HOUSE OF REPRESENTATIVES

H.B. NO.

419

THIRTIETH LEGISLATURE, 2019

H.D. 2

STATE OF HAWAII

S.D. 1

 

 

 

 

 

A BILL FOR AN ACT

 

 

RELATING TO TRANSIENT ACCOMMODATIONS.

 

 

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

 


PART I

SECTION 1. (a) Notwithstanding any provision of section 237D-6.5, Hawaii Revised Statutes, to the contrary, a county shall be eligible to receive $           from the State for the purpose of enforcing all applicable laws and ordinances relating to transient accommodations and short-term vacation rentals; provided that no funds shall be released to a county until it has:

(1) Established a real property tax rate that applies only to:

(A) Transient accommodations; or

(B) Short-term vacation rentals occupied for a period of one hundred eighty consecutive days or less;

(2) Developed a process to expediently issue zoning permits pursuant to the respective county zoning ordinances to, and collect all applicable taxes from, qualifying properties that are proposed for use as:

(A) Transient accommodations; or

(B) Short-term vacation rentals occupied for a period of one hundred eighty consecutive days or less;

(3) Established a registry to track compliance by, and any complaints concerning, permittees who receive zoning permits issued pursuant to the respective county zoning ordinances pursuant to paragraph (2);

(4) Established an expedited process for addressing alleged violations of zoning and zoning permits issued pursuant to the respective county zoning ordinances by operators of:

(A) Transient accommodations; or

(B) Short-term vacation rentals occupied for a period of one hundred eighty consecutive days or less;

(5) Established an expedited process for addressing an appeal filed by a party that was denied a zoning permit issued pursuant to the respective county zoning ordinances pursuant to paragraph (2); provided that a county that has not established an expedited process by December 31, 2019, shall establish a process that is functionally equivalent to the contested case hearing process described in section 91-9, Hawaii Revised Statutes;

(6) Enacted legislation that implements the conditions described in paragraphs (1) through (5); and

(7) Through its mayor, notified the governor in writing that it has complied with the conditions described in paragraphs (1) through (6).

(b) Within thirty days of receiving written notification from the mayor of a county that it has complied with the conditions described in subsection (a)(1) through (6), the governor shall instruct the director of finance to review whether the county is in compliance with the required conditions. If the director's review indicates that the county is in compliance, the director of finance shall release to the county the funds authorized in section 2 of this Act; provided that the funds have not lapsed. If the director's review indicates that the county is not in compliance with the required conditions, the director shall communicate to the mayor of the county the results of the review and shall specify the actions that the county is required to take to achieve compliance with the required conditions. The release of funds to a county under this Act shall not be contingent upon another county having complied with the conditions described in subsection (a)(1) through (6).

(c) As used in this section, "transient accommodations" has the same meaning as in section 237D-1, Hawaii Revised Statutes.

SECTION 2. There is allocated out of the revenues collected under chapter 237D, Hawaii Revised Statutes, before any distribution to the counties under section 237D-6.5, Hawaii Revised Statutes, the sum of $           or so much thereof as may be necessary for fiscal year 2019-2020 for the city and county of Honolulu and the counties of Maui, Hawaii, and Kauai to enforce all applicable laws and ordinances relating to transient accommodations and short-term vacation rentals as established in this Act; provided that no respective county shall receive more than $           from this allocation.

The sum allocated shall be expended by the respective counties for the purposes of this Act.

SECTION 3. Each county receiving an allocation for the enforcement of all applicable laws and ordinances relating to transient accommodations and short-term vacation rentals as established in this Act shall submit an interim report to the legislature no later than twenty days prior to the convening of the regular session of 2020 and a final report within twenty days after the close of the 2019-2020 fiscal year. The reports shall include all enforcement actions taken by the respective county wherein the county expended any funds allocated by this Act.

PART II

SECTION 4. The legislature finds that, under certain circumstances, allowing a private person to act as a tax collection agent is likely to ease the burden of collecting taxes. Section 237-9(e), Hawaii Revised Statutes, allows a person engaged in network marketing, multi-level marketing, or other similar business to enter into an agreement with the department of taxation to act as a tax collection agent on behalf of its direct sellers. The legislature finds that similarly allowing a transient accommodations broker to act as a tax collection agent on behalf of providers of transient accommodations that utilize the services of the transient accommodations broker may facilitate the collection of transient accommodations taxes and general excise taxes.

