Report Title:
Economic Emergency; Gubernatorial Powers
Description:
Authorizes the governor to declare an economic emergency during the period from 9/11/01 to 6/30/02. Empowers the governor to impose a moratorium on the collection of general excise tax on food items. Empowers the governor to declare a tax holiday on retail goods. Empowers the governor to suspend, waive, defer, or modify contract obligations owed to the State. Authorizes the governor to waive landing fees and airport system support charges.
|
THE SENATE |
S.B. NO. |
17 |
|
TWENTY-FIRST LEGISLATURE, 2001 |
S.D. 1 |
|
|
THIRD SPECIAL SESSION |
||
|
STATE OF HAWAII |
A BILL FOR AN ACT
relating to economic emergency.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The September 11, 2001, terrorist attacks on the United States have severely impacted Hawaii’s economy. Business experienced catastrophic revenue losses as a result of decreases in the number of visitors to Hawaii. The nation has been warned to expect the continuation of the war on terrorism as well as continued losses due to lagging consumer confidence. With the increased risk of further terrorist attacks around the world, the economic welfare of the State is further threatened.
The purpose of this Act is to confer temporarily upon the governor certain specific powers to provide immediate relief to the people of Hawaii, minimize economic impact on airport concessionaires due to increased security protocols, and to facilitate continuity of business activities and services.
SECTION 2. (a) Declaration of economic emergency. The governor may issue a proclamation declaring an economic emergency for the period from September 11, 2001, to June 30, 2002, if the governor finds that, during this time period, in addition to any determination that the slowdown of business activity in the State poses an imminent or present danger to the public health, safety, or welfare, there has been a two hundred per cent statewide increase in initial claims filed for unemployment benefits, other than claims resulting from a labor dispute, when compared with initial claims filed in the corresponding week of the preceding calendar year.
(b) Upon the declaration of the economic emergency, the governor may exercise specific emergency powers under this Act to provide relief during the period of the economic emergency to residents of the State who, as a result of the September 11, 2001, terrorist attacks have experienced substantial monetary losses. The relief provided under this Act shall be to provide immediate relief to the people of Hawaii, minimize economic impact on airport concessionaires due to increased security protocols, and to facilitate continuity of business activities and services.
SECTION 3. (a) Pursuant to section 2 and notwithstanding any other law to the contrary, the governor may impose a moratorium on the collection of general excise tax on all of the gross proceeds or income arising from the manufacture, production, packaging, and sale of food items within the State.
As used in this section, "food items" means
(1) Any food or food product for home consumption except alcoholic beverages, tobacco, and hot foods or hot food products ready for immediate consumption other than those authorized pursuant to clauses (3), (4), (5), (6), (7) and (8) of this subsection;
(2) Seeds and plants for use in gardens to produce food for the personal consumption of the eligible household;
(3) In the case of those persons who are sixty years of age or over or who receive supplemental security income benefits or disability or blindness payment under title I, II, X, XIV, or XVI of the Social Security Act (42 U.S.C.A. §§ 301 et seq., 401 et seq., 1201 et seq., 1351 et seq., or 1381 et seq.), and their spouses, meals prepared by and served in senior citizens' centers, apartment buildings occupied primarily by such persons, public or private nonprofit establishments that contract with the appropriate agency of the State to offer meals for such persons at concessional prices, and meals prepared for and served to residents of federally subsidized housing for the elderly;
(4) In the case of persons sixty years of age or over and persons who are physically or mentally handicapped or otherwise so disabled that they are unable adequately to prepare all of their meals, meals prepared for and delivered to them (and their spouses) at their home by a public or private establishment that contracts with the appropriate State agency to perform such services at concessional prices;
(5) In the case of narcotics addicts or alcoholics, and their children, served by drug addiction or alcoholic treatment and rehabilitation programs, meals prepared and served under such programs;
(6) In the case of disabled or blind recipients of benefits under Title I, II, X, XIV, or XVI of the Social Security Act (42 U.S.C. §§301 et seq., 401 et seq., 1201 et seq., or 1381 et seq.), or individuals described in 7 U.S.C. 2012(r)(2) through (7) who are residents in a public or private nonprofit group living arrangement that serves no more than sixteen residents and is certified by the appropriate State agency or agencies under regulations issued under section 1616(e) of the Social Security Act (42 U.S.C. §1382(e)(1))or under standards determined by the Secretary to be comparable to standards implemented by appropriate State agencies under such section, meals prepared and served under such arrangement;
(7) In the case of women and children temporarily residing in public or private nonprofit shelters for battered women and children, meals prepared and served by such shelters; and
(8) In the case of households that do not reside in permanent dwellings and households that have no fixed mailing addresses, meals prepared for and served by a public or private nonprofit establishment (approved by an appropriate State or local agency) that feeds such individuals and by private establishments that contract with the appropriate agency of the State to offer meals for such individuals at concessional prices.
