STAND. COM. REP. NO. 47

Honolulu, Hawaii

RE: S.B. No. 760

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirtieth State Legislature

Regular Session of 2019

State of Hawaii

Sir:

Your Committee on Agriculture and Environment, to which was referred S.B. No. 760 entitled:

"A BILL FOR AN ACT RELATING TO AGRICULTURE,"

begs leave to report as follows:

The purpose and intent of this measure is to amend the important agricultural land qualified agricultural cost tax credit to include as "qualified agricultural costs" measures to improve, enhance, and restore former plantation lands for agricultural use.

Your Committee received testimony in support of this measure from the O‘ahu County Committee on Legislative Priorities of the Democratic Party of Hawai‘i, Hawai‘i Farm Bureau, Hawaii Agriculture Research Center, and three individuals. Your Committee received comments on this measure from the Department of Taxation, Department of Agriculture, and Office of Planning.

Your Committee finds that Act 183, Session Laws of Hawaii 2005, provided for the designation of important agricultural lands and directed the Department of Agriculture to develop a program of incentives to promote agricultural viability. The incentives program developed for important agricultural lands included a tax credit for "qualified agricultural costs" such as costs incurred for feasibility studies, plans, and design of facilities and infrastructure, equipment for agricultural purposes, and regulatory processing and consulting services. However, this incentive program did not include any incentive for the conservation and protection of agricultural lands. This measure would expand the eligible costs for the important agricultural land qualified agricultural cost tax credit to include expenditures to improve, enhance, and restore former plantation lands used primarily for agricultural purposes.

Your Committee has amended this measure by specifying that the important agricultural land qualified agricultural cost tax credit shall apply only to former plantation lands that were used solely for agricultural uses and activities.

As affirmed by the record of votes of the members of your Committee on Agriculture and Environment that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 760, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 760, S.D. 1, and be referred to your Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committee on Agriculture and Environment,

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MIKE GABBARD, Chair