HB 2602: DBEDT; Travel; Tourism; Sustainable Infrastructure; Climate Resilience; Matching Grant Program; Reports; Appropriation

A BILL FOR AN ACT

RELATING TO A SUSTAINABLE TOURISM INFRASTRUCTURE.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  The legislature finds that the State's visitor industry constitutes essential economic infrastructure that supports statewide employment, tax revenues, and public services, while also relying heavily on energy, water, transportation, and coastal assets that are increasingly vulnerable to climate-related risks.

     The legislature further finds that strategic, capital-based sustainability and climate resilience investments in visitor industry facilities, particularly in hotels, cruise ship operations, passenger terminals, and port-related infrastructure, can reduce greenhouse gas emissions, improve energy and water efficiency, mitigate climate risks, and reduce long-term public infrastructure and disaster recovery costs borne by the State.

     Additionally, the legislature finds that in 2025, the State enacted a 0.75 percentage point increase to the transient accommodations tax and imposed the tax on certain proceeds from cruise fares, commonly referred to as the green fee, to create a dedicated funding source to support climate resilience, environmental protection, and sustainability initiatives related to the visitor industry.  According to the office of the governor, the increased transient accommodations tax is projected to generate approximately $100,000,000 in tax revenues annually.

     Furthermore, the legislature finds that leveraging limited public funds to support voluntary, outcome-driven, private-sector investments through competitive, matching grants can achieve measurable environmental and economic benefits without imposing new regulatory mandates or creating ongoing financial obligations for the State.

     Accordingly, the purpose of this Act is to establish within the department of business, economic development, and tourism a matching grant program to support voluntary sustainability and climate resilience investments in visitor industry infrastructure, maximize the return on public investment, and ensure transparency and accountability in the use of public funds.

     SECTION 2.  Chapter 201, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§201-     Sustainable tourism infrastructure matching grant program.  (a)  There is established within the department a sustainable tourism infrastructure matching grant program to support one-time capital investments by eligible applicants in tourism infrastructure that advance measurable sustainability and climate resilience outcomes within the State's visitor industry.

     (b)  Grants awarded under this section shall be used exclusively for one-time capital expenditures that produce measurable sustainability or climate resilience outcomes, including but not limited to:

     (1)  Energy efficiency retrofits or electrification;

     (2)  Renewable energy or emissions-reduction infrastructure;

     (3)  Water efficiency, conservation, or reuse systems;

     (4)  Waste reduction or materials management infrastructure;

     (5)  Climate adaptation or resilience improvements, including flood mitigation;

     (6)  Cycling and micromobility infrastructure; and

     (7)  Passenger terminal or port facility improvements that reduce environmental impacts.

     (c)  No funds awarded under this section shall be used for ongoing operating expenses, routine maintenance, or any other activities required by law.

     (d)  No grant shall be awarded under this section unless matched by private funds, in an amount to be determined by the department, to ensure shared investment, fiscal discipline, and leverage of state funds.

     (e)  In awarding grants, the department shall prioritize projects that:

     (1)  Are implementation-ready;

     (2)  Demonstrate clear, measurable sustainability or climate resilience outcomes;

     (3)  Leverage significant private capital;

     (4)  Reduce long-term infrastructure risk or public cost exposure; and

     (5)  Align with statewide climate and economic resilience goals.

     (f)  The department shall submit a report of its findings and recommendations, including any proposed legislation, to the legislature no later than twenty days prior to the convening of each regular session, beginning with the regular session of 2027.  The report shall include, at a minimum:

     (1)  The number and amount of grants awarded;

     (2)  Types and locations of projects funded;

     (3)  Amount of private matching funds leveraged;

     (4)  Quantifiable sustainability or climate outcomes achieved; and

     (5)  An assessment of program effectiveness relative to stated goals.

     (g)  The department may adopt rules pursuant to chapter 91 to carry out the purposes of this section.