The legislature also finds that hosting platforms should be subject to fines if the hosting platform collects a booking service fee for a transient accommodation that is located in the State and if the operator or plan manager of the transient accommodation is not registered with the director of taxation under section 237D-4, Hawaii Revised Statutes.

The legislature additionally finds that transient accommodations brokers, hosting platforms, and booking services should regularly provide data on transient accommodations listings in Hawaii, for greater transparency and data sharing purposes.

The purpose of this part is to:

(1) Amend the definition of "transient accommodations" to include other forms of transient accommodations and other terms that the counties may have defined;

(2) Make it unlawful for a hosting platform to provide, and collect a fee for, booking services in connection with transient accommodations located in the State if the operator or plan manager is not registered with the director of taxation as required under section 237D-4, Hawaii Revised Statutes;

(3) Require anonymous, periodic reports by transient accommodations brokers, hosting platforms, and booking services to the department of business, economic development, and tourism of transient accommodations listings;

(4) Enable a transient accommodations broker to register as a tax collection agent with respect to transient accommodations taxes and general excise taxes for its operators and plan managers; and

(5) Require operators and plan managers to remove a transient accommodation advertisement upon notice that the property is not in compliance with state law or county ordinance.

This part is not intended to preempt or otherwise limit the authority of counties to adopt, monitor, and enforce local land use regulations, and this Part is not intended to transfer the authority to monitor and enforce such regulations away from the counties.

SUBPART A. DEFINITIONS

SECTION 5. Section 237D-1, Hawaii Revised Statutes, is amended as follows:

1. By adding two new definitions to be appropriately inserted and to read:

""Booking service" means any reservation or payment service provided by a person or entity that facilitates a transient accommodation transaction between an operator and a prospective transient or occupant, and for which the person or entity collects or receives, directly, or indirectly through an agent or intermediary, a fee in connection with the reservation or payment services provided for the transient accommodation transaction.

"Hosting platform" means a person or entity that participates in the transient accommodations business by providing, and collecting or receiving a fee for, booking services through which an operator or plan manager may offer a transient accommodation. Hosting platforms usually, though not necessarily, provide booking services through an online platform that allows an operator or plan manager to advertise the transient accommodations through a website provided by the hosting platform and the hosting platform conducts a transaction by which potential renters arrange, use, pay, whether the renter pays rent directly to the operator, plan manager, or to the hosting platform."

2. By amending the definition of "transient accommodations" to read:

""Transient accommodations" means the furnishing of a room, apartment, suite, single family dwelling, or the like to a transient for less than one hundred eighty consecutive days for each letting in a hotel, apartment hotel, motel, condominium or unit as defined in chapter 514B, cooperative apartment, dwelling unit, or rooming house that provides living quarters, sleeping, or housekeeping accommodations, or other place in which lodgings are regularly furnished to transients. "Transient accommodations" includes "transient accommodations units", "transient vacation rentals", "transient vacation units", "transient vacation use", or any similar term that may be defined by county ordinance to mean a room, apartment, house, condominium, beach house, hotel room, suite, or similar living accommodation rented to a transient person for less than one hundred eighty consecutive days in exchange for payment in cash, goods, or services."

SUBPART B. HOSTING PLATFORM LIABILITY; TRANSIENT ACCOMMODATIONS INDUSTRY TRANSPARENCY

SECTION 6. Chapter 201, Hawaii Revised Statutes, is amended by adding a new section to part I to be appropriately designated and to read as follows:

"201-   Each transient accommodations broker, hosting platform, and booking service shall electronically transmit a quarterly report of Hawaii listing data by the fifth day of each March, June, September, and December with the previous quarter's data to the department of business, economic development, and tourism. Listing data shall be submitted through an online process, using a reporting template and appropriate calculation guidelines developed by, and made publicly available on the website of, the department of business, economic development, and tourism. Reported data shall be anonymized and aggregated by zip code, by the reporting party, and shall include all of the following fields:

(1) Total number of available units;

(2) Total number of available rooms;

(3) Total available room nights;

(4) Total occupied room nights;

(5) Average daily rate;

(6) Number of nights stayed per booking; and

(7) Total revenue.

