HOUSE OF REPRESENTATIVES

H.B. NO.

1296

THIRTY-FIRST LEGISLATURE, 2021

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

relating to State funds.

 

 

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

 


SECTION 1. Section 245-26, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) Stamps shall be sold at their denominated values, plus a stamp fee of 1.7 per cent of the denominated value of each stamp sold[, composed of the aggregate of:

(1) .2 per cent of the denominated value of the stamp] to pay for the cost to the State of providing the stamps, with that amount to be deposited to the credit of the department of taxation's cigarette tax stamp administrative special fund; [and

(2) 1.5 per cent of the denominated value of the stamp to pay for the cost of enforcing the stamp tax, with that amount to be deposited to the credit of the department of the attorney general's tobacco enforcement special fund;]

provided that the department by rule may modify the stamp fee to reflect actual costs incurred by the State in providing the stamps."

SECTION 2. Section 245-41, Hawaii Revised Statutes, is amended to read as follows:

"245-41 Enforcement; injunction; disposition of fines. (a) Enforcement of this part shall be under the jurisdiction of the attorney general. The attorney general may seek assistance in the enforcement of this part from other law enforcement agencies.

(b) Notwithstanding the existence of other remedies at law, the attorney general may apply for a temporary or permanent injunction restraining any person from violating or continuing to violate this part. The injunction shall be issued without bond.

[(c) Where the attorney general initiates and conducts an investigation resulting in the imposition and collection of a criminal fine pursuant to this part, one hundred per cent of the fine shall be distributed to the attorney general to be deposited to the credit of the department of the attorney general's tobacco enforcement special fund; provided that if the attorney general engages the prosecuting attorney for the investigation or prosecution, or both, resulting in the imposition and collection of a criminal fine under this part, the fine shall be shared equally between the attorney general and the prosecuting attorney.]"

SECTION 3. Section 328L-3, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) There is established in the state treasury the emergency and budget reserve fund, which shall be a special fund administered by the director of finance and into which shall be deposited:

(1) [Moneys received from the tobacco settlement moneys under section 328L-2;

(2)] Appropriations made by the legislature to the fund; and

[(3)] (2) Five per cent of the state general fund balance at the close of the fiscal year, whenever state general fund revenues for each of two successive fiscal years exceeds revenues for each of the preceding fiscal years by five per cent. For the purpose of this section, the general fund balance at the close of the fiscal year shall be calculated after any:

(A) Tax refund or tax credit is provided by the legislature;

(B) Deposit into the emergency and budget reserve fund or another reserve fund is appropriated by the legislature; or

(C) Prepayment of general obligation bond debt service or pension or other post-employment benefit liability is appropriated by the legislature;

during the same regular session as the transfer depositing such moneys to the emergency and budget reserve fund; provided that transfers shall not be made to the emergency and budget reserve fund whenever the balance of the emergency and budget reserve fund is equal to or more than ten per cent of general fund revenues for the preceding fiscal year. The transfer shall be executed by the director of finance.

All moneys deposited into the emergency and budget reserve fund under paragraphs (1) [and (2)] and all moneys deposited under paragraph [(3)] (2) shall be kept in separate and distinct accounts."

SECTION 4. Section 328L-6, Hawaii Revised Statutes, is amended to read as follows:

"[[]328L-6[]] Tobacco prevention and control advisory board. (a) There is established a tobacco prevention and control advisory board under the department for administrative purposes.

(b) The tobacco prevention and control advisory board shall consist of members who are involved in tobacco prevention and control. Membership of the board shall be as follows:

(1) One member of the governor's staff, appointed by the governor;

(2) One member to be appointed by the governor from a list of two names submitted by the president of the senate;

(3) One member to be appointed by the governor from a list of two names submitted by the speaker of the house of representatives;

(4) The director or the director's designee;

(5) The superintendent of education or the superintendent's designee;

(6) Three members having demonstrated interest in and having backgrounds beneficial to controlling and preventing the use of tobacco, appointed by the director of health; and

(7) Three members representing populations at risk for tobacco use, appointed by the governor.

