STAND. COM. REP. NO.  789

 

Honolulu, Hawaii

                , 2011

 

RE:   H.B. No. 1306

      H.D. 2

 

 

 

 

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Sixth State Legislature

Regular Session of 2011

State of Hawaii

 

Sir:

 

     Your Committee on Finance, to which was referred H.B. No. 1306, H.D. 1, entitled:

 

"A BILL FOR AN ACT RELATING TO HOUSING,"

 

begs leave to report as follows:

 

     The purpose of this bill is to provide for the development of affordable housing in a transparent and fiscally responsible manner by, among other things:

 

(1)  Eliminating the exemption from general excise and receipts taxes for county affordable housing projects;

 

(2)  Requiring that every claim for a general excise tax exemption for qualified affordable housing projects be reviewed by the Hawaii Housing Finance and Development Corporation (HHFDC) and the Department of Taxation (DOTAX) prior to initial or renewal certification;

 

(3)  Requiring that certifications of a general excise tax exemption for qualified affordable housing projects be renewed every four years;

 

(4)  Authorizing the Auditor, at the direction of the Legislature, to audit any certified general excise tax exemption for qualified affordable housing projects;

 

(5)  Requiring DOTAX to maintain an annual and cumulative record of all general excise tax exemptions granted to qualified affordable housing projects; and

 

(6)  Diverting program fees charged by HHFDC in connection with the approval and certification of affordable housing general excise tax exemptions from the Dwelling Unit Revolving Fund to the Rental Housing Trust Fund.

 

     Several concerned individuals supported this bill.  HHFDC, DOTAX, Kauai County Housing Agency, Tax Foundation of Hawaii, and Hawaii Association of REALTORS provided comments.

 

     Your Committee has amended this bill by:

 

     (1)  Restoring the program fees to the Dwelling Unit Revolving Fund;

 

     (2)  Making its provisions applicable to taxable years beginning after December 31, 2011;

 

     (3)  Removing provisions that make public all records maintained in association with the HHFDC affordable housing general excise tax exemption;

 

     (4)  Providing that by claiming the general excise tax exemption for a qualified affordable housing project, a taxpayer consents to the public disclosure of the taxpayer's name and status as a claimant;

 

     (5)  Changing its effective date to July 1, 2030, to encourage further discussion; and

 

     (6)  Making technical, nonsubstantive amendments for clarity, consistency, and style.

 

     As affirmed by the record of votes of the members of your Committee on Finance that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1306, H.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 1306, H.D. 2.

 

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

 

 

 

 

____________________________

MARCUS R. OSHIRO, Chair