Any transient accommodations broker, hosting platform, or booking service who fails to provide a quarterly report to the department of business, economic development, and tourism shall be subject to penalties of $100 per day for non-compliance."

SECTION 7. Chapter 237D, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"237D-   Booking services. (a) It shall be unlawful for a hosting platform to provide and collect a fee for booking services provided in connection with a transient accommodation located in the State if the operator or plan manager of the transient accommodation is not registered with the director as required under section 237D-4. This section shall not apply to booking services provided in connection with a transient accommodation that is a hotel.

(b) A hosting platform that violates this section shall be subject to a penalty of $1,000 per booking service transaction from which fees were collected in violation of subsection (a). Each reservation or payment service for the letting of a transient accommodation shall be a separate booking service transaction.

(c) As used in this section:

"Booking service" shall have the same meaning as in section 237D-1.

"Hosting platform" shall have the same meaning as in 237D‑1.

"Hotel" means an establishment consisting of any building, structure, or portion thereof containing more than nine rooming units that, as part of its routine operations, furnishes transient accommodations and provides one or more additional customary lodging services other than the living accommodations and the use of furniture, fixtures, and appliances, such as room attendant, room service, bell service laundering service, concierge service or daily housekeeping services.

(d) The department may require, by subpoena, a hosting platform to provide the names and registration identification numbers for all operators and plan managers for whom the hosting platform provided booking services and for all operators and plan managers for whose property or transient accommodations the hosting platform provided booking services.

(e) The department shall not impose penalties under this section if the hosting platform obtains the registration identification number issued under section 237D-4 of the operators or plan managers described in subsection (d), in the format in which the numbers are issued by the department.

(f) Any monetary penalty assessed under this section shall be due and payable thirty days after the hosting platform is notified of the imposition of the penalty. Penalties assessed under this section may be appealed to the director of taxation or the director's designee."

SECTION 8. Section 237D-4, Hawaii Revised Statutes, is amended to read as follows:

"237D-4 Certificate of registration. (a) Each operator or plan manager as a condition precedent to engaging or continuing in the business of furnishing transient accommodations or in business as a resort time share vacation plan shall register with the director the name and address of each place of business within the State subject to this chapter. The operator or plan manager shall make a one-time payment as follows:

(1) $5 for each registration for transient accommodations consisting of one to five units;

(2) $15 for each registration for transient accommodations consisting of six or more units; and

(3) $15 for each resort time share vacation plan within the State;

upon receipt of which the director shall issue a certificate of registration in such form as the director determines, attesting that the registration has been made. The registration shall not be transferable and shall be valid only for the operator or plan manager in whose name it is issued and for the transaction of business at the place designated therein. Acquisition of additional transient accommodation units after payment of the one-time fee shall not result in additional fees.

(b) The registration, or in lieu thereof a notice stating where the registration may be inspected and examined, shall at all times be conspicuously displayed at the place for which it is issued. The name, phone number, and electronic mail address of the local contact shall at all times be conspicuously displayed in the same place as the registration or the same place as the notice stating where the registration may be inspected and examined. Failure to meet the requirements of this subsection shall be unlawful. The department may issue citations to any person who fails to conspicuously display the registration or notice, or the local contact's name, phone number, or electronic mail address as required by this subsection. A citation issued pursuant to this subsection for each transient accommodation or resort time share vacation interest, plan, or unit in violation of this subsection shall include a monetary fine of not less than:

(1) $500 per day, for a first violation for which a citation is issued;

(2) $1,000 per day, for a second violation for which a citation is issued; and

(3) $5,000 per day, for a third and any subsequent violation for which a citation is issued.

(c) Any advertisement, including an online advertisement, for any transient accommodation or resort time share vacation interest, plan, or unit shall conspicuously provide:

(1) [The registration identification number or an electronic link to the registration identification number of the] The operator or plan [manager issued pursuant to this section; and] manager's transient accommodations tax registration identification number;

(2) The local contact's name, phone number, and electronic mail address, provided that this paragraph shall be considered satisfied if this information is provided to the transient or occupant prior to the furnishing of the transient accommodation or resort time share vacation unit[.]; and

(3) The applicable land use permit or registration identification number of each advertised unit as provided by the county having jurisdiction.