(b) The moratorium shall be issued in the form of an executive order and shall be for a period of twenty-six weeks beginning on December 1, 2001 and ending on June 1, 2002.
SECTION 4. (a) Pursuant to section 2 and notwithstanding any law to the contrary, the governor may declare a tax holiday on retail sales. The tax holiday shall be a moratorium on the collection of general excise taxes on retail sales if the sales price of the article is less than $100 for a limited time. All savings generated by this section shall be passed on by the seller to the purchaser. This moratorium, or limited exemption, shall apply to retail sales only and not to sales on items that will be resold in any manner.
(b) The limited exemption on general excise tax collection provided in this section shall apply to each retail sales item that sells for less than $100, regardless of how many items are sold on the same invoice to a customer.
(c) The limited exemption on general excise tax collection provided in this section shall not apply to:
(1) The first $99.99 of an article selling for more than $99.99;
(2) The rental of items that are available within the State for retail sale, including but not limited to clothing, furniture, footwear, electronics, and videos;
(3) Taxable services performed on retail items, such as repair, remodeling, or maintenance services and cleaning or laundry services;
(4) Rebates, layaway sales, rain checks, or exchanges when the exchanges occur before or after the tax holiday period;
(5) Mail, telephone, e-mail, or Internet orders; or
(6) Food, regardless of source or method of preparation.
(d) Articles that are normally sold as a unit shall continue to be sold in that manner and shall not be priced separately and sold as individual items to obtain the exemption.
(e) If exempt items are sold together with taxable merchandise as a set or single unit, the full price shall be subject to tax unless the price of the exempt item is separately stated. When exempt clothing is sold in a set that also contains taxable merchandise as a free gift, the exempt clothing may qualify for the exemption.
(f) A retailer may offer discounts to reduce the sales price of an item. If the discount reduces the sales price to $99.99 or less, the item shall qualify for the exemption.
(g) The total price of items advertised as "buy one, get one free," or "buy one, get one for a reduced price," shall not be averaged for both items to qualify for the exemption.
(h) Shipping and handling charges shall be included as part of the sales price of the item.
(i) The retailer shall not be required to obtain any special license, permit, or other documentation on sales of eligible items during the exemption holiday period; provided that the retailer's records shall clearly identify the type of item sold, the date the item was sold, and the sales price of the item.
(j) The tax holiday shall be a week in duration to begin sometime before December 9, 2001. The declaration of the retail tax holiday shall be made by executive order.
SECTION 5. Section 102-2, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:
(b) The bidding requirements of subsection (a) shall not apply to concessions or space on public property set aside for the following purposes:
(1) For operation of ground transportation services at airports;
(2) For lei vendors;
(3) For airline and aircraft operations;
(4) For automatic teller machines and vending machines, except vending machines located at public schools operated by blind or visually handicapped persons in accordance with section 302A-412;
(5) For operation of concessions set aside without any charge;
(6) For operation of concessions by handicapped or blind persons[;] , except concessions operated in the public schools by blind or visually handicapped persons in accordance with section 302A-412;
(7) For operation of concessions on permits revocable on notice of thirty days or less; provided that no such permits shall be issued unless the premises covered under the permit is no longer being used for the existing purposes, [and that] the permit is issued as a temporary use of the premises until the governmental agency proceeds to use the premises for a new purpose[;] and [provided further] that no permits shall be issued for more than one year; and provided further that revocable permits issued by the department of transportation for use of state airports may exceed such one year maximum period if:
(A) The governor determines that there exists a crisis having statewide impacts, such as a natural disaster or a severe economic crisis and
(B) During the crisis, the director of transportation, with the approval of the governor, determines that such further extensions of the term of the revocable permits are necessary;
(8) For operation of concessions or concession spaces for a beach service association dedicated to the preservation of the Hawaii beachboy tradition, incorporated as a nonprofit corporation in accordance with state law, and whose members are appropriately licensed or certified as required by law; and
(9) For operation of concessions at county zoos, botanic gardens, or other county parks which are environmentally, culturally, historically, or operationally unique and are supported, by nonprofit corporations incorporated in accordance with state law solely for purposes of supporting county aims and goals of the zoo, botanic garden, or other county park and operating under agreement with the appropriate agency solely for such purposes, aims, and goals.
