HB2438 HD2

SECTION 1. The legislature finds that Hawaii's arts and cultural organizations preserve the history, language, and traditions that shape the State's communities and strengthen learning, connection, and opportunity for residents across the islands. The legislature further finds that stable and predictable funding is necessary to expand access to cultural programs and ensure that these organizations can continue serving future generations.

Therefore, the purpose of this Act is to establish the Hawaii cultural trust and related incentives to encourage charitable giving and to provide long-term support for Hawaii's arts, culture, and heritage.

SECTION 2. Chapter 201, Hawaii Revised Statutes, is amended by adding a new part to be appropriately designated and to read as follows:

"Part . HAWAII CULTURAL TRUST

§201-A Definitions. As used in this part, unless the context otherwise requires:

"Advisory committee" means the Hawaii cultural trust advisory committee.

"Coordinator" means the Hawaii cultural trust coordinator.

"County" includes the city and county of Honolulu, county of Hawaii, county of Kauai, and county of Maui.

"Department" means the department of business, economic development, and tourism.

"Director" means the director of business, economic development, and tourism.

"Trust" means the Hawaii cultural trust.

"Trust account" means the Hawaii cultural trust account.

§201-B Hawaii cultural trust; Hawaii cultural trust coordinator. (a) There is established within the department the Hawaii cultural trust.

(b) The Hawaii cultural trust shall be administered by the Hawaii cultural trust coordinator, who shall be appointed and supervised by the director, and shall be employed without regard to chapter 76. The coordinator shall be assisted by the Hawaii cultural trust advisory committee.

§201-C Hawaii cultural trust account. (a) There is established within the state treasury the Hawaii cultural trust account, to be administered by the trust.

(b) Funds in the trust account shall be used solely for the purposes of the trust, as set forth in subsection (d), and shall not lapse at the end of each fiscal year.

(1) The legislature;

(2) The federal government or a county government;

(3) Funds received from the issuance of special number plates issued pursuant to section 249- ;

(4) Private sources, including businesses, other organizations, and individuals; and

(5) Interest earned on funds in the trust account.

(d) Funds in the trust account shall be allocated annually as follows:

(1) Fifty per cent shall be allocated to the state foundation on culture and the arts to expand arts programs and programs that foster creativity and cultural expression; and

(2) Fifty per cent shall be allocated to the office of Hawaiian affairs for cultural preservation, education, and community-based cultural advancement.

§201-D Hawaii cultural trust advisory committee. (a) There is established within the trust the Hawaii cultural trust advisory committee.

(b) The advisory committee shall advise the trust regarding:

(1) Priorities for the distribution of funds within the trust account;

(2) Program criteria for the trust; and

(3) Community input and impact.

(1) A representative of the state foundation on culture and the arts;

(2) A representative of the office of Hawaiian affairs;

(3) Native Hawaiian cultural practitioners; and

(4) Representatives of nonprofit organizations from the arts, humanities, and heritage communities;

provided that there shall be no more than members on the advisory committee.

§201-E Reports. No later than twenty days before the convening of each regular session, the trust shall submit a report to the legislature and advisory committee regarding:

(1) The total amount of funds collected by and disbursed from the trust account;

(2) The recipient and purpose of each grant, award, or other disbursement made by the trust account;

(3) Measured impacts on cultural preservation and the arts;

(4) Evaluation metrics aligned with the goals of economic development and cultural vitality; and

(5) Recommendations, including proposed legislation, if any, to improve the programs and operations of the trust.

§201-F Rules. The department shall adopt rules pursuant to chapter 91 to implement this part."

SECTION 3. Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§235- Hawaii cultural trust; income tax credit; administration. (a) There shall be allowed to each taxpayer subject to the taxes imposed by this chapter an income tax credit which shall be deductible from the taxpayer's net income tax liability, if any, imposed by this chapter for the taxable year in which the credit is properly claimed.

(b) A taxpayer may claim the credit under this section if the taxpayer made a monetary contribution during the taxable year to:

(1) The Hawaii cultural trust established pursuant to section 201-B; and

(2) One or more qualified Hawaii cultural organizations.

(c) The credit shall be equal to the amount of contributions made to the Hawaii cultural trust or the total amount of contributions made to one or more qualified Hawaii cultural organizations during the taxable year, whichever is less, subject to the limits set forth in subsection (d).

(d) The credit claimed under this section shall not exceed:

(1) $500 for a taxpayer filing any return other than a joint return;

(2) $1,000 for taxpayers filing a joint return; and

(3) $2,500 for a corporation subject to tax under this chapter.

(e) The credit allowed under this section shall be nonrefundable and shall be claimed only to the extent of the taxpayer's net income tax liability for the taxable year.

