Bill Text: HI SB2905 | 2018 | Regular Session | Introduced
Bill Title: Relating To On-site Early Childhood Facilities.
Spectrum: Partisan Bill (Democrat 4-0)
Status: (Engrossed - Dead) 2018-04-25 - Conference committee meeting to reconvene on 04-26-18 2:15PM in conference room 312. [SB2905 Detail]
Download: Hawaii-2018-SB2905-Introduced.html
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THE SENATE |
S.B. NO. |
2905 |
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TWENTY-NINTH LEGISLATURE, 2018 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
RELATING to on-site early childhood facilities.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The legislature finds that Hawaii has one of the highest costs for child care in the nation. The annual tuition cost of many child care facilities in Hawaii exceeds the annual in-state tuition at the University of Hawaii at Manoa. In many cases, the costs for child care for two children are as much as one full-time working parent would make in a year after taxes. Not surprisingly, in many families, one parent will leave the workforce to care for their children on a full-time basis, instead of enrolling the children in child care.
The legislature further finds that more of Hawaii's children are entering kindergarten without the physical, cognitive, linguistic, social, and emotional skills necessary to prepare them for success in school life. The link between school readiness and success in school is indisputable. According to kindergarten teachers within the department of education, many of the children who do not attend pre-kindergarten programs could be eighteen to twenty-four months behind developmentally than their peers who do attend preschool.
The legislature also finds that the creation of on-site early childhood facilities by employers addresses concerns of child care costs while also providing access to early childhood learning programs. Employers who create on-site early childhood facilities may see greater employee retention, performance, and lower absenteeism as well as a more productive and positive workplace environment.
The purpose of this Act is to establish an income tax credit for employers who create on-site early childhood facilities to increase access to high quality early childhood programs from child care to preschool and junior kindergarten.
SECTION 2. Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:
"§235‑ On-site early childhood facility tax credit. (a) There shall be allowed to each taxpayer subject to the taxes imposed by this chapter, an income tax credit which 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. In the case of a partnership, S corporation, estate, or trust, the tax credit allowable is for qualified costs incurred by the entity for the taxable year. The cost upon which the tax credit is computed shall be determined at the entity level. Distribution and share of the credit shall be determined pursuant to section 704(b) of the Internal Revenue Code.
(b) For the purposes of this section:
"Qualified costs" means
the expenses incurred in acquiring, constructing, and establishing an on-site
early childhood facility and the associated operating costs.
"Qualified on-site
early childhood facility"
means an on-site early child hood facility offered by an employer to all
employees that is licensed and approved by the department of human services and
receives an accreditation from a recognized national early childhood accredited
agency within two years of initial operation.
(c) The director of human services shall adopt
rules pursuant to chapter 91 that shall determine the criteria for eligibility
for the credit. The rules shall require
proof of an on-site early childhood facility. The department of human services shall issue a
certification to the taxpayer after the taxpayer submits documentation as
required by the department of human services. Such certification shall be acceptable as
proof of the qualified costs related to the implementation of a qualified on-site
early childhood facility for the purposes of the credit allowed under this
section.
(d) The department of human services, in
consultation with the department of taxation, shall provide a certificate of
approval to qualified on-site early childhood facilities implemented by employers.
In developing criteria for an on-site
early childhood facility certificate of approval, the department of human
services shall consider:
(1) Whether the on-site
early childhood facility provides early childhood programs from child care to
preschool and junior kindergarten;
(2) Participation
rate by employees;
(3) Quality of the early
childhood programs being provided; and
(4) Whether the presence of an on-site early childhood facility promotes a healthy workplace environment.
(e) The director of human services, in
consultation with the director of taxation, shall create a form that indicates
an employer is using an on-site early childhood facility.
(f) The tax credit shall be equal to twenty-five
per cent of the qualified costs paid or incurred by the employer in connection
with a qualified early childhood facility, subject to the following:
(1) The total
credit allowed for an employer in any taxable year shall not exceed $ ;
(2) The on-site
early childhood facility shall operate for a minimum of ten years or the credit
may be recaptured;
(3) Costs paid or incurred by an employer for insurance shall not be taken into account when calculating the costs included in the on-site early childhood facility credit computation;
(4) The total
amount of credit claimed on returns filed by all employers in the State's
fiscal year shall not exceed the annual on-site early childhood facility credit
cap. If the total amount of credit
claimed on returns filed by all employers in the State's fiscal year exceeds
the on-site early childhood facility credit annual cap, the credit shall be
allowed to employers based on the date of certification by the department of human
services on a first come, first served basis. Any employer who is certified by the
department of human services in a fiscal year and who does not receive the on-site
early childhood facility credit because the annual credit cap has been exceeded
for that fiscal year shall receive priority for the credit in the following
fiscal year before employers receiving certification in that fiscal year; and
(5) The annual on-site early childhood facility credit cap shall be determined by the director of taxation for each year from January 1 to December 31 beginning in 2019.
(g) If the tax credit under this section exceeds the taxpayer's net income tax liability, the amount of the excess tax credit over payments due shall be refunded to the eligible taxpayer.
(h) Every claim, including amended claims, for the tax credit under this section shall be filed on or before the end of the twelfth month following the close of the taxable year for which the tax credit may be claimed. Failure to meet the filing requirements of this subsection shall constitute a waiver of the right to claim the tax credit.
(i) No taxpayer shall claim any other credit
under this chapter for the same qualified costs used to properly claim a tax
credit under this section for the taxable year.
(j) The director of taxation:
(1) Shall prepare forms as may be necessary to claim the tax credit under this section;
(2) Shall require the taxpayer to furnish certification designated by the department of human services to ascertain the validity of the claim for the tax credit; and
(3) May adopt rules pursuant to chapter 91 to effectuate the purposes of this section.
(k) This section shall not apply to any amount paid or incurred before January 1, 2019."
SECTION 3. There is established one full-time equivalent (1.0 FTE) on-site early childhood facility coordinator position in the executive office on early learning to assist with licensure and accreditation requirements, work with providers, and ensure appropriate facility design of on-site early childhood facilities established by employers in the State.
SECTION 4. 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 2018-2019 for one full-time equivalent (1.0 FTE) on-site early childhood facility coordinator position in the executive office on early learning to assist with licensure and accreditation requirements, work with providers, and ensure appropriate facility design of on-site early childhood facilities established by employers in the State.
The sum appropriated shall be expended by the department of education for the purposes of this Act.
SECTION 5. New statutory material is underscored.
SECTION 6. This Act shall take effect on July 1, 2018; provided that the tax credit established in section 2 of this Act shall apply to taxable years beginning after December 31, 2018.
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INTRODUCED BY: |
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Report Title:
On-Site Early Childhood Facilities; Income Tax Credit; Appropriation
Description:
Establishes an income tax credit for employers who create on-site early childhood facilities. Establishes and appropriates funds for one on-site early childhood facility coordinator position.
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.
