Hawaii Revised Statutes, Chapter 248 — County Budgets; Tax Funds

Division 1. Government — Title 14. Taxation

Hawaii Revised Statutes as published by the Hawaii State Legislature (files updated 1/5/2026 7:14 PM).

Division 1 Government

Title 14 Taxation

Chapter 248 County Budgets; Tax Funds

§248-1 Definitions

Wherever used in this chapter:

"Council" means the county council of each county concerned.

"Director" means the state director of finance unless otherwise stated or indicated in context.

"Liquid fuel" or "fuel" has the meaning defined by section 243-1.

"Property" or "real property" means and includes all land and appurtenances thereof and the buildings, structures, fences, and improvements erected on or affixed to the same, and any fixture that is erected on or affixed to such land, buildings, structures, fences, and improvements, including all machinery and other mechanical or other allied equipment and the foundations thereof, whose use thereof is necessary to the utility of such land, buildings, structures, fences, and improvements, or whose removal therefrom cannot be accomplished without substantial damage to such land, buildings, structures, fences, and improvements, excluding, however, any growing crops.

[RL 1935, pts of §§1900, 2010, and 2100; am L 1935, c 153, §§1, 3; am L 1937, c 172, §4; am L Sp 1941, c 26, pt of §1; RL 1945, §5251; am L 1947, c 111, §4; RL 1955, §129-1; am L Sp 1959 2d, c 1, §14; am L 1963, c 114, §1; HRS §248-1; am L 2016, c 52, §4]

§248-2 Repealed

[Repealed]

[L 2000, c 18, §9]

§248-2.5 Repealed

[Repealed]

[L 2003, c 135, §14]

§248-2.6 County surcharge on state tax; disposition of proceeds

[Section repealed December 31, 2030. L Sp 2017, c 1, §6.] (a) If adopted by county ordinance, all county surcharges on state tax collected by the director of taxation shall be paid into the state treasury quarterly, within ten working days after collection, and shall be placed by the director of finance in special accounts; provided that county surcharge revenues levied, assessed, and collected in a county with a population greater than five hundred thousand shall be deposited into the mass transit special fund established under section 248-2.7. Out of the revenues generated by county surcharges on state tax paid into each respective state treasury special account or the mass transit special fund, the director of finance shall deduct one per cent of the gross proceeds of a respective county's surcharge on state tax to reimburse the State for the costs of assessment, collection, disposition, and oversight of the county surcharge on state tax incurred by the State. Amounts retained shall be general fund realizations of the State.

(b) The amounts deducted for costs of assessment, collection, disposition, and oversight of county surcharges on state tax shall be withheld from payment to the counties by the State out of the county surcharges on state tax collected for the current calendar year.

(c) For the purpose of this section, the costs of assessment, collection, disposition, and oversight of the county surcharges on state tax shall include any and all costs, direct or indirect, that are deemed necessary and proper to effectively administer this section and sections 237-8.6 and 238-2.6.

(d) For a county with a population equal to or less than five hundred thousand that adopts a county surcharge on state tax, after the deduction and withholding of the costs under subsections (a) and (b), the director of finance shall pay the remaining balance on a quarterly basis to the director of finance of each county that has adopted a county surcharge on state tax under section 46-16.8.

For a county with a population greater than five hundred thousand that adopts or extends a county surcharge on state tax ordinance, after the deduction and withholding of the costs under subsections (a) and (b), the director of finance shall administer the remaining surcharge revenues in accordance with section 248-2.7.

The payments shall be made after the county surcharges on state tax have been paid into the state treasury special accounts or the mass transit special fund or after the disposition of any tax appeal, as the case may be. All county surcharges on state tax collected shall be distributed by the director of finance to the county in which the county surcharge on state tax is generated and shall be a general fund realization of the county, to be used for the purposes specified in section 46-16.8 by each of the counties.

[L 2005, c 247, §§5, 9; am L 2015, c 240, §7; am L Sp 2017, c 1, §5]

§248-2.7 Mass transit special fund; established; distribution of funds

(a) There is established a mass transit special fund to be administered by the department of budget and finance.

(b) For the period beginning on January 1, 2018, to December 31, 2030, transient accommodations tax and surcharge on state tax revenues allocated to the mass transit special fund pursuant to sections 237D-2(e) and 248-2.6 shall be deposited into the special fund. All interest earned on the moneys in the special fund shall be credited to the general fund. The mass transit special fund shall be exempt from the central service expenses deduction under section 36-27 and departmental administrative expenses deduction under section 36-30.

(c) Upon receiving a certification statement from the comptroller pursuant to section 40-81.5, the director of finance shall allocate and disburse moneys in the mass transit special fund to the director of finance of a county with a population greater than five hundred thousand; provided that the director of finance shall only disburse those amounts that are certified in the certification statement for that county for the purposes specified in section 46-16.8; provided further that revenues allocated from the special fund shall not be used for:

(1) Operating or maintenance costs of the mass transit project or any purpose not consistent with section 46-16.8(f); or

(2) Administrative, operating, marketing, or maintenance costs, including personnel costs, of a rapid transportation authority charged with the responsibility for constructing, operating, or maintaining the mass transit project;

provided further that the total amount of funds that are available, allocated, and disbursed by the director of finance pursuant to this section shall not be in excess of the total amount indicated on the certification statement. The director of finance may allocate and disburse moneys pursuant to this section on a monthly basis.