(c) Members shall:

(1) Be appointed or designated, as applicable, without regard to section 26-34;

(2) Serve without compensation; and

(3) Serve for a term of three years.

(d) The tobacco prevention and control advisory board, in collaboration with the department, shall develop a strategic plan for tobacco prevention and control, including:

(1) Developing and implementing effective and cost efficient programs, including health promotion and disease prevention;

(2) Developing adequate standards and benchmarks by which measures of program success under paragraph (1) of this subsection may be appropriately evaluated; and

(3) Assessing the effectiveness of programs engaged in health promotion and disease prevention.

The strategic plan shall be in writing and shall be a public document.

[(e) The tobacco prevention and control advisory board shall advise the on the administration of the Hawaii tobacco prevention and control trust fund.]"

SECTION 5. Section 28-15, Hawaii Revised Statutes, is repealed.

["28-15 Tobacco enforcement special fund. (a) There is established in the state treasury the tobacco enforcement special fund, into which shall be deposited the tobacco settlement moneys as provided by section 328L-2(a), the allocated portion of the stamp fee designated to pay for the cost of enforcing the cigarette tax stamp as provided by section 245-26, and fines as provided for by section 245-41.

(b) The tobacco enforcement special fund shall be administered by the department of the attorney general and shall be used for administering, operating, monitoring, and ensuring compliance with and enforcement of:

(1) The Master Settlement Agreement as defined in chapter 675 and any other statutes or programs relating to that agreement;

(2) Chapter 675;

(3) Tobacco prevention programs;

(4) The cigarette tax stamp as defined in chapter 245 and any other statutes or programs relating to that chapter;

(5) Chapter 245;

(6) Chapter 486P and any other statutes or programs relating to that chapter; and

(7) Any other requirement deemed necessary to carry out the purposes of the fund.

(c) All unencumbered and unexpended moneys in excess of $500,000 remaining on balance in the tobacco enforcement special fund at the close of June 30 of each year shall lapse to the credit of the state general fund.

(d) The department of the attorney general shall submit a report to the legislature, no later than twenty days prior to the convening of each regular session, providing an accounting of the receipts and expenditures of the fund."]

SECTION 6. Section 328L-2, Hawaii Revised Statutes, is repealed.

["328L-2 Hawaii tobacco settlement special fund. (a) There is established in the state treasury the Hawaii tobacco settlement special fund into which shall be deposited:

(1) All tobacco settlement moneys; and

(2) All interest and earnings accruing from the investment of moneys in the fund;

provided that of all tobacco settlement moneys received by the State each fiscal year, the sum representing the first $350,000 of those moneys shall first be deposited in the state treasury in each fiscal year to the credit of the tobacco enforcement special fund. The Hawaii tobacco settlement special fund shall be administered by the department.

(b) The fund shall be used for the purpose of receiving, allocating, and appropriating the tobacco settlement moneys as follows:

(1) Fifteen per cent shall be appropriated into the emergency and budget reserve fund under section 328L-3;

(2) Twelve and one-half per cent shall be appropriated into the Hawaii tobacco prevention and control trust fund under section 328L-5;

(3) Twenty-six per cent shall be appropriated into the university revenue-undertakings fund created in section 304A‑2167.5, to be applied to the payment of the principal of and interest on, and to generate required coverage, if any, for, revenue bonds issued by the board of regents of the University of Hawaii to finance the cost of construction of a university health and wellness center, including a new medical school facility, to be situated on the island of Oahu; and

(4) Any remaining amounts shall be deposited to the credit of the state general fund;

in the succeeding fiscal year."]

SECTION 7. Section 328L-5, Hawaii Revised Statutes, is repealed.

