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Home My WebLink AboutCOM 0497.002 2020-2022 OF"4w HEATHER L. KIMBALL * ?# Contact Information Council Member (808)961-8828 Chair, Committee on Governmental Operations, �j.-a..% (808)961-8018(staff) Relations and Economic Development r'T OF'K+`�r heather.kimball@hawaiicounty.gov Council District 1 HAWAII COUNTY COUNCIL County of Hawai`i Hawai`i County Building 25 Aupuni Street, Suite 1402 Hilo, Hawai`i 96720 DATE: November 12, 2021 TO: Maile David, Council Chair � And Members of the Hawaii County Council ' - FROM: Heather L. Kimball, Council Member Council District 1 SUBJECT: Concerning Resolution No. 263-21; a Resolution Approving the Legislative Proposals for Inclusion in the 2022 Hawaii State Association of Counties Legislative Package Attached please find the following additional information on Resolution 263-21; HSAC Legislative Package,to be distributed at the GORED Committee Meeting on 11/17/21: HSAC 2022 Legislative Package Descriptions, Justification for County TAT Bill, and Justification for Motor Vehicle Fees. Thank you. HK/jlk Attachment oav m. o Ref. To: Pf Ref. 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O � > ttO � y trJHrnO c� C' � � �' dtrJyO wxm > � t� OM, 1-3y 1y � y M1-3 JC � O > ptt � � Z � 1-3 � atrJpp y1-3 trJ -yy3H CMn Cd t� � � y ZPC tt5 � � � � y n ~ O C' y yyy OHS Ry t4 > 1.3 dt t40o0 y0 � �J � � O � y > O � � t� � p c2Z � � d O � > tttzlIMI y > 1-3 > � tJ Cy t� �JO � H Justification for Proposed Bill for an Act Relating to County Transient Accommodations Tax Act 1, Special Session or 2021, authorized the counties to establish a transient accommodation tax up to 3% on the gross rental, gross rental proceeds, and taxable fair market rental value, from all contracts entered into on or after the adoption of the ordinance. The Legislature overrode the Governor's veto of HB 862, HD2, SD2, CD1, in enacting Act 1. Proposed Bill for an Act Relating to County Transient Accommodations Tax 1. This bill is to responds to objections in the Governor's veto message on HB 862, HD2, SD2, CD1, relating to administration and enforcement of the county transient accommodations tax by the Department of Taxation to assist the counties with the administration and collection of the county transient accommodations tax by: • Granting to the director of taxation the rights and powers for the administration of the county transient accommodations taxes, in addition to his authority under chapter 231, HRS, administration of taxes; and • Provides for the levy, assessment, and collection of the tax as provided in chapter 237D. 2. The bill authorizes the counties to: • Establish a transient accommodations tax by ordinance; and • Notify the director of taxation within ten days of adoption of the county TAT ordinance. 3. Not earlier than January 1, following the enactment of the county TAT ordinance, the director of taxation shall levy, assess, collect, and administer the county TAT. 4. The revenues received by the counties from the county TAT shall be used to address the impact of the visitor industry on county services such as police and fire protection, parks and recreation facilities, emergency services, water systems, roads and transportation systems, and other infrastructure; authorizes the counties to further define impacted county services and facilities. Comment: This subsection emphasizes the original legislative intent when the TAT was enacted (Conference Committee Report No. 207 (1990): "Currently, the counties must come before the legislature each year to request financial assistance. This process discourages long-range planning. The Legislature noted that "...many of the burdens imposed by tourism fall on the counties." The Legislature noted that increased pressures of the visitor industry meant greater demands on county services, such as "...providing, maintaining, and upgrading police and fire protection, parks, beaches, water, roads, sewage systems, and other tourism related infrastructure." 5. Conforms language used for the county surcharge on the state general excise tax to give the director of taxation authority to: • Determine the county or counties in which a person is engaged in business, in the case of a person engaged in business in more than one county; • Revise the TAT tax forms as necessary; and • Providing for taxpayers filing on a fiscal year basis. 6. Provides that the county TAT collected shall be paid into the state treasury quarterly, within ten days after collection and placed in special accounts for each county that had adopted the tax by ordinance and paid to each to county after withholding a percentage to be determined to reimburse the state for the costs of administering the assessment, collection, disposition, and oversight of the county TAT. Comment. In 1990, the Legislature provided that "5 percent of the TAT revenues will be retained by the State to cover the administrative costs of assessment, collection, and disposition of the revenues, with the remainder of the TAT revenues will be distributed to the counties." a i i Justification for Proposed i Bill for ars Act Relating to registration of Vehicles Abandoned and derelict vehicles are a widespread problem in Hawaii, which increasingly impacting our quality of Fife, environment, public health and safety. The j increasing number of abandoned and derelict vehicles the costs related to the removal and disposition of the vehicles are an increasing challenge for the counties. The proposed trill removes the $10 cap on fee for the highway beautification and disposal of abandoned or derelict vehicles revolving fund. Background ound Due to the volume of abandoned vehicles and the number of complaints, it sometimes takes up to 45 days for the posting, towing and disposal of an abandoned vehicle. The County of Kauai, as an example, in 2017, received 1,119 reported abandoned/derelict vehicles (834 abandoned/365 derelict). In FY 2019, Kauai Police Department had 653 vehicles towed and had more than 270 pending complaints. The costs relating to abandoned/derelict vehicles continue to grow. During 2017, the department handled the removal of 404 abandoned and derelict vehicles, 498 in 2018. Kauai taxpayers paid more than $411,000 for the handling and disposal of abandoned and derelict vehicles in 2017; $423,000 in 2018; and$419,999 for the period up until September 2019. In 2020, the County of Kauai testified that the Kauai Police Department has a difficult time enforcing the collection of outstanding towing and related costs. The l testimony further pointed out that many offenders,who litter the island with vehicles, regularly transfer and register vehicles. County needs authority to levy and collect all charges related to towing, removal, and disposal of abandoned and derelict vehicles, including the authority to deny recurring offenders from transferring and/or registering vehicles unless their outstanding charges have been paid. Because of the greater number of registered vehicles in some of the counties, I the$10 cap is sufficient. However, removing the cap considers the varying conditions in different counties; storage space, recycling facilities, administrative services. i i I