SECTION 6. Section 261-7, Hawaii Revised Statutes, is amended as follows, including adding new subsections (h) and (i):
§261-7 Operation and use privileges. (a) In operating an airport or air navigation facility owned or controlled by the department of transportation, or in which it has a right or interest, the department may enter into contracts, leases, licenses, and other arrangements with any person:
(1) Granting the privilege of using or improving the airport or air navigation facility or any portion or facility thereof or space therein for commercial purposes;
(2) Conferring the privilege of supplying goods, commodities, things, services, or facilities at the airport or air navigation facility;
(3) Making available services, facilities, goods, commodities, or other things to be furnished by the department or its agents at the airport or air navigation facility; or
(4) Granting the use and occupancy on a temporary basis by license or otherwise of any portion of the land under its jurisdiction which for the time being may not be required by the department so that it may put the area to economic use and thereby derive revenue therefrom.
All the arrangements shall contain a clause that the land may be repossessed by the department when needed for aeronautics purposes upon giving the tenant temporarily occupying the same not less than thirty days' notice in writing of intention to repossess.
(b) Except as otherwise provided in this section, in each case mentioned in subsection (a)(1), (2), (3), and (4), the department may establish the terms and conditions of the contract, lease, license, or other arrangement, and may fix the charges, rentals, or fees for the privileges, services, or things granted, conferred, or made available, for the purpose of meeting the expenditures of the statewide system of airports set forth in section 261-5(a), which includes expenditures for capital improvement projects approved by the legislature. Such charges shall be reasonable and uniform for the same class of privilege, service, or thing.
(c) The department shall enter into a contract with no more than one person ("contractor") for the sale and delivery of in-bond merchandise at Honolulu International Airport, in the manner provided by law. The contract shall confer the right to operate and maintain commercial facilities within the airport for the sale of in-bond merchandise and the right to deliver to the airport in-bond merchandise for sale to departing foreign-bound passengers.
The department shall grant the contract pursuant to the laws of this State and may take into consideration:
(1) The payment to be made on in-bond merchandise sold at Honolulu International Airport and on in-bond merchandise displayed or sold elsewhere in the State and delivered to the airport;
(2) The ability of the applicant to comply with all federal and state rules and regulations concerning the sale and delivery of in-bond merchandise; and
(3) The reputation, experience, and financial capability of the applicant.
The department shall actively supervise the operation of the contractor to insure its effectiveness. The department shall develop and implement such guidelines as it may find necessary and proper to actively supervise the operations of the contractor, and shall include guidelines relating to the department's review of the reasonableness of contractor's price schedules, quality of merchandise, merchandise assortment, operations, and service to customers.
Apart from the contract described in this subsection, the department shall confer no right upon nor suffer nor allow any person to offer to sell, sell, or deliver in-bond merchandise at Honolulu International Airport; provided that this section shall not prohibit the delivery of in-bond merchandise as cargo to the Honolulu International Airport.
(d) The department, by contract, lease, or other arrangement, upon a consideration fixed by it, may grant to any qualified person the privilege of operating, as agent of the State or otherwise, any airport owned or controlled by the department; provided that no such person shall be granted any authority to operate the airport other than as a public airport or to enter into any contracts, leases, or other arrangements in connection with the operation of the airport which the department might not have undertaken under subsection (a).
