REPORT TITLE:
Hotels, Boardinghouses


DESCRIPTION:
Eliminates issue of a county business license to operate lodging
or tenement houses, hotels, and boardinghouses and repeals the
$10 annual license fee.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        3101
THE SENATE                              S.B. NO.           
TWENTIETH LEGISLATURE, 2000                                
STATE OF HAWAII                                            
                                                             
________________________________________________________________
________________________________________________________________


                   A  BILL  FOR  AN  ACT

RELATING TO LODGING OR TENEMENT HOUSES, HOTELS, AND
   BOARDINGHOUSES.



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

 1      SECTION 1.  The purpose of this Act is to eliminate the
 
 2 issue of a county business license to operate lodging or tenement
 
 3 houses, hotels, and boardinghouses and to repeal the $10 annual
 
 4 license fee.
 
 5      SECTION 2.  Section 46-15.4, Hawaii Revised Statutes, is
 
 6 amended by amending subsection (a) to read as follows:
 
 7      "(a)  The respective counties may conduct inspections to
 
 8 enforce sections [445-92] 445-93 to 445-96.  Each county may
 
 9 conduct its inspections without a warrant if the conditions
 
10 enumerated in subsection (c) exist.  A county shall conduct its
 
11 inspection with a warrant in accordance with this section if the
 
12 circumstances enumerated in subsection (c) do not exist or if
 
13 specific buildings or premises to be inspected can be identified
 
14 through citizen complaint or by information obtained from state
 
15 agencies under section 46-15.5.  The issuance and execution of an
 
16 administrative inspection warrant shall be as follows:
 
17      (1)  A judge of the circuit court, or any district judge
 
18           within the judge's jurisdiction, may issue warrants for
 
19           the purpose of conducting administrative inspections.
 

 
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 1           The warrants shall be issued upon proper oath or
 
 2           affirmation showing probable cause that:
 
 3           (A)  The conditions of a license under section 445-95
 
 4                have been violated; or
 
 5           (B)  A person is operating a lodging or tenement house,
 
 6                group home, group residence, group living
 
 7                arrangement, hotel, boardinghouse, or restaurant
 
 8                without a license;
 
 9      (2)  A warrant shall issue only upon an affidavit of an
 
10           individual having knowledge of the facts alleged, sworn
 
11           to before the judge and establishing the grounds for
 
12           issuing the warrant.  If the judge is satisfied that
 
13           there is probable cause to believe the grounds for
 
14           issuing a warrant exist, the judge shall issue a
 
15           warrant identifying the area, premises, building, or
 
16           records to be inspected, the purpose of the inspection,
 
17           and, if appropriate, the type of property to be
 
18           inspected, if any.  The warrant shall:
 
19           (A)  State the grounds for its issuance and the name of
 
20                each person whose affidavit has been taken in
 
21                support thereof;
 
22           (B)  Be directed to a person authorized by the county
 
23                to execute it;
 

 
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                                     S.B. NO.           
                                                        
                                                        

 
 1           (C)  Command the person to whom it is directed to
 
 2                inspect the area, premises, building, or records
 
 3                identified for the purpose specified and, if
 
 4                appropriate, use reasonable force in conducting
 
 5                the inspection authorized by the warrant and
 
 6                direct the seizure of the property specified;
 
 7           (D)  Identify the item or types of property to be
 
 8                seized, if any; and
 
 9           (E)  Direct that it be served during the daylight
 
10                business hours between 8:00 a.m. and 5:00 p.m. and
 
11                designate the judge to whom it shall be returned;
 
12      (3)  A warrant issued pursuant to this section shall be
 
13           executed and returned within ten days of its date
 
14           unless, upon a showing of a need for additional time,
 
15           the court orders otherwise.  If property is seized
 
16           pursuant to a warrant, a copy shall be given to the
 
17           person from whom or from whose premises the property is
 
18           taken, together with a receipt for the property taken.
 
19           The return of the warrant shall be made promptly,
 
20           accompanied by a written inventory of any property
 
21           taken.  The inventory shall be made in the presence of
 
22           the person executing the warrant and of the person from
 
23           whose possession or premises the property was taken, if
 

 
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 1           present, or in the presence of at least one credible
 
 2           person other than the person executing the warrant.  A
 
 3           copy of the inventory shall be delivered to the person
 
 4           from whom or from whose premises the property was taken
 
 5           and to the applicant for the warrant; and
 
 6      (4)  The judge who has issued a warrant shall attach thereto
 
 7           a copy of the return and all papers returnable in
 
 8           connection therewith and file them with the clerk of
 
 9           the issuing court."
 