Upon notice that the property is not in compliance with state law or county ordinance, an operator or plan manager shall remove the transient accommodations unit advertisement.

(d) Failure to meet the requirements of subsection (c) shall be unlawful. The department may issue citations to any [person, including] operators[,] or plan managers[, and transient accommodations brokers, who violates] who violate subsection (c). A citation issued pursuant to this subsection for each transient accommodation or resort time share vacation interest, plan, or unit in violation of subsection (c) shall include a monetary fine of not less than:

(1) $500 per day, for a first violation for which a citation is issued;

(2) $1,000 per day, for a second violation for which a citation is issued; and

(3) $5,000 per day, for a third and any subsequent violation for which a citation is issued.

(e) The registration provided for by this section shall be effective until canceled in writing. Any application for the reissuance of a previously canceled registration identification number shall be regarded as a new registration application and shall be subject to the payment of the one-time registration fee. The director may revoke or cancel any license issued under this chapter for cause as provided by rule under chapter 91.

(f) If the license fee is paid, the department shall not refuse to issue a registration or revoke or cancel a registration for the exercise of a privilege protected by the First Amendment of the Constitution of the United States, or for the carrying on of interstate or foreign commerce, or for any privilege the exercise of which, under the Constitution and laws of the United States, cannot be restrained on account of nonpayment of taxes, nor shall section 237D-14 be invoked to restrain the exercise of such a privilege, or the carrying on of such commerce.

[(g) Any person who may lawfully be required by the State, and who is required by this chapter, to register as a condition precedent to engaging or continuing in the business of furnishing transient accommodations or as a plan manager subject to taxation under this chapter, who engages or continues in the business without registering in conformity with this chapter, shall be guilty of a misdemeanor. Any director, president, secretary, or treasurer of a corporation who permits, aids, or abets such corporation to engage or continue in business without registering in conformity with this chapter, shall likewise be guilty of a misdemeanor. The penalty for the misdemeanors shall be the same as that prescribed by section 231-35 for individuals, corporations, or officers of corporations, as the case may be, for violation of that section.

(h)] (g) Any monetary fine assessed under this section shall be due and payable thirty days after issuance of the citation, subject to appeal rights provided under this subsection. Citations may be appealed to the director of taxation or the director's designee.

(h) Any person who is required by this section to register as a condition precedent to engaging or continuing in the business of furnishing transient accommodations or as a plan manager subject to taxation under this chapter, who engages or continues in the business without registering in conformity with this section, shall be subject to the citation process and monetary fines under section 237D-4(d).

(i) For purposes of this section, "engaging or continuing in the business of furnishing transient accommodations" includes posting any advertisement for the furnishing of a transient accommodation."

SUBPART C. TRANSIENT ACCOMMODATIONS BROKERS AS TAX COLLECTION AGENTS

SECTION 9. Chapter 237, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"237-   Transient accommodations broker as tax collection agent; operator and plan manager. (a) The director may permit a transient accommodations broker to register as a tax collection agent on behalf of all of its operators and plan managers by entering into a tax collection agreement with the director or by submitting a tax collection agent registration statement to the director; provided that the transient accommodations broker agrees in writing:

(1) To obtain written consent from all of its operators and plan managers for the disclosure of periodic returns and information required under subsection (g);

(2) To furnish information to the counties as required in subsection (g); and

(3) That continuing to collect fees for booking services in connection with a transient accommodation, seven days after receiving written notice from a state or county governmental authority that the subject property is not in compliance with state law or county ordinance, is a violation of the tax collection agreement.

Any tax collection agreement entered into pursuant to this section shall be subject to and in accordance with all applicable provisions of state law and county ordinances and shall not permit a tax collection agent, nor any operator or plan manager conducting business through the tax collection agent, to opt out of any requirements or obligations under state law or county ordinance.

