Report Title:

Trust for Cultural Development Account

 

Description:

Creates trust for cultural development account, to be used to promote cultural activity within the State. Specifies appropriate uses of funds in trust for cultural development account. Establishes income tax credit for contributions to trust fund. Appropriates funds to trust fund.

THE SENATE

S.B. NO.

2050

TWENTY-FIRST LEGISLATURE, 2002

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

relating to cultural development.

 

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

SECTION 1. Chapter 9, Hawaii Revised Statutes, is amended by adding a new part II to read as follows:

"PART II. HAWAII TRUST FOR CULTURAL DEVELOPMENT

§9-A Definitions. As used in this part:

"Board" means the trust for cultural development board established by section 9-C.

"Commission" means the state foundation on culture and arts commission established by section 9-2.

"Community cultural participation grant program" means the program created by section 9-G.

"Core partner agencies" means the foundation and other agencies so certified pursuant to section 9-K and rules adopted thereunder.

"Cultural development grant program" means the program created by section 9-F.

"Cultural organization" means an organization that is:

(1) Exempt from federal income taxation under section 501(c)(3) of the Internal Revenue Code of 1986, as amended; and

(2) Organized primarily for the purpose of producing, promoting or presenting the arts, heritage, programs, and humanities to the public or organized primarily for identifying, documenting, interpreting, or preserving cultural resources.

"Department" means the department of accounting and general services.

"Foundation" means the state foundation on culture and the arts.

"Trust" means the trust for cultural development fund established by section 9-B.

§9-B Trust for cultural development fund. (a) There is established within the state treasury the trust for cultural development fund, into which shall be placed all funds received by the board or department as donations or appropriations for cultural development. Interest earned by the trust shall be credited to the trust. The primary purpose of the trust is to serve as a repository for public and private moneys designated to fund specific arts, heritage, and humanities programs.

(b) All moneys in the trust shall be appropriated to the department for the purposes of this part.

§9-C Trust for cultural development board. (a) There is established the "trust for cultural development board" consisting of seven members appointed by the governor under section 26-34. No person may serve on the board and the commission concurrently. The membership of the board shall reflect the geographical and cultural diversity of the State. Each member shall have a background that demonstrates a commitment to Hawaii's culture. In addition to the members appointed by the governor, the comptroller shall be an ex officio member of the board and shall serve as chairperson of the board.

(b) The president of the senate and the speaker of the house of representatives shall each appoint a nonvoting, advisory member of the board from their respective houses of the legislature.

(c) Board members shall serve without compensation, but shall be reimbursed for their necessary and reasonable expenses incurred in the performance of their duties, including travel expenses.

(d) Notwithstanding the term of office specified in section 26-34, of the board members first appointed by the governor:

(1) Two shall serve for terms ending June 30, 2004;

(2) Two shall serve for terms ending June 30, 2005; and

(3) Three shall serve for terms ending June 30, 2006.

(e) A majority of the members of the board constitutes a quorum for the transaction of business. The board shall meet at least once every three months at a place, day, and hour determined by the chairperson. The board shall also meet at other times and places specified by the call of the chairperson or of a majority of the members of the board. The chairperson shall invite representatives of the core partner agencies to all meetings of the board.

(f) The board shall oversee management of the trust and shall provide direction to the department for the coordination, administration and evaluation of the cultural development grant program, the community cultural participation grant program, and the use of funds received by core partner agencies under section 9-J.

(g) The board shall adopt rules under chapter 91 to carry out the purposes of this part.

§9-D Administrative support. The department shall provide staff support to the board. Under the direction of the board, the staff shall:

(1) Coordinate grant management;

(2) Provide trust management and accounting;

(3) Work with cultural agencies and their constituents to communicate with and educate the public about the role culture plays in the lives of citizens and communities; and

(4) Evaluate the cultural development grant program, the community cultural participation grant program, and the use of funds received under section 9-J by core partner agencies.

§9-E Disbursement of funds; allotment. (a) Under the direction of the board, the department shall disburse each fiscal year up to forty-two per cent of the amount in the trust on June 30 preceding the year of disbursement.

