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SB220
THE SENATE
S.B. NO.
220
THIRTY-THIRD LEGISLATURE, 2025
STATE OF HAWAII
A BILL FOR AN ACT
relating
to transportation financing
.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
����
SECTION
1
.
�
Section 23-14, Hawaii Revised Statutes, is
amended by amending subsection (a) to read as follows:
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"(a)
�
Beginning on September 5, 2017, and ending on
December 31, [
2031,
]
2056,
the auditor, on an annual basis, shall
conduct a review of any rapid transportation authority in the State charged
with the responsibility of constructing, operating, or maintaining a locally
preferred alternative for a mass transit project that receives moneys from a
surcharge on state tax established pursuant to section 46-16.8, transient
accommodations tax revenues pursuant to section 237D-2(e), or both.
�
The annual review shall include a review of
documents, including but not limited to invoices, contracts, progress reports,
and time schedules, to determine that:
����
(1)
�
Expenditures by the authority comply
with the criteria established pursuant to section 46-16.8(f); and
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(2)
�
The authority follows accounting best
practices for substantiating its expenditures."
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SECTION
2
.
�
Section
40-81.5, Hawaii Revised Statutes, is amended by amending subsection (a) to read
as follows:
����
"(a)
�
Beginning on September 5, 2017, and ending on
December 31, [
2031,
]
2056,
the comptroller, upon the request for
payment by the rapid transportation authority, shall verify that the
authority's invoices for the capital costs of a locally preferred alternative
for a mass transit project comply with section 46-16.8(f)."
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SECTION
3
.
�
Section
46-16.8, Hawaii Revised Statutes, is amended by amending subsections (a)
through (c) to read as follows:
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"(a)
�
Each county may establish a surcharge on
state tax at the rates enumerated in sections 237-8.6 and 238-2.6.
�
A county electing to establish this surcharge
shall do so by ordinance; provided that:
����
(1)
�
No ordinance shall be adopted until the
county has conducted a public hearing on the proposed ordinance;
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(2)
�
The ordinance shall be adopted before
December 31, 2005; and
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(3)
�
No county surcharge on state tax that
may be authorized under this subsection shall be levied before January 1, 2007,
or after December 31, [
2022,
]
2030,
unless extended pursuant to
subsection (b).
Notice of
the public hearing required under paragraph (1) shall be published in a
newspaper of general circulation within the county at least twice within a
period of thirty days immediately preceding the date of the hearing.
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A
county electing to exercise the authority granted under this subsection shall
notify the director of taxation within ten days after the county has adopted a
surcharge on state tax ordinance and, beginning no earlier than January 1,
2007, the director of taxation shall levy, assess, collect, and otherwise
administer the county surcharge on state tax.
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(b)
�
Each county that has established a surcharge
on state tax before July 1, 2015, under authority of subsection (a) may extend
the surcharge until December 31, [
2030,
]
2056,
at the same
rates.
�
A county electing to extend this
surcharge shall do so by ordinance; provided that:
����
(1)
�
No ordinance shall be adopted until the
county has conducted a public hearing on the proposed ordinance; and
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(2)
�
The ordinance shall be adopted before
January 1, [
2018.
]
2026.
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A
county electing to exercise the authority granted under this subsection shall
notify the director of taxation within ten days after the county has adopted an
ordinance extending the surcharge on state tax.
�
The director of taxation shall levy, assess, collect, and otherwise
administer the extended surcharge on state tax.
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(c)
�
Each county that has not established a
surcharge pursuant to subsection (a) on state tax before July 1, 2015, may
establish the surcharge at the rates enumerated in sections 237-8.6 and
238-2.6.
�
A county electing to establish
this surcharge shall do so by ordinance; provided that:
����
(1)
�
No ordinance shall be adopted until the
county has conducted a public hearing on the proposed ordinance;
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(2)
�
The ordinance shall be adopted before
December 31, 2023; and
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(3)
�
No county surcharge on state tax that
may be authorized under this subsection shall be levied before January 1, 2019,
or after December 31, [
2030.
]
2056.
����
A
county electing to exercise the authority granted under this subsection shall
notify the director of taxation within ten days after the county has adopted a
surcharge on state tax ordinance.
�
Beginning on January 1, 2019, January 1, 2020, January 1, 2024, or
January 1, 2025, as applicable pursuant to sections 237-8.6 and 238-2.6, the
director of taxation shall levy, assess, collect, and otherwise administer the
county surcharge on state tax."
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SECTION
4
.
�
Section
237-8.6, Hawaii Revised Statutes, is amended by amending subsection (b) to read
as follows:
����
"(b)
�
Each county surcharge on state tax that may
be adopted, extended, or amended pursuant to section 46-16.8 shall be levied
beginning in a taxable year after the adoption of the relevant county
ordinance; provided that no surcharge on state tax may be levied:
����
(1)
�
Before:
���������
(A)
�
January 1, 2007, if the county
surcharge on state tax was established by an ordinance adopted before December
31, 2005;
���������
(B)
�
January 1, 2019, if the county
surcharge on state tax was established by the adoption of an ordinance after
June 30, 2015, but before June 30, 2018;
���������
(C)
�
January 1, 2020, if the county
surcharge on state tax was established by the adoption of an ordinance on or
after June 30, 2018, but before March 31, 2019;
���������
(D)
�
January 1, 2024, if the county
surcharge on state tax was established by the adoption of an ordinance on or
after March 31, 2019, but before August 1, 2023; or
���������
(E)
�
January 1, 2025, if the county
surcharge on state tax was established by the adoption of an ordinance on or
after August 1, 2023, but before December 31, 2023; and
����
(2)
�
After December 31, [
2030.
