STAND. COM. REP. NO.  423-14

 

Honolulu, Hawaii

                , 2014

 

RE:   H.B. No. 2060

      H.D. 2

 

 

 

 

Honorable Joseph M. Souki

Speaker, House of Representatives

Twenty-Seventh State Legislature

Regular Session of 2014

State of Hawaii

 

Sir:

 

     Your Committee on Economic Development & Business, to which was referred H.B. No. 2060, H.D. 1, entitled:

 

"A BILL FOR AN ACT RELATING TO TAXATION,"

 

begs leave to report as follows:

 

The purpose of this measure is to achieve greater energy security for Hawaii by developing more self-sufficiency with regard to energy supply.  Specifically, this measure:

 

     (1)  Establishes a renewable fuels production tax credit; and

 

     (2)  Repeals the ethanol facility tax credit.

 

     The Department of Transportation, Pacific Biodiesel Technologies, Hawaii Renewable Energy Alliance, Blue Planet Foundation, Maui Venture Consulting LLC, and numerous concerned individuals testified in support of this measure.  Ulupono Initiative testified in support of this bill with amendments.  The Department of Business, Economic Development, and Tourism; Department of Taxation; and Tax Foundation of Hawaii provided comments.

 

     Hawaii is one of the most isolated land masses on Earth and lacks the means of production for traditional petrochemical fuels. Hawaii imports nearly 90 percent of its energy supply, including various forms of fossil fuel.  This makes the state extremely vulnerable to soaring prices or market disruptions which can hinder, cripple, or even devastate the State’s economy and the well-being of its inhabitants.  Thus, it is critical for Hawaii to become more energy self-sufficient.  The establishment of a renewable fuels production tax credit has the potential to significantly increase renewable energy growth in Hawaii and address our future energy needs.

 

     Your Committee has amended this measure by:

 

     (1)  Specifying that the right to claim the renewable fuels production tax credit will be lost if a taxpayer claiming the credit fails to provide certain information in writing to the Department of Taxation and Department of Business, Economic Development, and Tourism;

 

     (2)  Changing its effective date to January 20, 2050; and

 

     (3)  Making technical, nonsubstantive amendments for clarity, consistency, and style.

 

     As affirmed by the record of votes of the members of your Committee on Economic Development & Business that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2060, H.D. 1, as amended herein, and recommends that it be referred to the Committee on Finance in the form attached hereto as H.B. No. 2060, H.D. 2.

 

 

Respectfully submitted on behalf of the members of the Committee on Economic Development & Business,

 

 

 

 

____________________________

CLIFT TSUJI, Chair