The director shall deny an application for registration as a tax collection agent under this section for violations of this subsection and may deny an application for any other cause authorized by law, including any violation of this chapter or rules adopted pursuant thereto, violation of any prior tax collection agreement, or failure to meet minimum criteria that may be set forth by the department in rules adopted pursuant to chapter 91.

The director shall issue a certificate of registration or letter of denial within thirty days after a transient accommodations broker submits to the director a completed and signed tax collection agent registration statement, in a form prescribed by the department.

The registration shall be valid only for the tax collection agent in whose name it is issued, and for the website or hosting platform designated therein, and shall not be transferable.

(b) In addition to its own responsibilities under this chapter, a registered tax collection agent shall report, collect, and pay over the taxes due under this chapter on behalf of all of its operators and plan managers from the date of registration until the registration is canceled as provided in subsection (h); provided that the registered tax collection agent's obligation to report, collect, and pay taxes on behalf of all of its operators and plan managers shall apply solely to transient accommodations in the State arranged or booked directly through the registered tax collection agent.

(c) The registered tax collection agent's operators and plan managers shall obtain licensure under this chapter and remain subject to the requirements of title 14; provided that the registered tax collection agent shall report, collect, and pay the taxes under this chapter on behalf of the operators and plan managers for business activity conducted directly through the agent, as set forth in this section, from the date of registration until the registration is canceled as provided in subsection (h). For purposes of any other business activity, the operators and plan managers shall be subject to all requirements of title 14 and all county ordinances and rules regulating transient accommodations, regardless of the terms used by the county to refer to transient accommodations, as if this section did not exist.

A registered tax collection agent shall be issued separate certificates of registration under this chapter with respect to taxes payable on behalf of its operators and plan managers in its capacity as a registered tax collection agent and, if applicable, with respect to any taxes payable under this chapter for its own business activities.

(d) If the registered tax collection agent fails to report or pay the taxes under this chapter on behalf of the operators and plan managers, as set forth in this section, the registered tax collection agent and the operator or plan manager shall be jointly and severally liable for the taxes due under this chapter, including penalties and interest as provided by law, with respect to their business activities conducted directly through the registered tax collection agent from the date of registration until the registration is canceled as provided in subsection (h).

(e) A tax collection agent shall be liable for the taxes imposed by this chapter that are due and collected on behalf of operators and plan managers, if taxes are collected, but not reported or paid, together with penalties and interest as provided by law.

(f) Except as otherwise provided in this subsection and subsection (g), all returns and other information provided by a registered tax collection agent, including the application for registration as a tax collection agent or any tax collection agreement, shall be confidential, and disclosure thereof shall be prohibited as provided in section 237-34. Nothing in this subsection shall prevent public disclosure of information about registered agents as provided in subsection 92F-12(a)(13) or of aggregated information not identifiable to a specific tax collection agent.

(g) A registered tax collection agent shall file periodic returns in accordance with section 237-30 and annual returns in accordance with section 237-33. Each periodic return required under section 237-30 shall be accompanied by an electronic cover sheet, in a form prescribed by the department that includes the following information:

(1) For each operator and plan manager on whose behalf the tax collection agent is required to report, collect, and pay over taxes due under this chapter, the operator's or plan manager's name, address, and general excise tax license number; and

(2) For each transient accommodation rented through the registered tax collection agent or the website or hosting platform designated in the certificate of registration issued pursuant to chapter 237D, for which taxes are being remitted pursuant to this chapter:

(A) The address of the transient accommodation;

(B) The number of nights that each transient accommodation was rented and the rate or price at which each transient accommodation was rented; and

(C) The amount of tax being remitted pursuant to this chapter and the amount of any federal form 1099 income that was derived from each transient accommodation.

Upon request by the planning director or mayor of the applicable county, a registered tax collection agent shall disclose any of the information contained in the returns or cover sheets required by this subsection to the planning director or any county official designated by the mayor to receive the information. Notwithstanding any law to the contrary, including section 237-34, the planning director and county official designated to receive the information pursuant to this subsection may examine and copy the returns and cover sheets to ensure compliance with this section, state tax laws and county tax ordinances, and any applicable land use laws and ordinances.

(h) The registration provided for under this section shall be effective until canceled in writing.

