Report Title:

Transient Accommodations Tax: State Parks Special Fund



Caps TAT revenues deposited to tourism special fund at an unspecified annual amount; diverts excess to state parks special fund.


S.B. NO.









relating to Transient Accommodations Tax.



SECTION 1. The legislature recognizes the connection between Hawaii's state park system and the vitality of its economy, especially its tourism sector. Over 7,000,000 tourists visit our islands each year to enjoy our great outdoors, including the natural beauty and the cultural treasures that comprise much of the state park system.

In the past, the nexus between the state park system and the tourism sector has not been clearly connected, as our state parks are usually some distance away from what are generally viewed as the primary tourism facilities, the resort destination. However, the allure of our islands for these tourists very heavily depends on ancillary facilities such as shopping and entertainment venues and customary visits to cultural and natural offerings of our state parks and other outdoor venues.

The recent and prolonged economic malaise exacerbated by September 11 has, as in most other government programs, severely limited the ability of the state park system to properly maintain the heavily used and often aged state park facilities throughout our islands, often leading to complaints from visitors and repeat visitors about the deteriorated condition of our state parks.

In order to better align the heretofore limited linkage between tourism and the state park system and recognizing the natural benefit of direct assistance from an industry whose constituency is the majority of the state park users, the legislature believes that a portion of the tourism special fund's share of the transient accommodations tax should be earmarked to supplement the operating costs of the state park system, and that the amount of money transferred to the tourism special fund should be limited by a dollar cap.

SECTION 2. Section 237D-6.5, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

"(b) Beginning on January 1, 1999[[],[]] revenues collected under this chapter shall be distributed as follows:

(1) 17.3 per cent of the revenues collected under this chapter shall be deposited into the convention center capital and operations special fund established under section 206X-10.5;

(2) 37.9 per cent of the revenues collected under this chapter shall be deposited into the tourism special fund established under section 201B-11; provided that if the amount of revenues collected exceeds $           in any year, then all revenues collected in excess of $           shall be deposited into the state parks special fund established in section 184-3.4; and

(3) 44.8 per cent of the revenues collected under this chapter shall be transferred as follows: Kauai county shall receive 14.5 per cent, Hawaii county shall receive 18.6 per cent, city and county of Honolulu shall receive 44.1 per cent, and Maui county shall receive 22.8 per cent.

All transient accommodations taxes shall be paid into the state treasury each month within ten days after collection, and shall be kept by the state director of finance in special accounts for distribution as provided in this subsection."

SECTION 3. Section 184-3.4, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) There is established within the state treasury a fund to be known as the state parks special fund[. All] into which shall be deposited:

(1) All proceeds collected by the state parks programs involving park user fees, any leases or concession agreements, the sale of any article purchased from the department to benefit the state parks programs, or any gifts or contributions[, shall be deposited into this fund;]; and

(2) Transient accommodations tax revenues as provided in section 237D-6.5(b)(2);

provided that proceeds derived from the operation of Iolani Palace shall be used to supplement its educational and interpretive programs."

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, 2002.