(e) The department may fix and regulate, from time to time, reasonable landing fees for aircraft, including the imposition of landing surcharges or differential landing fees, and other reasonable charges for the use and enjoyment of the airports and the services and facilities furnished by the department in connection therewith, including the establishment of a statewide system of airports landing fees, a statewide system of airports support charges, and joint use charges for the use of space shared by users, which fees and charges may vary among different classes of users such as foreign carriers, domestic carriers, inter-island carriers, air taxi operators, helicopters, and such other classes as may be determined by the director, for the purpose of meeting the expenditures of the statewide system of airports set forth in section 261-5(a), which includes expenditures for capital improvement projects approved by the legislature.
In setting airports rates and charges, including landing fees, the director may enter into contracts, leases, licenses, and other agreements with aeronautical users of the statewide system of airports containing such terms, conditions, and provisions as the director deems advisable.
If the director has not entered into contracts, leases, licenses, and other agreements with any or fewer than all of the aeronautical users of the statewide system of airports prior to the expiration of an existing contract, lease, license, or agreement, the director shall set and impose rates, rentals, fees, and charges pursuant to this subsection without regard to the requirements of chapter 91; provided that a public informational hearing shall be held on the rates, rentals, fees, and charges.
The director shall develop rates, rentals, fees, and charges in accordance with a residual methodology so that the statewide system of airports shall be, and always remain, self-sustaining. The rates, rentals, fees, and charges shall be set at such levels as to produce revenues which, together with aviation fuel taxes, shall be at least sufficient to meet the expenditures of the statewide system of airports set forth in section 261-5(a), including expenditures for capital improvement projects approved by the legislature, and to comply with covenants and agreements with holders of airport revenue bonds.
The director may develop and formulate methodology in setting the various rates, rentals, fees, and charges imposed and may determine usage of space, estimate landed weights, and apply such portion of nonaeronautical revenue deemed appropriate in determining the rates, rentals, fees, and charges applicable to aeronautical users of the statewide system of airports.
The rates, rentals, fees, and charges determined by the director in the manner set forth in this subsection shall be those charges payable by the aeronautical users for the periods immediately following the date of expiration of the existing contract, lease, license, or agreement. If fees are established pursuant to this section, the department shall prepare a detailed report on the circumstances and rates and charges that have been established, and shall submit the report to the legislature no later than twenty days prior to the convening of the next regular session.
If a schedule of rates, rentals, fees, and charges developed by the director in accordance with this section is projected by the department to produce revenues which, together with aviation fuel taxes, will be in excess of the amount required to meet the expenditures of the statewide system of airports set forth in section 261-5(a), including expenditures for capital improvement projects approved by the legislature, and to comply with covenants and agreements with holders of airport revenue bonds, the department shall submit the schedule of rates, rentals, fees, and charges to the legislature prior to the convening of the next regular session of the legislature. Within forty-five days after the convening of the regular session, the legislature may disapprove any schedule of rates, rentals, fees, and charges required to be submitted to it by this section by concurrent resolution. If no action is taken by the legislature within the forty-five-day period the schedule of rates, rentals, fees, and charges shall be deemed approved. If the legislature disapproves the schedule within the forty-five-day period, the director shall develop a new schedule of rates, rentals, fees, and charges in accordance with this section within seventy-five days of the disapproval. Pending the development of a new schedule of rates, rentals, fees, and charges, the schedule submitted to the legislature shall remain in force and effect.
[Notwithstanding any other provision of law to the contrary, the department may waive landing fees and other aircraft charges established under this section at any airport owned or controlled by the State whenever:
(1) The governor declares a state of emergency; and
(2) The department determines that the waiver of landing fees and other charges for the aircraft is consistent with assisting in the delivery of humanitarian relief to disaster-stricken areas of the State.]
(f) To enforce the payment of any charges for repairs or improvements to, or storage or care of any personal property made or furnished by the department or its agent in connection with the operation of an airport or air navigation facility owned or operated by the department, the department shall have liens on the property, which shall be enforceable by it as provided by sections 507-18 to 507-22.
(g) The department from time to time may establish developmental rates for buildings and land areas used exclusively for general aviation activities at rates not less than fifty per cent of the fair market rentals of the buildings and land areas and may restrict the extent of buildings and land areas to be utilized.
