Transportation Energy

 

Description:

Establishes a comprehensive approach to increasing the use of alternative fuel vehicles in the State, including state procurement of alternative fuel vehicles, tax incentives, and infrastructure requirements.


HOUSE OF REPRESENTATIVES

H.B. NO.

1811

TWENTY-FIFTH LEGISLATURE, 2009

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT


 

 

RELATING TO TRANSPORTATION ENERGY.

 

 

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

 


PART I.

TRANSPORTATION ENERGY INFRASTRUCTURE

     SECTION 1.  Chapter 196, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§196-A  Requirement for electric vehicle charging capability.  Beginning January 1, 2015, every new single family residential dwelling constructed in the State shall include electric vehicle charging capability.  Electric vehicle charging capability shall comply with the applicable standards established by SAE International."

     SECTION 2.  Chapter 291, Hawaii Revised Statutes, is amended by adding two new sections to be appropriately designated and to read as follows:

     "§291-A  Designation of parking spaces for electric vehicles.  All commercial and public parking lots with at least one hundred parking spaces shall designate at least one parking space exclusively for electric vehicles.  An additional electric vehicle parking location shall be required for each additional one hundred parking spaces in the parking lot; provided that the designated parking spaces shall be located either near the building entrance or near electrical service, at the discretion of the facility manager.  Electric vehicle parking spaces shall be designated, clearly marked, and enforced no later than December 31, 2010.

     For the purposes of this section, "electric vehicle" means an electric vehicle, as defined in section 196-B, or neighborhood electric vehicle, as defined in section 286-2, with an electric vehicle license plate.

     §291-B  Parking spaces reserved for electric vehicles; penalties.  (a)  Beginning January 1, 2011, any person who parks a non-electric vehicle in a space designated and marked as reserved for electric vehicles shall receive a warning. 

     (b)  Beginning July 1, 2011, any person who parks a non-electric vehicle in a space designated and marked as reserved for electric vehicles shall be guilty of a traffic infraction under chapter 291D and shall be fined not less than $50 but not  more than $100 and shall pay any costs incurred by the court related to assessing the fine.

     (c)  Any citation issued under this chapter may be mailed to the violator pursuant to section 291C-165(b)."

     SECTION 3.  Section 269-1, Hawaii Revised Statutes, is amended by amending the definition of "public utility" to read as follows:

     ""Public utility":

     (1)  Includes every person who may own, control, operate, or manage as owner, lessee, trustee, receiver, or otherwise, whether under a franchise, charter, license, articles of association, or otherwise, any plant or equipment, or any part thereof, directly or indirectly for public use, for the transportation of passengers or freight, or the conveyance or transmission of telecommunications messages, or the furnishing of facilities for the transmission of intelligence by electricity by land or water or air within the State, or between points within the State, or for the production, conveyance, transmission, delivery, or furnishing of light, power, heat, cold, water, gas, or oil, or for the storage or warehousing of goods, or the disposal of sewage; provided that the term shall include:

          (A)  Any person insofar as that person owns or operates a private sewer company or sewer facility; and

          (B)  Any telecommunications carrier or telecommunications common carrier;

     (2)  Shall not include:

         (A)  Any person insofar as that person owns or operates an aerial transportation enterprise;

          (B)  Persons owning or operating taxicabs, as defined in this section;

          (C)  Common carriers transporting only freight on the public highways, unless operating within localities or along routes or between points that the public utilities commission finds to be inadequately serviced without regulation under this chapter;

          (D)  Persons engaged in the business of warehousing or storage unless the commission finds that regulation thereof is necessary in the public interest;

         (E)  The business of any carrier by water to the extent that the carrier enters into private contracts for towage, salvage, hauling, or carriage between points within the State and the carriage is not pursuant to either an established schedule or an undertaking to perform carriage services on behalf of the public generally;

         (F)  The business of any carrier by water, substantially engaged in interstate or foreign commerce, transporting passengers on luxury cruises between points within the State or on luxury round-trip cruises returning to the point of departure;

          (G)  Any person who:

              (i)  Controls, operates, or manages plants or facilities for the production, transmission, or furnishing of power primarily or entirely from nonfossil fuel sources; [and]

             (ii)  Provides, sells, or transmits all of that power, except such power as is used in its own internal operations, directly to a public utility for transmission to the public; and

            (iii)  Owns, controls, operates, or manages plants or facilities used primarily to charge or discharge vehicle batteries, that provide power for vehicle propulsion;

          (H)  A telecommunications provider only to the extent determined by the commission pursuant to section 269-16.9;

          (I)  Any person who controls, operates, or manages plants or facilities developed pursuant to chapter 167 for conveying, distributing, and transmitting water for irrigation and such other purposes that shall be held for public use and purpose;

          (J)  Any person who owns, controls, operates, or manages plants or facilities for the reclamation of wastewater; provided that:

              (i)  The services of the facility shall be provided pursuant to a service contract between the person and a state or county agency and at least ten per cent of the wastewater processed is used directly by the State or county which has entered into the service contract;

             (ii)  The primary function of the facility shall be the processing of secondary treated wastewater that has been produced by a municipal wastewater treatment facility that is owned by a state or county agency;

            (iii)  The facility shall not make sales of water to residential customers;

             (iv)  The facility may distribute and sell recycled or reclaimed water to entities not covered by a state or county service contract; provided that, in the absence of regulatory oversight and direct competition, the distribution and sale of recycled or reclaimed water shall be voluntary and its pricing fair and reasonable.  For purposes of this subparagraph, "recycled water" and "reclaimed water" mean treated wastewater that by design is intended or used for a beneficial purpose; and

              (v)  The facility shall not be engaged, either directly or indirectly, in the processing of food wastes; and

         (K)  Any person who owns, controls, operates, or manages any seawater air conditioning district cooling project; provided that at least fifty per cent of the energy required for the seawater air conditioning district cooling system is provided by a renewable energy resource, such as cold, deep seawater.

     If the application of this chapter is ordered by the commission in any case provided in paragraphs (2)(C), (2)(D), (2)(H), and (2)(I), the business of any public utility that presents evidence of bona fide operation on the date of the commencement of the proceedings resulting in the order shall be presumed to be necessary to public convenience and necessity, but any certificate issued under this proviso shall nevertheless be subject to such terms and conditions as the commission may prescribe, as provided in sections 269-16.9 and 269-20."

PART II.

TRANSPORTATION ENERGY INCENTIVES

     SECTION 4.  Chapter 196, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§196-B  Transportation energy transformation grant fund.  (a)  There is established in the state treasury a special fund to be designated as the transportation energy transformation grant fund into which shall be deposited appropriations made by the legislature to the fund.  Moneys in the transportation energy transformation grant fund may be expended by the director to carry out the director's duties and obligations under this chapter.  Disbursements from the transportation energy transformation grant fund shall not be subject to chapter 42F or 103D.

     (b)  As used in this section:

     "Director" means the director of business, economic development, and tourism.

     "Electric vehicle" has the same meaning as section 30(c)(1), of the Internal Revenue Code, and includes a plug-in hybrid electric vehicle, that:

     (1)  Draws energy for propulsion from a traction battery with at least four kilowatt hours of capacity; and

     (2)  Uses an off-board source of energy to recharge a battery as specified in paragraph (1);

     "Fleet" means more than fifty light duty motor vehicles in the State owned or operated by related entities.

     "Integrated intelligently with the electrical grid" means that the demand of the vehicle for electricity from the grid is controlled to reduce the electrical demand on the grid during peak demand times and maximize the use of renewable energy sources or use of renewable energy potentially available off-peak that would otherwise be curtailed.

     (c)  The transportation energy transformation grant fund shall be used by the director to make transportation energy transformation grants authorized under this section.  The transportation energy transformation grant fund shall also be used by the director to pay for any administrative and operational costs, including personnel costs and marketing costs, associated with a transportation energy transformation grant program.  Any law to the contrary notwithstanding, the director may use the moneys in the transportation energy transformation grant fund to employ or retain, by contract or otherwise, without regard to chapters 76 and 78, necessary professional, expert, managerial, technical, and support personnel to implement and carry out the purposes of this chapter.

     (d)  Prior to June 30 of each calendar year, fifty per cent of the grants made from the transportation energy transformation grant fund shall be reserved for non-fleet vehicles; provided that no more than ten per cent of the grants may be provided to any one fleet. 

