Establishes a Local Agriculture Transportation Cost Reimbursement Pilot Program within the Department of Agriculture and Biosecurity to reimburse eligible ranchers and farmers a portion of their costs to transport livest, the official text

HOUSE OF REPRESENTATIVES

H.B. NO.

1707

THIRTY-THIRD LEGISLATURE, 2026

H.D. 1

STATE OF HAWAII

S.D. 2

C.D. 1

A BILL FOR AN ACT

RELATING TO AGRICULTURE.

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

SECTION 1.  The
legislature finds that increasing local agricultural production is essential to
the long-term sustainability and food security of the State.  However, local agricultural producers face
significant economic challenges, particularly with the high costs of
transporting agricultural products and necessary supplies across the
State.  In a recent survey report on
Hawaii commercial agricultural expansion, thirty-nine per cent of participating
local ranchers and farmers cited shipping and transportation costs as a leading
barrier to the expansion of their agricultural production.  These transportation costs place undue strain
and financial burdens on farmers and ranchers, limiting their ability to
compete in local markets and reducing the overall productivity of Hawaii's
agricultural sector.  Additionally, in
response to the economic tariffs being implemented by the Trump administration,
the department of transportation harbors division reported that effective July
1, 2025, the tariff for wharfage and pipeline toll rates will reflect a 4.1 per
cent increase, further adding to the strain on local producers.

The legislature recognizes that, to
successfully scale up local production, the establishment of a cost
reimbursement program that offsets the increased transportation costs of
agricultural producers is necessary to ensure growth in the agricultural
sector.  The financial relief provided by
a cost reimbursement program would help strengthen local agriculture, encourage
greater self-sufficiency, support the State's broader efforts to diversify its
economy, and promote sustainable agricultural practices.

Accordingly, the purpose of this Act is to establish
a local agriculture transportation cost reimbursement pilot program to ensure
that certain local agricultural producers, including those that manage
livestock and produce essential commodities and those engaged in floriculture
and nursery production, receive support to offset the high costs of
transporting goods to market and to obtain necessary supplies.

SECTION 2.
Chapter 141, Hawaii Revised Statutes, is amended by adding a new section
to be appropriately designated and to read as follows:

"§141-   Local agriculture transportation cost
reimbursement pilot program; rules.  (a)
There is established within the department of agriculture and
biosecurity a local agriculture transportation cost reimbursement pilot program
to reimburse eligible agricultural producers for a portion of the producer's
costs to transport agricultural commodities.

(b)  To be eligible to receive
reimbursement payments pursuant to this section, an agricultural producer shall:

(1)  Be an owner of livestock or a
producer of agricultural commodities in the State; a cooperative aggregator or
food hub; or a start-up or small-scale farmer, with proof of commercial intent,
that earns below the threshold of gross receipts under paragraph (3);

(2)  Incur costs for transporting
in a covered motor vehicle or through air cargo, parcel, or water cargo carrier
services:

(A)  Livestock, livestock products, or agricultural commodities to
market within the State; or

(B)  Necessary supplies for the use of the agricultural producer; and

(3)  Provide to the department of
agriculture and biosecurity proof that the agricultural producer has annual
gross receipts totaling $2,500 or more or, if the agricultural producer is a
start-up or small‑scale farmer, provide to the department proof of
commercial intent.

(c)  The total amount of reimbursement
payments disbursed pursuant to this section shall not exceed $2,000,000 in any year.  No single producer shall receive more than
$25,000 or fifty per cent of the producer's eligible transportation costs per
fiscal year, whichever is less, and no single cooperative aggregator or food
hub shall receive more than $50,000 or fifty per cent of the aggregator's or
food hub's eligible transportation costs per fiscal year, whichever is less.

(d)  The department of agriculture and biosecurity
shall submit an annual report to the legislature no later than
twenty days prior to the convening of each regular session.  The report shall include:

(1)  The
total number of producers reimbursed;

(2)  The
total amount of funds disbursed; and

(3)  Any
recommendations for improvements or modifications to the program, including any
proposed legislation.

(e)  The department of agriculture and biosecurity
may establish rules pursuant to chapter 91 necessary to carry out the
purposes of this section.

(f)  For the purposes of this section:

"Agricultural
commodity" has the same meaning as defined in section 145-21, including
nursery production and honey.

"Covered
motor vehicle" means a motor vehicle:

(1)  Registered
and owned by an owner of livestock or a producer of agricultural commodities in
the State; and

(2)  Used
for the transport of livestock, livestock products, agricultural commodities,
and necessary supplies within the State.

"Necessary
supplies" means chemicals, feed, fertilizer, fuel, seeds, plants,
supplies, equipment parts, and other inputs as determined by the department of
agriculture and biosecurity."

SECTION 3.
There is appropriated out of the general revenues of the State of Hawaii
the sum of $1,000,000 or so much thereof as may be necessary for fiscal year
2026-2027 for the department of agriculture and biosecurity to fund and
administer the local agriculture transportation cost reimbursement pilot
program established pursuant to this Act.

The sum appropriated shall be expended by
the department of agriculture and biosecurity for the purposes of this Act.

SECTION 4.
There is appropriated out of the general revenues of the State of Hawaii
the sum of $55,200 or so much thereof as may be necessary for fiscal year
2026-2027 to establish and fund one full-time
equivalent (1.0 FTE) position within the department of agriculture and
biosecurity to administer the local agriculture transportation cost
reimbursement pilot program established pursuant to this Act.

The sum appropriated shall be expended by
the department of agriculture and biosecurity for the purposes of this Act.

SECTION 5.
New statutory material is underscored.

SECTION 6.
This Act shall take effect on July 1, 2026, and shall be repealed on
June 30, 2029.