(f) All claims for a tax credit under this section, including any amended claims, shall be filed on or before the end of the twelfth month following the close of the taxable year for which the credit may be claimed. Failure to comply with the foregoing provision shall constitute a waiver of the right to claim the credit.

(g) The director of taxation shall prepare forms and may require proof, in a form prescribed by the director, of the contributions made pursuant to subsection (b).

(h) The proof required pursuant to subsection (g) may include receipts or written acknowledgments from the Hawaii cultural trust and from qualified Hawaii cultural organizations, including the organization's name, the organization's federal employer identification number, and the amount and date of the contribution.

(i) The state foundation on culture and the arts shall work with the office of Hawaiian affairs to maintain a list of qualified Hawaii cultural organizations for purposes of administering the tax credit. The list shall be posted on each respective agency's official website and shall be updated annually.

(j) The director of taxation may adopt rules pursuant to chapter 91 to implement this section.

(k) As used in this section, "qualified Hawaii cultural organization":

(1) Means an organization that:

(A) Is organized and operated in the State as a nonprofit organization exempt under section 501(c)(3) of the Internal Revenue Code of 1986, as amended;

(B) Is registered and in good standing with the department of the attorney general pursuant to chapter 467B;

(C) Has a primary purpose of providing cultural programs, services, or education that advances one or more of the following:

(i) Arts and arts education, including visual arts, performing arts, music, dance, theater, literary arts, media arts, and arts learning;

(ii) Native Hawaiian culture, language, ʻike kupuna, cultural practice, and cultural perpetuation;

(iii) History, heritage, and preservation, including museums, archives, historic sites, and cultural heritage programs; and

(iv) Humanities and cultural literacy, including storytelling, community-based cultural education, and cultural research and interpretation; and

(D) Meets any additional criteria established by the department and adopted by rule pursuant to chapter 91; and

(2) Shall not include any organization that is:

(A) Primarily organized for religious worship, political campaign activity, or lobbying;

(B) Primarily a private foundation, as defined under section 509(a) of the Internal Revenue Code of 1986, as amended; or

SECTION 4. Chapter 249, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§249- Special number plates; Hawaii cultural trust; authorized. (a) Notwithstanding any law to the contrary, the director of finance shall issue to any registered owner of a motor vehicle, who is a resident of the State, upon completed application and payment of the required fees, a special number plate for the registered owner's motor vehicle supporting the Hawaii cultural trust established pursuant to section 201-B.

(b) The director of finance of the city and county of Honolulu, in consultation with the directors of finance of the counties of Kauai, Maui, and Hawaii; chiefs of police of the city and county of Honolulu and the counties of Kauai, Maui, and Hawaii; and director of business, economic development, and tourism, shall establish a special number plate design that:

(1) Contains words, images, or both, that indicate the special number plate is issued to support the Hawaii cultural trust;

(2) Is similar in shape and size to the uniform state number plate prescribed by law; and

(3) Does not obstruct the visibility of the numbers or letters or any other information that is required by law to be on a number plate and is readily identifiable and distinguishable under actual traffic conditions.

(1) Infringe upon or otherwise violate any trademark, trade name, service mark, copyright, or other proprietary or property right;

(2) Represent any obscene or degrading image, idea, word, or phrase;

(3) Advertise or endorse a product, brand, or service that is provided for sale;

(4) Promote any religious belief; or

(5) Promote any philosophy based on prejudice or that is contrary to state civil rights laws.

(d) Each special number plate shall be securely fastened to the motor vehicle in lieu of the uniform state number plate.

(e) The director of finance shall charge a special number plate fee at least equal to the county's cost of providing the special number plate and administrative costs, if any, plus a fundraising fee to be determined by the director of finance in consultation with the director of business, economic development, and tourism. The fundraising fee shall be in addition to any other state or county fees collected for a motor vehicle registration or license plate.

(f) The director of finance may charge an additional fundraising fee of the same or a different amount as the fundraising fee established pursuant to subsection (e), for the renewal of a special number plate. If an additional fundraising fee is implemented pursuant to this subsection, the director of finance shall revoke the special number plate of any registered owner of a motor vehicle who fails to pay the additional fundraising fee imposed by this subsection.

(g) The revenue generated by the fundraising fees, or a portion of the revenue generated by the fundraising fees as determined by the director of finance, shall be deposited in the name of the Hawaii cultural trust into the Hawaii cultural trust account. The director of finance shall determine the most efficient means of directing the revenue generated by the fundraising fees to the Hawaii cultural trust.

(h) The director of finance may revoke all special number plates issued pursuant to this section if the total number of registered owners of motor vehicles that obtain the special number plates is less than one hundred fifty within three years of issuance of the first special number plate.

