STAND. COM. REP. NO. 2071

Honolulu, Hawaii

RE: S.B. No. 2922

Honorable Ronald D. Kouchi

President of the Senate

Twenty-Ninth State Legislature

Regular Session of 2018

State of Hawaii

Sir:

Your Committee on Education, to which was referred S.B. No. 2922 entitled:

"A BILL FOR AN ACT PROPOSING AMENDMENTS TO ARTICLES VIII AND X OF THE CONSTITUTION OF THE STATE OF HAWAII TO AUTHORIZE THE LEGISLATURE TO ESTABLISH A SURCHARGE TO INCREASE FUNDING FOR PUBLIC EDUCATION,"

begs leave to report as follows:

The purpose and intent of this measure is to propose amendments to the Constitution of the State of Hawaii to advance the State's goal of providing a quality education for the children of Hawaii by authorizing the Legislature to establish, as provided by law, a surcharge on residential investment property and visitor accommodations.

Your Committee received testimony in support of this measure from the Department of Education; Hawaii State Teacher Association; HE‘E Coalition; Young Progressives Demanding Action – Hawaii; Hawai‘i Alliance for Progressive Action; Hawaii Children's Action Network; IMUAlliance; Special Education Advisory Council; Americans for Democratic Action, Hawai‘i; Hawaii Appleseed Center for Law and Economic Justice; Civic Education Council; HawaiiKidsCAN; and numerous individuals. Your Committee received testimony in opposition to this measure from the Maui County Council Chair Mike White, American Resort Development Association Hawai‘i, Rental By Owner Awareness Association, Coalition for Equal Taxation, and two individuals. Your Committee received comments on this measure from the City and County of Honolulu and Tax Foundation of Hawaii.

Your Committee finds that Hawaii's public schools are severely underfunded. At $12,855 per child, Hawaii trails mainland school districts of similar size when adjusting for cost of living. This lack of adequate funding has resulted in an inability to repair and renovate deteriorating facilities, higher class sizes, a lack of adequate classroom supplies, elimination of arts and career and technical education courses, budget cuts for special education and English language learner programs, and an increasing number of vacant teacher positions statewide.

Your Committee further finds that Hawaii is the only state that does not fund education through property taxes. A surcharge on investment properties and visitor accommodations will provide much needed funding for the State's public schools and will bring Hawaii's education funding policy closer to the funding enjoyed by school districts in other states and with a similar size of enrollment. This measure gives Hawaii's citizens the opportunity to vote on whether to amend the Constitution of the State of Hawaii to facilitate that surcharge.

As affirmed by the record of votes of the members of your Committee on Education that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2922 and recommends that it pass Second Reading and be referred to your Committee on Judiciary.

Respectfully submitted on behalf of the members of the Committee on Education,

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MICHELLE N. KIDANI, Chair