10      SECTION 3.  Section 237-24.7, Hawaii Revised Statutes, is
 
11 amended to read as follows:
 
12      "237-24.7  Additional amounts not taxable.  In addition to
 
13 the amounts not taxable under section 237-24, this chapter shall
 
14 not apply to:
 
15      (1)  Amounts received by the operator of a hotel from the
 
16           owner of the hotel in amounts equal to and which are
 
17           disbursed by the operator for employee wages, salaries,
 
18           payroll taxes, insurance premiums, and benefits,
 
19           including retirement, vacation, sick pay, and health
 
20           benefits.  As used in this paragraph:
 
21                "Employee" means employees directly engaged in the
 
22           day-to-day operation of the hotel and employed by the
 
23           operator.
 

 
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 1                "Hotel" means an operation [licensed under] as
 
 2           defined in section [445-92.] 445-90.
 
 3                "Operator" means any person who, pursuant to a
 
 4           written contract with the owner of a hotel, operates or
 
 5           manages the hotel for the owner.
 
 6                "Owner" means the fee owner or lessee under a
 
 7           recorded lease of a hotel;
 
 8      (2)  Amounts received by the operator of a county
 
 9           transportation system operated under an operating
 
10           contract with a political subdivision, where the
 
11           political subdivision is the owner of the county
 
12           transportation system.  As used in this paragraph:
 
13                "County transportation system" means a mass
 
14           transit system of motorized buses providing regularly
 
15           scheduled transportation within a county.
 
16                "Operating contract" or "contract" means a
 
17           contract to operate and manage a political
 
18           subdivision's county transportation system, which
 
19           provides that:
 
20                (A)  The political subdivision shall exercise
 
21                     substantial control over all aspects of the
 
22                     operator's operation;
 
23                (B)  The political subdivision controls the
 

 
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 1                     development of transit policy, service
 
 2                     planning, routes, and fares; and
 
 3                (C)  The operator develops in advance a draft
 
 4                     budget in the same format as prescribed for
 
 5                     agencies of the political subdivision.  The
 
 6                     budget must be subject to the same
 
 7                     constraints and controls regarding the lawful
 
 8                     expenditure of public funds as any public
 
 9                     sector agency, and deviations from the budget
 
10                     must be subject to approval by the
 
11                     appropriate political subdivision officials
 
12                     involved in the budgetary process.
 
13                "Operator" means any person who, pursuant to an
 
14           operating contract with a political subdivision,
 
15           operates or manages a county transportation system.
 
16                "Owner" means a political subdivision that owns or
 
17           is the lessee of all the properties and facilities of
 
18           the county transportation system (including buses, real
 
19           estate, parking garages, fuel pumps, maintenance
 
20           equipment, office supplies, etc.), and that owns all
 
21           revenues derived therefrom;
 
22      (3)  Surcharge taxes on rental motor vehicles imposed by
 
23           chapter 251 and passed on and collected by persons
 

 
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 1           holding certificates of registration under that
 
 2           chapter;
 
 3      (4)  Amounts received by the operator of orchard properties
 
 4           from the owner of the orchard property in amounts equal
 
 5           to and which are disbursed by the operator for employee
 
 6           wages, salaries, payroll taxes, insurance premiums, and
 
 7           benefits, including retirement, vacation, sick pay, and
 
 8           health benefits.  As used in this paragraph:
 
 9                "Employee" means an employee directly engaged in
 
10           the day-to-day operations of the orchard properties and
 
11           employed by the operator.
 
12                "Operator" means a producer who, pursuant to a
 
13           written contract with the owner of the orchard
 
14           property, operates or manages the orchard property for
 
15           the owner where the property contains an area
 
16           sufficient to make the undertaking economically
 
17           feasible.
 
18                "Orchard property" means any real property that is
 
19           used to raise trees with a production life cycle of
 
20           fifteen years or more producing fruits or nuts having a
 
21           normal period of development from the initial planting
 
22           to the first commercially saleable harvest of not less
 
23           than three years.
 

