STAND. COM. REP. NO. 2384

Honolulu, Hawaii

RE:    S.B. No. 3027

       S.D. 1

Honorable Donna Mercado Kim

President of the Senate

Twenty-Seventh State Legislature

Regular Session of 2014

State of Hawaii

Madam:

     Your Committees on Economic Development, Government Operations and Housing and Energy and Environment, to which was referred S.B. No. 3027 entitled:

"A BILL FOR AN ACT RELATING TO ECONOMIC DEVELOPMENT,"

beg leave to report as follows:

     The purpose and intent of this measure is to:

     (1)  Allow the Energy Resources Coordinator and Governor to designate areas as energy zones; and

     (2)  Provide a state business tax credit to qualifying businesses in energy zones.

     Your Committees received testimony in support of this measure from Indigenous Consultants, LLC; and Kaiuli Energy.  Your Committees received comments on this measure from the Department of Business, Economic Development, and Tourism; Department of Taxation; and Tax Foundation of Hawaii.

     Your Committees find that the Hawaii Clean Energy Initiative looks to meet seventy percent of Hawaii's energy needs by 2030 through energy efficiency and renewable energy.  By exercising more energy efficiency and better harnessing local energy supplies, the Hawaii Clean Energy Initiative strives to work with public and private organizations at the national, state, county, and grassroots levels to achieve several key objectives, including fostering and demonstrating innovation in the use of clean energy technologies, creative financing, and public policy to accelerate Hawaii's transition to clean energy.

     Your Committees further find that for the Hawaii Clean Energy Initiative to optimize working relationships with private organizations toward its goals, there are certain areas in the State that need the particular attention of government to help attract private sector investment.  These incentives will encourage the development, growth, and expansion of the private sector, a cornerstone of our society that the people of the State have grown to depend on for their health, safety, and welfare.

     Your Committees have amended this measure by inserting an effective date of July 1, 2050, to encourage further discussion.

     As affirmed by the records of votes of the members of your Committees on Economic Development, Government Operations and Housing and Energy and Environment that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 3027, as amended herein, and recommend that it pass Second Reading in the form attached hereto as S.B. No. 3027, S.D. 1, and be referred to the Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committees on Economic Development, Government Operations and Housing and Energy and Environment,

____________________________ MIKE GABBARD, Chair

____________________________ DONOVAN M. DELA CRUZ, Chair