(i) Nothing in this section shall be construed to apply to any plates issued pursuant to sections 249-9.2, 249-9.5, 249-9.6, 249-9.7, 249-9.8, and 249-9.9.

(j) As used in this section, unless a different meaning appears from the context, "special number plate" means a license plate that represents the Hawaii cultural trust."

SECTION 5. Section 76-16, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

"(b) The civil service to which this chapter applies shall comprise all positions in the State now existing or hereafter established and embrace all personal services performed for the State, except the following:

(1) Commissioned and enlisted personnel of the Hawaii National Guard and positions in the Hawaii National Guard that are required by state or federal laws or regulations or orders of the National Guard to be filled from those commissioned or enlisted personnel;

(2) Positions filled by persons employed by contract where the director of human resources development has certified that the service is special or unique or is essential to the public interest and that, because of circumstances surrounding its fulfillment, personnel to perform the service cannot be obtained through normal civil service recruitment procedures. Any contract may be for any period not exceeding one year;

(3) Positions that must be filled without delay to comply with a court order or decree if the director determines that recruitment through normal recruitment civil service procedures would result in delay or noncompliance, such as the Felix-Cayetano consent decree;

(4) Positions filled by the legislature or by either house or any committee thereof;

(5) Employees in the office of the governor and office of the lieutenant governor, and household employees at Washington Place;

(6) Positions filled by popular vote;

(7) Department heads, officers, and members of any board, commission, or other state agency whose appointments are made by the governor or are required by law to be confirmed by the senate;

(8) Judges, referees, receivers, masters, jurors, notaries public, land court examiners, court commissioners, and attorneys appointed by a state court for a special temporary service;

(9) One bailiff for the chief justice of the supreme court who shall have the powers and duties of a court officer and bailiff under section 606-14; one secretary or clerk for each justice of the supreme court, each judge of the intermediate appellate court, and each judge of the circuit court; one secretary for the judicial council; one deputy administrative director of the courts; three law clerks for the chief justice of the supreme court, two law clerks for each associate justice of the supreme court and each judge of the intermediate appellate court, one law clerk for each judge of the circuit court, two additional law clerks for the civil administrative judge of the circuit court of the first circuit, two additional law clerks for the criminal administrative judge of the circuit court of the first circuit, one additional law clerk for the senior judge of the family court of the first circuit, two additional law clerks for the civil motions judge of the circuit court of the first circuit, two additional law clerks for the criminal motions judge of the circuit court of the first circuit, and two law clerks for the administrative judge of the district court of the first circuit; and one private secretary for the administrative director of the courts, the deputy administrative director of the courts, each department head, each deputy or first assistant, and each additional deputy, or assistant deputy, or assistant defined in paragraph (16);

(10) First deputy and deputy attorneys general, the administrative services manager of the department of the attorney general, one secretary for the administrative services manager, an administrator and any support staff for the criminal and juvenile justice resources coordination functions, and law clerks;

(11) (A) Teachers, principals, vice-principals, complex area superintendents, deputy and assistant superintendents, other certificated personnel, and no more than twenty noncertificated administrative, professional, and technical personnel not engaged in instructional work;

(B) Effective July 1, 2003, teaching assistants, educational assistants, bilingual or bicultural school-home assistants, school psychologists, psychological examiners, speech pathologists, athletic health care trainers, alternative school work study assistants, alternative school educational or supportive services specialists, alternative school project coordinators, and communications aides in the department of education;

(D) Members of the faculty of the university of Hawaii, including research workers, extension agents, personnel engaged in instructional work, and administrative, professional, and technical personnel of the university;

(12) Employees engaged in special, research, or demonstration projects approved by the governor;

(13) (A) Positions filled by inmates, patients of state institutions, and persons with severe physical or mental disabilities participating in the work experience training programs;

(B) Positions filled with students in accordance with guidelines for established state employment programs; and

(C) Positions that provide work experience training or temporary public service employment that are filled by persons entering the workforce or persons transitioning into other careers under programs such as the federal Workforce Investment Act of 1998, as amended, or the Senior Community Service Employment Program of the Employment and Training Administration of the United States Department of Labor, or under other similar state programs;

(14) A custodian or guide at Iolani Palace, the Royal Mausoleum, and Hulihee Palace;

(15) Positions filled by persons employed on a fee, contract, or piecework basis, who may lawfully perform their duties concurrently with their private business or profession or other private employment and whose duties require only a portion of their time, if it is impracticable to ascertain or anticipate the portion of time to be devoted to the service of the State;

