STAND. COM. REP. NO. 2057
RE: S.B. No. 2416
Honorable Ronald D. Kouchi
President of the Senate
Twenty-Ninth State Legislature
Regular Session of 2018
State of Hawaii
Your Committee on Housing, to which was referred S.B. No. 2416 entitled:
"A BILL FOR AN ACT RELATING TO THE CONVEYANCE TAX,"
begs leave to report as follows:
The purpose and intent of this measure is to:
(1) Increase the conveyance rates for certain conveyance tax categories; and
(2) Repeal the statutory monetary cap on the disposition of conveyance taxes dedicated for deposit into the rental housing revolving fund for the financing of affordable rental housing developments.
Your Committee received testimony in support of this measure from the League of Women Voters of Hawaii, Americans for Democratic Action Hawai‘i, IMUAlliance, Hawaii Habitat for Humanity Association, and two individuals. Your Committee received testimony in opposition to this measure from the Hawai‘i Association of REALTORS. Your Committee received comments on this measure from the Department of Taxation, Hawaii Housing Finance and Development Corporation, and Tax Foundation of Hawaii.
Your Committee finds that existing law dedicates a certain percentage or monetary amount of the conveyance taxes collected, whichever is lesser, for deposit into the rental housing revolving fund. Monies in this fund are used to provide loans or grants for the development, pre-development, construction, acquisition, preservation, and substantial rehabilitation of rental housing units. By increasing certain conveyance tax rates and repealing the statutory monetary cap on the disposition of conveyance tax dedicated for deposit into the rental housing revolving fund, this measure allocates additional monies for rental housing finance and development in the State.
Your Committee has amended this measure by:
(1) Changing the effective date from July 1, 2018, to January 1, 2019, to allow sufficient time for the Department of Taxation to update the relevant forms and instructions to implement the conveyance tax rate changes under certain categories; and
(2) Making technical, nonsubstantive amendments for the purposes of clarity and consistency.
As affirmed by the record of votes of the members of your Committee on Housing that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2416, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 2416, S.D. 1, and be referred to your Committee on Ways and Means.
Respectfully submitted on behalf of the members of the Committee on Housing,
WILL ESPERO, Chair