Hawaii-2020-SB2695-Amended

SECTION 1. Chapter 356D, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§356D- Housing incentive fund. (a) There is established a housing incentive fund, into which shall be deposited:

(1) Appropriations made by the legislature funded by general obligation bonds; and

(2) Contributions made by any individual, partnership, firm, association, or corporation.

(b) The housing incentive fund shall be administered by the authority and shall be used for the construction, rehabilitation, or preservation of multifamily housing targeted to essential workers and low to moderate income households, including seniors and people having special needs, and for the necessary expenses in administering this part.

(c) Eligible recipients of funding by the housing incentive fund include state and county governments, nonprofit organizations, public-private partnerships, and for-profit developers of multifamily housing. Individuals may not receive direct assistance from the fund.

(d) Disbursements made from the housing incentive fund shall be subject to repayment or recapture under the guidelines adopted by the authority. Any disbursement that is repaid or recaptured shall be deposited in the housing incentive fund and shall be available for reimbursement on a continuing basis for the purposes of this section.

(e) The authority shall submit a report to the legislature no later than twenty days prior to the convening of each regular session to provide an accounting of the receipts and expenditures of the fund."

SECTION 2. Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§235- Housing incentive fund; income tax credit. (a) Any individual or taxpaying entity that files a net income tax return for a taxable year may claim a tax credit under this section against the Hawaii state individual or corporate net income tax for contributing to the housing incentive fund established in section 356D- . The amount of the credit shall be equal to twenty per cent of the amount contributed to the fund during the taxable year.

(b) The contribution amount used to calculate the credit under this section may not be used to calculate any other state income tax deduction or credit allowed by law.

(c) If the amount of the tax credit exceeds the taxpayer's income tax liability for the taxable year, the excess may be used as a credit against the tax liability in subsequent taxable years, until either the credit is exhausted or for a period of ten years, whichever is earlier. All claims, including any amended claims, for tax credits under this section shall be filed on or before the end of the twelfth month following the close of the taxable year for which the credit may be claimed. Failure to comply with the foregoing provision shall constitute a waiver of the right to claim the credit.

(d) The aggregate amount of tax credits allowed to all eligible contributors shall not exceed $4,000,000 per biennium. This limitation applies to all contributions for which tax credits are claimed under this section. The authority shall be responsible for administering the aggregate cap.

(e) Within thirty days after the date on which a taxpayer makes a contribution to the housing incentive fund, the Hawaii public housing authority shall file with each contributing taxpayer, and a copy with the director of taxation, completed forms that show as to each contribution to the fund by that taxpayer the following:

(1) The name, address, and social security number or federal employer identification number of the taxpayer that made the contribution;

(2) The dollar amount paid for the contribution by the taxpayer; and

(3) The date the payment was received by the fund.

(f) To receive the tax credit provided under this section, a taxpayer shall claim the credit on the taxpayer's state income in the manner prescribed by the director of taxation and file with the return a copy of the form issued by the Hawaii public housing authority under subsection (e).

(g) This section does not prohibit the director of taxation from conducting an examination of the credit claimed and assessing additional tax due under section 235-108.

(h) A partnership, subchapter S corporation, limited partnership, limited liability company, or any other passthrough entity making a contribution to the housing incentive fund under this section is considered to be the taxpayer for purposes of this section, and the amount of the credit allowed must be determined at the passthrough entity level. The amount of the total credit determined at the entity level must be passed through to the partners, shareholders, or members in proportion to their respective interests in the passthrough entity."

SECTION 3. The director of finance is authorized to issue general obligation bonds in the sum of $ or so much thereof as may be necessary and the same sum or so much thereof as may be necessary is appropriated for fiscal year 2020-2021 for the purpose of funding the housing incentive fund.

SECTION 4. The appropriation made for the housing incentive fund authorized by 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, 2022, shall lapse as of that date.

SECTION 5. New statutory material is underscored.

SECTION 6. This Act, upon its approval on July 1, 2050, shall apply to taxable years beginning after December 31, 2020.

THE SENATE	S.B. NO.	2695
THIRTIETH LEGISLATURE, 2020		S.D. 2
STATE OF HAWAII