 
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 1                "Owner" means a fee owner or lessee under a
 
 2           recorded lease of orchard property;
 
 3      (5)  Taxes on nursing facility income imposed by chapter
 
 4           346E and passed on and collected by operators of
 
 5           nursing facilities;
 
 6      (6)  Amounts received under property and casualty insurance
 
 7           policies for damage or loss of inventory used in the
 
 8           conduct of a trade or business located within the State
 
 9           or a portion thereof that is declared a natural
 
10           disaster area by the governor pursuant to section
 
11           209-2;
 
12      (7)  Amounts received as compensation by community
 
13           organizations, school booster clubs, and nonprofit
 
14           organizations under a contract with the chief election
 
15           officer for the provision and compensation of precinct
 
16           officials and other election-related personnel,
 
17           services, and activities, pursuant to section 11-5;
 
18      (8)  Interest received by a person domiciled outside the
 
19           State from a trust company (as defined in section
 
20           412:8-101) acting as payment agent or trustee on behalf
 
21           of the issuer or payees of an interest bearing
 
22           instrument or obligation, if the interest would not
 
23           have been subject to tax under this chapter if paid
 

 
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                                     S.B. NO.           
                                                        
                                                        

 
 1           directly to the person domiciled outside the State
 
 2           without the use of a paying agent or trustee; provided
 
 3           that if the interest would otherwise be taxable under
 
 4           this chapter if paid directly to the person domiciled
 
 5           outside the State, it shall not be exempt solely
 
 6           because of the use of a Hawaii trust company as a
 
 7           paying agent or trustee;
 
 8      (9)  Amounts received by a management company from related
 
 9           entities engaged in the business of selling interstate
 
10           or foreign common carrier telecommunications services
 
11           in amounts equal to and which are disbursed by the
 
12           management company for employee wages, salaries,
 
13           payroll taxes, insurance premiums, and benefits,
 
14           including retirement, vacation, sick pay, and health
 
15           benefits.  As used in this paragraph:
 
16                "Employee" means employees directly engaged in the
 
17           day-to-day operation of related entities engaged in the
 
18           business of selling interstate or foreign common
 
19           carrier telecommunications services and employed by the
 
20           management company.
 
21                "Management company" means any person who,
 
22           pursuant to a written contract with a related entity
 
23           engaged in the business of selling interstate or
 

 
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                                     S.B. NO.           
                                                        
                                                        

 
 1           foreign common carrier telecommunications services,
 
 2           provides managerial or operational services to that
 
 3           entity.
 
 4                "Related entities"means:
 
 5                (A)  An affiliated group of corporations within
 
 6                     the meaning of section 1504 (with respect to
 
 7                     affiliated group defined) of the federal
 
 8                     Internal Revenue Code of 1986, as amended;
 
 9                (B)  A controlled group of corporations within the
 
10                     meaning of section 1563 (with respect to
 
11                     definitions and special rules) of the federal
 
12                     Internal Revenue Code of 1986, as amended;
 
13                (C)  Those entities connected through ownership of
 
14                     at least eighty per cent of the total value
 
15                     and at least eighty per cent of the total
 
16                     voting power of each such entity (or
 
17                     combination thereof), including partnerships,
 
18                     associations, trusts, S corporations,
 
19                     nonprofit corporations, limited liability
 
20                     partnerships, or limited liability companies;
 
21                     and
 
22                (D)  Any group or combination of the entities
 
23                     described in paragraph (C) constituting a
 

 
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                                     S.B. NO.           
                                                        
                                                        

 
 1                     unitary business for income tax purposes;
 
 2           whether or not the entity is located within or without
 
 3           the State or licensed under this chapter; and
 
 4     (10)  Amounts received as grants under section 206M-15."
 
 5      SECTION 4.  Section 445-94, Hawaii Revised Statutes, is
 
 6 amended to read as follows:
 
 7      "445-94  Certificates.(a)  No [license shall be issued
 
 8 for a] person shall operate a lodging or tenement house, group
 
 9 home, group residence, group living arrangement, hotel, or
 
10 boardinghouse, until the [applicant] person secures from the
 
11 department of health [and presents to the treasurer] a
 
12 certificate setting forth that an agent of the department has
 
13 examined the building or buildings, with a description sufficient
 
14 to identify and locate the same, and that the same are in good
 
15 sanitary condition.
 
