RELATING TO TRANSPORTATION.

HB2038

HOUSE OF REPRESENTATIVES

H.B. NO.

2038

THIRTY-THIRD LEGISLATURE, 2026

STATE OF HAWAII

A BILL FOR AN ACT

relating
to transportation
.

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

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SECTION 1.
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The legislature finds that climate change is
a global issue that threatens Hawaii's coastlines, natural resources, and the
wellbeing of residents.
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A significant
portion of Hawaii's greenhouse gas emissions originates from gasoline
"superusers", defined as the top ten per cent of drivers in terms of
gasoline consumption, with each individual using at least 1,270 gallons of
gasoline annually.

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The legislature further finds that
in Hawaii, about 6.8 per cent of drivers, or approximately sixty-five thousand
individuals, are gasoline superusers.
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On
average, each gasoline superuser drives more than forty thousand miles
annually.
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Altogether, Hawaii gasoline
superusers consume approximately 117,000,000 gallons of gasoline in a year,
making up about one-quarter of the State's total annual gasoline usage.

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The legislature additionally finds
that the financial barriers to the adoption of clean transportation
alternatives are disproportionately high for lower-income individuals.
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This disparity risks creating an uneven path
toward clean transportation, where environmental and economic benefits accrue
primarily to those with greater resources.
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The legislature believes that it is vital to address this inequity to
ensure that the shift toward a cleaner transportation system is inclusive and
accessible to all members of society.

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The legislature also finds that
reducing greenhouse gas emissions from transportation is essential to mitigate
climate change and protect the State's environment, economy, and wellbeing of
residents.
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It is in the public interest
to provide financial assistance to encourage residents to adopt cleaner
transportation alternatives, including but not limited to electric vehicles,
more fuel-efficient vehicles, personal or electric bicycles, public
transportation passes, and charging equipment, especially for those in low- and
moderate-income communities who may face affordability barriers.

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The purpose of this Act is to
establish a clean transportation alternatives incentive program that returns
funds to
eligible residents of the State who meet a
certain income threshold or are gasoline superusers, based on their prior fuel usage
,
for any qualifying purchase that supports clean mobility, while promoting
climate justice and resource efficiency.

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SECTION 2.
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Chapter 225P, Hawaii Revised Statutes, is
amended by adding a new section to be appropriately designated and to read as
follows:

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�225P-
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Clean transportation alternatives incentive program
;
established.
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(a)
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There is established within the department of transportation a
clean transportation alternatives incentive program
to
provide financial incentives through:

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(1)
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An income-based
incentive subsidy for residents whose income does not exceed $150,000 per year
who relinquish or replace a gasoline-powered vehicle; and

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(2)
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A gasoline
superuser subsidy for residents who are verified gasoline superusers and who
relinquish or replace a gasoline-powered vehicle.

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(b)
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To qualify for an income-based incentive
pursuant to subsection (a), an applicant shall submit proof of:

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(1)
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A household
federal adjusted gross income not exceeding $150,000;

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(2)
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Hawaii
residency; and

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(3)
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Purchase of a
qualifying clean transportation alternative within ninety days of relinquishing
a gasoline-powered vehicle.

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(c)
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The income-based incentive shall be $4,000 per
gasoline-powered vehicle traded in for an applicant who has submitted the
necessary documentation as required pursuant to subsection (b) and is approved
by the department of transportation.

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(d)
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To qualify for the gasoline superuser
incentive, an applicant shall submit proof of:

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(1)
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Annual gasoline
consumption exceeding 1,270 gallons, using registration and mileage records;

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(2)
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Hawaii
residency; and

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(3)
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Purchase of a
qualifying clean transportation alternative within ninety days of relinquishing
a gasoline-powered vehicle.

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(e)
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When an applicant relinquishes a
gasoline-powered vehicle, the dealer receiving the vehicle shall calculate the applicant's
average annual gasoline use for the vehicle based on registration records and
the following formula:

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(1)
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Current
odometer reading minus the odometer reading at time of purchase, which shall
equal the total miles driven;

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(2)
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The total miles
driven divided by the federal Environmental Protection Agency miles per gallon rating,
which shall equal the total gallons; and

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(3)
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The total
gallons divided by the number of years owned by the applicant, which shall
equal the average annual gallons.

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(f)
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The gasoline superuser incentive shall be awarded
to an applicant who has submitted the necessary documentation as required
pursuant to subsection (d) and is approved by the department of transportation.
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The amount of the award shall be calculated based
on the average annual gallons, as determined by subsection (e)(3) multiplied by
$7.00 per-gallon gasoline incentive rate.

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The department of transportation shall
establish the per-gallon rate to achieve the greatest possible emissions
reductions for each dollar of state funds spent.

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(g)
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Incentive funds may be paid as a voucher, or
any other form as determined by the department of transportation, to be used by
the recipient for any eligible purpose.

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(h)
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No applicant shall receive more than one
incentive allowed under this section within a five year period, to begin on the
day following the disbursement of the incentive.

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(i) The department of
transportation shall adopt rules pursuant to chapter 91 necessary to carry out
this section.
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The rules adopted pursuant
to this section shall address, at minimum:

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(1)
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Approving
eligible expenditures;

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(2)
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Verifying
eligibility, income limits, and qualifying purchases;

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(3)
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Acceptable
documentation and procedures for distribution of the incentive; and

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(4)
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Setting tiers
or higher rates for low- or moderate-income households, as defined by current
state or federal guidelines.

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(j)
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As used in this section:

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"Clean transportation
alternative" includes but is not limited to:

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(1)
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Purchase or
lease of an electric vehicle or plug-in hybrid;

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(2)
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Purchase of a
new or used vehicle achieving at least twenty per cent better fuel economy than
the vehicle replaced;

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(3)
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Purchase of a
bicycle, electric bicycle, or personal micro-mobility device;

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(4)
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Purchase of a
bus or public transit pass or card valid for six months or longer; or

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(5)
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Purchase and
installment of electric vehicle or bicycle charging equipment.

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"Gasoline superuser"
means an individual whose verified average annual gasoline consumption exceeds
1,270 gallons per year or who is within the top ten per cent of statewide
drivers by fuel use, as determined by the department of transportation.
"

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SECTION 3.
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There is appropriated out of the general
revenues of the State of Hawaii the sum of $60,000,000 or so much thereof as
may be necessary for fiscal year 2026-2027 for the department of transportation
to implement and administer the clean transportation alternatives incentive
program established pursuant to section 225P- , Hawaii Revised
Statutes; provided that the department may expend up to $6,000,000 for
administrative expenses directly related to the program.

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

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SECTION 4.
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New statutory material is underscored.

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SECTION 5.
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This Act shall take effect on July 1, 2026,
and shall be repealed on
.

INTRODUCED BY:

_____________________________

Report Title:

Department
of Transportation; Clean Transportation Alternatives; Incentive Program;
Appropriation

Description:

Requires
the Department of Transportation to establish a Clean Transportation Alternatives
Incentive Program that returns funds to eligible residents of the State who
meet a certain income threshold or use a certain amount of gasoline as fuel for
transportation.

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