Bill Text: HI HB2170 | 2016 | Regular Session | Introduced
Bill Title: Medical Practice Zone Designation; Medically Underserved Areas
Spectrum: Strong Partisan Bill (Democrat 12-1)
Status: (Introduced - Dead) 2016-01-27 - Referred to EDB/HLT, CPC, FIN, referral sheet 3 [HB2170 Detail]
Download: Hawaii-2016-HB2170-Introduced.html
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HOUSE OF REPRESENTATIVES |
H.B. NO. |
2170 |
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TWENTY-EIGHTH LEGISLATURE, 2016 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING TO HEALTH CARE.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The purpose of this Act is to increase access to physician and dental services for residents of the State who live in federally-designated "medically underserved areas" or "health professional shortage areas" by granting certain benefits to physicians and dentists who provide services in these areas. The benefits provided under this Act shall be similar to, but not the same as, the benefits available under the enterprise zone program under chapter 209E, Hawaii Revised Statutes.
SECTION 2. There is created a pilot project within the department of business, economic development, and tourism, to provide certain tax and other benefits similar to those provided in an enterprise zone, for physicians and dentists who agree to work within certain areas of the State for a certain period.
The department of health shall work cooperatively with the department of business, economic development, and tourism to implement this Act.
SECTION 3. Definitions. As used in this Act, unless the context clearly requires otherwise:
"Department" means the department of business, economic development, and tourism.
"Director" means the director of business, economic development, and tourism.
"Health professional shortage area" means a geographic area within the State that is served by an inadequate supply of physicians or dentists and includes a geographic service area identified as a health professional shortage area by the Health Resources and Services Administration of the United States Department of Health and Human Services.
"Medical or dental establishment" means a single physical location where a medical practice is conducted by a physician or dentist providing professional services.
"Medical practice" includes one or more medical or dental establishments, any number of which may be located within a medical practice shortage zone.
"Medical practice shortage zone" means either a health professional shortage area or a medically underserved area, or both, that is:
(1) Within the jurisdiction of a county government; and
(2) Eligible for the benefits under this Act.
"Medically underserved area" means a geographic location within the State that has insufficient health resources in terms of physician or dental personnel or facilities, or both, to meet the medical or dental needs of the resident population and includes a geographic service area identified as a medically underserved area by the Health Resources and Services Administration of the United States Department of Health and Human Services.
"Qualified medical practice" means any corporation, partnership, or sole proprietorship that is authorized to do business in the State and whose practitioner is licensed under chapter 448 or 453, Hawaii Revised Statutes; qualified under section 6 of this Act; and subject to the state corporate or individual income tax under chapter 235, Hawaii Revised Statutes.
"Taxes due the State" means income taxes due under chapter 235, Hawaii Revised Statutes.
SECTION 4. Medical practice shortage zone; designation. The director, in consultation with the director of health, shall designate areas within the State as medical practice shortage zones for a period of seven years. The director shall publish, update, and make available to the general public on the department's website a list of medical practice shortage zones each year.
SECTION 5. Duplication of existing tax incentives; prohibition. There shall be no duplication of existing state tax incentives to qualified medical practices located in a medical practice shortage zone.
SECTION 6. Qualified medical practice; designation. (a) A medical practice may obtain designation as a qualified medical practice if the medical practice:
(1) Registers with the department and certifies that the medical practice either:
(A) Will begin conducting the medical practice in a medical practice shortage zone within one year of the date of registration; or
(B) Is already actively conducting the medical practice in an area immediately prior to the area's being designated a medical practice shortage zone, and
(2) Enters into an agreement with the department within six months of the date of registration to actively and continuously conduct the medical practice within the medical practice shortage zone for no less than seven consecutive years from the date of the agreement; provided that no agreement may be entered into after June 30, 2021, and that no benefits may be granted under this Act after June 30, 2028.