     (e)  Subject to the availability of funds and the standards in this section, grants for approved electric vehicles shall be provided to purchasers of electric vehicles intended to be integrated intelligently with the electrical grid and licensed for use on highways in the State, as follows: 

     (1)  Beginning January 1, 2010, and expiring December 31, 2010:  up to $4,000 per vehicle limited to the first five hundred vehicles that are approved;

     (2)  Beginning January 1, 2011, and expiring December 31, 2011:  up to $3,500 per vehicle limited to the first one thousand vehicles that are approved;

     (3)  Beginning January 1, 2012, and expiring December 31, 2013:  up to $2,500 per vehicle limited to the first two thousand vehicles per year that are approved;

     (4)  Beginning January 1, 2014, and expiring December 31, 2015:  up to $2,000 per vehicle limited to the first two thousand five hundred vehicles that are approved per year; and

     (5)  Beginning January 1, 2016, and expiring December 31, 2021: up to $500 per vehicle limited to the first ten thousand vehicles that are approved per year.

     (f)  The director shall adopt rules, pursuant to chapter 91, that establish the descriptions, specifications, guidelines, and requirements for intelligent integration with the electrical grid.  The director may amend, narrow, or expand the definitions, descriptions, specifications, and requirements of intelligent integration.

     (g)  A grant shall only be made to applicants that:

     (1)  Meet the descriptions, specifications, guidelines, and requirements established by rule;

     (2)  File a completed application form, as determined solely by the director, together with all supporting documentation required by the director;

     (3)  File completed grant applications together for all vehicles in a fleet, if applicable;

     (4)  Complete the purchase or lease, licensing, and registration of the vehicle, prior to applying for the grant;

     (5)  Provide all other information deemed necessary by the director; and

     (6)  Comply with all additional requirements needed to implement the grant program, as determined by the director.

     (h)  The director shall submit an annual report on the  transportation energy transformation grant fund and statistical information on program participation to the governor and the legislature no later than twenty days prior to the convening of each regular session beginning with the regular session of 2010."

SECTION 5. There is appropriated out of the general revenues of the State of Hawaii the sum of $3,750,000 or so much thereof as may be necessary for fiscal year 2009-2010 to be deposited into the transportation energy transformation grant fund.

SECTION 6.  There is appropriated out of the transportation energy transformation grant fund the sum of $3,750,000 or so much thereof as may be necessary for fiscal year 2009-2010 to implement the purposes of the transportation energy transformation grant fund. 

The sum appropriated shall be expended by the department of business, economic development, and tourism for the purposes of section    of this Act.

This appropriation shall not lapse at the end of the fiscal year for which the appropriation is made; provided that all moneys from the appropriation that are unencumbered as of June 30, 2012, shall lapse as of that date.

     SECTION 7.  Chapter 235, Hawaii Revised Statutes, is amended by adding two new sections to be appropriately designated and to read as follows:

     "§235-A  Electric vehicle charging; income tax credit.  (a)  There shall be allowed to each taxpayer subject to the taxes imposed by this chapter a tax credit for code-compliant electric vehicle charging infrastructure installed and placed in service in the State that shall be deductible from the taxpayer's net income tax liability.  The tax credit may be claimed for the taxable year in which the code-compliant electric vehicle charging system is placed in service in the State.

     (b)  The amount of the credit shall be seventy per cent of the cost of the electric vehicle charging system or $500 per electric vehicle charge point of the system, whichever is less.  The cost of the electric vehicle charging system includes all costs to acquire, construct, and install the electric vehicle charging system that are required to be capitalized under section 263 of the Internal Revenue Code to the electric vehicle charging system.  The cost of the electric vehicle charging system does not include costs that are properly allocable to land or to a building and its structural components, including but not limited to, costs related to the acquisition of land on which the electric vehicle charging system is located, expenses for permits, legal fees, project management, or engineering to the extent such expenses are related to the land.

     (c)  If a deduction is taken under section 179 of the Internal Revenue Code, no tax credit shall be allowed for that portion of the cost for which the deduction is taken.

     (d)  The basis of eligible property for depreciation or accelerated cost recovery system purposes for state income taxes shall be reduced by the amount of credit allowable and claimed.  In the alternative, the taxpayer shall treat the amount of the credit allowable and claimed as a taxable income item for the taxable year in which it is properly recognized under the method of accounting used to compute taxable income.

     (e)  The costs used to compute this tax credit may not be used to compute any other tax credit.

     (f)  For the purposes of this section:

     "Electric vehicle charge point" means the part of the electric vehicle charging system that delivers electricity from a source outside an electric vehicle into one electric vehicle.

     "Electric vehicle charging system" means a system that is designed in compliance with Article 625 of the National Electrical Code and delivers electricity from a source outside an electric vehicle into one or more electric vehicles.  An electric vehicle charging system may include several charge points simultaneously connecting several electric vehicles to the system.

     (g)  The director of taxation shall prepare any forms that may be necessary to claim a tax credit under this section.  The director may also require the taxpayer to furnish reasonable information to ascertain the validity of the claim for credit made under this section and may adopt rules necessary to effectuate the purposes of this section pursuant to chapter 91.

     (h)  If the tax credit under this section exceeds the taxpayer's income tax liability, the excess of the credit over liability may be used as a credit against the taxpayer's income tax liability in subsequent years until exhausted.  Every claim, including amended claims, for a tax credit under this section shall be filed on or before the end of the twelfth month following the close of the taxable year for which the credit may be claimed.  Failure to comply with the foregoing provision shall constitute a waiver of the right to claim the credit.

     (i)  This tax credit applies to electric vehicle charging systems placed in service after July 1, 2009, and before January 1, 2016."

     §235-B  Alternative fuel refueling; income tax credit.  (a)  There shall be allowed to each taxpayer subject to the taxes imposed by this chapter a tax credit for any alternative fuel refueling infrastructure installed and placed in service in the State that shall be deductible from the taxpayer's net income tax liability.  The tax credit may be claimed for the taxable year in which the alternative fuel refueling infrastructure is placed in service.

     (b)  The amount of the credit shall be thirty per cent of the cost of the alternative fuel refueling infrastructure or $10,000, whichever is less.  The cost of the alternative fuel refueling infrastructure includes all costs to acquire, construct and install the alternative fuel refueling infrastructure that are required to be capitalized under section 263 of the Internal Revenue Code to the alternative fuel refueling infrastructure.  The cost of the alternative fuel refueling infrastructure does not include costs that are properly allocable to land or to a building and its structural components, including, but not limited to costs related to the acquisition of land on which the alternative fuel refueling infrastructure is located, expenses for permits, legal fees, project management, or engineering to the extent such expenses are related to the land.

     (c)  If a deduction is taken under section 179 of the Internal Revenue Code, no tax credit shall be allowed for that portion of the cost for which the deduction is taken.

     (d)  The basis of eligible property for depreciation or accelerated cost recovery system purposes for state income taxes shall be reduced by the amount of credit allowable and claimed.  In the alternative, the taxpayer shall treat the amount of the credit allowable and claimed as a taxable income item for the taxable year in which it is properly recognized under the method of accounting used to compute taxable income.

     (e)  The costs used to compute this tax credit may not be used to compute any other tax credit.

     (f)  Recapture provisions shall conform with the recapture provisions applied to “alternative fuel refueling property” credits described in section 30C of the Internal Revenue Code.

     (g)  For the purposes of this section:

     "Alternative fuel refueling infrastructure" means equipment for the storage and dispensing of alternative fuels for the refueling of alternative fuel vehicles, and shall conform with the definition of “alternative fuel refueling property” contained in section 30C of the Internal Revenue Code.

     (h)  The director of taxation shall prepare any forms that may be necessary to claim a tax credit under this section.  The director may also require the taxpayer to furnish reasonable information to ascertain the validity of the claim for credit made under this section and may adopt rules necessary to effectuate the purposes of this section pursuant to chapter 91.

     (i)  If the tax credit under this section exceeds the taxpayer's income tax liability, the excess of the credit over liability may be used as a credit against the taxpayer's income tax liability in subsequent years until exhausted.  Every claim, including amended claims, for a tax credit under this section shall be filed on or before the end of the twelfth month following the close of the taxable year for which the credit may be claimed.  Failure to comply with the foregoing provision shall constitute a waiver of the right to claim the credit.

     (j)  This tax credit applies to alternative fuel refueling infrastructure placed in service after July 1, 2009, and before January 1, 2016."

     SECTION 8.  Chapter 237, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§237-A  Exemption of sale or lease of certain vehicles.  (a) Beginning January 1, 2010, and expiring December 31, 2015, there shall be exempted from the measure of the taxes imposed by this chapter all of the gross proceeds arising from the sale or lease of a new or used light duty motor vehicle that is classified as an alternative fuel vehicle or a fuel economy leader vehicle.

