STAND. COM. REP. NO.2432

Honolulu, Hawaii

, 2002

RE: S.B. No. 3061

S.D. 1

 

 

Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committee on Economic Development and Technology, to which was referred S.B. No. 3061 entitled:

"A BILL FOR AN ACT RELATING TO ECONOMIC DEVELOPMENT,"

begs leave to report as follows:

The purpose of this measure is to establish a new section which allows a tax income exclusion for income from live entertainment.

Your Committee received testimony in favor of this measure from the Department of Business, Economic Development, and Tourism, T. Iida Contracting, Ltd., Hawaii Songwriters Association, Ka Hoku Productions, the Davis Agency, Musicians' Association of Hawaii, Stardust Productions, and seven individuals. Your Committee received testimony opposing this measure from the Department of Taxation and one individual, and comments from Tax Foundation of Hawaii.

Your Committee finds that this measure will help Hawaii's performing arts community, will protect and promote Hawaii's rich cultural legacy, and will help our economy.

Your Committee finds that Hawaii needs a multi-pronged approach to improving the economy. In order to effect this approach, your Committee has amended this measure by inserting fourteen other measures relating to economic development. This economic package of measures represents a work in progress for the Committee on Economic Development and Technology towards the development of a comprehensive plan to address Hawaii's economic future. The measures are as follows:

(1) S.B. 2028; Issues general obligation bonds for macadamia nut processing, manufacturing, and production facilities;

(2) S.B. 2381; Appropriates moneys for the formulation of a strategic plan to make Hawaii the "Geneva of the Pacific";

(3) S.B. 2411; Appropriates funds for the marketing of Hawaii products and services;

(4) S.B. 2535; Supports the activities of PACON International in the design and planning of an ocean park;

(5) S.B. 2606; Creates a statewide unifying entity of seventeen members from the public and private sectors to create a strategic economic development plan and to appropriate money for its development;

(6) S.B. 2712; Amends the hiring requirements for firms enrolled in the Hawaii Enterprise Zones (EZ) partnership;

(7) S.B. 2834; Clarifies the application of certain high technology tax incentives;

(8) S.B. 2540; Appropriates funds for the Community-based Economic Development Program of the Department of Business, Economic Development, and Tourism;

(9) S.B. 2374; Establishes a council to advise and assist the legislature on the economy;

(10) S.B. 2379; Adds a new chapter on misleading electronic mail;

(11) S.B. 2533; Extends the general excise tax exemption of the enterprise zone to retailers in East Maui until June 30, 2007;

(12) S.B. 2707; Repeals the June 30, 2002, sunset date for the Regulatory Flexibility Act and the small business defender, and making other changes to more effectively assist small businesses;

(13) S.B. 2711; Changes the frequency for adjustment of the loan interest rate for the Hawaii capital loan program from semiannual to the first of each month; and

(14) S.B. 2933; Allows the department of business, economic development, and tourism to provide low interest loans to inventors or authors for the development of their new manufactured products, marks, works, works of authorship, or inventions.

Further, your Committee has amended this measure by exempting professional live musical performers from general excise taxation, rather than providing tax income exclusion for income from live entertainment.

Relating to Part IX of the bill providing a general excise exemption for live performances, your Committee recognizes that further discussion of how to best structure the exemption for live professional musical performers is necessary and welcomed.

Relating to Part XIII of the bill as amended, your Committee urges the Department of Business, Economic Development, and Tourism to look at depressed areas such as East Maui to be targeted for appropriated marketing funds.

As affirmed by the record of votes of the members of your Committee on Economic Development and Technology that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 3061, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 3061, S.D. 1, and be referred to the Committee on Ways and Means.

 

Respectfully submitted on behalf of the members of the Committee on Economic Development and Technology,

____________________________

ROD TAM, Chair