     (h)  For the purposes of this section, "eligible applicants" includes but is not limited to:

     (1)  Hotels, resorts, and other properties furnishing transient accommodations;

     (2)  Cruise ship operators;

     (3)  Passenger terminal operators;

     (4)  Port or harbor facilities that directly support visitor transportation;

     (5)  Bikeshare networks and operators and private nonprofit organizations doing similar work; and

     (6)  Other visitor-serving facilities, as determined by the department, that demonstrate a clear nexus to sustainability or climate resilience outcomes."

     SECTION 3.  There is appropriated out of the general revenues of the State of Hawaii the sum of $           or so much thereof as may be necessary for fiscal year 2026-2027 for the sustainable tourism infrastructure matching grant program established under section 2 of this Act.

     The sum appropriated shall be expended by the department of business, economic development, and tourism for the purposes of this Act.

     SECTION 4.  New statutory material is underscored.

     SECTION 5.  This Act shall take effect on July 1, 3000.

Report Title:

DBEDT; Travel; Tourism; Sustainable Infrastructure; Climate Resilience; Matching Grant Program; Reports; Appropriation

Description:

Establishes the sustainable tourism infrastructure matching grant program within the Department of Business, Economic Development, and Tourism to support one-time capital investments that advance measurable sustainability and climate resilience outcomes within the State's visitor industry.  Requires annual reports to the Legislature.  Appropriates funds.  Effective 7/1/3000.  (HD2)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

A BILL FOR AN ACT

RELATING TO A SUSTAINABLE TOURISM INFRASTRUCTURE.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  The legislature finds that the State's visitor industry constitutes essential economic infrastructure that supports statewide employment, tax revenues, and public services, while also relying heavily on energy, water, transportation, and coastal assets that are increasingly vulnerable to climate-related risks.

     The legislature further finds that strategic, capital-based sustainability and climate resilience investments in visitor industry facilities, particularly in hotels, cruise ship operations, passenger terminals, and port-related infrastructure, can reduce greenhouse gas emissions, improve energy and water efficiency, mitigate climate risks, and reduce long-term public infrastructure and disaster recovery costs borne by the State.

     Additionally, the legislature finds that in 2025, the State enacted a 0.75 percentage point increase to the transient accommodations tax, commonly referred to as the green fee, to create a dedicated funding source to support climate resilience, environmental protection, and sustainability initiatives related to the visitor industry.  According to the office of the governor, the increased transient accommodations is projected to generate approximately $100,000,000 in tax revenues annually.

     Furthermore, the legislature finds that leveraging limited public funds to support voluntary, outcome-driven, private-sector investments through competitive, matching grants can achieve measurable environmental and economic benefits without imposing new regulatory mandates or creating ongoing financial obligations for the State.

     Accordingly, the purpose of this Act is to establish within the department of business, economic development, and tourism a matching grant program to support voluntary sustainability and climate resilience investments in visitor industry infrastructure, maximize the return on public investment, and ensure transparency and accountability in the use of public funds.

     SECTION 2.  Chapter 201, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§201-     Sustainable tourism infrastructure matching grant program.  (a)  There is established within the department a sustainable tourism infrastructure matching grant program to support one-time capital investments by eligible applicants in tourism infrastructure that advance measurable sustainability and climate resilience outcomes within the State's visitor industry.

     (b)  Grants awarded under this section shall be used exclusively for one-time capital expenditures that produce measurable sustainability or climate resilience outcomes, including but not limited to:

     (1)  Energy efficiency retrofits or electrification;

     (2)  Renewable energy or emissions-reduction infrastructure;

     (3)  Water efficiency, conservation, or reuse systems;

     (4)  Waste reduction or materials management infrastructure;

     (5)  Climate adaptation or resilience improvements, including flood mitigation; and

     (6)  Passenger terminal or port facility improvements that reduce environmental impacts.

     (c)  No funds awarded under this section shall be used for ongoing operating expenses, routine maintenance, or any other activities required by law.