(16) Positions of first deputies or first assistants of each department head appointed under or in the manner provided in section 6, article V, of the Hawaii State Constitution; three additional deputies or assistants either in charge of the highways, harbors, and airports divisions or other functions within the department of transportation as may be assigned by the director of transportation, with the approval of the governor; one additional deputy in the department of human services either in charge of welfare or other functions within the department as may be assigned by the director of human services; four additional deputies in the department of health, each in charge of one of the following: behavioral health, environmental health, hospitals, and health resources administration, including other functions within the department as may be assigned by the director of health, with the approval of the governor; two additional deputies in charge of the law enforcement programs, administration, or other functions within the department of law enforcement as may be assigned by the director of law enforcement, with the approval of the governor; three additional deputies each in charge of the correctional institutions, rehabilitation services and programs, and administration or other functions within the department of corrections and rehabilitation as may be assigned by the director of corrections and rehabilitation, with the approval of the governor; two administrative assistants to the state librarian; and an administrative assistant to the superintendent of education;

(17) Positions specifically exempted from this part by any other law; provided that:

(A) Any exemption created after July 1, 2014, shall expire three years after its enactment unless affirmatively extended by an act of the legislature; and

(B) All of the positions defined by paragraph (9) shall be included in the position classification plan;

(18) Positions in the state foster grandparent program and positions for temporary employment of senior citizens in occupations in which there is a severe personnel shortage or in special projects;

(19) Household employees at the official residence of the president of the university of Hawaii;

(20) Employees in the department of education engaged in the supervision of students during meal periods in the distribution, collection, and counting of meal tickets, and in the cleaning of classrooms after school hours on a less than half-time basis;

(21) Employees hired under the tenant hire program of the Hawaii public housing authority; provided that no more than twenty-six per cent of the authority's workforce in any housing project maintained or operated by the authority shall be hired under the tenant hire program;

(22) Positions of the federally funded expanded food and nutrition program of the university of Hawaii that require the hiring of nutrition program assistants who live in the areas they serve;

(23) Positions filled by persons with severe disabilities who are certified by the state vocational rehabilitation office that they are able to perform safely the duties of the positions;

(24) The sheriff;

(25) A gender and other fairness coordinator hired by the judiciary;

(26) Positions in the Hawaii National Guard youth and adult education programs;

(27) In the Hawaii state energy office in the department of business, economic development, and tourism, all energy program managers, energy program specialists, energy program assistants, and energy analysts;

(28) Administrative appeals hearing officers in the department of human services;

(29) In the Med-QUEST division of the department of human services, the division administrator, finance officer, health care services branch administrator, medical director, and clinical standards administrator;

(30) In the director's office of the department of human services, the enterprise officer, information security and privacy compliance officer, security and privacy compliance engineer, security and privacy compliance analyst, information technology implementation manager, assistant information technology implementation manager, resource manager, community or project development director, policy director, special assistant to the director, and limited English proficiency project manager or coordinator;

(31) The Alzheimer's disease and related dementia services coordinator in the executive office on aging;

(32) In the Hawaii emergency management agency, the executive officer, public information officer, civil defense administrative officer, branch chiefs, and emergency operations center state warning point personnel; provided that for state warning point personnel, the director shall determine that recruitment through normal civil service recruitment procedures would result in delay or noncompliance;

(33) The executive director and seven full-time administrative positions of the school facilities authority;

(34) Positions in the Mauna Kea stewardship and oversight authority;

(35) In the office of homeland security of the department of law enforcement, the statewide interoperable communications coordinator;

(36) In the social services division of the department of human services, the business technology analyst;

(37) The executive director and staff of the 911 board;

(38) The software developer supervisor and senior software developers in the department of taxation;

(39) In the department of law enforcement, five Commission on Accreditation for Law Enforcement Agencies, Inc., coordinator positions;

(40) The state fire marshal and deputy state fire marshal in the office of the state fire marshal;

(41) The administrator for the law enforcement standards board;

(42) In the office of the director of taxation, the data privacy officer and tax business analysts; [~~and~~]

[[](43)[]] All positions filled by the Hawaii tourism authority within the department of business, economic development, and tourism[.]; and

(44) The Hawaii cultural trust coordinator.

The director shall determine the applicability of this section to specific positions.

Nothing in this section shall be deemed to affect the civil service status of any incumbent as it existed on July 1, 1955."

SECTION 6. 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 7. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 8. This Act shall take effect on July 1, 3000; provided that section 3 of this Act shall apply to taxable years beginning after December 31, 2026.

HOUSE OF REPRESENTATIVES	H.B. NO.	2438
THIRTY-THIRD LEGISLATURE, 2026		H.D. 2
STATE OF HAWAII