STAND. COM. REP. NO. 283

Honolulu, Hawaii

RE: S.B. No. 645

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-First State Legislature

Regular Session of 2021

State of Hawaii

Sir:

Your Committee on Public Safety, Intergovernmental, and Military Affairs, to which was referred S.B. No. 645 entitled:

"A BILL FOR AN ACT RELATING TO TAXATION,"

begs leave to report as follows:

The purpose and intent of this measure is to:

(1) Extend the period in which a county may adopt a surcharge on state tax, under certain conditions; and

(2) Authorize the use of county surcharge revenues for affordable and workforce housing infrastructure.

Your Committee received testimony in opposition to this measure from one individual. Your Committee received comments on this measure from the Department of Taxation and Tax Foundation of Hawaii.

Your Committee finds that section 46-16.8(c), Hawaii Revised Statutes, authorizes counties to establish a surcharge on the state general excise and use taxes by adopting an ordinance prior to March 31, 2019. Your Committee further finds that this measure extends the period in which a county may adopt such an ordinance until December 31, 2021, and this extra time will provide counties with an opportunity to plan for updates to transportation projects and transportation infrastructure repairs.

Your Committee has amended this measure by specifying that the ordinance to establish the surcharge on state tax shall be adopted prior to July 1, 2023.

As affirmed by the record of votes of the members of your Committee on Public Safety, Intergovernmental, and Military Affairs that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 645, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 645, S.D. 1, and be referred to your Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committee on Public Safety, Intergovernmental, and Military Affairs,

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CLARENCE K. NISHIHARA, Chair