(b)  As used in this section:

"Alternative fuel" means alcohol fuels, mixtures containing eighty-five per cent or more by volume of alcohols with gasoline or other fuels, natural gas, liquefied petroleum gas, hydrogen, biodiesel, mixtures containing twenty per cent or more by volume of biodiesel with diesel or other fuels, other fuels derived from biological materials, and electricity provided by off-board energy sources.

"Alternative fuel vehicle" means a vehicle capable of operating on an alternative fuel.

"Fuel economy leader vehicle" means a vehicle that is identified by the United States Environmental Protection Agency as a fuel economy leader in its class and model year.

"Light duty motor vehicle" has the same meaning as contained in 10 Code of Federal Regulations Part 490; provided that it does not include any vehicle incapable of traveling on highways or any vehicle with a gross vehicle weight rating greater than eight thousand five hundred pounds."

     SECTION 9.  Section 226-18, Hawaii Revised Statutes, is amended to read as follows:

     "§226-18  Objectives and policies for facility systems--energy.  (a)  Planning for the State's facility systems with regard to energy shall be directed toward the achievement of the following objectives, giving due consideration to all:

     (1)  Dependable, efficient, and economical statewide energy systems capable of supporting the needs of the people;

     (2)  Increased energy self-sufficiency where the ratio of indigenous to imported energy use is increased;

     (3)  Greater energy security and diversification in the face of threats to Hawaii's energy supplies and systems; and

     (4)  Reduction, avoidance, or sequestration of greenhouse gas emissions from energy supply and use.

     (b)  To achieve the energy objectives, it shall be the policy of this State to ensure the short- and long-term provision of adequate, reasonably priced, and dependable energy services to accommodate demand.

     (c)  To further achieve the energy objectives, it shall be the policy of this State to:

     (1)  Support research and development as well as promote the use of renewable energy sources;

     (2)  Ensure that the combination of energy supplies and energy-saving systems is sufficient to support the demands of growth;

     (3)  Base decisions of least-cost supply-side and demand-side energy resource options on a comparison of their total costs and benefits when a least-cost is determined by a reasonably comprehensive, quantitative, and qualitative accounting of their long-term, direct and indirect economic, environmental, social, cultural, and public health costs and benefits;

     (4)  Promote all cost-effective conservation of power and fuel supplies through measures, including:

         (A)  Development of cost-effective demand-side management programs;

         (B)  Education; and

         (C)  Adoption of energy-efficient practices and technologies;

     (5)  Ensure, to the extent that new supply-side resources are needed, that the development or expansion of energy systems uses the least-cost energy supply option and maximizes efficient technologies;

     (6)  Support research, development, [and] demonstration, and utilization of energy efficiency, load management, and other demand-side management programs, practices, and technologies;

     (7)  Promote alternate fuels and transportation energy efficiency [by encouraging diversification of transportation modes and infrastructure];

     (8)  Support actions that reduce, avoid, or sequester greenhouse gases in utility, transportation, and industrial sector applications;

     (9)  Support actions that reduce, avoid, or sequester Hawaii's greenhouse gas emissions through agriculture and forestry initiatives; and

    (10)  Provide priority handling and processing for all state and county permits required for renewable energy projects."

     SECTION 10.  Section 235-110.3, Hawaii Revised Statutes, is amended to read as follows:

     "§235-110.3  [Ethanol] Biofuel facility tax credit.  (a)  Each year during the credit period, there shall be allowed to each taxpayer subject to the taxes imposed by this chapter, [an ethanol] a biofuel facility tax credit that shall be applied to the taxpayer's net income tax liability, if any, imposed by this chapter for the taxable year in which the credit is properly claimed.

     For each qualified [ethanol] biofuel production facility, the annual dollar amount of the [ethanol] biofuel facility tax credit during the eight-year period shall be equal to thirty per cent of its nameplate capacity if the nameplate capacity is greater than five hundred thousand [but less than fifteen million] gallons.  A taxpayer may claim this credit for the first fifteen million gallons of capacity of each qualifying [ethanol] biofuel facility; provided that:

     (1)  The claim for this credit by any taxpayer of a qualifying [ethanol] biofuel production facility shall not exceed one hundred per cent of the total of all investments made by the taxpayer in the qualifying [ethanol] biofuel production facility prior to and during the credit period;

     (2)  The qualifying [ethanol] biofuel production facility operated at a level of production of at least seventy-five per cent of its nameplate capacity on an annualized basis;

     (3)  The qualifying [ethanol] biofuel production facility is in production on or before January 1, 2017; and

     (4)  No taxpayer that claims the credit under this section shall claim any other tax credit under this chapter for the same taxable year.

     (b)  As used in this section:

     "Biofuel" means ethanol, biodiesel, diesel, jet fuel, or other liquid fuel meeting the relevant fuel specifications of ASTM International (formerly ASTM, the American Society for Testing and Materials).

     "Credit period" means a maximum period of eight years beginning from the first taxable year in which the qualifying [ethanol] biofuel production facility begins production even if actual production is not at seventy-five per cent of nameplate capacity.

     "Investment" means a nonrefundable capital expenditure related to the development and construction of any qualifying [ethanol] biofuel production facility, including processing equipment, waste treatment systems, pipelines, and liquid storage tanks at the facility or remote locations, including expansions or modifications.  Capital expenditures shall be those direct and certain indirect costs determined in accordance with section 263A of the Internal Revenue Code, relating to uniform capitalization costs, but shall not include expenses for compensation paid to officers of the taxpayer, pension and other related costs, rent for land, the costs of repairing and maintaining the equipment or facilities, training of operating personnel, utility costs during construction, property taxes, costs relating to negotiation of commercial agreements not related to development or construction, or service costs that can be identified specifically with a service department or function or that directly benefit or are incurred by reason of a service department or function.  For the purposes of determining a capital expenditure under this section, the provisions of section 263A of the Internal Revenue Code shall apply as it read on March 1, 2004.  For purposes of this section, investment excludes land costs and includes any investment for which the taxpayer is at risk, as that term is used in section 465 of the Internal Revenue Code (with respect to deductions limited to amount at risk).

     "Nameplate capacity" means the qualifying [ethanol] biofuel production facility's production design capacity, in gallons of [motor fuel grade ethanol] biofuel per year.

     "Net income tax liability" means net income tax liability reduced by all other credits allowed under this chapter.

     "Qualifying [ethanol] biofuel production" means [ethanol] biofuel produced from renewable, organic feedstocks, or waste materials, including municipal solid waste.  All qualifying production shall be fermented, distilled, gasified, or produced by physical chemical conversion methods such as reformation and catalytic conversion and dehydrated at the facility.

     "Qualifying [ethanol] biofuel production facility" or "facility" means a facility located in Hawaii [which] that produces [motor] fuel grade [ethanol meeting the minimum specifications by the American Society of Testing and Materials standard D-4806, as amended.] biofuel.

     (c)  In the case of a taxable year in which the cumulative claims for the credit by the taxpayer of a qualifying [ethanol] biofuel production facility exceeds the cumulative investment made in the qualifying [ethanol] biofuel production facility by the taxpayer, only that portion that does not exceed the cumulative investment shall be claimed and allowed.

     (d)  The department of business, economic development, and tourism shall:

     (1)  Maintain records of the total amount of investment made by each taxpayer in a facility;

     (2)  Verify the amount of the qualifying investment;

     (3)  Total all qualifying and cumulative investments that the department of business, economic development, and tourism certifies; and

     (4)  Certify the total amount of the tax credit for each taxable year and the cumulative amount of the tax credit during the credit period.

     Upon each determination, the department of business, economic development, and tourism shall issue a certificate to the taxpayer verifying the qualifying investment amounts, the credit amount certified for each taxable year, and the cumulative amount of the tax credit during the credit period.  The taxpayer shall file the certificate with the taxpayer's tax return with the department of taxation.  Notwithstanding the department of business, economic development, and tourism's certification authority under this section, the director of taxation may audit and adjust certification to conform to the facts.

     If in any year, the annual amount of certified credits reaches $12,000,000 in the aggregate, the department of business, economic development, and tourism shall immediately discontinue certifying credits and notify the department of taxation.  In no instance shall the total amount of certified credits exceed $12,000,000 per year.  Notwithstanding any other law to the contrary, this information shall be available for public inspection and dissemination under chapter 92F.

