Bill Text: HI SB741 | 2010 | Regular Session | Introduced
Bill Title: Fixed Guideway Station Enterprise Zones
Spectrum: Partisan Bill (Democrat 4-0)
Status: (Introduced - Dead) 2009-05-11 - Carried over to 2010 Regular Session. [SB741 Detail]
Download: Hawaii-2010-SB741-Introduced.html
Report Title:
Fixed Guideway Station Enterprise Zones
Description:
Creates enterprise zones within a half-mile radius of stations of a fixed guideway system on Oahu. Grants various tax concessions relating to enterprise zones to qualified businesses, including new construction of affordable housing within those zones.
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THE SENATE |
S.B. NO. |
741 |
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TWENTY-FIFTH LEGISLATURE, 2009 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
relating to fixed guideway station enterprise zones.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The Hawaii Revised Statutes is amended by adding a new chapter to be appropriately designated and to read as follows:
"Chapter
FIXED GUIDEWAY STATION ENTERPRISE ZONES
§ -1 Purpose. The purpose of this chapter is to stimulate economic development, including the construction of affordable housing, along the routes of a fixed guideway transportation system by creating enterprise zones along the routes that are within a one-half mile radius of fixed guideway stations.
§ -2 Definitions. As used in this chapter, 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.
"Establishment" means a single physical location where a business is conducted. A business may include one or more establishments, any number of which may be in a fixed guideway station enterprise zone.
"Fixed guideway station enterprise zone" means an area:
(1) Designated by the governor, upon the recommendation of the director of business, economic development, and tourism under this chapter that is within a one-half mile radius of a fixed guideway station;
(2) That is within the jurisdiction of a county government; and
(3) That is eligible for the benefits under this chapter.
"Full-time employee" means any employee for whom the employer is legally required to provide employee fringe benefits.
"Qualified business" means any corporation, partnership, or sole proprietorship authorized to do business in the State that is qualified under section ‑6, subject to the state corporate or individual income tax under chapter 235, and includes the construction, operation, administration, or maintenance of affordable housing, and retail, services, or parking businesses.
"Taxes due the State" means income taxes due under chapter 235.
§ -3 Fixed guideway station enterprise zone designation. The governor, upon the recommendation of the director, shall:
(1) Approve the designation of areas within the State as fixed guideway station enterprise zones that are within a one-half mile radius of fixed guideway station and fix their boundaries for a period of twenty years; and
(2) Allow the Hawaii community development authority to develop affordable housing, workforce housing, and retail, services, and parking businesses within a fixed guideway station enterprise zone; provided that income eligibility for workforce housing shall be one hundred sixty per cent or less of the median household income within the zone as determined by the United States Department of Housing and Urban Development.
A fixed guideway station enterprise zone shall not be subject to the requirement for prior authorization of the legislature by concurrent resolution under section 171‑53.
§ -4 Government assistance; prohibition. There shall be no duplication of existing state tax incentives to qualified businesses that locate in a fixed guideway station enterprise zone.
§ -5 Rules. The department shall adopt rules in accordance with chapter 91 to implement this chapter, including rules relating to health, safety, building, planning, zoning, and land use, which shall supersede all other inconsistent ordinances and rules relating to the use, zoning, planning, and development of land and construction in a fixed guideway station enterprise zone. Rules adopted under this section shall follow existing law, rules, and ordinances as closely as is consistent with standards meeting minimum requirements of energy efficiency, health, and safety. The department may provide by rule that lands within a fixed guideway station enterprise zone shall not be developed beyond existing uses or that improvements thereon shall not be demolished or substantially reconstructed, or may provide other restrictions on the use of the zone.
§ -6 Eligibility; qualified business. (a) Any business may be eligible to be designated a qualified business for purposes of this chapter if the business:
(1) Begins the operation of a business within a fixed guideway station enterprise zone;
(2) Increases its average annual number of full-time employees by at least ten per cent by the end of its first tax year of participation; and
(3) During each subsequent taxable year at least maintains that higher level of employment.