A registered tax collection agent may cancel its registration under this section by delivering written notice of cancellation to the director and each of the agent's operators and plan managers furnishing transient accommodations in the State no later than ninety days prior to the effective date of cancellation.

The director may cancel a tax collection agent's registration under this section for any cause, including any violation of this chapter or rules adopted pursuant thereto, or for violation of any applicable tax collection agreement, by delivering written notice of cancellation to the tax collection agent no later than ninety days prior to the effective date of cancellation.

(i) When conducting business with an operator or plan manager with respect to a property for lease or rent, transient accommodations brokers, hosting platforms, and booking services shall:

(1) Notify the operator or plan manager that the subject property is required to be in compliance with applicable state and county land use laws and ordinances prior to retaining the services of the transient accommodations broker, hosting platform, or booking service;

(2) Require the operator or plan manager to provide the transient accommodations broker, hosting platform, or booking service with the operator's or plan manager's transient accommodations tax identification number and local contact information and shall notify the operator or plan manager that this information is required in advertisements for transient accommodations or resort time share vacation interests, plans, or units under section 237D-4;

(3) Require the operator or plan manager to provide the transient accommodation broker, hosting platform, and booking service with the county non-conforming use registration number, or other unit-specific transient accommodation registration number as issued by the appropriate county agency, and verification of compliance with state and county land use laws in the form of a written certification, verification, or permit, as applicable, issued by the appropriate county agency; and

(4) Require the operator or plan manager to provide any other information as may be required by rulemaking.

An operator or plan manager shall remove any advertisement, including an online advertisement, for a transient accommodation located in the State for which the operator or plan manager fails to comply with paragraph (2), (3), or (4) or for which the operator or plan manager has received written notice from a state or county governmental authority that the property is not in compliance with state law or county ordinance, as applicable. The state or county governmental authority shall provide a copy of the written notice to the transient accommodations broker, hosting platform, or booking service.

(j) Nothing in this section shall be construed to preempt or prohibit the authority of a unit of local government in the State, including counties and any other political subdivisions of the State, to adopt, monitor, and enforce local land use ordinances, rules, or regulations, nor to transfer the authority to monitor and enforce these ordinances, rules, or regulations away from the counties.

(k) For the purposes of this section:

"Booking service" has the same meaning as in section 237D‑1.

"Director" means the director of taxation.

"Hosting platform" has the same meaning as in section 237D‑1.

"Operator" has the same meaning as in section 237D-1.

"Plan manager" has the same meaning as in section 237D-1.

"Transient accommodations" has the same meaning as in section 237D-1.

"Transient accommodations broker" has the same meaning as in section 237D-1."

SECTION 10. Chapter 237D, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"237D-   Transient accommodations broker as tax collection agent; operator and plan manager. (a) The director may permit a transient accommodations broker to register as a tax collection agent on behalf of all of its operators and plan managers by entering into a tax collection agreement with the director or by submitting a tax collection agent registration statement to the director; provided that the transient accommodations broker agrees in writing:

(1) To obtain written consent from all of its operators and plan managers for the disclosure of periodic returns and information required under subsection (g);

(2) To furnish information to the counties as required in subsection (g); and

(3) That continuing to collect fees for booking services in connection with a transient accommodation, seven days after receiving written notice from a state or county governmental authority that the subject property is not in compliance with state law or county ordinance, is a violation of the tax collection agreement.

Any tax collection agreement entered into pursuant to this section shall be subject to and in accordance with all applicable provisions of state law and county ordinances and shall not permit a tax collection agent, nor any operator or plan manager conducting business through the tax collection agent, to opt out of any requirements or obligations under state law or county ordinance.

The director shall deny an application for registration as a tax collection agent under this section for violations of this subsection and may deny an application for any other cause authorized by law, including any violation of this chapter or rules adopted pursuant thereto, violation of any prior tax collection agreement, or failure to meet minimum criteria that may be set forth by the department in rules adopted pursuant to chapter 91.

The director shall issue a certificate of registration or letter of denial within thirty days after a transient accommodations broker submits to the director a completed and signed tax collection agent registration statement, in a form prescribed by the department. The registration shall be valid only for the tax collection agent in whose name it is issued, and for the website or hosting platform designated therein, and shall not be transferable.