     (e)  If the credit under this section exceeds the taxpayer's income tax liability, the excess of credit over liability shall be refunded to the taxpayer; provided that no refunds or payments on account of the tax credit allowed by this section shall be made for amounts less than $1.  All claims for a credit under this section must be properly filed on or before the end of the twelfth month following the close of the taxable year for which the credit may be claimed.  Failure to comply with the foregoing provision shall constitute a waiver of the right to claim the credit.

     (f)  If a qualifying [ethanol] biofuel production facility or an interest therein is acquired by a taxpayer prior to the expiration of the credit period, the credit allowable under subsection (a) for any period after such acquisition shall be equal to the credit that would have been allowable under subsection (a) to the prior taxpayer had the taxpayer not disposed of the interest.  If an interest is disposed of during any year for which the credit is allowable under subsection (a), the credit shall be allowable between the parties on the basis of the number of days during the year the interest was held by each taxpayer.  In no case shall the credit allowed under subsection (a) be allowed after the expiration of the credit period.

     [(g)  Once the total nameplate capacities of qualifying ethanol production facilities built within the State reaches or exceeds a level of forty million gallons per year, credits under this section shall not be allowed for new ethanol production facilities.  If a new facility's production capacity would cause the statewide ethanol production capacity to exceed forty million gallons per year, only the ethanol production capacity that does not exceed the statewide forty million gallon per year level shall be eligible for the credit.]

     [(h)] (g)  Prior to construction of any new qualifying [ethanol] biofuel production facility, the taxpayer shall provide written notice of the taxpayer's intention to begin construction of a qualifying [ethanol] biofuel production facility.  The information shall be provided to the department of taxation and the department of business, economic development, and tourism on forms provided by the department of business, economic development, and tourism, and shall include information on the taxpayer, facility location, facility production capacity, anticipated production start date, and the taxpayer's contact information.  Notwithstanding any other law to the contrary, this information shall be available for public inspection and dissemination under chapter 92F.

     [(i)] (h)  The taxpayer shall provide written notice to the director of taxation and the director of business, economic development, and tourism within thirty days following the start of production.  The notice shall include the production start date and expected [ethanol] biofuel fuel production for the next twenty-four months.  Notwithstanding any other law to the contrary, this information shall be available for public inspection and dissemination under chapter 92F.

     [(j)] (i) If a qualifying [ethanol] biofuel production facility fails to achieve an average annual production of at least seventy-five per cent of its nameplate capacity for two consecutive years, the stated capacity of that facility may be revised by the director of business, economic development, and tourism to reflect actual production for the purposes of determining [statewide production capacity under subsection (g) and] allowable credits for that facility under subsection (a).  Notwithstanding any other law to the contrary, this information shall be available for public inspection and dissemination under chapter 92F.

     [(k)] (j)  Each calendar year during the credit period, the taxpayer shall provide information to the director of business, economic development, and tourism on the number of gallons [of ethanol] and type of biofuel produced and sold during the previous calendar year, how much was sold in Hawaii versus overseas, percentage of Hawaii-grown feedstocks and other feedstocks used for [ethanol] biofuel production, the number of employees of the facility, and the projected number of gallons [of ethanol] and type of biofuel production for the succeeding year.

     [(l)] (k)  In the case of a partnership, S corporation, estate, or trust, the tax credit allowable is for every qualifying [ethanol] biofuel production facility.  The cost upon which the tax credit is computed shall be determined at the entity level.  Distribution and share of credit shall be determined pursuant to section 235-110.7(a).

     [(m)] (l)  Following each year in which a credit under this section has been claimed, the director of business, economic development, and tourism shall [submit a written] include in its annual report to the governor and legislature [regarding the production and sale of ethanol.  The report shall include:] the following:

     (1)  The number, location, and nameplate capacities of qualifying [ethanol] biofuel production facilities in the State;

     (2)  The total number of gallons of [ethanol] biofuel produced and sold during the previous year; and

     (3)  The projected number of gallons of [ethanol] biofuel production for the succeeding year.

     [(n)] (m)  The director of taxation shall prepare forms that may be necessary to claim a credit under this section.  Notwithstanding the department of business, economic development, and tourism's certification authority under this section, the director may audit and adjust certification to conform to the facts.  The director may also require the taxpayer to furnish information to ascertain the validity of the claim for credit made under this section and may adopt rules necessary to effectuate the purposes of this section pursuant to chapter 91."

     SECTION 11.  Section 238-9.5, Hawaii Revised Statutes, is amended to read as follows:

     "§238-9.5  Motor vehicle importation; report by dealers; proof of payment.  (a)  Every dealer, as defined in section 437-1.1, shall submit a report to the director, on or before the last day of each calendar month, for all motor vehicles delivered by the dealer in the prior month as a courtesy delivery.  The report shall contain the name and address of the dealer making the courtesy delivery, name and address of the seller of the vehicle, type of motor vehicle, the landed value of the vehicle, the name and address of the purchaser or importer, the date of importation, and other information relevant to the courtesy delivery as requested by the director.

     As used in this section, "courtesy delivery" means the preparation for delivery and the delivery by a dealer of a motor vehicle imported into the State by a person who purchased the motor vehicle from an out-of-state motor vehicle manufacturer or an out-of-state dealer and does not apply to motor vehicles sold by the in-state dealer.

     (b)  The director of taxation shall prepare forms necessary for individuals importing motor vehicles into the State to prove payment of the use tax necessary to register the motor vehicle.

     (c)  The tax imposed by this chapter shall not apply to an alternative fuel vehicle or fuel economy leader vehicle that is exempted pursuant to chapter 237."

     SECTION 12.  Section 251-2, Hawaii Revised Statutes, is amended to read as follows:

     "§251-2  Rental motor vehicle and tour vehicle surcharge tax.  (a)  There is levied and shall be assessed and collected each month a rental motor vehicle surcharge tax of $2 a day, except that for the period of September 1, 1999, to August 31, 2011, the tax shall be $3 a day, or any portion of a day that a rental motor vehicle is rented or leased.  The rental motor vehicle surcharge tax shall be levied upon the lessor; provided that the tax shall not be levied on the lessor if:

     (1)  The lessor is renting the vehicle to replace a vehicle of the lessee that is being repaired; and

     (2)  A record of the repair order for the vehicle is retained either by the lessor for two years for verification purposes or by a motor vehicle repair dealer for two years as provided in section 437B-16.

     (b)  There is levied and shall be assessed and collected each month a tour vehicle surcharge tax of:

     (1)  $65 for each tour vehicle used or partially used during the month that falls into the over twenty-five passenger seat category; and

     (2)  $15 for each tour vehicle used or partially used during the month that falls into the eight to twenty-five passenger seat category.

     The tour vehicle surcharge tax shall be levied upon the tour vehicle operator.

     (c)  For the period beginning January 1, 2010, and ending  December 31, 2015, up to two hundred alternative fuel light duty motor vehicles per rental car fleet shall be exempt from the rental motor vehicle surcharge tax. 

     (d)  For the purposes of this section:

     "Alternative fuel" has the same meaning as defined in section 237-A.

     "Alternative fuel vehicle" has the same meaning as defined in section 237-A.

     "Light duty motor vehicle" has the same meaning as defined in section 237-A.

     "Rental car fleet" refers to all vehicles in the State owned or operated by related entities, as that term is defined in section 237-23.5."

     SECTION 13.  Section 286-41, Hawaii Revised Statutes, is amended to read as follows:

     "§286-41  Application for registration; full faith and credit to current certificates; this part not applicable to certain equipment.  (a)  Every owner of a motor vehicle which is to be operated upon the public highways shall, for each vehicle owned, except as herein otherwise provided, apply to the director of finance of the county where the vehicle is to be operated, for the registration thereof.  If a vehicle is moved to another county and is to be operated upon the public highways of that county, the existing certificate of registration shall be valid until its expiration date, at which time the owner shall apply to the director of finance of the county in which the vehicle is then located for the registration of the vehicle, whether or not the owner is domiciled in the county or the owner's principal place of business is in that county, except that this provision shall not apply to vehicles which are temporarily transferred to another county for a period of not more than three months.

     (b)  Application for the registration of a vehicle shall be made upon the appropriate form furnished by the director of finance and shall contain the name, occupation, and address of the owner and legal owner; and, if the applicant is a member of the United States naval or military forces, the applicant shall give the organization and station.  All applications shall also contain a description of the vehicle, including the name of the maker, the type of fuel for the use of which it is adapted (e.g., gasoline, diesel oil, liquefied petroleum gas), the serial or motor number, and the date first sold by the manufacturer or dealer, and such further description of the vehicle as is called for in the form, and such other information as may be required by the director of finance, to establish legal ownership.  A person applying for initial registration of a neighborhood electric vehicle shall certify in writing that a notice of the operational restrictions applying to the vehicle as provided in section 291C-134 [are] is contained on a permanent notice attached to or painted on the vehicle in a location that is in clear view of the driver.

