HB1077 • 2026

RELATING TO ECONOMIC DEVELOPMENT.

Taxes

Active

The official status still shows this bill as active or still awaiting another formal step.

Sponsor: NAKAMURA (Introduced by request of another party)
Last action: 2025-12-08
Official status: Carried over to 2026 Regular Session.
Effective date: Not listed

Plain English Breakdown

The official source material does not provide specific details about procedures for evaluating project proposals or the exact timing of when the tax increase will take effect.

Increase in Transient Accommodations Tax for Climate Change Projects

This bill increases the transient accommodations tax to fund projects addressing climate change impacts and supporting economic development.

What This Bill Does

Increases the transient accommodations tax rate from 9.25% to 11%
Establishes a special fund for climate mitigation and resiliency
Allocates funds from the transient accommodations tax to both the climate mitigation and resiliency fund and the economic development and revitalization fund

Who It Names or Affects

Tourists who pay transient accommodations tax in Hawaii
Government agencies involved in economic development and disaster preparedness

Terms To Know

Transient Accommodations Tax: A tax on short-term rentals or hotel stays, used by Hawaii to fund various projects.
Resiliency Projects: Projects that help communities adapt and recover from the impacts of climate change and natural disasters.

Limits and Unknowns

The bill does not specify how much money will be allocated to each fund.
It is unclear when exactly the tax increase will take effect, though it is mentioned as being effective on July 1, 3000 (likely a placeholder for an actual date).

Amendments

These notes stay tied to the official amendment files and metadata from the legislature.

HD1

Hawaii published version HD1

Plain English: This amendment allows the Department of Defense to fund projects that help Hawaii become more resilient against climate change, creates a special fund for these efforts, and increases the transient accommodations tax to support both resiliency and economic development.

The Department of Defense can now fund projects aimed at increasing resilience against climate change impacts.
A selection committee will be formed to recommend projects that receive funding from the newly established Climate Mitigation and Resiliency Special Fund.
An Economic Development and Revitalization Special Fund is created, which also receives a portion of transient accommodations tax revenue.
The transient accommodations tax rate is increased to provide more funds for both special funds.

The exact details on how the selection committee will operate are not fully explained in this amendment text.

HD2

Hawaii published version HD2

Plain English: The amendment increases the transient accommodations tax rate and allocates a portion of the additional revenue to address climate change impacts and advance economic development.

Increases the transient accommodations tax rate from 9.25% to 10.25% for the period from January 1, 2018, to December 31, 2025, and from 10.25% to 12% for the period from January 1, 2026, to December 31, 2030.
Deposits excess tax revenues into a mass transit special fund established under section 248-2.7.

The exact allocation of funds for climate change projects and economic development is not detailed in the amendment text provided.

Bill History

2025-12-08 D
Carried over to 2026 Regular Session.
2025-02-14 H
Report adopted; referred to the committee(s) on FIN as amended in HD 2 with Representative(s) Matsumoto, Reyes Oda voting aye with reservations; Representative(s) Garcia, Muraoka, Pierick, Shimizu voting no (4) and Representative(s) Cochran, Matayoshi, Poepoe, Ward excused (4).
2025-02-14 H
Reported from ECD/TOU (Stand. Com. Rep. No. 655) as amended in HD 2, recommending referral to FIN.
2025-02-12 H
The committee on TOU recommend that the measure be PASSED, WITH AMENDMENTS. The votes were as follows: 4 Ayes: Representative(s) Tam, Templo, Hussey, Ilagan; Ayes with reservations: none; Noes: none; and 3 Excused: Representative(s) Holt, Todd, Matsumoto.
2025-02-12 H
The committee on ECD recommend that the measure be PASSED, WITH AMENDMENTS. The votes were as follows: 4 Ayes: Representative(s) Ilagan, Hussey, Tam, Templo; Ayes with reservations: none; Noes: none; and 3 Excused: Representative(s) Holt, Todd, Matsumoto.
2025-02-07 H
Bill scheduled to be heard by ECD/TOU on Wednesday, 02-12-25 10:15AM in House conference room 423 VIA VIDEOCONFERENCE.
2025-02-06 H
Passed Second Reading as amended in HD 1 and referred to the committee(s) on ECD/TOU with none voting aye with reservations; Representative(s) Garcia, Muraoka voting no (2) and Representative(s) Ward excused (1).
2025-02-06 H
Reported from EEP (Stand. Com. Rep. No. 226) as amended in HD 1, recommending passage on Second Reading and referral to ECD/TOU.
2025-02-04 H
The committee on EEP recommend that the measure be PASSED, WITH AMENDMENTS. The votes were as follows: 5 Ayes: Representative(s) Lowen, Perruso, Kahaloa, Kusch, Quinlan; Ayes with reservations: none; Noes: none; and 1 Excused: Representative(s) Ward.
2025-01-28 H
Bill scheduled to be heard by EEP on Tuesday, 02-04-25 9:00AM in House conference room 325 VIA VIDEOCONFERENCE.
2025-01-23 H
Referred to EEP, ECD/TOU, FIN, referral sheet 3
2025-01-23 H
Introduced and Pass First Reading.
2025-01-21 H
Pending introduction.

