REPORT TITLE:
Tax Credit; Agriculture


DESCRIPTION:
Provides a tax credit for agricultural infrastructure
investments.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        2023 
HOUSE OF REPRESENTATIVES                H.B. NO.           
TWENTIETH LEGISLATURE, 2000                                
STATE OF HAWAII                                            
                                                             
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                   A  BILL  FOR  AN  ACT

RELATING TO AGRICULTURAL INFRASTRUCTURE.



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

 1      SECTION 1.  Findings and purpose.  The legislature finds
 
 2 that the downsizing of the sugar industry and the transitioning
 
 3 of the agricultural industry from plantation agriculture to
 
 4 diversified agriculture presents an opportunity for great
 
 5 expansion in Hawaii's agricultural production.  Plantation
 
 6 agriculture created a valuable inventory of infrastructure
 
 7 including irrigation systems, roads, and drainage systems.  To
 
 8 build these systems today will cost more than agricultural
 
 9 enterprises are willing to invest in start-up costs.
 
10      Agricultural expansion requires that this valuable
 
11 infrastructure be preserved and reconfigured to support new
 
12 agricultural ventures.  Lacking the huge investments by sugar
 
13 companies to construct and maintain these systems, incentives are
 
14 required to encourage private investment in agricultural
 
15 infrastructure to preserve and enhance the existing systems.
 
16      The purpose of this Act is to provide a tax credit for major
 
17 investment in the planning, design, construction, reconstruction,
 
18 improvement, altering, or repair of large agriculture supporting
 

 
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 1 infrastructure.
 
 2      SECTION 2.  Chapter 235, Hawaii Revised Statutes, is amended
 
 3 by adding a new section to be appropriately designated and to
 
 4 read as follows:
 
 5      "�235-    Agriculture infrastructure improvement credit.
 
 6 (a)  There shall be allowed to each taxpayer, subject to the
 
 7 taxes imposed by this chapter, an agricultural infrastructure
 
 8 improvement tax credit which shall apply to the taxpayer's net
 
 9 income tax liability, if any, imposed by this chapter for the
 
10 taxable year in which the credit is properly claimed.  The tax
 
11 credit shall be an amount equal to ten per cent of the cost of
 
12 improvements over $200,000 made by the taxpayer to agricultural
 
13 infrastructure for the taxable year in which the improvements
 
14 were made.
 
15      (b)  The credit allowed under this section shall be claimed
 
16 against the net income tax liability for the taxable year.  For
 
17 the purpose of this credit, the "net income tax liability" means
 
18 net income tax liability reduced by all other credits allowed
 
19 under this chapter.
 
20      (c)  If the tax credit under this section exceeds the
 
21 taxpayer's income tax liability, the excess of the tax credit
 
22 over liability may be used as a credit against the taxpayer's
 

 
 
 
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 1 income tax liability in subsequent years until exhausted.  All
 
 2 claims, including any amended claims, for tax credits under this
 
 3 section shall be filed on or before the end of the twelfth month
 
 4 following the close of the taxable year for which the credit may
 
 5 be claimed.  Failure to comply with the foregoing provision shall
 
 6 constitute a waiver of the right to claim the credit.
 
 7      (d)  As used in this section:
 
 8      "Agricultural infrastructure improvement" means the
 
 9 planning, design, construction, reconstruction, improvement,
 
10 altering, or repair of supporting infrastructure used or formerly
 
11 used by a plantation system or other large agricultural
 
12 operation, including irrigation systems, roads, and drainage
 
13 systems.
 
14      "Drainage systems" means an agricultural system of channels,
 
15 ditches, pipes, pumps, and accessory facilities established for
 
16 the purpose of drawing off water from a land area larger than two
 
17 thousand acres.
 
18      "Irrigation systems" means the agricultural system of
 
19 intakes, diversions, wells, ditches, siphons, pipes, reservoirs,
 
20 and accessory facilities established for the purpose of providing
 
21 water for agricultural production.
 
22      "Roads" means an agricultural system of cane haul roads or
 

 
 
 
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 1 ways established to take agricultural products from the fields to
 
 2 processing facilities without using the public highways."
 
 3      SECTION 3.  New statutory material is underscored.
 
 4      SECTION 4.  This Act shall take effect on January 1, 2001.
 
 5 
 
 6                              INTRODUCED BY:______________________