Bill Text: HI SB2752 | 2022 | Regular Session | Amended
Bill Title: Relating To Abandoned Wells.
Spectrum: Partisan Bill (Democrat 6-0)
Status: (Passed) 2022-06-27 - Act 213, on 06/27/2022 (Gov. Msg. No. 1314). [SB2752 Detail]
Download: Hawaii-2022-SB2752-Amended.html
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THE SENATE |
S.B. NO. |
2752 |
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THIRTY-FIRST LEGISLATURE, 2022 |
S.D. 2 |
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STATE OF HAWAII |
H.D. 1 |
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A BILL FOR AN ACT
RELATING TO ABANDONED WELLS.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The legislature finds that wells in
a state of disuse or disrepair can become conduits for contaminants to be
introduced into ground water. Abandoned
wells can also become receptacles for the disposal of waste, potentially
resulting in additional contamination and associated risk to public health and the
environment.
The legislature further finds that the
commission on water resource management has developed minimum standards
relating to water wells, including their sealing and abandonment, in order to
protect the quality and quantity of the State's ground water resources.
The purpose of this Act is to:
(1) Establish an income tax credit for taxpayers who are required to seal abandoned wells on their real property;
(2) Require an owner of an abandoned well to repair or seal the well at the owner's expense; and
(3) Appropriate funds for the following positions in the commission on water resource management:
(A) Either:
(i) Two full-time equivalent engineering technician positions; or
(ii) Two full-time equivalent environmental health specialist positions; and
(B) One full-time equivalent clerical position.
SECTION 2. Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to part I to be appropriately designated and to read as follows:
"§235- Well abandonment compliance income tax
credit. (a) There shall be allowed to each taxpayer a well abandonment
compliance income tax credit that shall be deductible from the taxpayer's net
income tax liability, if any, imposed by this chapter for the taxable year in
which the credit is properly claimed.
(b)
The cost upon which the tax credit is computed shall be determined at
the entity level. In the case of a
partnership, S corporation, estate, trust, or other pass through entity,
distribution and share of the credit shall be determined by rule.
(c)
The well abandonment compliance income tax credit shall be equal to
per cent of the qualified compliance costs incurred by
the taxpayer, up to a maximum of $ .
(d)
If the tax credit under this section exceeds the taxpayer's income tax
liability, the excess of the credit over liability may be used as a credit
against the taxpayer's income tax liability in subsequent years until
exhausted. All claims for the tax credit
under this section, including amended claims, shall be filed on or before the end
of the twelfth month following the close of the taxable year for which the
credit may be claimed. Failure to comply
with the foregoing provision shall constitute a waiver of the right to claim
the credit.
(e)
The director of taxation:
(1) Shall
prepare any forms that may be necessary to claim a credit under this section;
(2) May
require the taxpayer to furnish information to ascertain the validity of the
claim for credit made under this section; and
(3) May
adopt rules pursuant to chapter 91 to effectuate this section.
(f)
The commission on water resource management shall:
(1) Maintain
records of the total amount of qualified compliance costs for each taxpayer
claiming a credit;
(2) Verify
the amount of the qualified compliance costs claimed;
(3) Total
all qualified compliance costs claimed; and
(4) Certify
the total amount of the tax credit for each taxable year.
Upon each determination, the commission
on water resource management shall issue a certificate to the taxpayer
verifying the qualified compliance costs and the credit amount certified for
each taxable year. For a taxable year,
the commission on water resource management may certify a credit for a taxpayer
who could have claimed the credit in a previous taxable year, but chose not to because
the maximum annual credit amount under subsection (g) was reached in that
taxable year.
The taxpayer shall file the certificate
with the taxpayer's tax return with the department of taxation. Notwithstanding the commission on water
resource management's certification authority under this section, the director
of taxation may audit and adjust the certification to conform to the facts.
Notwithstanding
any other law to the contrary, the information required by this subsection
shall be available for public inspection and dissemination under chapter 92F.
(g) If in any taxable year the annual amount of
certified credits reaches $
in the aggregate, the commission on water resource management shall immediately
discontinue certifying credits and notify the department of taxation. In no instance shall the commission on water
resource management certify a total amount of credits exceeding $
per taxable year. To comply with this
restriction, the commission on water resource management shall certify credits
on a first come, first served basis.
The
department of taxation shall not allow the aggregate amount of credits claimed
to exceed that amount per taxable year.
(h)
As used in this section:
"Abandoned well" shall have
the same meaning as defined in section 174C-81.
"Net income tax liability"
means income tax liability reduced by all other credits allowed under this
chapter.
"Qualified compliance costs"
means construction costs that are necessary and directly incurred by the
taxpayer to seal an abandoned well in compliance with section 174C-87.
"Well" shall have the same meaning as defined in section 174C-3."
SECTION 3. Section
174C-81, Hawaii Revised Statutes, is amended by amending the definition of
"abandoned well" to read as follows:
""Abandoned well"
means any well [that], the purpose or use of which has been
permanently discontinued. Any well shall
be deemed abandoned [which is] whenever the well has served its
purpose, the well use has been permanently discontinued, the well is not
properly maintained, the physical condition of the well is causing a waste of
ground water or is impairing or threatens to impair the quality of the ground
water resources, or the well is in such a state of disrepair that its
continued use [for the purpose of obtaining ground water] is impractical[.]
or poses a hazard to public health or safety."
SECTION 4. Section 174C-87, Hawaii Revised Statutes, is amended to read as follows:
"§174C-87 [Abandonment]
Sealing of wells. (a) When a well is abandoned, the owner shall [fill
and] seal the well in a manner approved by the commission. Before [abandonment,] sealing,
the owner shall file with the commission [a report showing the owner's name
and address; the water use permit number, if any; the name and address of the
well driller who will be employed to perform the work required for abandonment;
the reason for abandonment; a description of the work to be performed to effect
the abandonment;] an application for a well sealing permit signed by a
driller licensed to do the work and such other information as the
commission may require.
(b) The owner of an abandoned well shall repair or seal the well at the owner's expense, as provided by the well construction and pump installation standards.
(c) Notwithstanding any other law to the contrary, if the owner of real property that includes an abandoned well transfers ownership of the real property, the owner shall notify the commission on water resource management of that transfer before entering escrow."
SECTION 5. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2022-2023 for the following positions in the commission on water resource management:
(1) Either:
(A) Two full-time equivalent (2.0 FTE) engineering technician positions; or
(B) Two full-time equivalent (2.0 FTE) environmental health specialist positions; and
(2) One full-time equivalent (1.0 FTE) clerical position.
The sum appropriated shall be expended by the department of land and natural resources for the purposes of this Act.
SECTION 6. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.
SECTION 7. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 8. This Act shall take effect on July 1, 2050; provided that section 2 of this Act shall apply to taxable years beginning after December 31, 2021.
Report Title:
Water; Abandoned Wells; Income Tax Credit; Appropriation
Description:
Establishes an income tax credit for taxpayers who are required to seal abandoned wells on their real property. Clarifies the definition of the term "abandoned well". Requires an owner of an abandoned well to seal the well at the owner's expense. Appropriates funds for three full-time equivalent (3.0 FTE) positions under the Commission on Water Resource Management. Effective 7/1/2050. (HD1)
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.
