Bill Text: HI SB745 | 2012 | Regular Session | Amended
Bill Title: Special Purpose Revenue Bonds; Seawater Air Conditioning Projects
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Passed) 2012-06-26 - (H) Act 155, on 6/25/2012 (Gov. Msg. No. 1258). [SB745 Detail]
Download: Hawaii-2012-SB745-Amended.html
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THE SENATE |
S.B. NO. |
745 |
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TWENTY-SIXTH LEGISLATURE, 2011 |
S.D. 2 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO SEAWATER AIR CONDITIONING.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The legislature finds that seawater air conditioning district cooling systems help to reduce our dependence on fossil fuels and help our economy. The twenty-eight thousand ton seawater air conditioning district cooling system under development for downtown Honolulu can potentially reduce Oahu's dependence on imported oil by as much as one hundred seventy-eight thousand barrels annually.
The downtown Honolulu seawater air conditioning project is expected to generate millions of dollars in construction project spending and create a significant amount of long-term gainful employment. Other local economic development benefits will accrue from money that is not exported outside the State to purchase oil but rather is circulated in the local economy.
During the lifetime of this cooling system, local spending would exceed $272,000,000. The calculated output based on this local spending is $504,000,000. This amount of local spending would also generate $161,000,000 in earnings and 2,978 full-time-equivalent person-years of jobs. This is equivalent to one hundred twelve full-time jobs for twenty-six and a half years.
Furthermore, this project will generate additional revenues for the State over its more than twenty-five-year life, including an estimated $16,961,000 in additional tax revenue during the calendar year period from 2011 to 2013. During this same period, this project will be eligible for $811,000 in enterprise zone benefits after the construction period. Therefore, the net fiscal benefit to the State during this period will be $16,150,000. If this project is not completed, there will be a net revenue loss to the State of $16,150,000. During its lifetime, the system would generate $27,300,000 in new state taxes.
The purpose of this Act is to assist seawater air conditioning district cooling systems by allowing the systems to benefit from the State's enterprise zone program.
SECTION 2. Section 209E-2, Hawaii Revised Statutes, is amended by amending the definition of "eligible business activity" to read as follows:
""Eligible business activity" means the:
(1) Manufacture of tangible personal property, the wholesale sale of tangible personal property as described in section 237-4, or a service business as defined in this section;
(2) Production of agricultural products where the business is a producer as defined in section 237-5, or the processing of agricultural products, all or some of which were grown within an enterprise zone;
(3) Research, development, sale, or production of all
types of genetically-engineered medical, agricultural, or maritime
biotechnology products; [or]
(4) Production of electric power from wind energy for
sale primarily to a public utility company for resale to the public[.];
or
(5) Production of air conditioning from a seawater air conditioning district cooling system."
SECTION 3. Section 209E-11, Hawaii Revised Statutes, is amended to read as follows:
"§209E-11 State general excise
exemptions. The department shall certify annually to the department of
taxation that any qualified business is exempt from the payment of general excise
taxes on the gross proceeds from an eligible business activity as defined in
this chapter; provided that agricultural businesses other than those engaged in
the production of genetically-engineered agricultural products shall not be
exempt from the payment of general excise taxes on the gross proceeds of
agricultural retail sales. The gross proceeds received by a contractor
licensed under chapter 444 shall be exempt from the general excise tax for
construction within an enterprise zone performed for a qualified business
within an enterprise zone or a business that has been approved by the
department to enroll into the enterprise zone program[.]; provided
that the gross proceeds received by a contractor licensed under chapter 444 in
connection with the construction of a seawater air conditioning district
cooling system shall not be exempt from the general excise tax. The
exemption shall extend for a period not to exceed seven years; provided that for qualified businesses engaged in the
manufacturing of tangible personal property or the producing or processing of
agricultural products, the exemption shall extend for a period not to exceed
ten years; provided further that if a force majeure event occurs, then the
period of time shall be tolled until the force majeure event ceases."
SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 5. This Act shall take effect on July 1, 2050.
Report Title:
Enterprise Zones; Seawater Air Conditioning Cooling System
Description:
Allows the sale of air conditioning produced from seawater air conditioning district cooling systems (SWAC) to qualify for state enterprise zone benefits. Establishes that contractors working on SWAC shall not be exempt from the general excise tax. Effective 07/01/2050. (SD2)
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