     (d)  No grant shall be awarded under this section unless matched by private funds, in an amount to be determined by the department, to ensure shared investment, fiscal discipline, and leverage of state funds.

     (e)  In awarding grants, the department shall prioritize projects that:

     (1)  Are implementation-ready;

     (2)  Demonstrate clear, measurable sustainability or climate resilience outcomes;

     (3)  Leverage significant private capital;

     (4)  Reduce long-term infrastructure risk or public cost exposure; and

     (5)  Align with statewide climate and economic resilience goals.

     (f)  The department shall submit a report of its findings and recommendations, including any proposed legislation, to the legislature no later than twenty days prior to the convening of each regular session, beginning with the regular session of 2027.  The report shall include, at a minimum:

     (1)  The number and amount of grants awarded;

     (2)  Types and locations of projects funded;

     (3)  Amount of private matching funds leveraged;

     (4)  Quantifiable sustainability or climate outcomes achieved; and

     (5)  An assessment of program effectiveness relative to stated goals.

     (g)  The department may adopt rules pursuant to chapter 91 to carry out the purposes of this section.

     (h)  For the purposes of this section, "eligible applicants" includes but is not limited to:

     (1)  Hotels, resorts, and other properties furnishing transient accommodations;

     (2)  Cruise ship operators;

     (3)  Passenger terminal operators;

     (4)  Port or harbor facilities that directly support visitor transportation; and

     (5)  Other visitor-serving facilities, as determined by the department, that demonstrate a clear nexus to sustainability or climate resilience outcomes."

     SECTION 3.  There is appropriated out of the general revenues of the State of Hawaii the sum of $           or so much thereof as may be necessary for fiscal year 2026-2027 for the sustainable tourism infrastructure matching grant program established under section 2 of this Act.

     The sum appropriated shall be expended by the department of business, economic development, and tourism for the purposes of this Act.

     SECTION 4.  New statutory material is underscored.

     SECTION 5.  This Act shall take effect on July 1, 3000.

Report Title:

DBEDT; Travel; Tourism; Sustainable Infrastructure; Climate Resilience; Matching Grant Program; Reports; Appropriation

Description:

Establishes the sustainable tourism infrastructure matching grant program within the Department of Business, Economic Development, and Tourism to support one-time capital investments that advance measurable sustainability and climate resilience outcomes within the State's visitor industry.  Requires annual reports to the Legislature.  Appropriates funds.  Effective 7/1/3000.  (HD1)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

A BILL FOR AN ACT

RELATING TO A sustainable tourism infrastructure.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  The legislature finds that the State's visitor industry constitutes essential economic infrastructure that supports statewide employment, tax revenues, and public services, while also relying heavily on energy, water, transportation, and coastal assets that are increasingly vulnerable to climate-related risks.

     The legislature further finds that strategic, capital-based sustainability and climate resilience investments in visitor industry facilities, particularly in hotels, cruise ship operations, passenger terminals, and port-related infrastructure, can reduce greenhouse gas emissions, improve energy and water efficiency, mitigate climate risks, and reduce long-term public infrastructure and disaster recovery costs borne by the State.

     Additionally, the legislature finds that in 2025, the State enacted a 0.75 per cent increase to the transient accommodations tax, commonly referred to as the "Green Fee", to create a dedicated funding source to support climate resilience, environmental protection, and sustainability initiatives related to the visitor industry.  According to the office of the governor, the increased transient accommodations is projected to generate approximately $100 million in tax revenues annually.

     Furthermore, the legislature finds that leveraging limited public funds to support voluntary, outcome-driven private-sector investments through competitive, matching grants can achieve measurable environmental and economic benefits without imposing new regulatory mandates or creating ongoing financial obligations for the State.

     Accordingly, the purpose of this Act is to establish within the department of business, economic development, and tourism a time-limited, performance-based matching grant program to support voluntary sustainability and climate resilience investments in visitor industry infrastructure, maximize the return on public investment, and ensure transparency and accountability in the use of public funds.

