STAND. COM. REP. NO. 2301

Honolulu, Hawaii

RE: S.B. No. 3156

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Second State Legislature

Regular Session of 2024

State of Hawaii

Sir:

Your Committee on Water and Land, to which was referred S.B. No. 3156 entitled:

"A BILL FOR AN ACT RELATING TO RENT CREDITS FOR DEMOLITION AND INFRASTRUCTURE COSTS ON PUBLIC LAND LEASES,"

begs leave to report as follows:

The purpose and intent of this measure is to repeal the sunset provision of Act 222, Session Laws of Hawaii 2021, to allow the Board of Land and Natural Resources to approve rent credits for demolition and infrastructure costs for public land leases beyond its current sunset date of June 30, 2026.

Your Committee received testimony in support of this measure from the Department of Land and Natural Resources.

Your Committee finds that Act 222, Session Laws of Hawaii 2021 (Act 222), authorizes the Board of Land and Natural Resources to reduce or waive rent payments over a fixed period specified in the lease contract for public land in exchange for demolition of existing unusable improvements or installation of new basic infrastructure, including drainage, sewer, water, or electrical utilities by the lessee. Act 222 also provides the Department of Land and Natural Resources with flexibility in its negotiations with lessees and allows the Department to incentivize development on public lands. However, Act 222 will sunset on June 30, 2026. This measure will allow the Department of Land and Natural Resources to retain its authority to negotiate long-term leases pursuant to commercially reasonable standards, while providing rent credit incentives.

Your Committee has amended this measure by inserting an effective date of July 1, 2050, to encourage further discussion.

As affirmed by the record of votes of the members of your Committee on Water and Land that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 3156, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 3156, S.D. 1, and be referred to your Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committee on Water and Land,

________________________________

LORRAINE R. INOUYE, Chair