HOUSE OF REPRESENTATIVES

H.R. NO.

230

TWENTY-FOURTH LEGISLATURE, 2007

 

STATE OF HAWAII

 

 

 

 

 

HOUSE RESOLUTION

 

 

REQUESTING THE LEGISLATIVE REFERENCE BUREAU TO STUDY THE IMPACT ON THE STATE ECONOMY CAUSED BY THE CONCENTRATION IN OWNERSHIP OF COMMERCIAL AND INDUSTRIAL LANDS.

 

 

 


     WHEREAS, in certain areas of the State, a small handful of large landowners, in some cases including the State and City and County of Honolulu, control the fee simple ownership of a high percentage of commercial and industrial leasehold properties; and

 

     WHEREAS, this condition and the resultant lack of competition has caused a shortage of available commercial and industrial properties, fee simple and leasehold, for wholesale and retail businesses, particularly small businesses and family-owned businesses; and

 

     WHEREAS, this high concentration of ownership has also caused problems in renegotiating lease rents on leasehold properties due to the shortage of comparable fee simple transactions to use to establish fair market values; and

 

     WHEREAS, this problem, particularly for small businesses on leasehold properties, has been lingering for a long time, and attempts by the Legislature to rectify it have been viewed by the Attorney General as an unconstitutional impairment of existing contracts; and

 

     WHEREAS, it is conceivable that other cities and regions in the west coast states of California, Oregon, and Washington may suffer this same problem; now, therefore,

 

     BE IT RESOLVED by the House of Representatives of the Twenty-fourth Legislature of the State of Hawaii, Regular Session of 2007, that the Legislative Reference Bureau is requested to study the impact on the State's economy caused by the concentration in ownership of commercial and industrial lands; and

 

BE IT FURTHER RESOLVED that the Managing Director of each county or if there is no Managing Director, an appropriate alternate designated by the Mayor, is requested to submit the following information for the respective county to the Legislative Reference Bureau not later than August 1, 2007:

 

     (1)  The total number of acres in the county that are zoned for commercial use and for industrial use, respectively;

 

     (2)  The total number of acres in the county that are zoned for commercial use, or industrial use, respectively, that are developed and used for those respective purposes;

 

     (3)  A list, with acreage owned, of the ten largest landowners, including the federal, state, and county governments, of commercial and industrial zoned land, developed and undeveloped, in the county;

 

     (4)  The total number of acres of commercial and industrial zoned land that is leased to lessees operating businesses on the zoned land, as opposed to landowners operating businesses on their own land;

 

     (5)  The types of businesses being operated on commercial and industrial zoned land that is leased, whether single user or developed and sublet to multiple sublessees in a commercial shopping center;

 

     (6)  The total assessed value of all commercial and industrial zoned land in the county;

 

     (7)  The total assessed value of all improvements on the commercial and industrial zoned lands in the county; and

 

     (8)  The total assessed value of all commercial and industrial zoned land and improvements in the county that is leased to lessees operating businesses on the leased land; and

 

     BE IT FURTHER RESOLVED that the Department of Taxation is requested to submit the following information to the Legislative Reference Bureau not later than August 1, 2007:

 

     (1)  The total general excise taxes imposed upon and collected from lease rent payments for commercial and industrial zoned land in the State;

 

     (2)  The extent to which the taxpayers of general excise taxes imposed and collected on lease rent payments for the commercial and industrial zoned lands are owned by state residents and the extent to which they are owned by foreign persons, such as multi-state chain fast food outlets or commercial chain stores;

 

     (3)  The percentage of income tax returns filed by commercial and industrial taxpayers that include deductions for lease rent payments and for mortgage payments to financial institutions for improvements made to leasehold properties; and

 

     (4)  Whether other states that have similar concentration of land ownership as identified by the Department of Taxation may have and can furnish information or data that is similar to that being requested of the Department by this Resolution; and

 

     BE IT FURTHER RESOLVED that the Department of Business, Economic Development, and Tourism is requested to submit to the Legislative Reference Bureau not later than August 1, 2007, information relating to the number of local small businesses, as opposed to foreign large business entities, that have commenced doing business in the State in the last five years; and

 

BE IT FURTHER RESOLVED that the Legislative Reference Bureau is requested to seek the assistance of the National Conference of State Legislatures in making a comparative review of various cities and regions in the states of California, Oregon, and Washington to determine the following:

 

     (1)  Whether any other cities or regions in California, Oregon, and Washington have similar situations in which a few large landowners control large concentrations of commercial and industrial lands;

 

     (2)  Whether, if other cities or regions suffer this same situation, it has resulted in the same types of problems businesses face in this State;

 

     (3)  Whether there were factors or causes other than the concentration of landownership that may have resulted in the same problems commercial and industrial businesses face in this State;

 

     (4)  What, if any, successful solution, including legislation, helped to alleviate or eliminate this problem in those other cities or regions; and

 

     (5)  Whether those same solutions may be applicable in this State; and

 

     BE IT FURTHER RESOLVED that the Legislative Reference Bureau is requested to submit a report of its findings and recommendations, including any proposed legislation, to the Legislature not later than twenty days prior to the convening of the Regular Session of 2008; and

 

     BE IT FURTHER RESOLVED that certified copies of this Resolution be transmitted to the Director of Taxation, the Director of Business, Economic Development, and Tourism, the Director of the Legislative Reference Bureau, the Executive Director of the National Conference of State Legislatures, and the Mayor, the Managing Director, and the Chairperson of the Council of each county.

 

 

 

 

OFFERED BY:

_____________________________

 

 

Report Title: 

Legislative Reference Bureau; Commercial and Industrial Properties