["328L-5 Hawaii tobacco prevention and control trust fund. (a) There is established the Hawaii tobacco prevention and control trust fund as a separate fund of a nonprofit entity having a board of directors and qualifying under section 501(c)(3) of the Internal Revenue Code of 1986, as amended, into which shall be deposited moneys received as provided under section 328L-2(b)(2). The director of health with the concurrence of the governor, shall select, in accordance with law, the entity based upon the proven record of accomplishment of the entity in administering a similar trust fund.

(b) Notwithstanding that the Hawaii tobacco prevention and control trust fund is established within a private entity, the department of budget and finance shall have oversight authority over the fund and may make periodic financial audits of the fund; provided that the director of finance may contract with a certified public accountancy firm for this purpose. The director of health with the concurrence of the governor in their sole discretion may rescind the selection of the entity. If the selection of the entity [is] rescinded, moneys in the trust fund shall revert back to the State and shall be deemed to be trust moneys.

(c) The entity selected under subsection (a), for each fiscal year, may expend up to fifty per cent of the total market value of the Hawaii tobacco prevention and control trust fund on the preceding June 30, for tobacco prevention and control, including but not limited to, reducing cigarette smoking and tobacco use among youth and adults through education and enforcement activities, and controlling and preventing chronic diseases where tobacco is a risk factor.

(d) The Hawaii tobacco prevention and control trust fund may receive appropriations, contributions, grants, endowments, or gifts in cash or otherwise from any source, including the State, corporations or other businesses, foundations, government, individuals, and other interested parties; provided that any appropriations made by the State shall not supplant or diminish the funding of existing tobacco prevention and control programs or any health related programs funded in whole or in part by the State.

(e) The assets of the Hawaii tobacco prevention and control trust fund shall consist of:

(1) Moneys appropriated under section 328L‑2(b)(2);

(2) Moneys appropriated to the Hawaii tobacco prevention and control trust fund by the state, county, or federal government;

(3) Private contributions of cash or property; and

(4) Income and capital gains earned by the trust fund.

(f) The aggregate principal sum deposited in the Hawaii tobacco prevention and control trust fund shall be invested by the entity selected under subsection (a) in a manner intended to maximize the rate of return on investment of the trust fund consistent with the objective of preserving the trust fund's principal.

(g) If the entity selected under subsection (a) is dissolved, the director of health, with the concurrence of the governor, shall select a successor entity. If the Hawaii tobacco prevention and control trust fund is terminated, the moneys remaining in the trust fund shall revert back to the State and shall be deemed to be trust moneys.

(h) The administration of the Hawaii tobacco prevention and control trust fund shall be advised by the tobacco prevention and control advisory board created under section 328L-6."]

SECTION 8. There is appropriated out of the general revenues of the State of Hawaii the sum of $           or so much thereof as may be necessary for fiscal year 2021-2022 and the same sum or so much thereof as may be necessary for fiscal year 2022-2023 to be deposited into the university revenue‑undertakings fund established pursuant to section 304A-2167.5, Hawaii Revised Statutes.

The sums appropriated shall be expended by the university of Hawaii for the purposes of this Act.

SECTION 9. Any unencumbered balances remaining in the tobacco enforcement special fund, Hawaii tobacco settlement special fund, and Hawaii tobacco prevention and control trust fund as of July 1, 2021, shall lapse to the credit of the general fund.

SECTION 10. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 11. This Act shall take effect on July 1, 2021.

 

INTRODUCED BY:

_____________________________

 

 


 


 

Report Title:

Tobacco Enforcement Special Fund; Hawaii Tobacco Settlement Special Fund; Hawaii Tobacco Prevention and Control Trust Fund; Repeal; General Fund; Appropriation

 

Description:

Repeals the tobacco enforcement special fund, Hawaii tobacco settlement special fund, and Hawaii tobacco prevention and control trust fund and transfers unencumbered balances to the general fund. Appropriates general funds to the university revenue‑undertakings fund.

 

 

 

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