(b) The department may use up to 7.5 per cent of any amount disbursed from the trust under this section for:

(1) Supporting the operations of the trust;

(2) Facilitating technical assistance;

(3) Local cultural planning; and

(4) Other activities that encourage cultural activity.

(c) At least 92.5 per cent of any amount disbursed from the trust under this section shall be distributed as follows:

(1) One-third to the preservation of, stabilization of, and investment in Hawaii's cultural resources through the cultural development grant program as provided by section 9-F;

(2) One-third to Hawaii's counties or native Hawaiian organizations through the community cultural participation grant program as provided by section 9-G; and

(3) One-third to the core partner agencies as provided by section 9-J.

§9-F Cultural development grant program. (a) There is created the cultural development grant program to be administered by the department under the direction of the board. The purpose of the program is to provide preservation of, stabilization of, and investment in Hawaii's cultural resources. The department shall make cultural development grants to cultural organizations through a request for proposal process.

(b) The grants may be used:

(1) To address significant opportunities to advance, preserve, or stabilize cultural resources; and

(2) To invest in the development of new cultural resources.

(c) The department shall give priority when awarding grants to:

(1) Proposals that have a broad cultural impact beyond the applicant itself; and

(2) Proposals from applicants that have culture as a priority within the mission of the applicant.

(d) Applicants that receive a grant under this section shall be required to match the grant amount in an amount as determined by the board.

§9-G Community cultural participation grant program. (a) There is created the community cultural participation grant program to be administered by the department under the direction of the board. The purpose of the program is to provide funds to counties and native Hawaiian organizations for local cultural activities. The department shall make community cultural participation grants to counties and native Hawaiian organizations.

(b) The board shall develop guidelines for local cultural plans.

(c) A local cultural plan shall:

(1) Identify priorities and specific strategies for building public cultural participation across cultural disciplines and organizations. The strategies may include the involvement of partners outside of the cultural sector such as business organizations, schools, and health and human services organizations;

(2) Identify annual benchmarks to determine the impact of grant funds; and

(3) Specify local leadership and governance for grant fund management and for ongoing planning and development of benchmarks.

(d) Local cultural plans shall be broadly disseminated within each county or native Hawaiian organization. The local cultural plans shall be used to encourage planning and collaboration among cultural entities.

§9-H Community cultural participation grants; disbursement. (a) For the fiscal year beginning July 1, 2003, the department, under the board's direction, shall make community cultural participation grants under section 9-G to counties and native Hawaiian organizations to support local cultural planning. The department shall provide technical assistance to counties and native Hawaiian organizations to support local cultural planning.

(b) Grant funds may be used to address planning costs associated with creating a local cultural plan, including:

(1) Conducting research;

(2) Convening the public;

(3) Using professional counsel and facilitators; and

(4) Surveying members of the community.

(c) The department shall allocate grant amounts to counties and native Hawaiian organizations using a base amount, plus a per capita amount for each county or native Hawaiian organization.

§9-I Community cultural participation grants; local cultural plans. (a) For the fiscal years beginning July 1, 2003, to July 1, 2011, the department, at the board's direction, shall make community cultural participation grants under section 9-G to counties and native Hawaiian organizations to support cultural activities identified in the local cultural plans. Grant funds received by a county or native Hawaiian organization shall be distributed locally as specified in the local cultural plan.

(b) A portion of the grant funds received each fiscal year by a county or native Hawaiian organization may be used for costs associated with grant management, community technical assistance, and accounting.

(c) For the fiscal year beginning July 1, 2007, a portion of each grant awarded to a county or native Hawaiian organization may be used:

(1) For revising local cultural plans;

(2) To articulate updated priorities in the local cultural plan; and

(3) For strategies to continue deepening and expanding participation in all facets of culture.

