STAND. COM. REP. NO. 1776

Honolulu, Hawaii

RE: H.B. No. 1327

H.D. 2

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Second State Legislature

Regular Session of 2023

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred H.B. No. 1327, H.D. 2, entitled:

"A BILL FOR AN ACT RELATING TO TAX CREDITS,"

begs leave to report as follows:

The purpose and intent of this measure is to provide financial support to teachers.

Specifically, this measure establishes a state income tax credit for qualified expenses incurred by certain individuals employed by the Department of Education, the Hawaii State Public Library System, or as part of a Head Start program in a school.

Your Committee received testimony in support of this measure from the Hawaii State Teachers Association, Hawaii State Teachers Association-Retired, and seven individuals.

Your Committee received comments on this measure from the Department of Education and Department of Taxation.

Your Committee finds that, in a recent survey to its members across the islands, the Hawaii State Teachers Association found that survey respondents reported spending an average of $953 of their own money each year to purchase various classroom supplies. Your Committee also finds that, according to numerous studies of teacher compensation, Hawaii's public school teachers receive the lowest salaries in the nation when adjusted for cost of living. As a result, your Committee further finds that when Hawaii public school teachers are forced to purchase classroom supplies with their personal funds because of inadequate school funding, they face a disproportionately adverse financial impact in comparison to their national peers.

Your Committee has amended this measure by clarifying that the measure shall apply to taxable years beginning after December 31, 2022.

As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1327, H.D. 2, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1327, H.D. 2, S.D. 1, and be placed on the calendar for Third Reading.

Respectfully submitted on behalf of the members of the Committee on Ways and Means,

________________________________

DONOVAN M. DELA CRUZ, Chair