Official Summary Text

RELATING TO ECONOMIC DEVELOPMENT.
Transient Accommodations Tax; Climate Change; Economic Development; Revitalization ($)
Increases the transient accommodations tax and allocates a portion of the tax to the general fund for projects that address climate change impacts and advance economic development and revitalization. Effective 7/1/3000. (HD2)

Current Bill Text

Read the full stored bill text

HB1077

HOUSE OF REPRESENTATIVES

H.B. NO.

1077

THIRTY-THIRD LEGISLATURE, 2025

STATE OF HAWAII

A BILL FOR AN ACT

RELATING TO ECONOMIC DEVELOPMENT.

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

����
SECTION 1.
�
The
legislature finds that Hawaii is experiencing a climate emergency.
�
The effects of climate change, such as rising
temperatures, prolonged droughts, and increasingly destructive and deadly
weather events, are felt across the island chain.
�
These impacts threaten not only our vibrant
ecosystems but, as actors within these ecosystems, the people of Hawaii as
well.
�
To ensure the health, safety, and
wellbeing of Hawaii's lands, waters, and people, successful mitigation of
and adaptation to climate change is imperative.

����
The legislature further finds that given
the scale and impact of the climate emergency, the State must invest in bold
actions to prepare for, mitigate, and adapt to climate change, including
resiliency to intensifying natural disasters.
�

A coordinated approach is necessary, and the department of defense,
charged with protecting the safety and welfare of the people of Hawaii and the
State's lead for hazard mitigation and disaster readiness, is prepared to
assume this responsibility, in coordination with the departments of business,
economic development, and tourism; land and natural resources; and
transportation, as well as the community, to provide for the safety, security,
and wellbeing of Hawaii's places and people.

����
The legislature further finds that economic development, in
particular, must consider climate
change.
�
Tourism, infrastructure, and community
development are all predicated upon Hawaii's land and natural resources.
�
Resiliency to and mitigation of climate
change must remain at the forefront of any economic development or
revitalization project.

����
The legislature further finds that Hawaii
needs to invest in efforts to reduce climate change impacts now to limit
current and future costs of climate change.
�

The anticipated extent of the impact of climate change is such that state
government needs to take comprehensive and coordinated mitigation efforts as
soon as possible.

����
The purposes of this Act are to:

����
(1)
�
Address
the impacts of climate change on the State and mitigate further impacts by
authorizing the funding of resiliency projects and establishing the climate
mitigation and resiliency special fund;

����
(2)
�
Support
resilient economic development and revitalization throughout the state by
establishing the economic development and revitalization special fund;

����
(3)
�
Increase
the transient accommodations tax and allocate a portion of the tax to the two
newly established special funds; and

����
(4)
�
Appropriate
funds into and out of the special funds.

����
SECTION 2.
�

The Hawaii Revised Statutes is amended by adding a new chapter to be
appropriately designated and to read as follows:

"
CHAPTER

RESILIENCY

����
�
��
-1
�
Resiliency projects.
�
The department of defense may fund projects
that strengthen the State's resiliency, including projects that mitigate, adapt
to, or increase resiliency against climate change.

