Bill Text: HI HB784 | 2017 | Regular Session | Amended

Hawaii House Bill 784 (Prior Session Legislation)

Bill Title: Relating To Enterprise Zones.

Spectrum: Partisan Bill (Democrat 3-0)

Status: (Introduced - Dead) 2017-02-17 - Report adopted. referred to the committee(s) on FIN as amended in HD 1 with none voting aye with reservations; none voting no (0) and Representative(s) DeCoite, Tokioka excused (2). [HB784 Detail]

Download: Hawaii-2017-HB784-Amended.html

HOUSE OF REPRESENTATIVES	H.B. NO.	784
TWENTY-NINTH LEGISLATURE, 2017		H.D. 1
STATE OF HAWAII

A BILL FOR AN ACT

RELATING TO ENTERPRISE ZONES.

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

SECTION 1. The legislature finds that the current statute pertaining to state enterprise zones sets a limited period for qualified businesses to receive the tax credit incentive. The legislature further finds that the expiration of the period will negatively impact agricultural entities and the governor's goal of doubling food production by 2020.

The legislature finds that the enterprise zones for agricultural producers should be extended until the agricultural "self-sufficiency" standard of the Constitution of the State of Hawaii is fulfilled. The legislature further finds that businesses providing renewable energy infrastructure for agricultural producers should also be eligible for the extended enterprise zone benefits.

The purpose of this Act is to:

(1) Require agricultural producers to have at least fifty per cent of its production to occur within the enterprise zones located within the same county to be eligible for designation as a qualified business in an enterprise zone; and

(2) Extend the tax credit eligibility periods in enterprise zones for agricultural producers.

SECTION 2. Section 209E-9, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) Any business firm may be eligible to be designated a qualified business for purposes of this chapter if the business:

(1) Begins the operation of a trade or business in an eligible business activity within an enterprise zone;

(2) During each taxable year has at least fifty per cent of its enterprise zone establishments' gross receipts attributable to the active conduct of trade or business within enterprise zones located within the same county; [~~and~~] except for business involved in manufacturing, producing, or processing of agricultural products, at least fifty per cent of its' enterprise zone establishments' production must occur within the enterprise zones located within the same county; and

(3) Either:

(A) Increases its average annual number of full-time employees employed at the business' establishment or establishments within enterprise zones located within the same county by at least ten per cent by the end of its first tax year of participation, and during each subsequent taxable year at least maintains that higher level of employment; or

(B) Increases its gross sales of agricultural crops produced, or agricultural products processed within enterprise zones located within the same county by two per cent annually.

For business firms engaged in producing or processing agricultural products, receipts from value-added products made from crops grown within enterprise zones located within the same county and sold at retail pursuant to the limits of subsection (e) shall count toward the gross receipts requirement under paragraph (2)."

SECTION 3. Section 209E-10, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) The department shall certify annually to the department of taxation the applicability of the tax credit provided in this chapter for a qualified business against any taxes due the State. Except for the general excise tax, the credit shall be eighty per cent of the tax due for the first tax year, seventy per cent of the tax due for the second tax year, sixty per cent of the tax due for the third year, fifty per cent of the tax due the fourth year, forty per cent of the tax due the fifth year, thirty per cent of the tax due the sixth year, and twenty per cent of the tax due the seventh year. For qualified businesses engaged in the manufacturing of tangible personal property or the producing or processing of agricultural products, the credit shall continue after the seventh year at the rate of twenty per cent of the tax due for each of the subsequent [~~three~~] six tax years. Any tax credit not usable shall not be applied to future tax years."

SECTION 7. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 8. This Act shall take effect on January 28, 2081, and shall apply to taxable years beginning after December 31, 2016.

Report Title:

Enterprise Zones; Agriculture; Renewable Energy; Tax Credit

Description:

Requires agricultural producers in an enterprise zone to have at least 50 percent of production to occur within the enterprise zones located within the same county. Extends the tax credit eligibility periods in enterprise zones for agricultural producers for an additional three years. (HB784 HD1)

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