STAND. COM. REP. NO. 3328

Honolulu, Hawaii

RE: S.B. No. 2694

S.D. 2

Honorable Ronald D. Kouchi

President of the Senate

Thirtieth State Legislature

Regular Session of 2020

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred S.B. No. 2694, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO THE LOW-INCOME HOUSING TAX CREDIT,"

begs leave to report as follows:

The purpose and intent of this measure is to authorize the state low-income housing tax credit to be allocated among partners or members of the taxpayer and to exempt tax credit investors from the federal "at-risk" and "passive activity loss" rules.

Your Committee received written comments in support of this measure from the Hawaii Housing Finance and Development Corporation; Hunt Companies, Inc.; Pacific Resource Partnership; Hawaii Regional Council of Carpenters; and Sugar Creek Capital.

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

Your Committee finds that this measure will expand the pool of Hawaii taxpayers that can invest in state low-income housing tax credits, thereby generating more capital for affordable rental housing projects.

Your Committee has amended this measure by:

(1) Changing the effective date to July 1, 2050, to facilitate further discussion on the measure; and

(2) Making technical nonsubstantive changes for purposes of clarity, consistency, 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. 2694, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 2694, S.D. 2.

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

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DONOVAN M. DELA CRUZ, Chair