����
�
��
-2
�
Resiliency projects; selection committee.
�
The department of defense shall convene a
selection committee to review and recommend projects for climate mitigation and
resiliency special fund allocation.
�
The
following members shall comprise the committee:

����
(1)
�
The
adjutant general;

����
(2)
�
The
director of business, economic development, and tourism;

����
(3)
�
The
director of finance;

����
(4)
�
The
chairperson of the board of land and natural resources;

����
(5)
�
The
director of transportation;

����
(6)
�
An
at-large member nominated by the president of the senate; and

����
(7)
�
An
at-large member nominated by the speaker of the house or representatives;

provided
that the two at-large members shall each be invited to serve and appointed by
the governor, without the advice and consent of the senate, from a list of
three nominees submitted for each position by the nominating authority
specified in this section.

����
�
��
-3
�
Climate mitigation and resiliency special
fund; established.
�
(a)
�
There is established in the state treasury
the climate mitigation and resiliency special fund, to be administered by the
department of defense, into which shall be deposited:

����
(1)
�
Appropriations
made by the legislature to the fund;

����
(2)
�
Fees
collected under this chapter or any rule adopted thereunder;

����
(3)
�
Grants
provided by governmental agencies or any other source;

����
(4)
�
Donations
made by private individuals or organizations for deposit into the fund;

����
(5)
�
Interest
earned from moneys in the emergency and budget reserve fund established in
section 328L-3;

����
(6)
�
A
portion of the revenues from the transient accommodations tax established by
chapter 237D, as provided by section 237D-6.5; and

����
(7)
�
Interest
earned from moneys in the fund.

����
(b)
�
Moneys
in the climate mitigation and resiliency special fund shall be used to advance
projects addressing climate change impacts, including projects that mitigate,
adapt to, or increase resiliency against climate change.
�
Moneys may also be used for consultant,
personnel, and administrative costs required to develop and implement the
aforementioned projects.

����
�
��

-4
�
Rules.
�
The adjutant general shall adopt rules
pursuant to chapter 91 necessary for the purposes of this chapter."

����
SECTION 3.
�

Chapter 201, Hawaii Revised Statutes, is amended by adding to part I a
new section to be appropriately designated and to read as follows:

����
"
�201-
��
��
Economic
development and revitalization special fund.
�
(a)
�

There is established in the state treasury the economic development
and revitalization special fund, to be administered by the department, into
which shall be deposited:

����
(1)
�
Appropriations
made by the legislature to the fund;

����
(2)
�
Fees
collected under this chapter or any rule adopted thereunder;

����
(3)
�
Grants
provided by governmental agencies or any other source;

����
(4)
�
Donations
made by private individuals or organizations for deposit into the fund;

����
(5)
�
A
portion of the revenues from the transient accommodations tax, as provided by
section 237D-6.5; and

����
(6)
�
Interest
earned from moneys in the fund.

����
(b)
�

Moneys in the economic development and revitalization special fund shall
be used for projects advancing:

����
(1)
�
Economic
development or revitalization;

����
(2)
�
Infrastructure
within tourism districts or resort areas;

����
(3)
�
Climate
change mitigation, adaptation, or resiliency; and

����
(4)
�
Tourism
marketing.

����
(c)
�

The department shall establish procedures for receiving and evaluating
project proposals for economic development and revitalization special fund
allocation; provided that

����
(1)
�
The
Hawaii tourism authority, office of planning and sustainable development, and
department of land and natural resources shall each review any project proposal
submitted for funding allocation and submit a recommendation for funding
allocation to the department;

����
(2)
�
The
department shall review any project proposal submitted for funding allocation
as well as the corresponding recommendations for funding allocation submitted
to the department pursuant to paragraph (1) and make a recommendation for
funding allocation to the governor; and

����
(3)
�
All
funding allocations are subject to the governor's final approval.