     (c)  If the vehicle to be registered is specially constructed, reconstructed, or rebuilt; is a special interest vehicle; or is an imported vehicle, this fact shall be stated in the application and upon the registration of the special interest motor vehicle and imported motor vehicle, which has been registered until that time in any other state or county, and the owner shall surrender to the director of finance the certificates of registration or other evidence of such form of registration as may be in the applicant's possession or control.  The director of finance shall grant full faith and credit to the currently valid certificates of title and registration describing the vehicle, the ownership thereof, and any liens noted thereon, issued by any title state or county in which the vehicle was last registered.  The acceptance by the director of finance of a certificate of title or of registration issued by another state or county, as provided in this subsection, in the absence of knowledge that the certificate is forged, fraudulent, or void, shall be a sufficient determination of the genuineness and regularity of the certificate and of the truth of the recitals therein, and no liability shall be incurred by any officer or employee of the director of finance by reason of so accepting the certificate.

     (d)  The owner of every motor vehicle of the current, previous, and subsequent year model bought out-of-state, subsequently brought into the State, and subject to the use tax under chapter 238 shall provide with the application for registration proof of payment of the use tax pursuant to requirements established by the department of taxation.  No registration certificate shall be issued without proof of payment of the use tax[.] unless the vehicle is an alternative fuel vehicle or fuel economy leader vehicle exempt from the use tax as provided in chapter 238.

     (e)  Notwithstanding any other law to the contrary, the director of finance of the county in which the application for registration is sought shall not require proof of insurance as a condition to satisfy the requirements of this part.  This subsection shall apply only to the initial registration of any motor vehicle.

     (f)  The provisions of this part requiring the registration of motor vehicles shall not apply to:

     (1)  Special mobile equipment;

     (2)  Implements of husbandry temporarily drawn, moved, or otherwise propelled upon the public highways; and

     (3)  Aircraft servicing vehicles which are being used exclusively on lands set aside to the department of transportation for airport purposes.

     (g)  Beginning January 1, 2010, and expiring December 31, 2015, the motor vehicle registration fee and other fees, if any, assessed upon or associated with the registration of an electric vehicle in this State, including any fees associated with the issuance of an electric vehicle license plate, shall be waived."

PART III.

TRANSPORTATION ENERGY REQUIREMENTS

     SECTION 14.  Chapter 196, Hawaii Revised Statutes, is amended by adding two new sections to be appropriately designated and to read as follows:

     "§196-C  Alternative fuel vehicle requirement for private fleets.  (a)  Beginning January 1, 2012, each fleet operator controlling more than fifty light duty motor vehicles in the State, when replacing its light duty motor vehicles or expanding its fleet, shall acquire increasing percentages of vehicles capable of operating on non-petroleum energy sources, including electric vehicles, flexible fuel vehicles, or other alternative fuel vehicles.  

     (b)  At least four per cent of all new light duty motor vehicles acquired by a fleet operator in the State during calendar year 2012 shall be alternative fuel vehicles.  This percentage shall increase by four per cent per year and shall reach seventy-six per cent by calendar year 2030.

     (c)  As used in this section:

     "Acquire" means to take into possession or control, whether by lease, purchase, or other arrangement.

     "Alternative fuel" has the same meaning as defined in section 237-A.

     "Alternative fuel vehicle" has the same meaning as defined in section 237-A.

     "Electric vehicle" means a vehicle powered by electricity; provided that it does not include a neighborhood electric vehicle or any vehicle that is not designed to obtain electricity from sources outside the vehicle.

     "Fleet operator" means an entity controlling more than fifty light duty motor vehicles for use in a business enterprise, including vehicle rental, but does not include vehicles held for retail sale.

     "Light duty motor vehicle" has the same meaning as defined in section 237-A.

     (d)  A fleet operator and its affiliates may aggregate their vehicle purchases.

     (e)  A fleet operator acquiring vehicles earlier than the program start date or in excess of the number of vehicles required shall be able to accumulate alternative fuel vehicle credits, which may be traded, sold, or banked for later use in meeting vehicle acquisition requirements.

     (f)  Every fleet operator shall file annual reports with the energy resources coordinator.  Reports shall be for each calendar year and shall conform to the format, content, and reporting requirements specified by the energy resources coordinator.  Reports shall be filed no later than June 30 following the close of the calendar year of the report.

     (g)  A fleet operator may apply to the energy resources coordinator for an exemption from the requirements of this section to the extent that the vehicles required by this section are not available or do not meet the specific needs of the fleet.  To be eligible for an exemption, a fleet operator must be able to demonstrate having made a good faith effort to comply with the requirements.

     (h)  Any fleet operator or any other person violating the requirements of this section may be subject to a fine of up to $1,000 for each nonconforming vehicle and up to $50 for each day that an annual report is late.

     (i)  The energy resources coordinator shall adopt rules, pursuant to chapter 91, for the administration and enforcement of this section.

     §196-D  Alternative fuel light duty motor vehicle sales requirement.  (a)  Beginning January 1, 2015, each motor vehicle dealer with sales of more than fifty light duty motor vehicles per year in the State shall increase the percentage of new and used light duty motor vehicles capable of operating on non-petroleum energy sources, including electric vehicles, flexible fuel vehicles, or other alternative fuel vehicles that it offers for sale in the State by no less than       per cent each year.

     (b)  For the purposes of this section:

     "Alternative fuel" has the same meaning as defined in section 237-A.

     "Alternative fuel vehicle" has the same meaning as defined in section 237-A.

     "Electric vehicle" has the same meaning as defined in section 196-C.

     "Light-duty motor vehicle" has the same meaning as defined in section 237-A.

     "Motor vehicle dealer" means a new motor vehicle dealer or a used motor vehicle dealer, as those terms are defined in section 437-1.1.

     "Sale" means the transfer of control, whether by lease, sale, or other arrangement, for a period greater than six months.

     (c)  A motor vehicle dealer may acquire credits for alternative fuel vehicles offered for sale or sold earlier than or in excess of the required amounts.  These credits may be banked, sold, or transferred to the dealer's affiliates or other motor vehicle dealers in the State.  Credits may be used to offset an equivalent number of required vehicles offered for sale.

     (d)  Each motor vehicle dealer shall file an annual report with the energy resources coordinator reporting on the number and type of alternative fuel vehicles and non-alternative fuel light duty motor vehicles sold or offered for sale during the previous calendar year, as well as any vehicle credits sold, purchased, traded, or banked.  Reports shall be for each calendar year and shall conform to format, content, and reporting requirements specified by the energy resources coordinator.  Reports shall be filed no later than June 30 following the close of the calendar year of the report.

     (e)  Any motor vehicle dealer not meeting the alternative fuel vehicle percentage requirement shall include in its report an explanation for not meeting the requirement.

     (f)  A motor vehicle dealer may apply to the energy resources coordinator for exemptions from the requirements of this section to the extent that the vehicles or credits required by this section were not available.  To be eligible for an exemption, the motor vehicle dealer must be able to demonstrate having made a good faith effort to comply with the requirements.

     (g)  Any motor vehicle dealer or any other person violating the requirements of this section may be subject to a fine of up to $1,000 for each nonconforming vehicle and up to $50 for each day that an annual report is late.

     (h)  Failure to file the required reports or to comply with the vehicle sales requirements of this section may be grounds for referral to the motor vehicle industry board for disciplinary action.

     (i)  The energy resources coordinator shall adopt rules, pursuant to chapter 91, for the administration and enforcement of this section."

     SECTION 15.  Section 103D-412, Hawaii Revised Statutes, is amended to read as follows:

     "§103D-412  [Energy-efficient vehicles.] Light duty motor vehicle requirements.  (a)  The procurement policy for all agencies purchasing or leasing light duty motor vehicles shall be to [obtain energy-efficient vehicles.  All covered fleets are directed to procure increasing percentages of energy-efficient vehicles as part of their annual vehicle acquisition plans, which shall be as follows:

     (1)  In the fiscal year beginning July 1, 2006, at least twenty per cent of newly purchased light-duty vehicles acquired by each covered fleet shall be energy-efficient vehicles;

     (2)  In the fiscal year beginning July 1, 2007, at least thirty per cent of newly purchased light-duty vehicles acquired by each covered fleet shall be energy-efficient vehicles;

     (3)  In the fiscal year beginning July 1, 2008, at least forty per cent of newly purchased light-duty vehicles acquired by each covered fleet shall be energy-efficient vehicles; and

     (4)  For each subsequent fiscal year, the percentage of energy-efficient vehicles newly purchased shall be five percentage points higher than the previous year, until at least seventy-five per cent of each covered fleet's newly purchased, light-duty vehicles are energy-efficient vehicles.]

reduce dependence on petroleum for transportation energy.

