Hawaii Tax Incentive Bill Stopped in Conference Committee

Islands Flush with Work, Legislation to be Revisited when Budget Issues Resolved

When tough decisions had to be made about Hawaii's budget for next year, a bill that would generate entertainment jobs in Hawaii was stopped in conference committee in May.

SB 2558 - a IATSE and SAG-endorsed tax credit bill sponsored by Sen. Carol Fukunaga - received great support from the governor and state legislators and looked to become law. However, just days before the conference committee met there were a series of labor settlements for school, university professor and public employees that added unexpected costs to the state budget. As a result, no tax credit bills got out of conference committee this year.

On the bright side, however, this is looking like a banner year for film and TV production in Hawaii. Agreements are in place to have two series of 10-13 episodes each produced in the Rainbow State, as well as two additional pilot series.

Fukunaga said legislation to continue Act 221 for an additional five years has been sent to Governor Linda Lingle. She has until June 28 to sign legislation into law. Act 221 provides investment credits for performing arts and creates attractive investment opportunities to out-of-state firms. The fact that this measure made it to the Governor's desk is good news in itself, as there has been significant controversy about Act 221 having too loose of requirements for credits.

The movie Blue Crush, for example, came under strong public scrutiny. The new legislation would tighten up these requirements. Fukunaga says the recent boom in activity in the industry will be useful in showcasing the economic benefits that come with more investment and she expects to see if a production credit bill, similar to SB 2558, can be passed next year.

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