THE SENATE

S.B. NO.

2831

THIRTY-SECOND LEGISLATURE, 2024

S.D. 1

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

RELATING TO THE COUNTY TRANSIENT ACCOMMODATIONS TAX.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 

     SECTION 1.  The legislature finds that, in the wake of the August 2023 Maui wildfires, the county of Maui is facing unanticipated revenue shortfalls, including in tax collections.  In December 2023, the office of the county auditor of the county of Maui reported on significant delinquencies in collection of the county transient accommodations tax.  The county department of finance is understaffed, and only two of eight positions with the county transient accommodations tax team have been filled.  The legislature finds that temporary assistance from the department of taxation in the collection of the county transient accommodations tax would allow the county of Maui to clear the existing backlog while it hires and trains needed personnel.

     Accordingly, the purpose of this Act is to authorize the department of taxation to assist a requesting county in levying, assessing, collecting, and otherwise administering the county transient accommodations tax, including delinquencies and penalties, for a six-year period beginning January 1, 2025.

     SECTION 2.  Section 237D-2.5, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

     "(a)  The county transient accommodations tax, upon the adoption of a county ordinance and in accordance with the requirements of section 46-20.7, shall be levied, assessed, and collected as provided in this section on all gross rental, gross rental proceeds, and fair market rental value taxable under this chapter.  No county shall set its transient accommodations tax at a rate greater than three per cent of all gross rental, gross rental proceeds, and fair market rental value taxable under this chapter.  With respect to the county transient accommodations tax, the applicable county director of finance shall have all the rights and powers of the director of taxation provided under this chapter[.]; provided that, if a major disaster is declared by the governor in a county having a population greater than one hundred thousand and less than two hundred thousand, the director of taxation shall be authorized for a six-year period beginning on January 1, 2025, to assist the county in levying, assessing, collecting, and otherwise administering the county transient accommodations tax, including delinquencies and penalties.

     All county transient accommodations taxes paid into the state treasury pursuant to this section shall be kept by the director of finance in a special account for distribution to the applicable county.  On or before January 1 or July 1 of each year, the director of finance shall compute and pay the amount due to the applicable county, which shall become a general fund realization of the county to be used for housing infrastructure, as defined in section 46-16.8, infrastructure rebuilding costs related to a major disaster, as declared by the governor, or any related debt service and finance agreement costs for both purposes.

     The director of finance shall deduct          per cent of the amount due to the applicable county to reimburse the State for the costs of assessment, collection, disposition, and oversight of the county transient accommodations tax incurred by the State.  Amounts retained shall be general fund realizations of the State."

     SECTION 3.  In accordance with section 9 of article VII, of the Constitution of the State of Hawaii and sections 37-91 and 37-93, Hawaii Revised Statutes, the legislature has determined that the appropriation contained in this Act will cause the state general fund expenditure ceiling for fiscal year 2024-2025 to be exceeded by $          , or          per cent.  The reasons for exceeding the general fund expenditure ceiling are that the appropriation made in this Act is necessary to serve the public interest and to meet the needs provided for by this Act.

     SECTION 4.  There is appropriated out of the general revenues of the State of Hawaii the sum of $          or so much thereof as may be necessary for fiscal year 2024-2025 to assist a county in levying, assessing, collecting, and otherwise administering the county transient accommodations tax.

     The sum appropriated shall be expended by the department of taxation for the purposes of this Act.

     SECTION 5.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 6.  This Act shall take effect on July 1, 2050.

 

 

Report Title:

DOTAX; Counties; County Transient Accommodations Tax; General Fund Expenditure Ceiling Exceeded; Appropriation

 

Description:

Authorizes the Department of Taxation, under certain circumstances, to assist a county in levying, assessing, collecting, and otherwise administering the county transient accommodations tax, including delinquencies and penalties, for a 6-year period beginning 1/1/2025.  Appropriates moneys.  Declares that the appropriation exceeds the general fund expenditure ceiling for 2024-2025.  Effective 7/1/2050.  (SD1)

 

 

 

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