]
2056.
"
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SECTION
5
.
�
Section 237D-2,
Hawaii Revised Statutes, is amended by amending subsection (e) to read as
follows:
����
"(e)
�
Notwithstanding the tax rates established in
subsections (a)(5) and (c)(3), 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, [
2030;
]
2056;
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 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.
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The
remaining tax revenues levied, assessed, and collected at the 9.25 per cent tax
rate pursuant to subsections (a) and (c) shall be deposited into the general
fund in accordance with section 237D-6.5(b)."
����
SECTION
6
.
�
Section
238-2.6, Hawaii Revised Statutes, is amended by amending subsection (b) to read
as follows:
����
"(b)
�
Each county surcharge on state tax that may
be adopted, extended, or amended shall be levied beginning in a taxable year
after the adoption of the relevant county ordinance; provided that no surcharge
on state tax may be levied:
����
(1)
�
Before:
���������
(A)
�
January 1, 2007, if the county
surcharge on state tax was established by an ordinance adopted before December
31, 2005;
���������
(B)
�
January 1, 2019, if the county
surcharge on state tax was established by the adoption of an ordinance after
June 30, 2015, but before June 30, 2018;
���������
(C)
�
January 1, 2020, if the county
surcharge on state tax was established by the adoption of an ordinance on or
after June 30, 2018, but before March 31, 2019;
���������
(D)
�
January 1, 2024, if the county
surcharge on state tax was established by the adoption of an ordinance on or
after March 31, 2019, but before August 1, 2023; or
���������
(E)
�
January 1, 2025, if the county
surcharge on state tax was established by the adoption of an ordinance on or
after August 1, 2023, but before December 31, 2023; and
����
(2)
�
After December 31, [
2030.
]
2056.
"
����
SECTION
7
.
�
Section
248-2.7, Hawaii Revised Statutes, is amended by amending subsection (b) to read
as follows:
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"
(b)
�
For the period beginning on January 1, 2018,
to December 31, [
2030,
]
2056,
transient accommodations tax and
surcharge on state tax revenues allocated to the mass transit special fund
pursuant to sections 237D-2(e) and 248-2.6 shall be deposited into the special
fund.
�
All interest earned on the moneys
in the special fund shall be credited to the general fund.
�
The mass transit special fund shall be exempt
from the central service expenses deduction under section 36-27 and
departmental administrative expenses deduction under section 36‑30."
����
SECTION
8.
�
Act 247, Session Laws of Hawaii 2005,
as amended by Act 240, Session Laws of Hawaii 2015, as amended by Act 1, First
Special Session Laws of Hawaii 2017, is amended by amending section 9 to read
as follows:
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"SECTION
9.
�
This Act shall take effect upon its
approval; provided that:
����
(1)
�
If none of the counties of the State adopt an
ordinance to levy a county surcharge on state tax by December 31, 2005, this
Act shall be repealed and section 437D-8.4, Hawaii Revised Statutes, shall be
reenacted in the form in which it read on the day prior to the effective date
of this Act;
����
(2)
�
If any county does not adopt an ordinance to
levy a county surcharge on state tax by December 31, 2005, it shall be
prohibited from adopting such an ordinance pursuant to this Act, unless
otherwise authorized by the legislature through a separate legislative act; and
����
(3)
�
If an ordinance to levy a county surcharge on
state tax is adopted by December 31, 2005:
���������
(A)
�
The ordinance shall be repealed on December
31, [
2022;
]
2056;
provided that the repeal of the ordinance shall
not affect the validity or effect of an ordinance to extend a surcharge on
state tax adopted pursuant to an act of the legislature; and
���������
(B)
�
This Act shall be repealed on December 31, [
2030,
]
2056,
and section 437D-8.4, Hawaii Revised Statutes, shall be reenacted
in the form in which it read on the day prior to the effective date of this
Act; provided that the amendments made to section 437D-8.4, Hawaii Revised
Statutes, by Act 226, Session Laws of Hawaii 2008, as amended by Act 11,
Session Laws of Hawaii 2009, and Act 110, Session Laws of Hawaii 2014, shall
not be repealed."
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SECTION
9.
�
This Act shall not be construed to
prohibit the use of funds generated by a county for purposes not prohibited by
state law.
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SECTION
10.
�
This Act does not affect rights and
duties that matured, penalties that were incurred, and proceedings that were
begun before its effective date.
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SECTION
11.
�
If any provision of this Act, or the
application thereof to any person or circumstance, is held invalid, the
invalidity does not affect other provisions or applications of the Act that can
be given effect without the invalid provision or application, and to this end
the provisions of this Act are severable.
����
SECTION
12.
�
Statutory material to be repealed is
bracketed and stricken.
�
New statutory
material is underscored.
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SECTION
13.
�
This Act shall take effect upon its
approval.
INTRODUCED BY:
_____________________________
Report Title:
County
Surcharge on State Tax; Extension; General Excise Tax; Transient Accommodations
Tax
Description:
Authorizes
a county that has adopted a surcharge to state tax to extend the surcharge to
12/31/2056.
�
Extends the end date of the
one percent Transient Accommodation Tax increase
to 12/31/2056.
�
Requires the State Auditor to conduct an
audit and annual review of the Honolulu Authority for Rapid Transportation
until 12/31/2056.
�
Requires the
Comptroller to certify the Honolulu Authority for Rapid Transportation's
invoices for capital costs until 12/31/2056.
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.