HRS § 237-27.6 — Solid waste processing, disposal, and electric generating facility; certain amounts exempt


§237-27.6 Solid waste processing, disposal,
and electric generating facility; certain amounts exempt. (a) Any
provision of the law to the contrary notwithstanding, there shall be exempted
from, and excluded from the measure of, the taxes imposed by this chapter all
of the amounts enumerated in subsection (b) arising from a transaction
involving a sale and leaseback of a solid waste processing, disposal, and
electric generating facility entered into by a political subdivision of the
State under section 46-19.1 where the facility is owned or under construction
by the subdivision before May 10, 1988.
(b) Amounts are exempted or excluded from
taxation under this chapter only to the extent that they:
(1) Are received by an operator of a facility under
an operating contract with a political subdivision, where the:
(A) Operator, or its successor, entered into
an operating contract prior to May 10, 1988;
(B) Operator enters into a lease of the
facility from the owner at a time that coincides with the time the owner and
the political subdivision entering into a sale and leaseback transaction; and
(C) Amounts are used by the operator to make
rental payments to the owner;
(2) Are received as rental payments by the owner of
the facility from the operator of the facility;
(3) Do not exceed the payments made by the owner of
the facility under the sale and leaseback transaction to the political
subdivision; and
(4) In no case exceed debt service costs incurred by
the political subdivision for the construction of the facility.
(c) For the purposes of this section:
"Debt service costs" means payments
of principal and interest on general obligation bonds issued at any time by a
political subdivision for the construction of the facility.
"Operator" means a private entity who
enters into an agreement or other arrangement with the owner of a solid waste
processing, disposal, and electric generating facility for the purpose of
operating such facility for a political subdivision of the State.
"Owner" means any person who
purchases a solid waste processing, disposal, and electric generating facility
under section 46-19.1.
"Sale and leaseback" means a
transaction in which a facility is sold by a political subdivision to a private
entity for cash, under an installment sale, a financing lease, or similar
arrangement, or any combination thereof, where the political subdivision has
the right to repurchase the facility at a later date, and where the facility is
leased to an operator of the facility.
"Solid waste processing, disposal, and
electric generating facility" or "facility" means a facility for
the processing and disposal of solid waste or the generation of electric
energy, or both, the construction of which has been financed pursuant to
section 47-4 and constitutes an undertaking as defined in section 49-1.