     SECTION 2.  Chapter 201, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§201-    Sustainable tourism infrastructure matching grant program.  (a)  There is established within the department of business, economic development, and tourism, a competitive, performance-based sustainable tourism infrastructure matching grant program to support one-time capital investments that advance measurable sustainability and climate resilience outcomes within the State's visitor industry.

     (b)  Eligible applicants may include but are not limited to:

     (1)  Hotels, resorts, and other transient accommodations;

     (2)  Cruise ship operators;

     (3)  Passenger terminal operators;

     (4)  Port or harbor facilities that directly support visitor transportation; and

     (5)  Other visitor-serving facilities, as determined by the department, that demonstrate a clear nexus to sustainability or climate resilience outcomes.

     (c)  Grant funds shall be used exclusively for one-time capital expenditures that produce measurable sustainability or climate resilience outcomes, including but not limited to:

     (1)  Energy efficiency retrofits or electrification;

     (2)  Renewable energy or emissions-reduction infrastructure;

     (3)  Water efficiency, conservation, or reuse systems;

     (4)  Waste reduction or materials management infrastructure;

     (5)  Climate adaptation or resilience improvements, including flood mitigation; and

     (6)  Passenger terminal or port facility improvements that reduce environmental impacts.

     (d)  Grant funds shall not be used for ongoing operating expenses, routine maintenance, or activities that are otherwise required by law.

     (e)  All grants awarded under this section shall require a private-sector matching contribution, in an amount determined by the department, to ensure shared investment, fiscal discipline, and leverage of state funds.

     (f)  In awarding grants, the department shall prioritize projects that:

     (1)  Are implementation-ready;

     (2)  Demonstrate clear, measurable outcomes;

     (3)  Leverage significant private capital;

     (4)  Reduce long-term infrastructure risk or public cost exposure; and

     (5)  Align with statewide climate and economic resilience goals.

     (g)  The department shall submit an annual report of its findings and recommendations, including any proposed legislation, on the grant program to the legislature no later than twenty days prior to the convening of each regular session, beginning with the regular session of 2027.  The report shall include, at a minimum:

     (1)  The number and amount of grants awarded;

     (2)  Types and locations of projects funded;

     (3)  Amount of private matching funds leveraged;

     (4)  Quantifiable sustainability or climate outcomes achieved; and

     (5)  An assessment of program effectiveness relative to stated goals.

     (h)  The department may adopt rules pursuant to chapter 91 to carry out the purposes of this section."

     SECTION 3.  There is appropriated out of the general revenues of the State of Hawaii the sum of $           or so much thereof as may be necessary for fiscal year 2026-2027 for the sustainable tourism infrastructure matching grant program established under section 2 of this Act.

     The sum appropriated shall be expended by the department of business, economic development, and tourism for the purposes of this Act.

     SECTION 4.  New statutory material is underscored.

     SECTION 5.  This Act shall take effect on July 1, 2026.

Report Title:

DBEDT; Travel and Tourism; Sustainable Infrastructure; Climate Resilience; Matching Grant Program; Reports; Appropriation

Description:

Establishes the sustainable tourism infrastructure matching grant program within the Department of Business, Economic Development, and Tourism to support one-time capital investments that advance measurable sustainability and climate resilience outcomes within the State's visitor industry.  Requires annual reports to the Legislature.  Appropriates funds.

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

STAND. COM. REP. NO.  587-26

Honolulu, Hawaii

                , 2026

RE:   H.B. No. 2602

      H.D. 2

Honorable Nadine K. Nakamura

Speaker, House of Representatives

Thirty-Third State Legislature

Regular Session of 2026

State of Hawaii

Madame:

     Your Committee on Energy & Environmental Protection, to which was referred H.B. No. 2602, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO A SUSTAINABLE TOURISM INFRASTRUCTURE,"

begs leave to report as follows:

     The purpose of this measure is to establish and appropriate funds for the Department of Business, Economic Development, and Tourism to establish a matching grant program to support voluntary, one-time capital investments by tourism industry operators in tourism infrastructure that produce measurable sustainability or climate resilience outcomes.