16      (b)  No [initial license shall be issued for a] person shall
 
17 operate a lodging or tenement house, group home, group residence,
 
18 group living arrangement, hotel, or boardinghouse, until the
 
19 [applicant] person secures a clearance from the appropriate
 
20 county agency responsible for ensuring compliance with county
 
21 building and zoning codes [and presents to the treasurer a
 
22 certificate] setting forth that an agent of the agency has
 
23 examined the building or buildings, proposed to be used for such
 

 
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 1 purposes, with a description sufficient to identify and locate
 
 2 the same; and that the same are in compliance with the building
 
 3 and zoning codes."
 
 4      SECTION 5.  Section 445-95, Hawaii Revised Statutes, is
 
 5 amended to read as follows:
 
 6      "445-95  Conditions [of license.] for conditional
 
 7 operation.  [A] The owner or operator of a lodging or tenement
 
 8 house, group home, group residence, group living arrangement,
 
 9 hotel, or boardinghouse[, license shall be issued upon the
 
10 following express conditions, which shall be incorporated in the
 
11 license:] shall:
 
12      (1)  [The licensee shall not] Not permit noisy or disorderly
 
13           conduct in the building or buildings; 
 
14      (2)  [No] Not allow any person engaging in acts of
 
15           prostitution [shall be allowed] to reside therein or
 
16           resort thereto;
 
17      (3)  [No] Not allow intoxicating liquor or other
 
18           intoxicating substance [shall] to be furnished or sold
 
19           therein, except as authorized by law;
 
20      (4)  [The] Keep the building or buildings and premises
 
21           [licensed shall be kept] in good sanitary condition, in
 
22           accordance with law and with the orders of the agent of
 
23           the department of health; 
 

 
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 1      (5)  [The] At all times allow the police, [agents of the
 
 2           licensing department,] agents of the state department
 
 3           of health, and agents of the appropriate county
 
 4           agencies responsible for compliance with the county's
 
 5           building and zoning codes [shall at all times have]
 
 6           access for purposes of inspection to enforce or
 
 7           administer this chapter and other applicable laws or
 
 8           rules; 
 
 9      (6)  [No] Not allow any gaming [shall be allowed]; 
 
10      (7)  [The licensee, if] If a lodging or tenement house,
 
11           group home, group residence, group living arrangement,
 
12           or boardinghouse [shall], keep records identifying its
 
13           tenants, lodgers, or boarders; and 
 
14      (8)  [No facility shall] Not deliver or purport to deliver
 
15           health care services or treatment unless it is
 
16           licensed, certified, or contracted for by the State or
 
17           other governmental agencies to do so."
 
18      SECTION 6.  Section 445-96, Hawaii Revised Statutes, is
 
19 amended to read as follows:
 
20      "445-96  Penalty.(a)  [Any person who keeps a lodging or
 
21 tenement house, group home, group residence, group living
 
22 arrangement, hotel, or boardinghouse, without a license shall be
 
23 fined in accordance with section 445-12.
 

 
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 1      (b)]  Any person [holding a license under this chapter] who
 
 2 violates or fails to observe any of the requirements or
 
 3 conditions of this chapter [or of the license], shall be fined
 
 4 not less than $100 nor more than $1,000 per day of violation for
 
 5 each violation [and the court may cancel the license]. 
 
 6      [(c)] (b)  Any person who intentionally or knowingly
 
 7 obstructs or interferes with the progress of any authorized
 
 8 inspection pursuant to this chapter shall be guilty of a
 
 9 misdemeanor."
 
10      SECTION 7.  Section 445-92, Hawaii Revised Statutes, is
 
11 repealed.
 
12      ["445-92  Fee.  The annual fee for a license to keep a
 
13 lodging or tenement house, group home, group residence, group
 
14 living arrangement, hotel, or boardinghouse shall be $10."]
 
15      SECTION 8.  Statutory material to be repealed is bracketed.
 
16 New statutory material is underscored.
 
17      SECTION 9.  This Act shall take effect upon its approval.
 
18 
 
19                           INTRODUCED BY:  _______________________