SB 3317: DBEDT; DOTAX; Native Hawaiians; Film and Media Industry; Tax Credit; Appropriations

THE SENATE	S.B. NO.	3317
THIRTY-THIRD LEGISLATURE, 2026
STATE OF HAWAII

A BILL FOR AN ACT

 

 

RELATING TO THE DEVELOPMENT OF A NATIVE HAWAIIAN FILM AND MEDIA INDUSTRY.

 

 

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

 

     SECTION 1.  (a)  The legislature finds that Hawaii is among the most sought-after filming locations globally.  However, the ownership, long-term economic benefits, and infrastructure development associated with film and media production predominantly occur outside the State.  Native Hawaiian history, culture, and identity have been commercialized through film and other media without significant Native Hawaiian ownership, workforce engagement, or infrastructure advancement.

     The legislature also finds that film and media production represent a high-value global export industry capable of generating sustainable revenue, skilled employment, tourism demand, and enhanced international brand equity.

     The legislature recognizes that title 43 Code of Federal Regulations part 50 formally establishes a lawful administrative pathway for the reconstitution and federal acknowledgment of a Native Hawaiian governing entity.  This framework for federal recognition affirms the unique legal and political status of Native Hawaiians, and recognizes that the reorganization of a Native Hawaiian governing body aligns with the trust relationship that exists between the United States and the Native Hawaiian community.

     The legislature also recognizes that Hale Kapu Moolelo A Alii Ana is a Native Hawaiian trust established to promote and protect Native Hawaiian culture, foster economic development, and create workforce opportunities.  Its structure and organizing efforts align with the principles and standards set forth in title 43 Code of Federal Regulations part 50.

     The legislature further recognizes that Alii Ana Studios, governed by the trust, is the only Native Hawaiian film studio in history to create two critically acclaimed, globally recognized, award-winning feature films backed by Academy Award‑nominated producers that are told entirely through Native Hawaiian narratives, cast with Native Hawaiian actors, and produced under Native Hawaiian leadership.  These films achieved historic global distribution deals through the American film market, with the studio's most recent feature film, "Kai", receiving a national theatrical release in 2026.  This is the first time in the indigenous history of Hawaiian storytelling that this feat has been achieved by an independent studio.

     The legislature notes that Alii Ana Studios has led global marketing campaigns for top-tier entertainment studios including Warner Bros., Apple TV+, Netflix, and Legendary Entertainment.  The studio also played a foundational role in launching Jason Momoa's production company.  Alii Ana Studios represents a new generation of indigenous-led cinematic infrastructure, combining artistic excellence with cultural stewardship and economic leadership.  The studio has provided mentorship and employment to Native Hawaiian creatives, established pathways for indigenous workforce development, and is preparing for the construction of permanent studio and post-production facilities that meet global standards.

     The legislature believes that strategic investment by the State in this proven studio and its governing trust would ensure compliance with both state and federal indigenous policy frameworks, while expanding Hawaii's economic base through full‑cycle, indigenous-led creative productions.

     The legislature also believes that it is important for the State to align with the federally recognized self-determination

framework for Native Hawaiians, support the reemergence of a governing trust, and establish a robust Native Hawaiian film and media economy centered in cultural integrity, economic equity, and federal compliance.

     The legislature further believes that it is vital for the State to:

     (1)  Develop a permanent Native Hawaiian studio and post‑production infrastructure;

     (2)  Facilitate financing for independent Native Hawaiian film and television productions;

     (3)  Facilitate the utilization of large external studio productions to finance infrastructure and workforce development;

     (4)  Ensure the use of full-cycle production and extended production timelines within the State;

     (5)  Incentivize productions' use of time, resources, and skilled labor within the State; and

     (6)  Incentivize the creation of paid apprenticeship opportunities and long-term career pathways for Native Hawaiian residents.

     (b)  Accordingly, the purpose of this Act is to develop a Native Hawaiian-owned and operated film and media industry by:

     (1)  Establishing and appropriating moneys for a Native Hawaiian film and media development program within the department of business, economic development, and tourism; and

     (2)  Establishing a full-cycle motion picture production income tax credit.

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

"Part    .  NATIVE HAWAIIAN FILM AND MEDIA DEVELOPMENT PROGRAM

     §201-A  Definitions.  As used in this part, unless the context otherwise requires:

     "Department" means the department of business, economic development, and tourism.

     "Independent Native Hawaiian production" means a feature film or episodic television series that is predominantly owned or controlled by a Native Hawaiian entity and produced under an independent budget model for global distribution.

     "Program" means the Native Hawaiian film and media development program.

     §201-B  Native Hawaiian film and media development program; established.  (a)  There is established within the department a Native Hawaiian film and media development program.

     (b)  The program shall:

     (1)  Support independent Native Hawaiian film and media productions;

     (2)  Facilitate the establishment and operation of Native Hawaiian-controlled studio and post-production facilities;

     (3)  Administer the financing incentives established under this chapter;

     (4)  Coordinate workforce training, apprenticeship programs, and union participation; and

     (5)  Collaborate with the Hawaii tourism authority to align film production with tourism and cultural promotion objectives.

     §201-C  Designation of eligible entity.  Hale Kapu Moolelo A Alii Ana is recognized as an eligible Native Hawaiian trust and operating studio.  The trust may participate in and receive support under the program to develop, manage, and operate film production and post-production facilities and independent productions.

     §201-D  Reports.  The department of business, economic development, and tourism shall submit a report to the legislature no later than twenty days prior to the convening of each regular session detailing the program's activities and specifying, for the most recently completed fiscal year any:

     (1)  Funds allocated and expended;

     (2)  Productions supported;

     (3)  Infrastructure developed; and

     (4)  Outcomes related to workforce development and apprenticeships."

