HOUSE OF REPRESENTATIVES

H.B. NO.

1564

TWENTY-NINTH LEGISLATURE, 2017

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

relating to taxation.

 

 

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

 


     SECTION 1.  The legislature finds that Hawaii has an aging transportation system, and that infrastructure on all of the islands in the State are in need of significant upgrades to increase durability and dependability.  In order to revitalize the transportation system, more funding is needed.  However, the legislature also finds that the traditional methods of raising revenue, such as the fuel tax or vehicle weight tax, would not provide sufficient revenue to fund the needed improvements.  The legislature believes that revenues from the county surcharge on state tax would provide the required revenue.

     The purpose of this Act is to strengthen mass transit projects funded by the county surcharge on state tax by providing a funding source to extend the projects beyond their initial routes.

     SECTION 2.  Section 46-16.8, Hawaii Revised Statutes, is amended as follows:

     1.  By amending subsection (b) to read:

     "(b)  Each county that has established a surcharge on state tax prior to [[]July 1, 2015,[]] under authority of subsection (a) may extend the surcharge [from] beyond January 1, 2023, [until December 31, 2027,] at the same rates.  A county electing to extend this surcharge shall do so by ordinance; provided that[:

     (1)  No] no ordinance shall be adopted until the county has conducted a public hearing on the proposed ordinance[; and

     (2)  The ordinance shall be adopted prior to July 1, 2016, but no earlier than July 1, 2015].

     A county electing to exercise the authority granted under this subsection shall notify the director of taxation within ten days after the county has adopted an ordinance extending the surcharge on state tax.  Beginning on January 1, 2023, the director of taxation shall levy, assess, collect, and otherwise administer the extended surcharge on state tax."

     2.  By amending subsection (e) to read:

     "(e)  Each county with a population greater than five hundred thousand that adopts or extends a county surcharge on state tax ordinance pursuant to subsection (a) or (b) shall use the surcharges received from the State for:

     (1)  Capital costs of a locally preferred alternative for a mass transit project; provided that, upon completion of the initial twenty-mile route of the mass transit project, surcharge revenues received thereafter shall be used to fund extension of the project beyond the initial route; and

     (2)  Expenses in complying with the Americans with Disabilities Act of 1990 with respect to paragraph (1).

The county surcharge on state tax shall not be used to build or repair public roads or highways, bicycle paths, or support public transportation systems already in existence prior to July 12, 2005."

     SECTION 3.  Section 237-8.6, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

     "(b)  Each county surcharge on state tax that may be adopted or extended pursuant to section 46-16.8 shall be levied beginning in the taxable year after the adoption of the relevant county ordinance; provided that no surcharge on state tax may be levied[:

     (1)  Prior] prior to:

          [(A)] (1)  January 1, 2007, if the county surcharge on state tax was established by an ordinance adopted prior to December 31, 2005; or

          [(B)] (2)  January 1, 2018, if the county surcharge on state tax was established by the adoption of an ordinance after June 30, 2015, but prior to July 1, 2016[; and

     (2)  After December 31, 2027]."

     SECTION 4.  Section 238-2.6, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

     "(b)  Each county surcharge on state tax that may be adopted or extended shall be levied beginning in the taxable year after the adoption of the relevant county ordinance; provided that no surcharge on state tax may be levied[:

     (1)  Prior] prior to:

          [(A)] (1)  January 1, 2007, if the county surcharge on state tax was established by an ordinance adopted prior to December 31, 2005; or

          [(B)] (2)  January 1, 2018, if the county surcharge on state tax was established by the adoption of an ordinance after June 30, 2015, but prior to July 1, 2016[; and

     (2)  After December 31, 2027]."

     SECTION 5.  Section 248-2.6, Hawaii Revised Statutes, is amended By amending subsection (d) to read as follows:

     "(d)  After the deduction and withholding of the costs under subsections (a) and (b), the director of finance shall [pay]:

     (1)  Pay fifty per cent of the remaining balance on [[]a[]] quarterly basis to the director of finance of each county that has adopted a county surcharge on state tax under section 46-16.8.  The quarterly payments shall be made after the county surcharges on state tax have been paid into the state treasury special accounts or after the disposition of any tax appeal, as the case may be.  All county surcharges on state tax collected shall be distributed by the director of finance to the county in which the county surcharge on state tax is generated and shall be a general fund realization of the county, to be used for the purposes specified in section 46-16.8 by each of the counties[.]; and

     (2)  Deposit the remaining fifty per cent into the state highway fund created by section 248-8."

     SECTION 6.  Act 247, Session Laws of Hawaii 2005, as amended by Act 240, Session Laws of Hawaii 2015, is amended by amending section 9 to read as follows:

     "SECTION 9.  This Act shall take effect upon its approval; provided that:

     (1)  If none of the counties of the State adopt an ordinance to levy a county surcharge on state tax by December 31, 2005, this Act shall be repealed and section 437D-8.4, Hawaii Revised Statutes, shall be reenacted in the form in which it read on the day prior to the effective date of this Act;

     (2)  If any county does not adopt an ordinance to levy a county surcharge on state tax by December 31, 2005, it shall be prohibited from adopting such an ordinance pursuant to this Act, unless otherwise authorized by the legislature through a separate legislative act; and

     (3)  If an ordinance to levy a county surcharge on state tax is adopted by December 31, 2005[:

         (A)  The], the ordinance shall be repealed on December 31, 2022; provided that the repeal of the ordinance shall not affect the validity or effect of an ordinance to extend a surcharge on state tax adopted pursuant to Act 240, Session Laws of Hawaii 2015[;

         (B)  This Act shall be repealed on December 31, 2027; and

         (C)  Section 437D-8.4, Hawaii Revised Statutes, shall be reenacted in the form in which it read on the day prior to the effective date of this Act; provided that the amendments made to section 437D-8.4, Hawaii Revised Statutes, by Act 226, Session Laws of Hawaii 2008, as amended by Act 11, Session Laws of Hawaii 2009, and Act 110, Session Laws of Hawaii 2014, shall not be repealed]."

     SECTION 7.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 8.  This Act shall take effect on July 1, 2017.

 

INTRODUCED BY:

_____________________________

 

 


 


 

Report Title:

County Surcharge on State Tax; Mass Transit; State Highway Fund

 

Description:

Authorizes a county that has established a county surcharge on state tax to make the surcharge permanent.  Requires that a mass transit project funded by county surcharges be extended beyond its initial route.  Requires that 50% of county surcharges collected be deposited into the state highway fund.

 

 

 

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.