S.B. NO.














relating to housing production.





     SECTION 1.  The legislature finds that the State has a housing crisis.  In March 2015, the department of business, economic development, and tourism found that for the period of 2015-2025, the demand for additional housing units is:  25,847 units for the city and county of Honolulu, 19,610 units for Hawaii county, 13,949 units for Maui county, and 5,287 units for Kauai county.  While this forecast projects an acute housing shortage from 2015 to 2025, there has been a lack of measureable progress at the county level to enact policies that will stimulate housing production to meet projected demand.

     The purpose of this Act is to require the counties to focus on being proactive in the production of new housing rather than reacting to individual housing projects by requiring each county to annually authorize the construction of ten per cent of the forecasted demand over the next ten years.

     SECTION 2.  Section 237D-6.5, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

     "(b)  Except for the revenues collected pursuant to section 237D-2(e), revenues collected under this chapter shall be distributed in the following priority, with the excess revenues to be deposited into the general fund:

     (1)  $1,500,000 shall be allocated to the Turtle Bay conservation easement special fund beginning July 1, 2015, for the reimbursement to the state general fund of debt service on reimbursable general obligation bonds, including ongoing expenses related to the issuance of the bonds, the proceeds of which were used to acquire the conservation easement and other real property interests in Turtle Bay, Oahu, for the protection, preservation, and enhancement of natural resources important to the State, until the bonds are fully amortized;

     (2)  $16,500,000 shall be allocated to the convention center enterprise special fund established under section 201B-8;

     (3)  $79,000,000 shall be allocated to the tourism special fund established under section 201B-11; provided that:

          (A)  Beginning on July 1, 2012, and ending on June 30, 2015, $2,000,000 shall be expended from the tourism special fund for development and implementation of initiatives to take advantage of expanded visa programs and increased travel opportunities for international visitors to Hawaii;

          (B)  Of the $79,000,000 allocated:

              (i)  $1,000,000 shall be allocated for the operation of a Hawaiian center and the museum of Hawaiian music and dance at the Hawaii convention center; and

             (ii)  0.5 per cent of the $79,000,000 shall be transferred to a sub-account in the tourism special fund to provide funding for a safety and security budget, in accordance with the Hawaii tourism strategic plan 2005-2015; and

          (C)  Of the revenues remaining in the tourism special fund after revenues have been deposited as provided in this paragraph and except for any sum authorized by the legislature for expenditure from revenues subject to this paragraph, beginning July 1, 2007, funds shall be deposited into the tourism emergency special fund, established in section 201B-10, in a manner sufficient to maintain a fund balance of $5,000,000 in the tourism emergency special fund;

     (4)  $103,000,000 shall be allocated as follows:  Kauai county shall receive 14.5 per cent, Hawaii county shall receive 18.6 per cent, city and county of Honolulu shall receive 44.1 per cent, and Maui county shall receive 22.8 per cent; provided that commencing with fiscal year 2018-2019, a sum that represents the difference between a county public employer's annual required contribution for the separate trust fund established under section 87A-42 and the amount of the county public employer's contributions into that trust fund shall be retained by the state director of finance and deposited to the credit of the county public employer's annual required contribution into that trust fund in each fiscal year, as provided in section 87A-42, if the respective county fails to remit the total amount of the county's required annual contributions, as required under section 87A-43; provided further that commencing with fiscal year 2020-2021 and each year thereafter until fiscal year 2030-2031, each county shall authorize the construction of new housing units as follows:

          (A)  For the city and county of Honolulu, 2,588 new housing units;

          (B)  For the county of Hawaii, 1,961 new housing units;

          (C)  For the county of Maui, 1,395 new housing units; and

          (D)  For the county of Kauai, 529 new housing units;

          provided that for each year a county fails to authorize the construction of the required number of new housing units, there shall be a reduction of one per cent of the county's applicable percentage share of revenues pursuant to this paragraph beginning the following fiscal year; provided further that for each year a county's percentage share is reduced for failure to authorize the construction of the required number of new housing units, the county may recoup the reduction at a rate of one per cent per year if the county meets or exceeds the number of new housing units required to be authorized in the next year; and

     (5)  $3,000,000 shall be allocated to the special land and development fund established under section 171-19; provided that the allocation shall be expended in accordance with the Hawaii tourism authority strategic plan for:

          (A)  The protection, preservation, maintenance, and enhancement of natural resources, including beaches, important to the visitor industry;

          (B)  Planning, construction, and repair of facilities; and

          (C)  Operation and maintenance costs of public lands, including beaches, connected with enhancing the visitor experience.

     All transient accommodations taxes shall be paid into the state treasury each month within ten days after collection and shall be kept by the state director of finance in special accounts for distribution as provided in this subsection.

     As used in this subsection, "fiscal year" means the twelve-month period beginning on July 1 of a calendar year and ending on June 30 of the following calendar year."

     SECTION 3.  New statutory material is underscored.

     SECTION 4.  This Act shall take effect on July 1, 2019, and shall be repealed on June 30, 2031.








Report Title:

Counties; Housing Production; Requirements; Transient Accommodations Tax



Requires, between fiscal year 2020-2021 and fiscal year 2030-2031, each county to authorize construction for a specified number of new housing units.  Reduces the amount of transient accommodations tax revenue the counties receive for failure to meet the requirements.  Allows for recoupment of reduction under certain circumstances.  Repeals June 30, 2031.




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