STAND. COM. REP. NO. 53

 

Honolulu, Hawaii

                  

 

RE:    S.B. No. 1096

       S.D. 1

 

 

 

Honorable Donna Mercado Kim

President of the Senate

Twenty-Eighth State Legislature

Regular Session of 2015

State of Hawaii

 

Madam:

 

     Your Committee on Commerce and Consumer Protection, to which was referred S.B. No. 1096 entitled:

 

"A BILL FOR AN ACT RELATING TO ON-BILL PROGRAMS,"

 

begs leave to report as follows:

 

     The purpose and intent of this measure is to exempt electric utilities serving as billing and collections agents for an on-bill program from certain state taxes and state laws regulating financial institutions, escrow depositories, or collection agencies.

 

     Your Committee received testimony in support of this measure from the Department of Business, Economic Development, and Tourism; Department of Taxation; Public Utilities Commission; and Hawaiian Electric Company, Inc.  Your Committee received testimony in opposition to this measure from one individual.  Your Committee received comments on this measure from the Tax Foundation of Hawaii.

 

     Your Committee finds that an on-bill program administered by an electric utility allows customers of the utility to purchase a renewable energy system, while the electric utility serves as a billing and collection agent for the on-bill program in a pass-through capacity for any and all monies collected and remitted while participating in the on-bill program.  Electric utilities who serve as billing and collection agents and function in a pass-through capacity are therefore not raising revenue from monies collected and remitted while participating in an on-bill program.

 

     Your Committee further finds that levying of revenue-related taxes or requiring other financial regulations on an electric utility participating in a pass-through capacity in an on-bill program would create additional costs for the utility, which could be passed on to ratepayers.  This measure would eliminate these additional costs but would not have an impact on other fees or taxes imposed on other amounts received in the normal course of operations by an electric utility.

 

     Your Committee has amended this measure by:

 

     (1)  Inserting an effective date of July 1, 2020, to encourage further discussion; and

 

     (2)  Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

 

     As affirmed by the record of votes of the members of your Committee on Commerce and Consumer Protection that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1096, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 1096, S.D. 1, and be referred to the Committee on Ways and Means.

 

Respectfully submitted on behalf of the members of the Committee on Commerce and Consumer Protection,

 

 

 

____________________________

ROSALYN H. BAKER, Chair