HB1661 • 2026

RELATING TO CAFETERIA PLANS.

Healthcare Labor Taxes

Passed Legislature

This bill passed both chambers and reached final enrollment, even if later executive action is not shown here.

Sponsor: SAYAMA, ILAGAN, KILA, KUSCH, LEE, M., MARTEN, MATAYOSHI, MIYAKE, OLDS, TAKAYAMA, TARNAS
Last action: 2026-05-07
Official status: Transmitted to Governor.
Effective date: Not listed

Plain English Breakdown

The official source material does not provide specific details on how the bill will impact existing cafeteria plans before July 1, 2027.

Rules for Cafeteria Plans

This bill sets rules for the maximum contributions and carryover limits for flexible spending accounts in public service cafeteria plans based on IRS guidelines.

What This Bill Does

Sets annual limits for maximum contributions to flexible spending accounts in public service cafeteria plans according to IRS guidelines.

Who It Names or Affects

Public service employees who use flexible spending accounts through their cafeteria plans.
Employers and organizations offering cafeteria plans to public service workers.

Terms To Know

Cafeteria Plan: A type of benefit plan that allows employees to choose from a menu of benefits, such as health insurance or flexible spending accounts.
Flexible Spending Account (FSA): An account where employees can set aside pre-tax dollars for certain expenses like medical costs or dependent care.

Limits and Unknowns

The bill does not specify what happens if the IRS changes its rules in a way that affects these accounts.
It is unclear how this will impact existing cafeteria plans before July 1, 2027.

Amendments

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

CD1

Hawaii published version CD1

Plain English: HB1661 CD1 HOUSE OF REPRESENTATIVES H.B.

HB1661 CD1 HOUSE OF REPRESENTATIVES H.B.
NO.
1661 THIRTY-THIRD LEGISLATURE, 2026 H.D.
1 STATE OF HAWAII S.D.

HD1

Hawaii published version HD1

Plain English: HB1661 HD1 HOUSE OF REPRESENTATIVES H.B.

HB1661 HD1 HOUSE OF REPRESENTATIVES H.B.
NO.
1661 THIRTY-THIRD LEGISLATURE, 2026 H.D.
1 STATE OF HAWAII A BILL FOR AN ACT RELATING TO CAFETERIA PLANS .

SD1

Hawaii published version SD1

Plain English: HB1661 SD1 HOUSE OF REPRESENTATIVES H.B.

HB1661 SD1 HOUSE OF REPRESENTATIVES H.B.
NO.
1661 THIRTY-THIRD LEGISLATURE, 2026 H.D.
1 STATE OF HAWAII S.D.

