THE SENATE

S.R. NO.

78

TWENTY-SEVENTH LEGISLATURE, 2014

 

STATE OF HAWAII

 

 

 

 

 

SENATE RESOLUTION

 

 

URGING THE GOVERNOR AND THE UNITED STATES FOREIGN-TRADE ZONES BOARD TO DEVELOP AND ESTABLISH A FOREIGN TRADE ZONE LICENSED TO THE OFFICE OF HAWAIIAN AFFAIRS AT CERTAIN KAKAAKO MAKAI PARCELS CONVEYED TO THE OFFICE OF HAWAIIAN AFFAIRS UNDER ACT 15, SESSION LAWS OF HAWAII 2012.

 

 


     WHEREAS, section 10-1, Hawaii Revised Statutes, states in pertinent part:  "The people of the State of Hawaii reaffirmed their solemn trust obligation and responsibility to native Hawaiians and furthermore declared in the state constitution that there be an office of Hawaiian affairs to address the needs of the aboriginal class of people of Hawaii"; and

 

     WHEREAS, the Office of Hawaiian Affairs is established pursuant to section 10-4, Hawaii Revised Statutes, having a purpose that includes "[t]he betterment of conditions of native Hawaiians"; and

 

     WHEREAS, the vision of the Office of Hawaiian Affairs is Hooulu Lahui Aloha, which means "To Raise a Beloved Nation"; and

 

     WHEREAS, the Office of Hawaiian Affairs is a semi-autonomous corporate body, separate and independent of the Executive branch of the State of Hawaii serving as trustee to receive and administer proceeds from the ceded lands trust pursuant to Act 304, Session Laws of Hawaii 1990; and

 

     WHEREAS, the conveyance of the Kakaako Makai parcels to the Office of Hawaiian Affairs under Act 15, Session Laws of Hawaii 2012, seeks to settle claims regarding breaches of trust obligations from November 7, 1978, to June 30, 2012, which will have the potential of restricting claims by the Office of Hawaiian Affairs to and any future funding from the State; and

 

     WHEREAS, the best use of these lands is development of commercial, income generating properties to provide revenue, with a strong potential for increasing revenues, to increase the value of the native Hawaiian trusts that benefit native Hawaiians and Hawaiians; and

 

     WHEREAS, the establishment of economic activities with a potential for international relationships is essential to nation-building; and

 

     WHEREAS, Foreign Trade Zones provide an opportunity for the development of international trade agreements as well as generating revenue and providing opportunities to benefit the Office of Hawaiian Affairs, native Hawaiians, Hawaiians, and the State of Hawaii; and

 

     WHEREAS, Foreign Trade Zones, as an economic activity, allow the deferral of customs duty for foreign merchandise until that merchandise enters United States customs territory; the merchandise may avoid customs duty by not entering the territory but being exported from the Foreign Trade Zones; and

 

     WHEREAS, in a Foreign Trade Zone, a manufacturer may take advantage of the tariff schedule of the United States by considering differences in duty rates between components and finished manufacture then assembling components into a final product that may have a lower duty than its component parts; and

 

     WHEREAS, in a Foreign Trade Zone, if there are import quotas on merchandise entering a United States customs territory and the restrictions apply, merchandise may be stored in a Foreign Trade Zone until a new quota period or export merchandise can be processed for export markets, taking advantage of the differences between United States prices and world prices for ingredients or components; and

 

     WHEREAS, a Foreign Trade Zone's warehouse and marshalling yards are ultra secure facilities pursuant to United States customs requirements and federal criminal laws and regulations, which result in lowered security and insurance costs for importers, exporters, processors, and manufacturers of goods; and

 

     WHEREAS, in a Foreign Trade Zone, certain drawback costs and delays may be avoided, a manufacturer may receive a ninety-nine percent refund of duty paid on an imported component that is subsequently incorporated in an exported product, full duty is paid at the import of the component, and the manufacturer declares what will be exported in manufactured form to qualify for drawback, and Foreign Trade Zone users can avoid these costs or merchandise can be imported under "Zone Restricted" status, which speeds up the drawback process; and

 

     WHEREAS, Zone Restricted status is given to merchandise brought into a foreign Trade Zone of a customs territory that is to be exported, stored, or destroyed (except destruction of distilled spirits, wines, and fermented malt liquors), and the merchandise is considered exported and cannot be returned to the customs territory for consumption unless the rules of United States Foreign-Trade Zones Board specify that its return is in the public interest; and

 

     WHEREAS, Zone Restricted status merchandise may not be manipulated, manufactured, processed, or assembled in a zone; and

 

     WHEREAS, Foreign Trade Zone users may avoid bonded warehouse limitations, which means that importers may need to post a bond and have a time-limited use of warehousing, but if Foreign Trade Zone users post no bond the merchandise may remain in the zone indefinitely; and

 

     WHEREAS, goods stored in a Foreign Trade Zone for bona fide customs reason may avoid state and local ad valorem taxes until they enter the customs territory; and

 

     WHEREAS,  operating a Foreign Trade Zone will provide an opportunity for economic development, international trade and commerce participation, import/export banking opportunities, i.e., risk protection, letters of credit for international trade, credit lines and bridge funding to support import and export activities, and performance and bid bonding and collateralization of inventory; and

 

     WHEREAS, participation in foreign and international trade is an activity that will strengthen nation building through international trade and commerce; now, therefore,

 

     BE IT RESOLVED by the Senate of the Twenty-seventh Legislature of the State of Hawaii, Regular Session of 2014, that the Governor and United States Foreign-Trade Zones Board are urged to develop and establish a Foreign Trade Zone licensed to the Office of Hawaiian Affairs at certain Kakaako Makai parcels conveyed to the Office of Hawaiian Affairs under Act 15, Session Laws of Hawaii 2012; and

 

     BE IT FURTHER RESOLVED that certified copies of this Resolution be transmitted to the Governor, Chairperson of the Board of Trustees of the Office of Hawaiian Affairs, Chairperson of the United States Foreign-Trade Zones Board, and each county mayor.

 

 

 

 

OFFERED BY:

_____________________________

 

 

Report Title: 

Foreign Trade Zones; OHA