Report Title:

Education Bond

Description:

Authorizes Department of Education to establish from the existing school entity, Molokai High and Intermediate School, two separate and distinct school entities, Molokai Middle School and Molokai High School, encompassing grades 7 to 8 and 9 to 12, respectively, under the federal Taxpayer Relief Act of 1997, as amended.

HOUSE OF REPRESENTATIVES

H.B. NO.

1440

TWENTY-SECOND LEGISLATURE, 2003

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

relating to education.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. The legislature finds that Congress passed the Taxpayer Relief Act of 1997 to allow state government agencies to issue Qualified Zone Academy Bonds in those areas designated as empowerment zones or enterprise communities. The program is a tremendous opportunity for the state to take advantage of a federal tax credit law that allows Hawaii an interest-free loan. Under this program, the federal government subsidizes fifteen-year bonds by providing tax credits to bond holders that are approximately equal to the interest that Hawaii would ordinarily pay the holders of taxable bonds. Eligible purchasers receive an annual federal income tax credit in lieu of periodic interest payments during the life of the bond.

This federal program was created to help educators and employers work together to ensure that students in economically depressed areas will have the education and skills to be prepared to work in today's competitive global economy.

The purpose of this Act is to enable the community of Molokai to take advantage of its federal designation as an enterprise community by authorizing the issuance of bonds pursuant to 26 U.S.C. section 1397E.

Currently, Molokai high and intermediate school is one school entity encompassing grade levels seven through twelve. This bond will allow the department of education to renovate existing structures to create two separate and distinct school entities called Molokai middle school and Molokai high school.

SECTION 2. Pursuant to article VII, sections 12 and 13 of the Hawaii State Constitution and 26 U.S.C. section 1397E, the director of finance is authorized to issue a bond in the sum of $4,615,000 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 2003-2004.

SECTION 3. There is hereby appropriated under the general obligation bond fund of the State, $4,615,000 for Molokai high and intermediate school improvements, pursuant to federal law 26 U.S.C. section 1397E.

SECTION 4. The appropriations shall not lapse at the end of the fiscal year for which the appropriations are made; provided that all moneys that are unencumbered as of June 30, 2006, shall lapse as of that date.

SECTION 5. The sum appropriated shall be expended by the department of accounting and general services for the purpose of this Act. The department of education shall fulfill the requirements pursuant to the Federal Taxpayer Relief Act of 1997, as amended.

SECTION 6. This Act shall take effect upon its approval.

INTRODUCED BY:

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