Beginning January 1, 2010, all state and county entities, when purchasing new vehicles, shall select vehicles with reduced dependence on petroleum-based fuels, in the following descending order of priority:

     (1)  The agency shall first evaluate any available electric or plug-in hybrid electric vehicle and, if it meets the needs of the agency, the vehicle shall be selected.

     (2)  If an electric or plug-in hybrid electric vehicle that meets the needs of the agency is not available, the agency may select a hydrogen or fuel cell vehicle.

     (3)  If a hydrogen or fuel cell vehicle that meets the needs of the agency is not available, the agency may select an alternative fuel vehicle.

     (4)  If an alternative fuel vehicle that meets the needs of the agency is not available, the agency may select a hybrid electric vehicle.

     (5)  If a hybrid electric vehicle that meets the needs of the agency is not available, the agency shall select a vehicle that is identified by the United States Environmental Protection Agency in its annual "Fuel Economy Leaders" report as being among the top performers for fuel economy in its class.

     (b)  For the purposes of this section:

     "Agency" means a state agency, office, or department.

     "Alternative fuel" has the same meaning [contained in 10 Code of Federal Regulations Part 490.] as defined in section 237-A.

     "Covered fleet" has the same meaning as contained in 10 Code of Federal Regulations Part 490 Subpart C.

     ["Energy-efficient vehicle" means a vehicle that:

     (1)  Is capable of using an alternative fuel;

     (2)  Is powered primarily through the use of an electric battery or battery pack that stores energy produced by an electric motor through regenerative braking to assist in vehicle operation;

     (3)  Is propelled by power derived from one or more cells converting chemical energy directly into electricity by combining oxygen with hydrogen fuel that is stored on board the vehicle in any form;

     (4)  Draws propulsion energy from onboard sources of stored energy generated from an internal combustion or heat engine using combustible fuel and a rechargeable energy storage system; or

     (5)  Is on the list of "Most Energy Efficient Vehicles" in its class or is in the top one-fifth of the most energy-efficient vehicles in its class available in Hawaii as shown by vehicle fuel efficiency lists, rankings, or reports maintained by the United States Environmental Protection Agency.]

     "Excluded vehicles" has the same meaning as provided in 10 Code of Federal Regulations Section 490.3.

     "Light-duty motor vehicle" has the same meaning as [contained in 10 Code of Federal Regulations Part 490.] defined in section 237-A.

     [(c)  Agencies may offset energy-efficient vehicle purchase requirements by successfully demonstrating percentage improvements in overall light-duty vehicle fleet mileage economy.  The offsets shall be measured against the fleet average miles per gallon of petroleum-based gasoline and diesel fuel, using the fiscal year beginning July 1, 2006, as a baseline, on a percentage-by-percentage basis.

     (d)  Agencies that use biodiesel fuel may offset the vehicle purchase requirements of this section at the rate of one vehicle for each four hundred fifty gallons of neat biodiesel fuel used.  Neat biodiesel fuel is one hundred per cent biodiesel (B100) by volume.

     (e)] (c)  Agencies may apply to the chief procurement officer for exemptions from the requirements of this section to the extent that the vehicles required by this section are not available or do not meet the specific needs of the agency.  Life cycle vehicle and fuel costs may be included in the determination of whether a particular vehicle meets the needs of the agency.  Estimates of future fuel prices shall be based on projections made by the United States Energy Information Administration.

     [(f)] (d)  Vehicles acquired from another state agency and excluded vehicles are exempt from the requirements of this section.

     [(g)] (e)  Nothing in this section is intended to interfere with [an agency's] the ability of a covered fleet to comply with [federally-imposed] the vehicle purchase mandates such [as those] required by 10 Code of Federal Regulations Part 490 Subpart C."

     SECTION 16.  Section 103D-1012, Hawaii Revised Statutes, is amended to read as follows:

     "[[]§103D-1012[]]  Biofuel preference.  (a)  Notwithstanding any other law to the contrary, contracts for the purchase of diesel fuel or boiler fuel shall be awarded to the lowest responsible and responsive bidders, with preference given to bids for biofuels or blends of biofuel and petroleum fuel.

     (b)  When purchasing fuel for use in diesel engines, the preference shall be [five cents] twenty per cent per gallon of one hundred per cent [biodiesel.] biomass-based diesel.  For blends containing both [biodiesel] biomass-based diesel and petroleum-based diesel, the preference shall be applied only to the [biodiesel] biomass-based diesel portion of the blend.

     (c)  When purchasing fuel for use in boilers, the preference shall be [five cents] twenty per cent per gallon of one hundred per cent biofuel.  For blends containing both biofuel and petroleum-based boiler fuel, the preference shall be applied only to the biofuel portion of the blend.

     (d)  As used in this section, "biodiesel" means a vegetable oil-based fuel that meets ASTM International standard D6751, "Standard Specification for Biodiesel (B100) Fuel Blend Stock for Distillate Fuels", as amended.

     (e)  As used in this section, "biofuel" means fuel from non-petroleum plant or animal based sources that can be used for the generation of heat or power.

     (f)  As used in this section, “biomass-based diesel” means biodiesel or diesel fuel substitute produced in Hawaii from biomass, provided that the fuel is registered with the Environmental Protection Agency for use in on-road engines and meets ASTM International fuel specifications for use in diesel engines.

     (g)  Beginning January 1, 2012, all state-owned diesel vehicles and equipment are required to be fueled with blends of biomass-based diesel, subject to the availability of the fuel, and so long as the price is no greater than twenty per cent more per gallon than the price of conventional diesel."

     SECTION 17.  Section 196-9, Hawaii Revised Statutes, is amended by amending subsection (c) to read as follows:

     "(c)  With regard to motor vehicles and transportation fuel, each agency shall:

     (1)  Comply with Title 10, Code of Federal Regulations, Part 490, Subpart C, "Mandatory State Fleet Program", if applicable;

     (2)  Comply with all applicable state laws regarding vehicle purchases;

     (3)  Once federal and state vehicle purchase mandates have been satisfied, purchase the most fuel-efficient vehicles that meet the needs of their programs; provided that life cycle cost-benefit analysis of vehicle purchases shall include projected fuel costs;

     (4)  Purchase alternative fuels and ethanol blended gasoline when available;

     (5)  [Evaluate a purchase preference for] Purchase biodiesel blends, [as applicable to agencies with diesel fuel purchases;] in accordance with chapter 103D;

     (6)  Promote efficient operation of vehicles;

     (7)  Use the most appropriate minimum octane fuel; [provided that] vehicles shall use 87-octane fuel unless the owner's manual for the vehicle states otherwise or the engine experiences knocking or pinging;

     (8)  [Beginning with fiscal year 2005-2006 as the baseline, collect] Collect and maintain, for [the life of] each vehicle acquired, the following data:

         (A)  Vehicle acquisition cost;

         (B)  United States Environmental Protection Agency rated fuel economy;

         (C)  Vehicle fuel configuration, such as gasoline, diesel, flex-fuel gasoline/E85, and dedicated propane;

         (D)  Actual in-use vehicle mileage;

         (E)  Actual in-use vehicle fuel consumption; and

         (F)  Actual in-use annual average vehicle fuel economy; and

     (9)  [Beginning with fiscal year 2005-2006 as the baseline with] With respect to each agency that operates a fleet of thirty or more vehicles, collect and maintain, in addition to the data in paragraph (8), the following:

         (A)  Information on the vehicles in the fleet, including vehicle year, make, model, gross vehicle weight rating, and vehicle fuel configuration;

         (B)  Fleet fuel usage, by fuel;

         (C)  Fleet mileage; and

         (D)  Overall annual average fleet fuel economy and average miles per gallon of gasoline and diesel."