A registered tax collection agent shall be issued separate certificates of registration under this chapter with respect to taxes payable on behalf of its operators and plan managers in its capacity as a registered tax collection agent and, if applicable, with respect to any taxes payable under this chapter for its own business activities.

(b) In addition to its own responsibilities under this chapter, a registered tax collection agent shall report, collect, and pay over the taxes due under this chapter on behalf of all of its operators and plan managers from the date of registration until the registration is canceled as provided in subsection (h); provided that the registered tax collection agent's obligation to report, collect, and pay taxes on behalf of all of its operators and plan managers shall apply solely to transient accommodations in the State arranged or booked directly through the registered tax collection agent.

(c) The registered tax collection agent's operators and plan managers shall obtain registration under this chapter and remain subject to the requirements of title 14; provided that the registered tax collection agent shall report, collect, and pay the taxes under this chapter on behalf of the operators and plan managers for business activity conducted directly through the registered tax collection agent, as set forth in this section, from the date of registration until the registration is canceled as provided in subsection (h). For purposes of any other business activity, the operators and plan managers shall be subject to all requirements of title 14 and all applicable ordinances and rules regulating transient accommodations, regardless of the terms used by the county to refer to transient accommodations, as if this section did not exist.

(d) If the registered tax collection agent fails to report or pay the taxes under this chapter on behalf of the operators and plan managers, as set forth in this section, the registered tax collection agent and the operator or plan manager shall be jointly and severally liable for the taxes due under this chapter, including penalties and interest as provided by law, with respect to their business activities conducted directly through the registered tax collection agent from the date of registration until the registration is canceled as provided in subsection (h).

(e) A tax collection agent shall be liable for the taxes imposed by this chapter that are due and collected on behalf of operators and plan managers, if taxes are collected, but not reported or paid, together with penalties and interest as provided by law.

(f) Except as otherwise provided in this subsection and subsection (g), all returns and other information provided by a registered tax collection agent, including the application for registration as a tax collection agent or any tax collection agreement, shall be confidential, and disclosure thereof shall be prohibited as provided in section 237D-13. Nothing in this subsection shall prevent public disclosure of information about registered agents as provided in subsection 92F-12(a)(13) or of aggregated information not identifiable to a specific tax collection agent.

(g) A registered tax collection agent shall file periodic returns in accordance with section 237D-6 and annual returns in accordance with section 237D-7. Each periodic return required under section 237D-6 shall be accompanied by an electronic cover sheet, in a form prescribed by the department that includes the following information:

(1) For each operator and plan manager on whose behalf the tax collection agent is required to report, collect, and pay over taxes due under this chapter, the operator's or plan manager's name, address, and transient accommodations registration identification number; and

(2) For each transient accommodation rented through the registered tax collection agent or the website or hosting platform designated in the certificate of registration issued pursuant to subsection (a), for which taxes are being remitted pursuant to this chapter:

(A) The address of the transient accommodation;

(B) The number of nights that each transient accommodation was rented and the rate or price at which each transient accommodation was rented; and

(C) The amount of tax being remitted pursuant to this chapter and the amount of any federal form 1099 income that was derived from each transient accommodation.

Upon request by the planning director or mayor of the applicable county, a registered tax collection agent shall disclose any of the information contained in the returns or cover sheets required by this subsection to the planning director or any county official designated by the mayor to receive the information. Notwithstanding any law to the contrary, including section 237D-13, the planning director and county official designated to receive the information pursuant to this subsection may examine and copy the returns and cover sheets to ensure compliance with this section, state and county tax laws and ordinances, and any applicable land use laws and ordinances.

(h) The registration provided for under this section shall be effective until canceled in writing.

A registered tax collection agent may cancel its registration under this section by delivering written notice of cancellation to the director and each of the agent's operators and plan managers furnishing transient accommodations in the State no later than ninety days prior to the effective date of cancellation.

The director may cancel a tax collection agent's registration under this section for any cause, including any violation of this chapter or rules adopted pursuant thereto, or for violation of any applicable tax collection agreement, by delivering written notice of cancellation to the tax collection agent no later than ninety days prior to the effective date of cancellation.