     Your Committee received testimony in support of this measure from the Hawaiʻi Tourism Authority; Chamber of Commerce Hawaii; and Hawaiʻi Bicycling League.

     Your Committee finds that the State's visitor industry supports statewide employment, tax revenues, and public services but also relies heavily on energy, water, transportation, and coastal assets that are increasingly vulnerable to climate-related risks.  Your Committee further finds that strategic capital investments in visitor industry facilities, particularly hotels, cruise ship operations, passenger terminals, and port-related infrastructure, can reduce greenhouse gas emissions, improve energy and water efficiency, mitigate climate risks, and reduce long-term public infrastructure and disaster recovery costs borne by the State.  Your Committee believes that this measure presents a fiscally prudent opportunity to leverage limited public funds to support voluntary, outcome-driven, private-sector investments to achieve measurable environmental and economic benefits.

     Your Committee has amended this measure by:

     (1)  Adding cycling and micromobility infrastructure to the authorized uses of grants awarded;

     (2)  Adding bikeshare networks and operators and private nonprofit organizations doing similar work to the applicants eligible for grants; and

     (3)  Making technical, nonsubstantive amendments for the purposes of clarity, consistency, and style.

     As affirmed by the record of votes of the members of your Committee on Energy & Environmental Protection that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2602, H.D. 1, as amended herein, and recommends that it be referred to your Committee on Finance in the form attached hereto as H.B. No. 2602, H.D. 2.

Respectfully submitted on behalf of the members of the Committee on Energy & Environmental Protection,

STAND. COM. REP. NO.  62-26

Honolulu, Hawaii

                , 2026

RE:   H.B. No. 2602

      H.D. 1

Honorable Nadine K. Nakamura

Speaker, House of Representatives

Thirty-Third State Legislature

Regular Session of 2026

State of Hawaii

Madame:

     Your Committees on Tourism and Economic Development & Technology, to which was referred H.B. No. 2602 entitled:

"A BILL FOR AN ACT RELATING TO A SUSTAINABLE TOURISM INFRASTRUCTURE,"

beg leave to report as follows:

     The purpose of this measure is to establish a matching grant program within the Department of Business, Economic Development, and Tourism to support voluntary sustainability and climate resilience investments in visitor industry infrastructure, maximize return on investment, and ensure transparency and accountability in the use of public funds.

     Your Committees received testimony in support of this measure from the Chamber of Commerce Hawaii.

     Your Committees find that although the State's visitor industry provides significant economic benefits to the State, these benefits are often offset by the industry's heavy reliance on energy, water, transportation, and coastal assets that are increasingly vulnerable to climate-related risks.  Your Committees further find that the strong public support for the green fee enacted in 2025 has highlighted the market demand for efforts aimed at sustainable tourism.  This measure is intended to encourage efforts by the visitor industry to implement sustainability and climate resilience measures through the use of a grant program to provide a one-time capital investment in projects that produce measurable sustainability or climate resilience outcomes.

     Your Committees have amended this measure by:

     (1)  Changing the effective date to July 1, 3000, to encourage further discussion; and

     (2)  Making technical, nonsubstantive amendments for the purposes of clarity, consistency, and style.

     Your Committees respectfully request your Committee on Finance, should it deliberate on this measure, to consider an appropriation amount of $5,000,000.

     As affirmed by the records of votes of the members of your Committees on Tourism and Economic Development & Technology that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 2602, as amended herein, and recommend that it pass Second Reading in the form attached hereto as H.B. No. 2602, H.D. 1, and be referred to your Committee on Energy & Environmental Protection.

Respectfully submitted on behalf of the members of the Committees on Tourism and Economic Development & Technology,