����
(d)
�

The department shall submit an annual report to the legislature no later
than twenty days prior to the convening of each regular session on the sources
of moneys deposited into the economic development and revitalization special
fund and expenditures of moneys in the special fund.
"

����
SECTION 4.
�

Section 237D-2, Hawaii Revised Statutes, is amended to read as follows:

����
"
�237D-2
�
Imposition and rates.
�
(a)
�
There is levied and shall be assessed and
collected each month a tax of:

����
(1)
�
Five
per cent for the period beginning on January 1, 1987, to June 30, 1994;

����
(2)
�
Six
per cent for the period beginning on July 1, 1994, to December 31, 1998;

����
(3)
�
7.25
per cent for the period beginning on January 1, 1999, to June 30, 2009;

����
(4)
�
8.25
per cent for the period beginning on July 1, 2009, to June 30, 2010; [
and
]

����
(5)
�
9.25
per cent for the period beginning on July 1, 2010, [
and thereafter;
]
to
December 31, 2025; and

����
(6)
�
11
per cent for the period beginning on January 1, 2026, and thereafter;

on the
gross rental or gross rental proceeds derived from furnishing transient
accommodations.

����
(b)
�
Every
transient accommodations broker, travel agency, and tour packager who arranges
transient accommodations at noncommissioned negotiated contract rates and every
operator or other taxpayer who receives gross rental proceeds shall pay to the
State the tax imposed by subsection (a), as provided in this chapter.

����
(c)
�
There
is levied and shall be assessed and collected each month, on the occupant of a
resort time share vacation unit, a transient accommodations tax of:

����
(1)
�
7.25
per cent on the fair market rental value until December 31, 2015;

����
(2)
�
8.25
per cent on the fair market rental value for the period beginning on January 1,
2016, to December 31, 2016; and

����
(3)
�
9.25
per cent on the fair market rental value for the period beginning on January 1,
2017, [
and thereafter.
]
to December 31, 2025; and

����
(4)
�
11
per cent on the fair market rental value for the period beginning on January 1,
2026, and thereafter.

����
(d)
�
Every
plan manager shall be liable for and pay to the State the transient
accommodations tax imposed by subsection (c) as provided in this chapter.
�
Every resort time share vacation plan shall be
represented by a plan manager who shall be subject to this chapter.

����
(e)
�
Notwithstanding
the tax rates established in subsections (a)(5)
and (6)
and (c)(3)[
,
]

and (4),
the tax rates levied, assessed, and collected pursuant to
subsections (a) and (c) shall be 10.25 per cent for the period beginning on
January 1, 2018, to December 31,
2025, and 12 per cent for the period
beginning on January 1, 2026, to December 31,
2030; provided that:

����
(1)
�
The
tax revenues levied, assessed, and collected pursuant to this subsection that
are in excess of the revenues realized from the levy, assessment, and
collection of tax at the [
9.25 per cent rate
]
rates established in
subsections (a)(5) and (6) and (c)(3) and (4)
shall be deposited quarterly
into the mass transit special fund established under section 248-2.7; and

����
(2)
�
If
a court of competent jurisdiction determines that the amount of county
surcharge on state tax revenues deducted and withheld by the State, pursuant to
section 248-2.6, violates statutory or constitutional law and, as a result,
awards moneys to a county with a population greater than five hundred thousand,
then an amount equal to the monetary award shall be deducted and withheld from
the tax revenues deposited under paragraph (1) into the mass transit special
fund, and those funds shall be a general fund realization of the State.

����
The remaining tax revenues levied,
assessed, and collected at the [
9.25 per cent tax rate pursuant to
]
rates
established in
subsections (a) and (c) shall be deposited into the general
fund in accordance with section 237D-6.5(b)."