(i) When conducting business with an operator or plan manager with respect to a property for lease or rent, transient accommodations brokers, hosting platforms, and booking services shall:

(1) Notify the operator or plan manager that the subject property is required to be in compliance with applicable state land use laws and county land use ordinances prior to retaining the services of the transient accommodations broker, hosting platform, or booking service;

(2) Require the operator or plan manager to provide the transient accommodations broker, hosting platform, or booking service with the operator or plan manager's transient accommodations tax registration identification number and local contact information and shall notify the operator or plan manager that this information is required in advertisements for transient accommodations or resort time share vacation interests, plans, or units under section 237D-4;

(3) Require the operator or plan manager to provide the transient accommodations broker with verification of compliance with state land use laws and county land use ordinances in the form of a written certification, verification, or permit, as applicable, issued by the appropriate county agency;

(4) Require the operator or plan manager to provide a statement to the transient accommodations broker confirming compliance with all land use laws and ordinances; and

(5) Require the operator or plan manager to provide any other information as may be required by rulemaking.

An operator or plan manager shall remove any advertisement, including an online advertisement, for a transient accommodation located in the State for which the operator or plan manager fails to comply with paragraph (2), (3), (4), or (5) or for which the operator or plan manager has received written notice from a state or local governmental authority that the property is not in compliance with state law or county ordinance, as applicable. The state or county governmental authority shall provide a copy of the written notice to the transient accommodations broker, hosting platform, or booking service.

(j) Nothing in this section shall be construed to preempt or prohibit the authority of a unit of local government in the State, including counties and any other political subdivisions of the State, to adopt, monitor, and enforce local land use ordinances, rules, or regulations, nor to transfer the authority to monitor and enforce these ordinances, rules, or regulations away from the counties."

SECTION 11. Section 237D-4.5, Hawaii Revised Statutes, is amended to read as follows:

"[[]237D-4.5[]] Certificate of registration for transient accommodations broker, travel agency, and tour packager. (a) Each transient accommodations broker, travel agency, or tour packager, as a condition precedent to entering into an arrangement to furnish transient accommodations at noncommissioned negotiated contract rates, shall register with the director. The transient accommodations broker, travel agency, or tour packager shall make a one-time payment of $15 for each registration, upon receipt of which the director shall issue a certificate of registration in a form as the director determines, attesting that the registration has been made. The registration shall not be transferable and shall be valid only for the transient accommodations broker, travel agency, or tour packager in whose name it is issued.

(b) The registration shall be effective until canceled in writing. Any application for the reissuance of a previously canceled registration identification number shall be regarded as a new application for registration and shall be subject to the payment of the one-time registration fee. The director may revoke or cancel any registration issued under this section for cause as provided by rule under chapter 91.

(c) Any person who enters into an arrangement to furnish transient accommodations without registering in conformity with this section shall be subject to the citation process and monetary fines under section 237D-4(d)."

PART III

SECTION 12. If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of the Act that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

SECTION 13. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 14. This Act shall take effect on January 1, 2020.

 



 

Report Title:

Transient Accommodations; Vacation Rentals; Counties; Enforcement; Hosting Platform Liability; Transparency; Data Sharing; Transient Accommodations Brokers; Tax Collection Agents

 

Description:

Part I: Makes a county eligible to receive TAT revenue allocations for the purpose of enforcing all applicable laws and ordinances relating to transient accommodations, under specified conditions. Requires reports from counties receiving funds for enforcement of transient accommodations and short-term vacation rentals ordinances. Part II: Amends the definition of "transient accommodations" to include additional forms of transient accommodations. Requires each transient accommodations broker, hosting platform, and booking service to submit to DBEDT quarterly reports of statistical data relating to transient accommodations listings. Makes it unlawful for a hosting platform to provide, and collect a fee for, booking services regarding transient accommodations if the operator or plan manager is not registered with the Director of Taxation. Amends requirements relating to transient accommodations tax certificates of registration to ensure greater transparency. Allows a transient accommodations broker to register as a GET and TAT tax collection agent for its operators and plan managers. Takes effect on 1/1/2020. (SD1)

 

 

 

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