STAND. COM. REP. 849

Honolulu, Hawaii

, 2003

RE: H.B. No. 685

H.D. 2

 

 

 

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committee on Finance, to which was referred H.B. No. 685, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO ENTERPRISE ZONE,"

begs leave to report as follows:

The purpose of this bill is to stimulate economic recovery on Oahu by directing the Governor to work with the City and County of Honolulu (City) to expand existing enterprise zones to areas where commercial real estate have a vacancy rate of 15 percent or more.

Qualified businesses would be eligible for state tax and county incentives for a two-year period.

The Department of Taxation and the Department of Business, Economic Development, and Tourism offered comments.

Your Committee has amended this bill by:

(1) Directing the Governor to work with the City to create additional enterprise zones rather than to expand existing enterprise zones;

(2) Changing the effective date to July 1, 2010, to facilitate continued discussion; and

(3) Making technical, nonsubstantive amendments for the purpose of clarity.

Ideally, enterprise zones should be designated as broadly as possible to provide much needed relief to many communities. However, in order to ensure a sufficient tax base, it is necessary to prioritize the granting of these benefits. For this reason, it is your Committee's intent that any designation of enterprise zones under this bill be targeted to communities with the greatest needs.

Finally, your Committee recognizes that the 15 percent vacancy criteria may unfairly favor urban areas over rural communities that may be equally deserving of assistance according to other standards. Therefore, in the days ahead, your Committee will carefully consider more equitable criteria that will allow different types of communities to qualify for designation.

As affirmed by the record of votes of the members of your Committee on Finance that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 685, H.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 685, H.D. 2.

Respectfully submitted on behalf of the members of the Committee on Finance,

 

____________________________

DWIGHT Y. TAKAMINE, Chair