     SECTION 18.  Section 437-28, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

     "(a)  In addition to any other actions authorized by law, the board, after notice and hearing as provided in chapter 91, and subject to appeal to the circuit court of the circuit in which the board has jurisdiction under the procedure and rules prescribed by the laws of the State or the applicable rules of the courts pertaining to appeals to circuit courts, may suspend, revoke, fine, or deny the renewal of any license, or prior to notice and hearing deny the issuance of any license for any cause authorized by law, including but not limited to circumstances where the board finds that the applicant or holder, or any officer, director, general manager, trustee, partner, or stockholder owning more than ten per cent interest of the applicant or holder:

     (1)  Has intentionally made a false statement of a material fact in the application for a license or in any other statement required by this chapter or has obtained or attempted to obtain a license by fraud or misrepresentation;

     (2)  Has failed to comply with, observe, or adhere to any provision of this chapter or any other law relating to the sale, taxing, or licensing of motor vehicles or any rule or order made pursuant to this chapter[;], or has been referred to the board by the energy resources coordinator for failing to comply with alternative fuel vehicle requirements;

     (3)  Has committed a fraudulent act in selling, purchasing, or otherwise dealing in motor vehicles or has misrepresented the terms and conditions of a sale, purchase, or contract for sale or purchase of a motor vehicle or any interest therein including an option to purchase motor vehicles;

     (4)  Has engaged in business under a past or present license issued pursuant to this chapter, in a manner as to cause injury to the public or to those with whom one is dealing;

     (5)  Has failed to comply with, observe, or adhere to any law in any other respect on account whereof the board may deem the applicant or holder to be an unfit or improper person to hold a license;

     (6)  Has failed to meet or maintain the conditions and requirements necessary to qualify for the issuance of a license;

     (7)  Is insolvent or has filed or is the subject of petition for bankruptcy, wage earner's plan, or financial reorganization plan; or has made or proposes to make an assignment for benefit of creditors;

     (8)  In the case of an individual applicant or holder of a license, if the applicant or holder is not at least eighteen years of age; in the case of a partnership applicant or holder of a license, if any general or limited partner thereof is not at least eighteen years of age;

     (9)  Has charged more than the legal rate of interest on the sale or purchase or attempted sale or purchase or in arranging the sale or purchase of a motor vehicle or any interest therein including an option to purchase;

    (10)  Has violated any of the laws pertaining to false advertising or to credit sales in the offering, soliciting, selling, or purchasing, or arranging to sell or purchase a motor vehicle or any interest therein;

    (11)  Has wilfully failed or refused to perform any unequivocal and indisputable obligation under any written agreement involving the sale or purchase of a motor vehicle or any interest therein including an option to purchase;

    (12)  Has been denied the issuance of a license under this chapter for substantial culpable cause or for having had a license issued under this chapter suspended, revoked, or the renewal thereof denied for substantial culpable cause;

    (13)  Has entered or has attempted to enter or proposes to enter into any contract or agreement contrary to this chapter or any rule adopted thereunder;

    (14)  Has been or is engaged or proposes to engage in the business of selling new motor vehicles as a dealer or auction without a proper franchise therefor;

    (15)  Has at any time employed or utilized or attempted or proposed to employ or utilize any person not licensed under this chapter who is required to be so licensed;

    (16)  Has entered or attempted to enter any one-payment contract, where the contract is required to be signed by the purchaser prior to removal of the motor vehicle for test driving from the seller's premises;

    (17)  Being a salesperson or dealer:

         (A)  Has required a purchaser of motor vehicles as a condition of sale and delivery thereof to purchase special features, appliances, accessories, or equipment not desired or requested by the purchaser; provided that this prohibition shall not apply as to special features, appliances, accessories, or equipment which are ordinarily installed on the vehicle when received or acquired by the dealer;

         (B)  Has represented and sold as an unused motor vehicle any motor vehicle which has been operated as a demonstrator, leased, or U-drive motor vehicle;

         (C)  Has sold a new motor vehicle without providing or securing for the purchaser the standard factory new car warranty for the vehicle, unless the dealer or salesperson clearly notes in writing on the sales contract that the new motor vehicle is sold without the standard factory warranty;

         (D)  Has sold a new motor vehicle covered by a standard factory warranty without informing the purchaser in writing that any repairs or other work necessary on any accessories which were not installed by the manufacturer of the vehicle may not be obtainable in a geographic location other than where the purchase occurred; provided that the notice required by this section shall conform to the plain language requirements of section 487A-1, regardless of the dollar amount of the transaction;

         (E)  Has engaged in any improper business conduct, including but not limited to employing, contracting with, or compensating consumer consultants; or

         (F)  Has sold or leased a new or used motor vehicle, other than at auction, without written documentation that contains the following provision printed legibly in at least fourteen-point bold typeface print, upon which the salesperson or dealer shall appropriately indicate the type of sale, and upon which both the customer and salesperson or dealer shall place their initials in the designated spaces, prior to the signing of the contract of sale or lease:

              "This (IS) (IS NOT) a door-to-door sale.  There (IS A) (IS NO) 3-DAY RIGHT TO CANCEL on this purchase.

              ____ Customer's Initials         ____ Salesperson's

                                      or Dealer's Initials";

    (18)  Being an applicant or holder of a dealer's license:

         (A)  Has sold or proposed to sell new motor vehicles without providing for the maintenance of a reasonable inventory of parts for new vehicles or without providing and maintaining adequate repair facilities and personnel for new vehicles at either the main licensed premises or at any branch location;

         (B)  Has employed or proposed to employ any salesperson who is not duly licensed under this chapter; or

         (C)  Has sold or proposed to sell new motor vehicles without being franchised therefor;

    (19)  Being an applicant or holder of an auction's license has sold or proposed to sell new motor vehicles without being franchised therefor;

    (20)  Being an applicant for a salesperson's license:

         (A)  Does not intend to be employed as a salesperson for a licensed motor vehicle dealer; or

         (B)  Intends to be employed as a salesperson for more than one dealer; or

    (21)  Being a manufacturer or distributor:

         (A)  Has attempted to coerce or has coerced any dealer in the State to enter into any agreement with the manufacturer or distributor or any other party, to perform any act not required by or to refrain from performing any act not contrary to the reasonable requirements of the franchise agreement with the dealer, by threatening to cancel the franchise agreement or by threatening to refuse, at the expiration of the current franchise agreement, to enter into a new franchise agreement with the dealer;

         (B)  Has attempted to coerce or has coerced any dealer in the State to enter into any agreement with the manufacturer or distributor or any other party, to perform any act not required by or to refrain from performing any act not contrary to the reasonable requirements of the franchise agreement with the dealer, by awarding or threatening to award a franchise to another person for the sale of the same make of any motor vehicle in the same sales area of responsibility covered by the existing franchise agreement of the dealer;

         (C)  Has attempted to or has canceled or failed to renew the franchise agreement of any dealer in the State without good faith, as defined herein. Upon such a cancellation or failure to renew the franchise agreement, the party canceling or failing to renew the franchise agreement, at the dealer's option, shall either:

              (i)  Compensate the dealer at the fair market going business value for the dealer's capital investment, which shall include but not be limited to the going business value of the business, goodwill, property, and improvement owned or leased by the dealer for the purpose of the franchise, inventory of parts, and motor vehicles possessed by the dealer in connection with the franchise, plus reasonable attorney's fees incurred in collecting compensation; provided that the investment shall have been made with reasonable and prudent judgment for the purpose of the franchise agreement; or

              (ii)  Compensate the dealer for damages including attorney's fees as aforesaid, resulting from the cancellation or failure to renew the franchise agreement.

As used in this paragraph, "good faith" means the duty of each party to any franchise agreement to fully comply with that agreement, or to act in a fair and equitable manner towards each other;

         (D)  Has delayed delivery of or refused to deliver without cause, any new motor vehicle to a dealer, franchised to sell the new motor vehicle, within a reasonable time after receipt of a written order for the vehicle from the dealer.  The delivery to another dealer of a motor vehicle of the same model and similarly equipped as the vehicle ordered by a dealer who has not received delivery thereof, but who had placed the written order for the vehicle prior to the order of the dealer receiving the vehicle, shall be prima facie evidence of a delayed delivery of, or refusal to deliver, a new motor vehicle without cause.  The nondelivery of a new motor vehicle to a dealer within sixty days after receipt of a written order for the vehicle from a dealer shall also be prima facie evidence of delayed delivery of, or refusal to deliver, a new motor vehicle without cause; provided that the delayed delivery of, or refusal to deliver, a motor vehicle shall be deemed with cause if the manufacturer establishes that the delay or refusal to deliver is due to a shortage or curtailment of material, labor, transportation, utility service, labor or production difficulty, or other similar cause beyond the reasonable control of the manufacturer;