����
SECTION 5.
�

Section 237D-6.5, Hawaii Revised Statutes, is amended by amending
subsection (b) to read as follows:

����
"(b)
�
Except for the revenues collected pursuant to
section 237D-2(e), revenues collected under this chapter shall be distributed
in the following priority, with the excess revenues to be deposited into the
general fund:

����
(1)
�
$1,500,000
shall be allocated to the Turtle Bay conservation easement special fund
beginning July 1, 2015, for the reimbursement to the state general fund of debt
service on reimbursable general obligation bonds, including ongoing expenses
related to the issuance of the bonds, the proceeds of which were used to
acquire the conservation easement and other real property interests in Turtle
Bay, Oahu, for the protection, preservation, and enhancement of natural
resources important to the State, until the bonds are fully amortized;

����
(2)
�
$11,000,000
shall be allocated to the convention center enterprise special fund established
under section 201B-8;

����
(3)
�
An
allocation shall be deposited into the tourism emergency special fund,
established in section 201B-10, in a manner sufficient to maintain a fund
balance of $5,000,000 in the tourism emergency special fund; [
and
]

����
(4)
�
$3,000,000
shall be allocated to the special land and development fund established under
section 171-19; provided that the allocation shall be expended in accordance
with the Hawaii tourism authority strategic plan for:

���������
(A)
�
The
protection, preservation, maintenance, and enhancement of natural resources,
including beaches, important to the visitor industry;

���������
(B)
�
Planning,
construction, and repair of facilities; and

���������
(C)
�
Operation
and maintenance costs of public lands, including beaches, connected with
enhancing the visitor experience[
.
]
;

����
(5)
�
7.3
per cent of the total revenue collected pursuant to section 237D-2 shall be
allocated to the climate mitigation and resiliency special fund, established
under section
���
-1;

����
(6)
�
7.3
per cent of the total revenue collected pursuant to section 237D-2 shall be
allocated to the economic development and revitalization special fund,
established under section 201-
��
.

All
transient accommodations taxes shall be paid into the state treasury each month
within ten days after collection and shall be kept by the state director of
finance in special accounts for distribution as provided in this subsection."

����
SECTION 6.
�

There is appropriated out of the general revenues of the State of Hawaii
the sum of $50,000,000 or so much thereof as may be necessary for fiscal year
2025-2026 to be deposited into the climate mitigation and resiliency special
fund.

����
SECTION 7.
�

There is appropriated out of the climate mitigation and resiliency
special fund the sum of $50,000,000 or so much thereof as may be necessary for
fiscal year 2025-2026 to advance projects addressing climate change impacts.

����
The sum appropriated shall be expended by
the department of defense for the purposes of this Act.

����
SECTION 8.
�

There is appropriated out of the climate mitigation and resiliency
special fund $90,000,000 or so much thereof as may be necessary for fiscal year
2025-2026 and the same sum or so much thereof as may be necessary for fiscal
year 2026-2027 to advance projects addressing climate change impacts.

����
The sum appropriated shall be expended by
the department of defense for the purposes of this Act.

����
SECTION 9.
�

There is appropriated out of the economic development and revitalization
special fund $90,000,000 or so much thereof as may be necessary for fiscal year
2025-2026 and the same sum or so much thereof as may be necessary for fiscal
year 2026-2027 to advance resilient economic development and revitalization
projects.

����
The sum appropriated shall be expended by
the department of business, economic development, and tourism for the purposes
of this Act.

����
SECTION 10.
�

The appropriations made by this Act shall not lapse at the end of the
fiscal year for which the appropriation is made; provided that all moneys from
the appropriation unencumbered as of June 30, 2028, shall lapse into the fund
from which appropriated as of that date.
�

Any unissued balance of any authorization made by this Act as of the
close of business on June 30, 2028, shall lapse.

����
SECTION 11.
�

Statutory material to be repealed is bracketed and stricken.
�
New statutory material is underscored.

����
SECTION 12.
�

This Act, upon its approval, shall take effect on July 1, 2025.

INTRODUCED BY:

_____________________________

BY REQUEST

Report Title:

Climate Mitigation and Resiliency Special Fund; Economic
Development and Revitalization Special Fund; Transient Accommodations Tax;
Department of Defense; Department of Business, Economic Development, and
Tourism; Appropriation

Description:

Establishes the Climate Mitigation and Resiliency Special
Fund and the Economic Development and Revitalization Special Fund.
�
Beginning January 1, 2026, increases the
Transient Accommodations Tax.
�
Allocates
funds generated by the increase to the newly established funds.

The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.