HB 1176 Summary

• Establishes the Hawaii Economic Diversification Grant Program under Chapter 206M, Hawaii Revised Statutes, to provide grants to qualified high technology businesses conducting qualified research activities in Hawaii.

• Grants equal the federal research activity credit under Internal Revenue Code Section 41 (as enacted December 31, 2011), with businesses required to claim the federal credit to qualify for the state grant.

• Qualified high technology businesses must be small businesses (500 or fewer employees) conducting more than 50% of activities in qualified research and registered in Hawaii; they must submit annual certified statements and surveys to the Department of Business, Economic Development, and Tourism.

• Annual grant certifications are capped at $10,000,000 in the aggregate statewide, with grants certified on a first-come, first-served basis once the limit is reached.

• Department of Business, Economic Development, and Tourism must track grantees, verify qualifying costs, collect employment and intellectual property data, and report annually to the legislature on program effectiveness by September 1.