SB2995

SECTION 1. The legislature finds that rideshare or ride-hailing services, formally known as transportation network companies, are services that offer on-demand rides by connecting drivers using their personal vehicles with passengers hailing a ride through a technology-based platform. The legislature further finds that in recent years, the rideshare industry has experienced substantial growth nationally and in the State, transforming the way people commute and navigate. In Hawaii, rideshare services are utilized by local residents in lieu of driving or owning a care of their own. Rideshare services are often also utilized by visitors.

The legislature further finds that, as the rideshare industry continues to grow, its impacts are also increasing. Many of these impacts stem from the use of fossil fuel vehicles by the drivers of transportation network companies. On average, a driver in the state logs roughly ten to twelve thousand miles per year. In comparison, a full-time rideshare driver can often exceed fifty thousand miles per year. The fossil fuel used for that amount of driving imposes a heavy economic burden on rideshare drivers, in addition to the environmental costs that come with air pollution and greenhouse gas emissions.

The legislature also finds that a recent study showed that Hawaii households with the highest reliance on gasoline, which include drivers for on-demand rideshare and delivery platforms, spend, on average, almost $14,000 on gasoline each year, which is roughly fourteen per cent of their incomes. Incentivizing these drivers to switch to electric vehicles could save them thousands of dollars annually on fuel costs and maintenance while significantly reducing greenhouse gas emissions.

The legislature finds that in recognition of the climate impacts of transportation emissions from the rideshare industry, California and Massachusetts have required transportation network companies to reduce their greenhouse gas emissions. Since 2024, California has also implemented an incentive program to help transportation network company drivers who qualify as low- or moderate-income to purchase or lease zero-emission vehicles. California's program is funded by a fee of nine cents charged to riders per ride. This fee has raised $30 million to support the conversion of transportation network company divers and fleets to zero-emission vehicles.

The legislature further finds that a similar incentive program is appropriate for Hawaii and will help ease the burden of transportation costs for low- to moderate-income drivers while facilitating the decarbonization of the rideshare transportation industry in line with the State's climate adaptation and mitigation mandates. This incentive program will provide an innovative and compelling self-funding model that collects a fee from the industry then returns the funds back to the industry to reduce its impacts, increase its efficiency, and enable savings for its workers.

Accordingly, the purpose of this Act is to:

(1) Establish a zero-emissions rideshare rebate program to be administered by the department of transportation;

(2) Establish a rideshare fee that shall be assessed on a rider of a prearranged ride; and

(3) Establish the zero-emissions rideshare subaccount within the highway development special fund.

SECTION 2. Chapter 279J, Hawaii Revised Statutes, is amended by adding two new sections to be appropriately designated and to read as follows:

"§279J-A Zero-emissions rideshare rebate program; established; third-party administrator. (a) There is established a zero-emissions rideshare rebate program to be administered by the department. The rebate program shall support the purchase or lease of zero-emission vehicles by qualified transportation network company drivers. The department may contract with a third-party manage and administer the rebate program.

(b) Each eligible purchase or lease of a zero-emission vehicle shall receive a rebate of not more than $ .

(c) The department shall make the rebate available to transportation network company drivers belonging to low- and moderate-income households.

(d) The department shall:

(1) Prepare any forms that may be necessary for an applicant to claim a rebate under this section;

(2) Require each applicant to furnish the information necessary to ascertain the validity of the claim, including but not limited to documentation that demonstrates the applicant's eligibility pursuant to rules adopted by the department; and

(3) Cooperate with a participating dealer or retailer to apply the rebate at the point-of-sale.

(e) Rebates issued pursuant to this section shall be subject to available funds; provided that if available funds have been exhausted, the department or third-party administrator shall not approve additional rebates for the remainder of the fiscal year.

(f) Nothing in this section shall alter taxes due on the original purchase of the zero-emission vehicle before the application of the rebate.

(g) Any rebate received under this section shall not be considered income for the purposes of state or county taxes.

(h) Subject to approval by the department, the third-party administrator may provide guidelines in addition to those specified under this section. The third-party administrator shall have the flexibility to make programmatic adjustments due to market changes, technological advancements, and levels of participation to ensure the prudent use and effective management of rebate program funds.

(i) A third-party administrator contracted by the department shall not be considered a "governmental body" as that term is defined in section 103D-4; provided that all moneys transferred to the third-party administrator shall only comprise funds collected pursuant to section 279J-B, appropriated by the legislature, or provided by the federal government or private funding sources. The third-party administrator shall not expend more than ten per cent of the amounts deposited into the zero-emissions rideshare subaccount with the highway development special fund pursuant to section 264-122(e) in any fiscal year, or any other reasonable percentage determined by the department, for the administration of the rebate program.

(j) The department shall adopt rules pursuant to chapter 91 to carry out the purposes of this section.

(k) For the purposes of this section:

"Low- and moderate-income household" means a household with an income equal to or less than one hundred forty per cent of the area median income as determined by the United States Department of Housing and Urban Development.

"Rebate program" means the zero-emissions rideshare rebate program.

"Zero-emission vehicle" has the same meaning as defined in section 196-9.

§279J-B Rideshare fee. (a) There shall be a rideshare fee of $ assessed on each prearranged ride; provided that the rider shall be subject to the rideshare fee.

(b) Each transportation network company shall collect and remit the rideshare fee to the department.

(c) All fees collected by the department under this section shall be deposited into the zero-emissions rideshare subaccount within the highway development special fund pursuant to section 264-122(e)."

SECTION 3. Section 264-122, Hawaii Revised Statutes, is amended to read as follows:

"§264-122 Highway development special fund. (a) There is established in the state treasury the highway development special fund to be administered by the department, into which shall be deposited:

(1) Transfers of county impact fees assessed under part VIII of chapter 46 and this part to pay for state highway improvements;

(2) Interest from investment of deposits; and

(3) Legislative and county appropriations.

(b) Moneys in the highway development special fund shall be used for the following purposes:

(1) Capital costs of qualifying proposed state highway improvements;

(2) Reevaluation of the need, geographic limitations, amount, and use of impact fees;

(3) Transfers to reimburse other special funds for expenditures which otherwise might have been funded with moneys in the highway development special fund;

(4) Transfers under sections 36-27 and 36-30;

(5) Refunds under section 264-125; and

(6) The department's costs to implement this part, including but not limited to costs to administer the highway development special fund.

(c) The department may establish accounts in the highway development special fund as necessary to implement this part and rules adopted by the department.

(d) There is established within the highway development special fund an electric bicycle and electric moped subaccount. The department shall expend moneys in the subaccount for the purposes of funding the electric bicycle and electric moped rebate program established pursuant to section 196-7.8.

(e) There is established within the highway development special fund a zero-emission rideshare subaccount. The department shall expend moneys in the subaccount for the purposes of funding the zero-emissions rideshare rebate program established pursuant to section 279J-A."

SECTION 4. In codifying the new sections added by section 2 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

SECTION 5. New statutory material is underscored.

SECTION 6. This Act shall take effect on July 1, 2026.

INTRODUCED BY:	_____________________________

THE SENATE	S.B. NO.	2995
THIRTY-THIRD LEGISLATURE, 2026
STATE OF HAWAII