(b) After designation of a medical practice shortage zone, each qualified medical practice within a zone shall submit an approved form annually to the department. The approved form shall be supplied by the department and shall provide the certification and information necessary for the department to determine if the medical practice continues to qualify as a qualified medical practice. The approved form shall be submitted by each medical practice to the .
(c) The form referred to in subsection (b) shall be prima facie evidence of the qualification of a medical practice for the purposes of this section.
SECTION 7. Qualified medical practice; tax credit. The director shall certify annually to the department of taxation the applicability of the tax credit provided in this Act for a qualified medical practice against any taxes due to the State. Except for the general excise tax, the credit shall be:
(1) Eighty per cent of the tax due the first tax year;
(2) Seventy per cent of the tax due the second tax year;
(3) Sixty per cent of the tax due the third tax year;
(4) Fifty per cent of the tax due the fourth tax year;
(5) Forty per cent of the tax due the fifth tax year;
(6) Thirty per cent of the tax due the sixth tax year; and
(7) Twenty per cent of the tax due the seventh tax year.
Any unused tax credit shall not be applied to future tax years.
(b) When a partnership is eligible for a tax credit under this section, each partner shall be eligible for the tax credit provided for in this section on the partner's income tax return in proportion to the amount of income received by the partner from the partnership. Any qualified medical practice having taxable income from the active conduct of a medical or dental establishment, both within and outside a medical practice shortage zone, shall allocate and apportion its taxable income attributable to that production. Tax credits provided for in this section shall only apply to taxable income of a qualified medical practice attributable to the active conduct of a medical or dental establishment within a medical practice shortage zone.
(c) In addition to any tax credit authorized under this section, any qualified medical practice shall be entitled to a tax credit against any taxes due the State in an amount equal to a percentage of unemployment taxes paid. The amount of the credit shall be equal to:
(1) Eighty per cent of the unemployment taxes paid during the first tax year;
(2) Seventy per cent of the unemployment taxes paid during the second tax year;
(3) Sixty per cent of the unemployment taxes paid during the third tax year;
(4) Fifty per cent of the unemployment taxes paid during the fourth tax year;
(5) Forty per cent of the unemployment taxes paid during the fifth tax year;
(6) Thirty per cent of the unemployment taxes paid during the sixth tax year; and
(7) Twenty per cent of the unemployment taxes paid during the seventh tax year.
(d) Tax credits provided for in subsection (c) shall only apply to the unemployment tax paid on employees employed at the medical or dental establishment or establishments located within the medical practice shortage zone. Any unused tax credit shall not be applied to future tax years.
SECTION 8. Qualified medical practice; tax exemptions. The director shall certify annually to the department of taxation that any qualified medical practice is exempt from the payment of general excise taxes on the gross proceeds from the conduct of a medical practice for any medical or dental establishment within a medical practice shortage zone. The director shall also certify annually to the department of taxation that any qualified medical practice is exempt from the use tax for purchases by the qualified medical practice for any medical or dental establishment within a medical practice shortage zone. The gross proceeds received by a contractor licensed under chapter 444, Hawaii Revised Statutes, shall be exempt from the general excise tax for construction within a medical practice shortage zone that is performed for a qualified medical practice within a medical practice shortage zone. The exemption shall extend for a period not to exceed seven years.
SECTION 9. Rules. The department may adopt rules pursuant to chapter 91, Hawaii Revised Statutes, to implement this Act.
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.
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. This Act shall take effect upon its approval and shall be repealed on June 30, 2028.
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INTRODUCED BY: |
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Report Title:
Medical Practice Zone Designation; Medically Underserved Areas
Description:
Establishes a pilot project within the Department of Business, Economic Development, and Tourism, to provide certain tax and other benefits, similar to those provided in an enterprise zone, for physicians and dentists who agree to work within those areas for a certain period. Provides that no agreement may be entered into after June 30, 2021 and no benefits may be granted after June 30, 2028.
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