(h) Notwithstanding any law to the contrary, in times of crises having statewide impacts, such as natural disasters or severe economic crises, as determined by the governor (which for purposes of this section shall not require a formal declaration as required by chapter 128), the director may, with the approval of the governor, suspend any applicable airport fees, charges, and rentals, including, without limitation, landing fees, airport system support charges, joint use space charges, airport lease rentals, and concession rents and charges (including any minimum annual guaranteed rents), for only such time as the governor deems necessary to address the crisis having statewide impacts, and provided that:
(1) In implementing such suspension, the department shall remain obligated to comply with subsection (b) and collect and realize sufficient revenue to meet the expenditures of the statewide system of airports set forth in section 261-5(a);
(2) The department shall comply with all rules, regulations, conditions, and restrictions imposed by the federal government, including the Federal Aviation Administration, unless and to the extent the State obtains approval to excuse such compliance; and
(3) Such suspension does not violate any covenants or contractual obligations under or relating to bonds or other types of financing issued or obtained by the department.
In implementing the suspension of applicable airport fees, charges, and rentals hereunder, the director of transportation may waive, reduce or defer the amount of such airport fees, charges, and rentals payable to the department. Notice of the implementation of any suspension (including waiver, reduction, or deferral) of applicable airport fees, charges, and rentals, shall be published statewide at least once in accordance with section 1-28.5. The effective commencement date of the suspension may be retroactive to the time the governor determines the existence of a crisis having statewide impacts, such as a natural disaster or a severe economic crisis. The termination of any such suspension shall be published in the same manner as the notice of implementation of the suspension.
The implementation of the suspension of applicable airport fees, charges, and rentals hereunder shall not require the adoption or amendment of rules pursuant to chapter 91.
(i) Notwithstanding any law to the contrary, if the governor determines that there exists a crisis having statewide impacts, such as a natural disaster or a severe economic crisis, during the term of any contract or lease issued pursuant to the director's authority under this section (including contracts and leases that have been either let under chapter 102 or executed and are presently in force), the director may, with the governor's prior approval, modify any of the terms and conditions of said contract or lease, including the agreed upon rent, for a period and upon such terms and conditions as the director shall deem necessary to allow the state airport lessee, concessionaire, or user to recoup at least some of the losses suffered by said lessee, concessionaire, or user that are attributable to said crisis having statewide impacts, such as a natural disaster or a severe economic crisis, provided the following conditions are satisfied:
(1) The state airport lessee, concessionaire, or user shall submit written evidence satisfactory to the director, proving the amount and the extent of any losses attributable to said crisis having statewide impacts, such as a natural disaster or a severe economic crisis;
(2) The losses, at a minimum, must be a significant reduction (at least ten percent) in the volume of business of said state airport lessee, concessionaire, or user at the state airport or airports covered by the contract or lease for a period of at least thirty days, computed on the average monthly gross income for the shorter of the following periods:
(A) The eight months just prior to the beginning of the crisis having statewide impacts (as determined by the governor); or
(B) As long at the state airport lessee, concessionaire, or user has had the contract or lease with the State to operate at a state airport or airports;
(3) If the state airport lessee or user is an airline, the airline will qualify for the relief described in this section provided the losses suffered by the airline comprises at least a ten percent reduction in the number of landings made at state airports by the airline for a period of at least thirty days, computed on the average number of monthly landings for the eight months just prior to the beginning of the crisis having statewide impacts (as determined by the governor);
(4) In implementing the modifications, the department shall remain obligated to comply with subsection (b) and collect and realize sufficient revenue to meet the expenditures of the statewide system of airports set forth in section 261-5(a);
(5) The department shall comply with all rules, regulations, conditions, and restrictions imposed by the federal government, including the Federal Aviation Administration, unless and to the extent the State obtains approval to excuse such compliance; and
(6) Such modifications do not violate any covenants or contractual obligations under or relating to bonds or other types of financing issued or obtained by the department.
SECTION 7. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 8. This Act is effective upon approval; provided that sections 5 and 6 shall be retroactively effective from September 11, 2001.
|
INTRODUCED BY: |
_____________________________ |
|
_____________________________ _____________________________ |