STAND. COM. REP. NO. 164

Honolulu, Hawaii

, 2005

RE: S.B. No. 713

S.D. 1

 

 

Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committees on Media, Arts, Science, and Technology and Business and Economic Development, to which was referred S.B. No. 713 entitled:

"A BILL FOR AN ACT RELATING TO A BUSINESS-RESEARCH INSTITUTE TAX CREDIT,"

beg leave to report as follows:

The purpose of this measure is to establish a Hawaii business-research institute tax credit to promote the formation and funding of research partnerships between business entities and eligible research institutions.

Testimony in support of this measure was submitted by the Department of Business, Economic Development, and Tourism; the Department of Taxation; University of Hawaii; Kamehameha Schools; and Hawaii Agriculture Research Center. In addition, your Committees received comments from the Tax Foundation of Hawaii.

Your Committees find that the State's economic future increasingly depends on investment in emerging technology-based sectors. Offering tax credits provides incentives for private-sector investments to support research or development conducted by an eligible institution, and is an investment in Hawaii's economic future. Your Committees believe that this measure will result in increased scientific research at Hawaii's universities and post-secondary educational and research institutions, and the growth of new technology-based enterprises.

In response to concerns raised by members, your Committees have amended this measure to clarify procedures for distributing the credits before and after the cap of $2,000,000 for any one calendar year is reached. Your Committees also have amended this measure by making technical, non-substantive amendments for the purposes of style and clarity.

As affirmed by the records of votes of the members of your Committees on Media, Arts, Science, and Technology and Business and Economic Development that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 713, as amended herein, and recommend that it pass Second Reading in the form attached hereto as S.B. No. 713, S.D. 1, and be referred to the Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committees on Media, Arts, Science, and Technology and Business and Economic Development,

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WILL ESPERO, Chair

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CAROL FUKUNAGA, Chair