HB454 HD2

SECTION 1. The legislature finds that there is a need to bolster business innovation and economic development in the State through programs under the Hawaii technology and development corporation. The legislature further finds that these programs should work towards specific goals related to economic growth and diversification. The legislature additionally finds that the Hawaii technology development corporation and its various programs should serve as a facilitative catalyst for innovation in the State and help to align the State with the emerging knowledge-based, zero-emission, and digital global economy while putting Hawaii on the path toward economic prosperity.

Accordingly, the purpose of this Act is to promote economic recovery and diversification by:

(1) Establishing state goals for economic growth fueled by innovation and technology;

(2) Appropriating funds to the Hawaii technology development corporation to support programs that address those goals; and

(3) Requiring the Hawaii technology development corporation to submit annual reports over three years to the legislature.

SECTION 2. (a) The legislature declares that the programs for which funds are appropriated pursuant to section 3 of this Act shall align with one or more of the following goals that address economic diversification:

(1) Economic diversification through participation in the digital economy: programs shall address economic diversification by strengthening Hawaii's participation in the digital economy, including:

(A) Accessing new markets and market opportunities;

(B) Strengthening business capacity and readiness to participate in the digital economy;

(D) Strengthening digital economy infrastructure, including broadband affordability and coworking facilities; and

(E) Increasing the number of businesses, revenue, and employees dedicated to the digital economy;

(2) Economic diversification through strengthened trade activities: programs shall address economic diversification by strengthening traded activities that redistribute Hawaii's gross domestic product, including:

(A) Increasing the export of goods manufactured in the State;

(B) Increasing the export of knowledge-based professional services;

(C) Increasing the value of knowledge-based professional services through research and development and intellectual property;

(D) Strengthening the post-production capacity for value-added agriculture and manufacturing; and

(E) Increasing businesses, revenue, and employees in traded sectors;

(3) Economic diversification through an increase in activity to reduce and mitigate climate change: programs shall address economic diversification by focusing on activities at the intersection of technology development and climate change mitigation, including:

(A) Making renewable energy more affordable;

(B) Retaining and strengthening businesses that are increasing revenues through solutions to reduce climate change;

(D) Increasing the number of businesses, revenue, and employees in renewable energy sectors; and

(4) Economic diversification through import replacement: programs shall address economic diversification by reducing reliance on imports and expanding local manufacturing, agriculture, aquaculture, and renewable resources, including:

(A) Strengthening local supply chains;

(B) Increasing food and energy self-sufficiency; and

(b) The Hawaii technology development corporation shall expend the funds appropriated in section 3 of this Act for the purpose of meeting the goals described in subsection (a); provided that the Hawaii technology development corporation may work with any other state or county agency for the implementation of the assigned programs.

(c) No later than twenty days prior to the convening of the regular sessions of 2026, 2027, and 2028, the Hawaii technology development corporation shall submit a report to the legislature that includes:

(1) A summary of the progress of the programs for which appropriations are made pursuant to this Act;

(2) The outcomes of the programs for which appropriations are made pursuant to this Act, including an assessment of each program's effectiveness in achieving the goals described in subsection (a); and

(3) Any findings and recommendations, including any proposed legislation.

SECTION 3. 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 2025-2026 and the same sum or so much thereof as may be necessary for fiscal year 2026-2027 for the purpose of economic diversification, as described in section 2(a) of this Act as follows:

(1) $ for the Hawaii small business innovation research program;

(2) $ for the manufacturing assistance program; and

(3) $ for accelerator programs facilitated by the Hawaii technology development corporation.

The sums appropriated shall be expended by the Hawaii technology development corporation for the purposes of this Act.

SECTION 4. The appropriation made for programs authorized by section 3 of this Act shall not lapse at the end of the fiscal biennium for which the appropriation is made; provided that all moneys from the appropriation unencumbered as of June 30, 2028, shall lapse as of that date.

SECTION 5. This Act shall take effect on July 1, 3000.

HOUSE OF REPRESENTATIVES	H.B. NO.	454
THIRTY-THIRD LEGISLATURE, 2025		H.D. 2
STATE OF HAWAII