Government Affairs Update

February 20, 2009

SUCCESS STORY

H.B.1405. The purpose of this bill is to maximize the State's ability to capture General Excise Taxes owed by out-of-state businesses by specifying the business activities that would constitute a sufficient connection with Hawai'i to allow the State to tax those activities.

Although the bill is still being circulated through the legislative process, HAR was successful in clarifying the language so that it did not apply to referrals and commissions based on services, but only on tangible property.

See the Committee Report which states:

“HAR voiced the concern that the bill might affect existing sourcing and apportionment rules for Commissions earned by real estate brokers and salespersons. Accordingly, your Committee has amended this bill as suggested by HAR, by removing the reference to services, and limiting the bill to sales of tangible personal property.”

LEGISLATIVE PROCESS

Friday, February 20th marks the first lateral deadline where bills must be in their final committee.

The next major deadline is March 6, 2009 known as the Decking deadline. Decking refers to the time when a bill, in the final form in which it is intended to be passed, is made available to members of the Legislature (i.e. "Decking" -- placed on the deck) for 48 hours prior to being voted on for passage, then crossed over.

TOP INITIATIVE REPORT

The following bills have made the First Lateral Deadline and/or are moving:

Mortgage Rescue Fraud Prevention Act

Historic Preservation Act

Private Transfer Fees

Unauthorized Practice of Law

BILLS TO LOOK OUT FOR

The following bills are up for hearing:

SB1156 would prohibit rental agreements from having no pet clauses; and

SB1157 would create a protected class based on domesticated pets.

We will discuss these bills and our position in next week’s bulletin.

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