STAND. COM. REP. NO.  631-22

 

Honolulu, Hawaii

                , 2022

 

RE:   H.B. No. 2085

 

 

 

 

Honorable Scott K. Saiki

Speaker, House of Representatives

Thirty-First State Legislature

Regular Session of 2022

State of Hawaii

 

Sir:

 

     Your Committee on Judiciary & Hawaiian Affairs, to which was referred H.B. No. 2085 entitled:

 

"A BILL FOR AN ACT PROPOSING AMENDMENTS TO ARTICLE VII, SECTIONS 12 AND 13, OF THE HAWAII CONSTITUTION TO EXPRESSLY PROVIDE THAT THE LEGISLATURE MAY AUTHORIZE THE COUNTIES TO ISSUE TAX INCREMENT BONDS AND TO EXCLUDE TAX INCREMENT BONDS FROM DETERMINATIONS OF THE FUNDED DEBT OF THE COUNTIES,"

 

begs leave to report as follows:

 

     The purpose of this measure is to propose amendments to the Hawaii State Constitution to expressly provide that the Legislature may authorize political subdivisions, such as the counties, to issue tax increment bonds and to exclude tax increment bonds in calculating the debt limit of the political subdivisions.

 

     Your Committee received testimony in support of this measure from the Department of Business, Economic Development, and Tourism and Office of Planning and Sustainable Development.  Your Committee received comments on this measure from the Tax Foundation of Hawaii.

 

     Your Committee finds that although existing law permits a county council to provide for tax increment financing, tax increment bonds do not neatly fit within the types of bonds that counties may issue under the Hawaii State Constitution.  Your Committee further finds that tax increment financing is a value capture financing tool which is successfully and widely used in other states.  This measure will allow counties to issue tax increments bonds that may be used for costly infrastructure upgrades without affecting the debt limit of the counties.

 

     As affirmed by the record of votes of the members of your Committee on Judiciary & Hawaiian Affairs that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2085 and recommends that it pass Second Reading and be referred to your Committee on Finance.

 

 

Respectfully submitted on behalf of the members of the Committee on Judiciary & Hawaiian Affairs,

 

 

 

 

____________________________

MARK M. NAKASHIMA, Chair