(b) A business also may be eligible to be designated a qualified business for purposes of this chapter if the business:
(1) Is actively engaged in conducting a business in an area immediately prior to an area being designated a fixed guideway station enterprise zone; and
(2) Increases its average annual number of full-time employees employed at the business's establishment or establishments located within the fixed guideway station enterprise zone by at least ten per cent by the end of the first tax year of participation. During each subsequent tax year, the establishment shall maintain at least that higher level of employment.
(c) After designation as a fixed guideway station enterprise zone, each qualified business in the zone shall submit annually to the department an approved form supplied by the department that provides the information necessary for the department to determine if the business qualifies as a qualified business. The approved form shall be submitted by each business to the governing body of the county in which the fixed guideway station enterprise zone is located, then forwarded to the department by the governing body of the county.
(d) The form referred to in subsection (c) shall be prima facie evidence of the eligibility of a business for the purposes of this section.
§ -7 State business tax credit. (a) The director 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:
(1) Eighty per cent of the tax due for the first tax year;
(2) Seventy per cent of the tax due for the second tax year;
(3) Sixty per cent of the tax due for the third year;
(4) Fifty per cent of the tax due the fourth year;
(5) Forty per cent of the tax due the fifth year;
(6) Thirty per cent of the tax due the sixth year; and
(7) Twenty per cent of the tax due the seventh year.
Any tax credit not usable 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 business having taxable income from the active conduct of a business, both within and without the fixed guideway station enterprise 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 business attributable to the active conduct of a business within the fixed guideway station enterprise zone.
(c) In addition to any tax credit authorized under this section, any qualified business 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 year;
(2) Seventy per cent of the taxes paid during the second year;
(3) Sixty per cent of the taxes paid during the third year;
(4) Fifty per cent of the taxes paid during the fourth year;
(5) Forty per cent of the taxes paid during the fifth year;
(6) Thirty per cent of the taxes paid during the sixth year; and
(7) Twenty per cent of the taxes paid during the seventh year.
(d) Tax credits provided for in subsection (c) shall only apply to the unemployment tax paid on employees employed at the qualified business' establishment or establishments located within the fixed guideway station enterprise zone. Any tax credit not usable shall not be applied to future tax years.
§ -8 State general excise and use tax exemptions. The director shall certify annually to the department of taxation that any qualified business is exempt from the payment of general excise taxes on the gross proceeds from the conduct of a business within a fixed guideway station enterprise zone. The director shall also certify annually to the department of taxation that any qualified business is exempt from the use tax for purchases by the qualified business. The gross proceeds received by a contractor licensed under chapter 444 shall be exempt from the general excise tax for construction within a fixed guideway station enterprise zone performed for a qualified business within a fixed guideway station enterprise zone. The exemption shall extend for a period not to exceed seven years.
§ -9 Local incentives. A county may propose local incentives to be made available in a fixed guideway station enterprise zone, including:
(1) Reduction of permit fees;
(2) Reduction of user fees;
(3) Reduction of real property taxes; and
(4) Regulatory flexibility, including, but not limited to:
(A) Special zoning districts;
(B) Permit process reform;
(C) Exemptions from local ordinances; and
(D) Other public incentives,
which shall be binding upon the locality upon designation of the fixed guideway station enterprise zone.
§ -10 Termination of fixed guideway station enterprise zone. Upon designation of an area as a fixed guideway station enterprise zone, the proposals for regulatory flexibility, tax incentives, and other public incentives specified in this chapter shall be binding upon the county governing body to the extent and for the period of time pursuant to section ‑3. If the county governing body is unable or unwilling to provide any of the incentives set forth in section ‑9 or other incentives acceptable to the director, and the director has not adopted rules pursuant to section ‑5 that supersede inconsistent ordinances and rules relating to the use, zoning, planning, and development of land and construction in a fixed guideway station enterprise zone, then the fixed guideway station enterprise zone shall terminate. Qualified businesses located in the fixed guideway station enterprise zone shall be eligible to receive the state tax incentives provided by this chapter even though the zone designation has terminated. No business may become a qualified business after the date of zone termination."
SECTION 2. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun, before its effective date.
SECTION 3. This Act shall take effect on July 1, 2009.
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INTRODUCED BY: |
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