Bill Text: HI HB2681 | 2010 | Regular Session | Amended

---

Bill Title: Taxation; Hotel Construction and Renovations

Spectrum: Partisan Bill (Democrat 8-0)

Status: (Introduced - Dead) 2010-02-12 - (H) Passed Second Reading as amended in HD 1 and referred to the committee(s) on FIN with Representative(s) Berg, Choy voting no (2) and Representative(s) Bertram, Cabanilla, Takumi excused (3). [HB2681 Detail]

Download: Hawaii-2010-HB2681-Amended.html

---

 

 

STAND. COM. REP. NO.  390-10

 

Honolulu, Hawaii

                , 2010

 

RE:   H.B. No. 2681

      H.D. 1

 

 

 

 

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Fifth State Legislature

Regular Session of 2010

State of Hawaii

 

Sir:

 

     Your Committees on Tourism, Culture, & International Affairs and Economic Revitalization, Business, & Military Affairs, to which was referred H.B. No. 2681 entitled:

 

"A BILL FOR AN ACT RELATING TO TAXATION,"

 

beg leave to report as follows:

 

     The purpose of this bill is to establish a refundable tax credit in the amount of four percent of qualified construction or renovation costs for hotel facilities in the state, for taxable years beginning after December 31, 2009, and ending December 31, 2011.

 

     The Waikiki Improvement Association, Wyndham Worldwide, Subcontractors Association of Hawaii, and Hawaii Hotel & Lodging Association testified in support of this bill.  The Hawaii Tourism Authority; Tourism Liaison; Department of Business, Economic Development, and Tourism; and Outrigger Enterprises Group supported the intent of this measure.  The Hawaii Government Employees' Association, AFSCME Local 152, AFL-CIO opposed this bill.  The Office of the Governor and Tax Foundation of Hawaii offered comments.

 

     Your Committees note the concerns that expanding the tax credit to include other resort property structures, such as restaurants and shops, may result in a larger than expected financial impact.  For example, Hawaii County has zoning laws for "resort nodes" which can be very large and may encompass golf courses, as well as structures.  Your Committees encourage the counties to provide input regarding the impact of this measure, particularly with regard to the zoning of resort areas.

 

     Your Committees have amended this bill by:

 

     (1)  Changing the amount of the credit to:

 

          (A)  Seven percent of the construction or renovation costs between $1,000,000 and $10,000,000; and

 

          (B)  Ten percent of the construction or renovation costs over $10,000,000 to a maximum of $100,000,000;

 

     (2)  Extending the credit to the taxable year ending December 31, 2015;

 

     (3)  Making the credit non-refundable, but allowing excess of credit to be applied against taxpayer liability in subsequent years until the credit is exhausted;

 

     (4)  Limiting the total tax credits that can be granted to $50,000,000 per year;

 

     (5)  Changing the effective date to July 1, 2112, to encourage further discussion; and

 

     (6)  Making technical, nonsubstantive amendments for clarity, consistency, and style.

 

     As affirmed by the records of votes of the members of your Committees on Tourism, Culture, & International Affairs and Economic Revitalization, Business, & Military Affairs that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 2681, as amended herein, and recommend that it pass Second Reading in the form attached hereto as H.B. No. 2681, H.D. 1, and be referred to the Committee on Finance.

 

Respectfully submitted on behalf of the members of the Committees on Tourism, Culture, & International Affairs and Economic Revitalization, Business, & Military Affairs,

 

 

____________________________ ANGUS L.K. MCKELVEY, Chair		____________________________ JOEY MANAHAN, Chair