STAND. COM. REP. NO. 906

Honolulu, Hawaii

RE: S.B. No. 23

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-First State Legislature

Regular Session of 2021

State of Hawaii

Sir:

Your Committees on Commerce and Consumer Protection and Ways and Means, to which was referred S.B. No. 23, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO MOTOR VEHICLE RENTAL INDUSTRY,"

beg leave to report as follows:

The purpose and intent of this measure is to repeal vehicle license recovery fees.

Your Committees received testimony in support of this measure from the Department of Commerce and Consumer Affairs. Your Committees received testimony in opposition to this measure from Avis Budget Group and Enterprise Holdings.

Your Committees find that, prior to Act 137, Session Laws of Hawaii 2017 (Act 137), the car rental industry was not allowed to pass on one-time fees, such as use taxes on vehicle importation and license plate fees. Instead, they were only allowed to visibly pass on recurring costs, such as general excise taxes, license and registration fees, surcharge taxes, and rents and fees payable to the Department of Transportation. Act 137, however, added first-time fees to the litany of other fees that car rental companies were authorized to visibly pass on to customers and changed the method of calculating the pass-on costs, resulting in some customers being charged more than their fair share of the taxes and fees. This measure repeals the authority of car rental companies to pass on vehicle license recovery fees to customers and adjusts the calculation methods of fees passed on to customers to be more fairly and directly attributable to their use of the vehicle on a particular day.

As affirmed by the records of votes of the members of your Committees on Commerce and Consumer Protection and Ways and Means that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 23, S.D. 1, and recommend that it pass Third Reading.

Respectfully submitted on behalf of the members of the Committees on Commerce and Consumer Protection and Ways and Means,

________________________________ DONOVAN M. DELA CRUZ, Chair

________________________________ ROSALYN H. BAKER, Chair