Bill > HB462

This bill establishes an Interstate Compact to Phase Out Corporate Welfare, which is a voluntary agreement among states to eliminate targeted economic incentives for specific companies. The compact defines "corporate welfare" as government disbursements or tax incentives given to particular companies or industries, and aims to create a more level economic playing field. Key provisions include prohibiting company-specific grants or tax incentives for businesses located in other member states, establishing a national board to draft recommendations for phasing out corporate welfare, and creating an enforcement mechanism that allows taxpaying residents to require state law enforcement to uphold the compact. The bill recognizes that current economic development practices create a "prisoner's dilemma" where governments feel compelled to offer subsidies to attract businesses, leading to an unproductive competition. Importantly, the compact excludes workforce development grants and is not retroactive to existing agreements. States can join the compact by enacting it into law and can withdraw with six months' notice. The national board, composed of appointees from member states, will meet annually to collect testimony, draft improvements, and publish reports on how to further reduce corporate welfare. The compact is designed to be liberally interpreted to achieve its purpose of creating fairer economic development policies that benefit all businesses equally.

Business and Industry

https://www.capitol.hawaii.gov/session/measure_indiv.aspx?billtype=HB&billnumber=462&year=2026