§9-J Core partner agency disbursements. (a) The department, at the direction of the board, shall distribute the amount disbursed from the trust for the core partner agencies as follows:

(1) The department shall allocate twenty per cent of the amount disbursed for joint efforts by the core partner agencies in fostering cooperative cultural projects, including cultural education, cultural tourism, and other cultural activities; and

(2) The department shall allocate eighty per cent of the amount disbursed to the core partner agencies for the purposes described in section 9-L. The board shall determine the amount or per cent of available funds that each core partner agency shall receive under this section.

(b) The core partner agencies shall not be eligible to apply for grants from the community cultural participation grant program or the cultural development grant program.

§9-K Allocation among core partner agencies. (a) The board may certify agencies other than the foundation as core partner agencies, pursuant to rules adopted by the board under chapter 91 for that purpose. At a minimum, the rules adopted by the board shall specify criteria to be used to determine whether an agency qualifies as a core partner agency. Prior to any disbursement of funds to a core partner agency certified under this section, the board shall review the agency's activities to ensure that the agency continues to qualify as a core partner agency.

(b) The board shall determine the level of funding for each core partner agency, pursuant to rules adopted under chapter 91 for the purpose of ensuring an equitable distribution of funds among the core partner agencies.

§9-L Use of funds by core partner agencies. (a) A core partner agency may use funds received under section 9-J to:

(1) Carry out the mission and mandate of the agency;

(2) Serve more grantees; and

(3) Encourage new cultural undertakings.

(b) Each core partner agency shall expend a portion of the amount received under section 9-J as determined by the board each fiscal year to fund development of qualitative benchmarks and culture within Hawaii. The evaluation of benchmarks may be done in partnership with one more higher education institutions in Hawaii. It is intended that this partnership will stimulate research and investigation of the ways in which culture and related cultural policy will impact the State over a ten year period."

SECTION 2. Chapter 235, Hawaii Revised Statutes, is amending by adding a new section to be appropriately designated and to read as follows:

"§235-   Trust for cultural development tax credit. (a) There shall be allowed to each taxpayer subject to the tax imposed under this chapter, a trust for cultural development tax credit which shall be applied against the taxpayer's net income tax liability, if any, imposed by this chapter for the taxable year in which the credit is properly claimed.

(b) The trust for cultural development tax credit shall be equal to the amount of the taxpayer's contribution to the trust for cultural development fund established by section 9-B; provided that in order to qualify for the credit, the taxpayer claiming the credit must also make a contribution to a Hawaii cultural organization during the tax year. The credit allowed under this section shall not exceed the lesser of:

(1) $500 for individual taxpayers;

(2) $2,500 for corporations; or

(3) The actual amount of the taxpayer's contribution to a Hawaii cultural organization during the tax year.

(c) For purposes of this section, a "Hawaii cultural organization" means an entity that is:

(1) Exempt from federal income taxation under section 501(c)(3) of the Internal Revenue Code of 1986, as amended; and

(2) Organized primarily for the purpose of producing, promoting or presenting the arts, heritage, programs, and humanities to the public or organized primarily for identifying, documenting, interpreting, or preserving cultural resources.

(d) If the tax credit under this section exceeds the taxpayer's income tax liability, the excess of the tax credit over liability may be used as a credit against the taxpayer's income tax liability in future years until exhausted. All claims, including any amended claims, for tax credits 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.

(e) Application for a credit under this section shall be upon forms provided by the department.

(f) The credit allowed under this section is in addition to any charitable contribution deduction allowable to the taxpayer.

(g) The credit under this section shall be for taxable years beginning after December 31, 2001."

SECTION 3. Chapter 9, Hawaii Revised Statutes, is amended by designating sections 9-1 to 9-18 as part I, entitled "General Provisions".

SECTION 4. There is appropriated out of the general revenues of the State of Hawaii the sum of $          , or so much thereof as may be necessary for fiscal year 2002-2003, to be used for start up costs associated with the trust for cultural development fund established under section 9-B, Hawaii Revised Statutes. The funds appropriated shall be expended by the department of accounting and general services for the purposes of this Act.

SECTION 5. In codifying the new sections added by section 1 of this Act and referred to in this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

SECTION 6. New statutory material is underscored.

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

INTRODUCED BY:

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