Any amounts allocated and disbursed pursuant to this section shall be subject to the availability of funds deposited and on balance in the special fund. The director of finance shall not allocate or disburse any amounts from the special fund that are in excess of any amounts deposited and on balance in the special fund.

(d) The director of finance shall post all certification statements received from the comptroller pursuant to section 40-81.5 on the department of budget and finance's website within ten working days of payments made pursuant to this section.

(e) The department of budget and finance shall submit an annual report to the legislature not later than twenty days prior to the convening of each regular session on the total amount of funds allocated pursuant to this section.

(f) The director of finance may establish rules, exempt from chapter 91, for the purposes of this section.

[L Sp 2017, c 1, §8; am L 2023, c 48, §7]

§248-3 State requirements

(a) On or before January 31 of each calendar year the state director of finance shall compute and submit to the council of each county the amounts which are payable to or retainable by the State for that county for the calendar year to meet interest charges for serial bonds, and the principal for all serial bonds maturing the following calendar year, which bonds have been issued by the State for county purposes (except bonds issued prior to January 1, 1945 for highway purposes).

(b) The board of trustees of the [employees'] retirement system of the State, on or before January 31 of each calendar year, shall submit to each county the amount estimated to be due from such county for the calendar year, pursuant to chapter 88, on account of the employees thereof who are members of the [employees'] retirement system.

(c) Any other information or estimates as to requirements for the calendar year, necessary to be given by any state office to any council in order that such requirements may be included in determining the tax rate for the county, shall be submitted by such officer to the council not later than January 31 of such year.

[L Sp 1957, c 1, §15(a)(3); am L Sp 1959 2d, c 1, §14; am L 1963, c 114, §1; Supp, §129-5.1; HRS §248-3]

§248-4 Submission of budgets during years legislature meets

In each year in which the legislature meets in regular session, each county shall submit to the legislature and to the director of finance, at least twenty days before the legislature convenes, the budget of the county for the current fiscal year and the next succeeding fiscal year. Such budgets shall show estimated receipts as well as estimated expenditures. The form in which budgets shall be submitted and the itemization thereof may be prescribed by the legislature which may require the inclusion therein of relevant information concerning the last two completed fiscal years.

[L 1941, c 236, §1; RL 1945, §5253; am L 1947, c 111, §2; RL 1955, §129-6; am L Sp 1957, c 1, §15(a)(4); am L Sp 1959 2d, c 1, §14; am L 1963, c 114, §1; am L 1965, c 166, §§1, 2; HRS §248-4; am L 1977, c 43, §1]

§248-5 Repealed

[Repealed]

[L 2016, c 52, §6]

§248-6 Repealed

[Repealed]

[L 1989, c 338, §2]

§248-7 Tax payments, how made; caveat

All payments to be made by the state director of finance shall be made upon warrants issued by the state comptroller. Nothing in this chapter shall be construed as in any way amending or repealing any law authorizing the withholding, by the state director of finance or the state comptroller, of moneys in the state treasury belonging or due to any county for the payment of principal or interest for state bonds, or any other charges.

[L 1932 2d, c 40, pt of §71; RL 1935, pt of §1922; am L 1937, c 172, pt of §2; RL 1945, pt of §5254; am L 1945, c 82, §4; am L 1947, c 111, pt of §3; RL 1955, §129-10; am L 1957, c 152, §1; am L Sp 1959 2d, c 1, §14; am L 1963, c 114, §1; HRS §248-7]

§248-8 Special funds in treasury of State

There are created in the treasury of the State three special funds to be known, respectively, as the state highway fund, the airport revenue fund, and the boating special fund. All taxes collected under chapter 243 in each calendar year, except the "county of Hawaii fuel tax", "city and county of Honolulu fuel tax", "county of Maui fuel tax", and "county of Kauai fuel tax", shall be deposited in the state highway fund; provided that:

(1) All taxes collected under chapter 243 with respect to gasoline or other aviation fuel sold for use in or used for airplanes shall be set aside in the airport revenue fund; and

(2) All taxes collected under chapter 243 with respect to liquid fuel sold for use in or used for small boats shall be deposited in the boating special fund.

As used in this section, "small boats" means all vessels and other watercraft except those operated in overseas transportation beyond the State, and ocean-going tugs and dredges. The chairperson of the board of land and natural resources, from July 1, 1992, and every three years thereafter, shall establish standards or formulas that will as equitably as possible establish the total taxes collected under chapter 243 in each fiscal year that are derived from the sale of liquid fuel for use in or used for small boats. The amount so determined shall be deposited in the boating special fund.

An amount equal to 0.3 per cent of the highway fuel tax but not more than $250,000 collected under chapter 243 shall be allocated each fiscal year to the special land and development fund for purposes of the management, maintenance, and development of trails and trail accesses under the jurisdiction of the department of land and natural resources established under section 198D-2.

