Department of Transportation; EAN Holdings, LLC; and two individuals.  Comments were received from the Department of Taxation and Tax Foundation of Hawaii.

     Your Committee finds that car-sharing is a green transportation innovation that significantly reduces vehicle miles traveled, oil imports, greenhouse gas emissions, and household transportation costs for Hawaii residents.  Car-sharing is a fairly new transportation innovation in the United States that has emerged only in the last ten years.  It is essentially membership-based hourly car rental.  Unlike traditional car rentals, however, car-sharing is not aimed at tourists or individuals who are getting personal vehicles repaired.  Car- sharing members are people who either cannot afford to or prefer not to own their own vehicles but occasionally need access to vehicles to run errands.  Car-sharing enables them to enjoy the benefits of automobile access without the high fixed costs and other concerns that come with car ownership.

     Your Committee has amended this measure by exempting car-sharing organizations from the rental motor vehicle surcharge tax entirely.

     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. 726, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 726, S.D. 1, and be referred to the Committee on Ways and Means.

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

____________________________

J. KALANI ENGLISH, Chair