Fighting to Keep High-tech Tax Credits-Act 221 is Working and Must be Allowed to Run its Course

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The Hawaii Technology Trade Association has been working hard this legislative session to prevent short-sighted changes from being made to Act 221. With the support of our Legislature, changes requested by the Administration have been averted to date.

On March 25, Gov. Linda Lingle announced her administration’s budget plans for fiscal years 2003-2005. In the administration’s attempt to balance the budget today, they are willing to abandon Hawaii’s high-tech future.


The administration continues to look only at the cost of the credit. By their own admission, they have no numbers or estimates for the additional tax revenue that is generated by the multiplier effect of tech companies using Act 221 credits to fund additional research, hire new employees, accelerate development and grow their businesses. Act 221 is not only helping our local tech companies, but is also attracting companies from the mainland. A large top tier venture fund, a major defense/aerospace company and several established biotech companies are poised to relocate to Hawaii as a direct result of Act 221. Act 221 is working and must be allowed to run its course.

HTTA recently announced the results of an informal study, which showed 15 tech companies projecting more than 1,000+ new high-paying, quality jobs created as a direct result of Act 221. With more and more companies securing Act 221 funding, the projected number of new jobs can accelerate quickly into the tens of thousands.

In the administration’s attempt to balance the budget today, thousands of jobs will never be created, hundreds of local people won’t get the chance to attain higher paying, quality jobs, and scores of kamaaina on the mainland will not be able to return home.

As one of our members stated, “Any farmer knows that there are two types of corn — feed corn and seed corn. You do not eat your seed corn, because it is your investment in the future. Unfortunately, the administration wants to undo the investment in “seed corn” that the Hawaii Legislature created called Act 221.

The governor needs to hear from you. Email, fax and call the governor and ask her to support Act 221, Hawaii’s tech industry and Hawaii’s economic future. Tell her about your personal successes or planned use of Act 221 and underscore “No changes to Act 221.” Please feel free to copy me at Send the governor an email at: Fax her at: 586-0006 or call 586-0034.

State legislators should be commended for the vision and courage they demonstrated in enacting Act 221 and underscore “No changes to Act 221.” Now is also the time to thank the Legislature for supporting Hawaii’s tech future. Email addresses of legislators on specific committees and leadership are in the following links: “Representatives at a Glance” and “Senators at a Glance”

”’Ann Chung is the Executive Director of the HTTA, a high-tech industry association working to build Hawaii’s technology industry and diversify Hawaii’s economy. She can be reached via email at:”’