STAND. COM. REP. NO. 232

 

Honolulu, Hawaii

                  

 

RE:    S.B. No. 1268

 

 

 

Honorable Colleen Hanabusa

President of the Senate

Twenty-Fourth State Legislature

Regular Session of 2007

State of Hawaii

 

Madam:

 

     Your Committee on Education, to which was referred S.B. No. 1268 entitled:

 

"A BILL FOR AN ACT RELATING TO A COLLEGE SAVINGS PROGRAM TAX CREDIT,"

 

begs leave to report as follows:

 

     The purpose of this measure is to increase the number of local residents attending institutions of higher education.

 

     Specifically, this measure establishes a college savings account program that provides a sliding-scale tax credit for contributions made to college savings accounts, the maximum of which would be $500. 

 

     Testimony in support of this measure was submitted by the Department of Taxation, the University of Hawaii, Hawaii Association of Independent Schools, and one individual.

 

     Your Committee received a fiscal impact statement from the Department of Taxation that this measure, if passed, would result in a revenue loss to the State of approximately $6.3 million dollars per year, assuming the maximum tax credit of $500.  No methodology was provided by the Department of Taxation.

 

     Your Committee finds that a college savings account tax credit will provide an additional incentive to encourage Hawaii taxpayers to take advantage of Hawaii's TuitionEDGE 529 program and, thereby, lower the cost of administering the fund and increase the participants' savings for college tuition.

 

     Your Committee further finds that a college savings account program tax credit for Hawaii residents is an important state investment, given our high cost of living, and can contribute to an increase of college graduates in Hawaii, including those in the socioeconomic and ethnically underrepresented groups.

 

     As affirmed by the record of votes of the members of your Committee on Education that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1268 and recommends that it pass Second Reading and be referred to the Committee on Economic Development and Taxation.

 

Respectfully submitted on behalf of the members of the Committee on Education,

 

 

 

____________________________

NORMAN SAKAMOTO, Chair