The 28th Hawaii State Legislative session adjourned May 5. What started out as a flurry of proposals, all vying for legislative attention, became a distilled set of appropriations by session end. The bills successfully passed with relevance to the nonprofit sector and for strengthening communities were appropriations for homeless services, ACs in schools, alternative energy projects, and early childhood education. A whole host of Grant in Aids were also approved this session.

Kudos to those nonprofit advocates for their work to move the needle this session.

HANO looked out for the overarching issues that plague or enhance nonprofit operations - bills that impacted the nonprofit funding environment, regulatory matters, taxes and tax-exemptions. This session, we followed and weighed in on the following measures:

SB 2812 SD 2 HD2 CD 1 (click to view). Passed out successfully.

Amends Hawaii's charitable registration and solicitation law to require affirmative disclosures to donors by professional solicitors; clarify exemptions from registration; authorize the Department of the Attorney General to issue cease and desist orders and impose administrative fines; and make other technical amendments.

HANO supported this bill for several provisions:

  • Redefines “professional solicitor” to exclude those who plan, conduct, manage, advise, consult or prepare grant or subsidy applications for charitable organizations;
  • Clarifies disclosure requirements for professional solicitors;
  • Lowers the fees for organizations under $25,000 to $0;
  • Allows for electronic submittal of reports to the Attorney General;
  • Raises the audit requirement thresholds from $500,000 total revenue to $500,000 in just contributed revenue.

Thanks to the State Attorney General's office for clarifying this law to better reflect the fundraising environment for nonprofits, to provide more protection from fraudulent behavior, and add greater transparency to this process.

SB 2547 SD 1 HD 1 CD 1 (click to view)

Sets a schedule of periodic review of tax exemptions and tax credits, including certain nonprofit activities and functions. This bill passed out successfully. HANO will continue to monitor the review of these important exemptions.

SB 2928 SD2 HD1 (click to view)

Proposed requiring special event operators to provide reports to the State Department of Taxation on any vendors at their special events who engage in business . HANO opposed the idea of putting the onus on nonprofit special event operators to police and report on the business activity of for-profit vendors for tax purposes. Latter versions of the bill exempted nonprofit organizations from such reporting requirements. In the end, the bill did not make it out of conference and is dead this session.

SB 3024, SD 1 HD 2 (click to view)

Proposed funding for an online filing system for the State Ethics Commission for greater filing ease, as well as an appropriation for a task force to clarify state lobbying laws. This bill did not pass out of conference committee.

SB 3070, SD 1 HD 1 (click to view

This bill did not make it out of conference, but had attempted to establish legislative policies for Grants in Aid. The latest HD 1 version required an organization to negotiate a lump sum or installment repayment to the State of the grant used for the planning, design, construction, renovation, operations, or equipment of facilities when the organization discontinues the activities and disposes of the land by sale. HANO opposed the HD 1 language and provided suggested language highlighting the importance of funding project related overhead.

In this election season, we encourage nonprofits to engage with legislators in the interim between sessions to share information about your missions and to affect strong public policy in next year's new biennium that will serve your missions and strengthen your communities.

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