STAND. COM. REP. NO. 2344

Honolulu, Hawaii

RE:    S.B. No. 2731

       S.D. 1

Honorable Donna Mercado Kim

President of the Senate

Twenty-Seventh State Legislature

Regular Session of 2014

State of Hawaii

Madam:

     Your Committee on Transportation and International Affairs, to which was referred S.B. No. 2731 entitled:

"A BILL FOR AN ACT RELATING TO A CAR-SHARING VEHICLE SURCHARGE TAX,"

begs leave to report as follows:

     The purpose and intent of this measure is to establish a car-sharing vehicle surcharge tax.

     Your Committee received testimony in support of this measure from the Department of Transportation, City and County of Honolulu Department of Planning and Permitting, City and County of Honolulu Department of Transportation Services, Car2Go, Ulupono Initiative, Hawaii Energy Policy Forum, and two individuals.  Your Committee received testimony in opposition to this measure from Enterprise Rent-A-Car.  Your Committee received comments on this measure from the Department of Taxation and the Tax Foundation of Hawaii.

     Your Committee finds that car-sharing is a green transportation innovation that can significantly reduce 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.  Unlike traditional car rentals, car-sharing is not aimed at tourists or individuals who are getting a personal vehicle repaired.  Car-sharing is generally rented by the minute or by the hour, rather than by the day.  Car-sharing members are persons 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:

     (1)  Making the surcharge tax pro rata on an hourly basis with a per day charge;

     (2)  Exempting car-sharing organizations that are registered with the Director of Taxation and subject to the car-sharing vehicle surcharge tax from the rental motor vehicle surcharge tax and tour vehicle surcharge tax; and

     (3)  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 Transportation and International Affairs that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2731, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 2731, 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