Report Title:

Transient Accommodations Tax: HTA; State Parks Special Fund

 

Description:

Caps TAT revenues deposited to tourism special fund at $50,000,000 annually; requires HTA to direct at least $1,000,000 of that amount to support of natural resources; deposits ninety per cent of any TAT revenues over $50,000,000 in state parks special fund and ten per cent in Hawaii statewide trail and access program, up to $2,000,000 annually and requires expenditures in response to master plan developed with HTA; any excess over $52,000,000 to general fund. (SD2)

THE SENATE

S.B. NO.

2350

TWENTY-FIRST LEGISLATURE, 2002

S.D. 2

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

relating to Transient Accommodations Tax.

 

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

SECTION 1. The legislature recognizes the connection between Hawaii's state park system and the vitality of its economy, especially its tourism sector. Over 7,000,000 tourists visit our islands each year to enjoy our great outdoors, including the natural beauty and the cultural treasures that comprise much of the state park system.

In the past, the nexus between the state park system and the tourism sector has not been clearly connected, as our state parks are usually some distance away from what are generally viewed as the primary tourism facilities, the resort destination. However, the allure of our islands for these tourists very heavily depends on ancillary facilities such as shopping and entertainment venues and customary visits to cultural and natural offerings of our state parks and other outdoor venues.

The recent and prolonged economic malaise exacerbated by September 11 has, as in most other government programs, severely limited the ability of the state park system to properly maintain the heavily used and often aged state park facilities throughout our islands, often leading to complaints from visitors and repeat visitors about the deteriorated condition of our state parks.

In order to better align the heretofore limited linkage between tourism and the state park system and recognizing the natural benefit of direct assistance from an industry whose constituency is the majority of the state park users, the legislature believes that a portion of the tourism special fund's share of the transient accommodations tax should be earmarked to supplement the operating costs of the state park system, and that the amount of money transferred to the tourism special fund should be limited by a dollar cap.

The purposes of this measure are to:

(1) Cap the share of the transient accommodations tax deposited in the tourism special fund at $50,000,000 annually;

(2) Require the HTA to expend, from the $50,000,000, at least $1,000,000 annually on activities in support of efforts to manage, improve, and protect Hawaii's natural environment and areas frequented by visitors;

(3) Allocate ninety per cent of any transient accommodations tax in excess of $50,000,000 annually, to be deposited in the state parks special fund, and ten per cent to the Hawaii statewide trail and access program, up to a total of $2,000,000;

(4) Require the department of land and natural resources to develop a master plan in coordination with the HTA for expenditure of the $2,000,000; and

(5) Allocate any transient accommodations tax in excess of $52,000,000 annually, to be deposited in the general fund of the State.

SECTION 2. Section 184-3.4, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) There is established within the state treasury a fund to be known as the state parks special fund[. All] into which shall be deposited:

(1) All proceeds collected by the state parks programs involving park user fees, any leases or concession agreements, the sale of any article purchased from the department to benefit the state parks programs, or any gifts or contributions[, shall be deposited into this fund]; provided that proceeds derived from the operation of Iolani Palace shall be used to supplement its educational and interpretive programs[.]; and

(2) Transient accommodations tax revenues pursuant to section 237D-6.5(b)(2); provided that these moneys shall be expended in response to a master plan developed in coordination with the Hawaii tourism authority."

SECTION 3. Section 198D-2, Hawaii Revised Statutes, is amended as follows:

1. By amending subsection (b) to read:

"(b) The trail and access program shall use funding for the management, maintenance, and development of trails and trail accesses under the jurisdiction of the department from the following sources:

(1) A portion of the highway fuel taxes collected under chapter 243;

(2) Federal government grants;

(3) Private contributions; [and]

(4) Fees, established pursuant to administrative rules and charged by the department for the commercial and other use of trails and trail accesses under the jurisdiction of the department[.]; and

(5) Transient accommodations tax revenues pursuant to section 237D-6.5(b)(2)."

2. By amending subsection (d) to read:

"(d) The moneys specified in subsection (b)(1), (3), [and] (4), and (5) shall be deposited in the special land and development fund under section 171-19 for the management, maintenance, and development of trails and trail accesses under the jurisdiction of the department[.]; provided that the moneys specified in subsection (b)(5) shall be expended for the management, maintenance, and development of trails and access areas frequented by visitors in response to a master plan developed in coordination with the Hawaii tourism authority."

SECTION 4. Section 201B-11, Hawaii Revised Statutes, is amended by amending subsection (c) to read as follows:

"(c) Moneys in the tourism special fund shall be used by the authority for the purposes of this chapter, provided that [not]:

(1) Not more than three per cent of this amount shall be used for administrative expenses[; provided further that of this amount the sum of], including $15,000 [shall be made available] for a protocol fund to be expended at the discretion of the executive director[; provided further that moneys in the tourism special fund shall be used], and for the salaries and expenses of the office of tourism established in section 201-92[.];

(2) Not more than ten per cent of any moneys awarded under any contract or agreement shall be used for administrative expenses, including all salaries and wages of the contractor or the contractor's employees; and

(3) At least $1,000,000 shall be made available to support efforts to manage, improve, and protect Hawaii's natural environment and areas frequented by visitors."

SECTION 5. Section 237D-6.5, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

"(b) Beginning on January 1, 1999[[],[]] revenues collected under this chapter shall be distributed as follows:

(1) 17.3 per cent of the revenues collected under this chapter shall be deposited into the convention center capital and operations special fund established under section 206X-10.5;

(2) 37.9 per cent of the revenues collected under this chapter shall be deposited into the tourism special fund established under section 201B-11; provided that beginning on January 1, 2002:

(A) If the amount of revenues collected exceeds $50,000,000 in any calendar year, of the revenues collected in excess of $50,000,000:

(i) Ninety per cent shall be deposited into the state parks special fund established in section 184-3.4; and

(ii) Ten per cent shall be transferred to the Hawaii statewide trail and access program pursuant to section 198D-2(b)(5);

provided that the total amount shall not exceed $2,000,000 in any calendar year; and

(B) If the amount of revenues collected exceeds $52,000,000 in any calendar year, revenues collected in excess of $52,000,000 shall be deposited into the general fund; and

(3) 44.8 per cent of the revenues collected under this chapter shall be transferred 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.

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."

SECTION 6. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 7. This Act shall take effect on July 1, 2002.