STAND. COM. REP. NO. 544

Honolulu, Hawaii

RE:    S.B. No. 713

       S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Twenty-Ninth State Legislature

Regular Session of 2017

State of Hawaii

Sir:

     Your Committee on Ways and Means, to which was referred S.B. No. 713 entitled:

"A BILL FOR AN ACT RELATING TO BUDGET DOCUMENTS,"

begs leave to report as follows:

     The purpose and intent of this measure is to require that the state six-year program and financial plan and budget include information on tax expenditures.

     Your Committee received comments on this measure from the Department of Budget and Finance, Department of Taxation, and Tax Foundation of Hawaii.

     Your Committee finds that more detailed information on tax expenditures is necessary for good public policy decision-making.  Tax expenditures, similar to the appropriations of funds, result in a reduction of resources available for public programs.  Your Committee further finds that public information on tax expenditures, particularly their negative impact on the state treasury, is not as readily available as is public information on budget appropriations and expenditures.

     Your Committee notes that it will continue to work with the Department of Budget and Finance on this measure and related legislation to improve and enhance budgetary information that is required to be submitted to the Legislature.

     Your Committee has amended this measure by:

     (1)  Clarifying the definition of the term "tax expenditures"; and

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

     As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 713, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 713, S.D. 1, and be placed on the calendar for Third Reading.

Respectfully submitted on behalf of the members of the Committee on Ways and Means,

________________________________

JILL N. TOKUDA, Chair