         (E)  Has discriminated against any of their franchised dealers in the State by directly or indirectly charging the dealer more for a new motor vehicle or services, parts, or accessories or a higher rate of transportation for transporting the vehicle from the manufacturing or assembly plant to the dealer or any portion of the distance, than is charged to any other of their franchised dealers in the State for the same make, model, and year of a new motor vehicle or for the same devices, parts, or accessories for the similar transportation for the vehicle during the same period.  A manufacturer or distributor who provides or causes to be provided greater transportation benefits for a new motor vehicle as aforesaid to any of their franchised dealers in the State than is provided to any of their competing franchised dealers in the State for the same or lesser price or charge than that imposed upon the franchised dealer in the State during the same period is deemed to have so discriminated against the competing franchised dealer in the State.  Evidence of similar discriminatory practice against franchised dealers in other states shall not constitute a defense to or justification of the commission of the discriminatory act against the franchised dealer in the State.  The intent and purpose of this subparagraph is to eliminate inequitable pricing policies set by manufacturers or distributors which result in higher prices of new motor vehicles to the consumer in the State.  This subparagraph shall be liberally interpreted to effect its intent and purpose and in the application thereof, the substance and effect and not the form of the acts and transactions shall be primarily considered in determining whether a discriminatory act has been committed.  Nothing contained in this subparagraph shall prohibit establishing delivered prices or destination charges to dealers in the State which reasonably reflect the seller's total transportation costs incurred in the manufacture or delivery of products to the dealers, including costs that are related to the geographical distances and modes of transportation involved in shipments to this State, or which meet those lower prices established by competitors;

         (F)  Has required a dealer of new motor vehicles in the State as a condition of sale and delivery of new motor vehicles to purchase special features, appliances, accessories, or equipment not desired or requested by the dealer; provided that this prohibition shall not apply to special features, appliances, accessories, or equipment, except heaters, that are regularly installed on that particular model or new motor vehicles as "standard" equipment or to special features, appliances, accessories, or equipment that are an integral part of the new motor vehicles and cannot be removed therefrom without substantial expense.  Nothing in this subparagraph shall make it unlawful for a dealer to sell a vehicle that includes a heater that has been installed as standard equipment;

         (G)  Has failed to adequately and fairly compensate its dealers for labor, parts, and other expenses incurred by the dealer to perform under and comply with manufacturer's warranty agreements. In no event shall any manufacturer or distributor pay its dealers a labor rate per hour for warranty work that is less than that charged by the dealer to the retail customers of the dealer nor shall the rates be more than the retail rates.  All claims made by the dealers for compensation for delivery, preparation, and warranty work shall be paid within thirty days after approval and shall be approved or disapproved within thirty days after receipt.  When any claim is disapproved, the dealer shall be notified in writing of the grounds for disapproval;

         (H)  Has wilfully failed to affix the vehicle bumper impact notice pursuant to section 437-4.5(a), or wilfully misstated any information in the notice.  Each failure or misstatement is a separate offense;

         (I)  Has wilfully defaced, or removed the vehicle bumper impact notice required by section 437-4.5(a) prior to delivery of the vehicle to which the notice is required to be affixed to the registered owner or lessee.  Each wilful defacement, alteration, or removal is a separate offense; or

         (J)  Has required a dealer to refrain from participation in the management of, investment in, or the acquisition of, any other line of new motor vehicle or related products; provided that the new motor vehicle dealer maintains a reasonable line of credit for each make or line of new motor vehicle, remains in compliance with reasonable facilities and other franchise requirements of the manufacturer or distributor, and makes no unauthorized change in the principal management of the dealer."

PART IV.

TRANSPORTATION ENERGY PLANS AND STUDIES

     SECTION 19.  (a)  The department of accounting and general services shall develop an implementation plan for the installation of electric vehicle charging stations at state-owned parking facilities.

     (b)  The department of accounting and general services shall submit a report of its findings and recommendations, including proposed legislation, to the legislature no later than twenty days prior to the convening of the regular session of 2010.

     SECTION 20.  Section 92F-19, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

     "(a)  No agency may disclose or authorize disclosure of government records to any other agency unless the disclosure is:

     (1)  Necessary for the performance of the requesting agency's duties and functions and is also:

         (A)  Compatible with the purpose for which the information was collected or obtained; or

         (B)  Consistent with the conditions or reasonable expectations of use and disclosure under which the information was provided;

     (2)  To the state archives for the purposes of historical preservation, administrative maintenance, or destruction;

     (3)  To another agency, another state, or the federal government, or foreign law enforcement agency or authority, if the disclosure is:

         (A)  For the purpose of a civil or criminal law enforcement activity authorized by law; and

         (B)  Pursuant to:

              (i)  A written agreement or written request, or

             (ii)  A verbal request, made under exigent circumstances, by an officer or employee of the requesting agency whose identity has been verified, provided that such request is promptly confirmed in writing;

     (4)  To a criminal law enforcement agency of this State, another state, or the federal government, or a foreign criminal law enforcement agency or authority, if the information is limited to an individual's name and other identifying particulars, including present and past places of employment;

     (5)  To a foreign government pursuant to an executive agreement, compact, treaty, or statute;

     (6)  To the legislature, or a county council, or any committee or subcommittee thereof;

     (7)  Pursuant to an order of a court of competent jurisdiction;

     (8)  To authorized officials of another agency, another state, or the federal government for the purpose of auditing or monitoring an agency program that receives federal, state, or county funding;

     (9)  To the offices of the legislative auditor, the legislative reference bureau, or the ombudsman of this State for the performance of their respective functions;

    (10)  To the department of human resources development, county personnel agencies, or line agency personnel offices for the performance of their respective duties and functions, including employee recruitment and examination, classification and compensation reviews, the administration and auditing of personnel transactions, the administration of training and safety, workers' compensation, and employee benefits and assistance programs, and for labor relations purposes; [or]

    (11)  To the department of business, economic development, and tourism for the performance of their statutory responsibilities; or

   [(11)] (12)  Otherwise subject to disclosure under this chapter."

     SECTION 21.  Section 226-17, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

     "(b)  To achieve the transportation objectives, it shall be the policy of this State to:

     (1)  Design, program, and develop a multi-modal system in conformance with desired growth and physical development as stated in this chapter;

     (2)  Coordinate state, county, federal, and private transportation activities and programs toward the achievement of statewide objectives;

     (3)  Encourage a reasonable distribution of financial responsibilities for transportation among participating governmental and private parties;

     (4)  Provide for improved accessibility to shipping, docking, and storage facilities;

     (5)  Promote a reasonable level and variety of mass transportation services that adequately meet statewide and community needs;

     (6)  Encourage transportation systems that serve to accommodate present and future development needs of communities;

     (7)  Encourage a variety of carriers to offer increased opportunities and advantages to interisland movement of people and goods;

     (8)  Increase the capacities of airport and harbor systems and support facilities to effectively accommodate transshipment and storage needs;

     (9)  Encourage the development of transportation systems and programs which would assist statewide economic growth and diversification;

    (10)  Encourage the design and development of transportation systems sensitive to the needs of affected communities and the quality of Hawaii's natural environment;

    (11)  Encourage safe and convenient use of low-cost, energy-efficient, non-polluting means of transportation;

    (12)  Coordinate intergovernmental land use and transportation planning activities to ensure the timely delivery of supporting transportation infrastructure in order to accommodate planned growth objectives; and

    (13)  [Encourage diversification of transportation modes and infrastructure] Include transportation energy demand estimates in state-wide and county-wide long-range land transportation plans that utilize travel demand forecasting models in order to promote alternate fuels and energy efficiency."

     SECTION 22.  Section 286-172, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

     "(a)  Subject to authorization granted by the chief justice with respect to the traffic records of the violations bureaus of the district courts and of the circuit courts, the director of transportation shall furnish information contained in the statewide traffic records system in response to:

     (1)  Any request from a state, a political subdivision of a state, or a federal department or agency, or any other authorized person pursuant to rules adopted by the director of transportation under chapter 91;

     (2)  Any request from a person having a legitimate reason, as determined by the director, as provided under the rules adopted by the director under paragraph (1), to obtain the information for verification of vehicle owner­ship, traffic safety programs, or for research or statistical reports[; or]

     (3)  Any request from a person required or authorized by law to give written notice by mail to owners of vehicles[.]; or

     (4)  Any request from the energy resources coordinator to track the number and type of vehicles in use and the effectiveness of efforts to increase the efficiency of and diversify the fuel needs of Hawaii’s transportation sector."

PART V.

MISCELLANEOUS PROVISIONS

     SECTION 23.  In codifying the new sections added by this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

     SECTION 24.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 25.  This Act shall take effect on July 1, 2009.

 

INTRODUCED BY:

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