STAND. COM. REP. NO145

Honolulu, Hawaii

, 2001

RE: H.B. No. 549

 

 

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-First State Legislature

Regular Session of 2001

State of Hawaii

Sir:

Your Committees on Economic Development and Business Concerns and Energy and Environmental Protection, to which was referred H.B. No. 549, entitled:

"A BILL FOR AN ACT RELATING TO STATE ENTERPRISE ZONES,"

beg leave to report as follows:

The purpose of this bill is to:

(1) Clarify that businesses in enterprise zones that produce electric power from wind energy for sale primarily to a public utility company for resale to the public are exempt from the general excise tax;

(2) Correct the terminology of "assisted" technology equipment to "assistive" technology equipment; and

(3) Eliminate the enterprise zone use tax exemption for all qualifying enterprise zone businesses.

Your Committees agree with the intent of this bill, and recognize that the use tax exemption has the potential to encourage participating businesses to purchase supplies and equipment outside of Hawaii, rather than from local vendors.

The Department of Business, Economic Development, and Tourism (DBEDT) and the Department of Taxation testified in support of this measure. Apollo Energy Corporation and Hawaii Renewable Energy Alliance also testified in support of the bill, with an amendment to retain the use tax exemption for qualified businesses. Hawaiian Electric Company, and its subsidiary utilities, Maui Electric Company and Hawaii Electric Light Company testified in support of the intent of this measure, and along with Hawaii Renewable Energy Alliance, suggested an amendment to clarify that the use tax exemption apply to electricity derived from all renewable resources, and not only from wind energy.

Your Committees acknowledge the benefits of renewable energy and ask that the next committee insert language to expand the general excise tax exemption to qualifying businesses that produce electric power from any renewable energy source.

As affirmed by the records of votes of the members of your Committees on Economic Development and Business Concerns and Energy and Environmental Protection that are attached to this report, your Committees are in accord with the intent and purpose of H.B. 549 and recommend that it pass Second Reading and be referred to the Committee on Consumer Protection and Commerce.

 

Respectfully submitted on behalf of the members of the Committees on Economic Development and Business Concerns and Energy and Environmental Protection,

____________________________HERMINA M. MORITA, Chair

 

____________________________LEI AHU ISA, Chair