Bill History

2026-05-08 S
Received notice of passage on Final Reading in House (Hse. Com. No. 888).
2026-05-07 H
Transmitted to Governor.
2026-05-06 H
Received notice of Final Reading (Sen. Com. No. 816).
2026-05-06 H
Passed Final Reading as amended in CD 1 with none voting aye with reservations; none voting no (0) and none excused (0).
2026-05-06 S
Passed Final Reading, as amended (CD 1). Ayes, 25; Aye(s) with reservations: none . 0 No(es): none. 0 Excused: none.
2026-05-01 S
48 Hrs. Notice (as amended CD 1) 05-06-26
2026-05-01 S
Reported from Conference Committee as amended CD 1 (Conf. Com. Rep. No. 146-26).
2026-05-01 H
Forty-eight (48) hours notice Wednesday, 05-06-26.
2026-05-01 H
Reported from Conference Committee (Conf Com. Rep. No. 146-26) as amended in (CD 1).
2026-05-01 S
The Conference committee recommends that the measure be PASSED, WITH AMENDMENTS. The votes of the Senate Conference Managers were as follows: 2 Aye(s): Senator(s) Elefante, Kim; Aye(s) with reservations: none ; 0 No(es): none; and 1 Excused: Senator(s) Fevella.
2026-05-01 H
The Conference Committee recommends that the measure be Passed, with Amendments. The votes were as follows: 3 Ayes: Representative(s) Sayama, Lee, M., Kapela; Ayes with reservations: none; 0 Noes: none; and 1 Excused: Representative(s) Reyes Oda.
2026-05-01 H
Conference Committee Meeting will reconvene on Friday, 05-01-26 at 12:00PM in Conference Room 016.
2026-04-29 H
Bill scheduled for Conference Committee Meeting on Friday, 05-01-26 8:45AM in conference room 016.
2026-04-29 H
Received notice of Senate conferees (Sen. Com. No. 791).
2026-04-29 S
Senate Conferees Appointed: Elefante Chair; Kim Co-Chair; Fevella.
2026-04-20 S
Received notice of appointment of House conferees (Hse. Com. No. 786).
2026-04-20 H
House Conferees Appointed: Sayama, Lee, M. Co-Chairs; Kapela, Reyes Oda.
2026-04-16 S
Received notice of disagreement (Hse. Com. No. 599).
2026-04-14 H
House disagrees with Senate amendment (s).
2026-04-10 H
Returned from Senate (Sen. Com. No. 523) in amended form (SD 1).
2026-04-10 S
Report Adopted; Passed Third Reading. Ayes, 25; Aye(s) with reservations: none. Noes, 0 (none). Excused, 0 (none). Transmitted to House.
2026-04-09 S
One Day Notice 04-10-26.
2026-04-09 S
Reported from WAM (Stand. Com. Rep. No. 3641) with recommendation of passage on Third Reading.
2026-04-06 S
The committee(s) on WAM recommend(s) that the measure be PASSED, UNAMENDED. The votes in WAM were as follows: 12 Aye(s): Senator(s) Dela Cruz, Moriwaki, DeCoite, Elefante, Hashimoto, Inouye, Kanuha, Kidani, Kim, Richards, Wakai, Fevella; Aye(s) with reservations: none ; 0 No(es): none; and 1 Excused: Senator(s) Lee, C..
2026-04-01 S
The committee(s) on WAM will hold a public decision making on 04-06-26 10:32AM; Conference Room 211 & Videoconference.
2026-03-23 S
Report adopted; Passed Second Reading, as amended (SD 1) and referred to WAM.
2026-03-23 S
Reported from LBT (Stand. Com. Rep. No. 3121) with recommendation of passage on Second Reading, as amended (SD 1) and referral to WAM.
2026-03-16 S
The committee(s) on LBT recommend(s) that the measure be PASSED, WITH AMENDMENTS. The votes in LBT were as follows: 4 Aye(s): Senator(s) Elefante, Lamosao, Ihara, Moriwaki; Aye(s) with reservations: none ; 0 No(es): none; and 1 Excused: Senator(s) Fevella.
2026-03-12 S
The committee(s) on LBT has scheduled a public hearing on 03-16-26 3:00PM; Conference Room 225 & Videoconference.
2026-03-10 S
Referred to LBT, WAM.
2026-03-06 S
Passed First Reading.
2026-03-06 S
Received from House (Hse. Com. No. 34).
2026-03-05 H
Passed Third Reading with none voting aye with reservations; none voting no (0) and Representative(s) Perruso excused (1). Transmitted to Senate.
2026-03-05 H
Reported from FIN (Stand. Com. Rep. No. 794-26), recommending passage on Third Reading.
2026-02-26 H
The committee on FIN recommend that the measure be PASSED, UNAMENDED. The votes were as follows: 16 Ayes: Representative(s) Todd, Takenouchi, Hartsfield, Hussey, Keohokapu-Lee Loy, Kitagawa, Kusch, Lee, M., Miyake, Morikawa, Perruso, Templo, Yamashita, Alcos, Gedeon, Reyes Oda; Ayes with reservations: none; 0 Noes: none; and 0 Excused: none.
2026-02-24 H
Bill scheduled to be heard by FIN on Thursday, 02-26-26 10:00AM in House conference room 308 VIA VIDEOCONFERENCE.
2026-02-17 H
Passed Second Reading as amended in HD 1 and referred to the committee(s) on FIN with none voting aye with reservations; none voting no (0) and Representative(s) Cochran, Lee, M., Poepoe excused (3).
2026-02-17 H
Reported from LAB (Stand. Com. Rep. No. 276-26) as amended in HD 1, recommending passage on Second Reading and referral to FIN.
2026-02-10 H
The committee on LAB recommend that the measure be PASSED, WITH AMENDMENTS. The votes were as follows: 6 Ayes: Representative(s) Sayama, Lee, M., Garrett, Kapela, Kong, Reyes Oda; Ayes with reservations: none; 0 Noes: none; and 0 Excused: none.
2026-02-05 H
Bill scheduled to be heard by LAB on Tuesday, 02-10-26 9:30AM in House conference room 309 VIA VIDEOCONFERENCE.
2026-01-26 H
Referred to LAB, FIN, referral sheet 1
2026-01-21 H
Introduced and Pass First Reading.
2026-01-20 H
Prefiled.

Official Summary Text

RELATING TO CAFETERIA PLANS.
Cafeteria Plans; Wage and Salary Reduction Benefit Programs; Flexible Spending Accounts; Public Service; Maximum Contributions; Carryover Limits
Requires the maximum contribution and carryover amounts for a public service flexible spending account plan to be set annually in accordance with the maximum amounts allowed under section 125 of the Internal Revenue Service Code. Effective 7/1/2027. (CD1)

Current Bill Text

Read the full stored bill text

HB1661

HOUSE OF REPRESENTATIVES

H.B. NO.

1661

THIRTY-THIRD LEGISLATURE, 2026

STATE OF HAWAII

A BILL FOR AN ACT

Relating
to Cafeteria plans
.

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

����
SECTION
1
.
�
Section 78-30, Hawaii Revised Statutes, is
amended by amending subsection (a) to read as follows:

����
"(a)
�
Each chief executive may establish a wage and
salary reduction benefit program which qualifies as a cafeteria plan within the
meaning of section 125 of the Internal Revenue Code of 1986, as amended[
.
]
;
provided that the maximum salary reduction contribution and maximum carryover
amount for any flexible spending account plan established pursuant to this
section shall be set annually in accordance with the inflation-adjusted maximum
amounts prescribed by the Internal Revenue Service for that calendar year.
�
The cafeteria plan shall allow eligible
employees to elect to reduce their pretax compensation in return for payment by
the jurisdiction of the expenses of eligible benefits."

����
SECTION
2.
�
Statutory material to be repealed is
bracketed and stricken.
�
New statutory
material is underscored.

����
SECTION 3.
�
This Act shall take effect upon its approval.

INTRODUCED BY:

_____________________________

Report Title:

Cafeteria
Plans; Wage and Salary Reduction Benefit Programs; Flexible Spending Accounts; Public
Service; Maximum Contributions; Carryover Limits

Description:

Specifies
that the maximum contribution and carryover amounts for a public service flexible
spending account plan shall be set in accordance with the annual limits
prescribed by the Internal Revenue Service for cafeteria plans.

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