STAND. COM. REP. NO. 205

Honolulu, Hawaii

, 2021

RE: H.B. No. 286

H.D. 1

Honorable Scott K. Saiki

Speaker, House of Representatives

Thirty-First State Legislature

Regular Session of 2021

State of Hawaii

Sir:

Your Committee on Economic Development, to which was referred H.B. No. 286 entitled:

"A BILL FOR AN ACT RELATING TO REAL ESTATE INVESTMENT TRUSTS,"

begs leave to report as follows:

The purpose of this measure is to:

(1) Require a real estate investment trust to notify the Department of Taxation of its presence within the State and to report certain tax information; and

(2) Impose a daily monetary fine for noncompliance.

Your Committee received testimony in support of this measure from Faith Action for Community Equity, International Longshore & Warehouse Union Local 142, Hawaii State Teachers Association, Imua Alliance, Democratic Party of Hawai‘i Education Caucus, Faith Action, LGBT Caucus of the Democratic Party of Hawaii, Trinity United Methodist Church, Hawai‘i Alliance for Progressive Action, Young Progressives Demanding Action, and numerous individuals. Your Committee received testimony in opposition to this measure from Park Hotels & Resorts, Inc.; and Securities Industry Association of Hawaii. Your Committee received comments on this measure from the Department of Taxation, NAIOP Hawaii, Douglas Emmett, Tax Foundation of Hawaii, Nareit Hawaii, and Alexander & Baldwin.

Your Committee finds that real estate investment trusts play a significant role in Hawaii's economy and the State would benefit from the accurate collection of data about their economic activities. As Hawaii faces major budget shortfalls this year and several years to come, it is imperative that all corporations provide accurate reporting of their assets and revenues generated.

Your Committee has amended this measure by:

(1) Clarifying that the Department of Taxation may require a real estate investment trust to notify the Department of the trust's presence within the State and report the assets and revenues generated annually;

(2) Changing the effective date to July 1, 2050, to encourage further discussion; and

(3) Making technical, nonsubstantive amendments for the purposes of clarity, consistency, and style.

As affirmed by the record of votes of the members of your Committee on Economic Development that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 286, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 286, H.D. 1, and be referred to your Committee on Consumer Protection & Commerce.

Respectfully submitted on behalf of the members of the Committee on Economic Development,

____________________________

SEAN QUINLAN, Chair