[L 1932 1st, c 19, pt of §12; RL 1935, pt of §2021; am L 1937, c 172, pt of §3; RL 1945, pt of §5260; am L 1945, c 82, pt of §5; am L 1947, c 196, pt of §1; am L 1951, c 67, §1 and c 302, §2; am L 1955, c 250, §1(a); RL 1955, §129-11; am L 1957, c 217, §3; HRS §248-8; am L 1969, c 10, §5; am L 1972, c 180, §4; am L 1991, c 272, §7; am L 1993, c 273, §4; am L 1997, c 106, §3]

§248-9 State highway fund

(a) Moneys in the state highway fund may be expended for the following purposes:

(1) To pay the costs of operation, maintenance, and repair of the state highway system, including without limitation, the cost of equipment and general administrative overhead;

(2) To pay the costs of acquisition, including real property and interests therein; planning; designing; construction; and reconstruction of the state highway system and bikeways, including without limitation, the cost of equipment and general administrative overhead;

(3) To reimburse the general fund for interest on and principal of general obligation bonds issued to finance highway projects where the bonds are designated to be reimbursable out of the state highway fund;

(4) To pay the costs of construction, maintenance, and repair of county roads; provided that none of the funds expended on a county road or program shall be federal funds when expenditure would cause a violation of federal law or a federal grant agreement; and

(5) To pay the costs of establishing and maintaining a drug and alcohol toxicology testing laboratory that is intended to support the prosecution of offenses relating to operation of a motor vehicle while under the influence of an intoxicant.

(b) At any time, the director of transportation may transfer from the state highway fund all or any portion of available moneys determined by the director of transportation to exceed one hundred thirty-five per cent of the requirements for the ensuing twelve months for the state highway fund as permitted by and in accordance with section 37-53. For purposes of the determination, the director of transportation shall take into consideration:

(1) The amount of federal funds and bond funds on deposit in, and budgeted to be expended from, the state highway fund during the period;

(2) Amounts on deposit in the state highway fund that are encumbered or otherwise obligated;

(3) Budgeted amounts payable from the state highway fund during the period;

(4) Revenues anticipated to be received by and expenditures to be made from the state highway fund during the period based on existing agreements and other information for the ensuing twelve months; and

(5) Any other factors as the director of transportation shall deem appropriate.

(c) The department of transportation shall establish county subaccounts within the state highway fund. Notwithstanding subsections (a) and (b), funds in each county subaccount shall be expended for state highway road capacity projects in the respective county.

For purposes of this subsection, "state highway road capacity project" means construction:

(1) Of a new road;

(2) To widen or add additional lanes to an existing road; or

(3) That increases the number of vehicles that may be driven on an island and alleviates the level of traffic congestion on existing roads of that island,

and any planning, design, or right-of-way acquisition related to the construction.

[L 1932 1st, c 19, pt of §12; am imp L 1932 2d, c 40, §§26, 71; am L Sp 1933, c 6, §1; RL 1935, pt of §2021; am L 1937, c 172, pt of §3; am L 1941, c 212, §1; am L Sp 1941, c 49, §1; RL 1945, pt of §5260; am L 1945, c 82, pt of §5; am L 1947, c 32, §5, c 36, §1, and c 196, pt of §1; am L 1953, c 189, §1; am L 1955, c 250, §1(b); am L 1955, c 249, §2, rat 70 Stat 545, c 602; RL 1955, §129-12; am L Sp 1959 2d, c 1, §§14, 16, 26; am L 1963, c 114, §1; am L 1966, c 43, §2; am L 1967, c 204, §1; HRS §248-9; am L 1977, c 68, §2; am L 1979, c 167, §1; am L 1989, c 309, §5; am L 1997, c 270, §1; am L 2006, c 125, §2 and c 166, §2; am L 2007, c 286, §1; am L 2018, c 215, §2; am L 2021, c 196, §3; am L 2023, c 148, §2]

§248-10 State highway fund; disposition of certain income

The department of land and natural resources shall deposit to the credit of the state highway fund created by section 248-8, all income received from the rental or lease of real property which has been acquired for highway purposes and paid for out of the state highway fund. Moneys thus deposited are hereby appropriated and may be expended by the department of transportation in accordance with section 248-9.

The department of transportation shall reimburse the department of land and natural resources, from the state highway fund, for all expenditures involved in the collection of such rental income and of the management and maintenance of such property. Such reimbursements shall be deposited in the general fund.

Nothing in this section shall be construed to amend or restrict the funds to be expended under any other law appropriating or authorizing the expenditure of other moneys by the department of transportation.

[L 1951, c 251, §1; am L 1953, c 132; RL 1955, §129-13; am L 1959, c 265, §16; am L Sp 1959 2d, c 1, §§21, 26; am L 1961, c 132, §2; HRS §248-10]

§248-11 Repealed

[Repealed]

[L 1979, c 167, §2]

§248-12 State highway fund to defray expenses of motor vehicle safety office

The department of transportation may expend funds from the state highway fund to defray the cost of administration and operation of the motor vehicle safety office.

[L 1978, c 159, §6]