Bill > SB374

This bill establishes comprehensive regulations for tax increment bonds (TIF) in Hawaii, requiring counties to implement several key oversight and transparency measures. Before issuing tax increment bonds, counties must commission and publicly share a detailed economic impact analysis that examines potential effects on job creation, housing affordability, tax revenues, and environmental sustainability. Counties will be required to conduct independent audits every two years to assess the fiscal health of TIF projects, submit these audit reports to the legislature, and make the findings publicly available. Additionally, counties must establish a review board to oversee tax increment bond projects and provide recommendations for improving fiscal accountability. The bill also restricts counties from excluding more than 20 percent of their total outstanding tax increment bonds from debt limit calculations, which aims to prevent fiscal overextension. The bill will only take effect if a constitutional amendment is ratified that specifically authorizes counties to issue tax increment bonds and allows these bonds to be excluded from calculations of county debt limits. The legislation is designed to learn from experiences in other states and create safeguards to maximize the benefits of tax increment financing while minimizing potential fiscal risks.

Government Affairs

https://www.capitol.hawaii.gov/session/measure_indiv.aspx?billtype=SB&billnumber=374&year=2026