     SECTION 3.  Chapter 235, Hawaii Revised Statutes, is amended by adding a new section to part VI to be appropriately designated and to read as follows:

     "§235-     Full-cycle motion picture production income tax credit.  (a)  Notwithstanding any law to the contrary, there shall be allowed to each taxpayer subject to the taxes imposed by this chapter, a full-cycle motion picture production income tax credit that shall be deductible from the taxpayer's net income tax liability, if any, imposed by this chapter for the taxable year in which the credit is properly claimed.  The amount of the credit shall be equal to fifty per cent of qualified production expenditures incurred within the State, subject to:

     (1)  A per-production cap of no less than $40,000 and no more than $50,000, as determined by rules adopted by the department of taxation pursuant to chapter 91; and

     (2)  An aggregate cap of $            .

     (b)  The credit allowed under this section shall be claimed against the net income tax liability for the taxable year.  For the purposes of this section, "net income tax liability" means net income tax liability reduced by all other credits allowed under this chapter.

     (c)  If the tax credit under this section exceeds the taxpayer's income tax liability, the excess of credits over liability shall be refunded to the taxpayer; provided that no refunds or payment on account of the tax credits allowed by this section shall be made for amounts less than $1.  All claims, including any amended claims, for tax credits under this section shall be filed on or before the end of the twelfth month following the close of the taxable year for which the credit may be claimed.  Failure to comply with any of the foregoing provision shall constitute a waiver of the right to claim the credit.

     (d)  To qualify for this tax credit, a production shall:

     (1)  Be a domestic or international motion picture or television studio production of any size;

     (2)  Utilize a qualified Native Hawaiian studio facility;

     (3)  Complete full-cycle production within the State;

     (4)  Demonstrate, to the satisfaction of the department of business, economic development, and tourism that a portion of tax credit's value will be reinvested in Hawaii-based infrastructure, which may include funding for:

          (A)  The construction or expansion of studio and post‑production facilities;

          (B)  The acquisition of production and post-production equipment;

          (C)  Funding for workforce training and paid apprenticeship programs; or

          (D)  The development of technical capabilities necessary for completing full-cycle production within the State;

     (5)  Employ a Hawaii-based workforce and union labor, and pay, where applicable, industry-standard wages;

     (6)  Offer paid apprenticeship opportunities that facilitate skill transfer over extended production timelines; and

     (7)  Establish pathways for long-term employment within the State's film and media industry.

     (e)  Noncompliance with reinvestment requirements of subsection (d)(4) shall result in the partial or complete recapture of any tax credit authorized by this section.

     (f)  To receive the tax credit, the taxpayer shall first prequalify the production for the credit by registering with the department of business, economic development, and tourism during the development or preproduction stage.

     (g)  The department of taxation:

     (1)  Shall prepare forms as may be necessary to claim a credit under this section;

     (2)  May require the taxpayer to furnish information to ascertain the validity of the claim for credit made under this section; and

     (3)  May adopt rules pursuant to chapter 91 necessary for the purposes of this section.

     (h)  Each taxpayer claiming a tax credit under this section shall submit to the department of business, economic development, and tourism a written, sworn statement that includes any information the department deems necessary for the purposes of the report required by subsection (i).

     (i)  The department of business, economic development, and tourism shall submit a report to the legislature no later than twenty days prior to the convening of each regular session specifying, for the most recently completed taxable year:

     (1)  The aggregate tax credits authorized under this section; and

     (2)  The reinvestments made by taxpayers who qualified for this tax credit as required by subsection (d)(4),

provided that the report required pursuant to this section may be combined with the report required pursuant to section 201-D.

     (j)  For the purposes of this section:

     "Full-cycle motion picture production" means the completion of a motion picture's production and post production process within the State, including principal photography, picture editing, color grading, sound design, music scoring, visual effects, final mastering, and delivery.

     "Qualified Native Hawaiian studio facility" refers to a film production or post-production facility that is owned or operated by an entity recognized by the department of business, economic development, and tourism as being Native Hawaiian-controlled and situated within the State.

     "Qualified production expenditures" means expenditures incurred within the State that are directly related to production, post-production, workforce compensation, and infrastructure investment, as determined by the department of business, economic development, and tourism."

     SECTION 4.  There is appropriated out of the general revenues of the State of Hawaii the sum of $5,000,000 or so much thereof as may be necessary for fiscal year 2026-2027 to support the Native Hawaiian film and media development program established pursuant to section 2 of this Act, to be allocated as follows:

     (1)  $1,000,000 for industry launch and platform activation, which includes studio activation, equipment acquisition, the launch of workforce and apprenticeship programs, and preparation for global distribution; and

     (2)  $4,000,000 for the development, production, post-production, and delivery of three independent Native Hawaiian feature films intended for global distribution.

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

     SECTION 5.  This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

     SECTION 6.  New statutory material is underscored.

     SECTION 7.  This Act shall take effect on July 1, 2026; provided that section 3 shall apply to taxable years beginning after December 31, 2025.

 

INTRODUCED BY:	_____________________________

 

 

 

Report Title:

DBEDT; DOTAX; Native Hawaiians; Film and Media Industry; Tax Credit; Appropriations

 

Description:

Establishes and appropriates moneys for a Native Hawaiian film and media development program within the Department of Business, Economic Development, and Tourism.  Establishes a full-cycle production tax credit for taxable years beginning after 12/31/2025.  Provides the Department of Taxation with certain duties and responsibilities in administering the tax credit.

 

 

 

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