Despite pushback from some hotel and commercial property owners, lawmakers this week continued to mull plans to require real estate investment trusts to pay Hawaii corporate income taxes, and reached agreements on some criminal justice bills.

As the final deadlines approach for this year’s session, the House and Senate have tentatively agreed to reform the state’s criminal property forfeiture law, and to demand more information from the state corrections system when inmates or staff die in prisons or jails.

Lawmakers have until Friday to put the finishing touches on all bills to get them ready for final votes this week and next week ahead of the scheduled adjournment May 2, and dozens of tax and other bills are still hanging in the balance.

Nareit Hawaii, an advocacy organization for real estate investment trusts, has bought local advertisements warning construction industry workers that Senate Bill 301 could slow the pace of investment and construction if it imposes new taxes on REITs.

“New taxes on REITs are a bad idea for our economy and for our working families,” according to the ads. REITs have made major investments in Hawaii, including in developments such as Ala Moana Center, the International Market Place and Ka Makana Alii Shopping Center.

Under federal law REITs are required to pay out at least 90% of their taxable income as dividends to their shareholders each year, and Hawaii and 48 other states allow REITs to deduct those dividends for tax purposes.

That means REITs are able to avoid paying state corporate income taxes on their earnings, and a coalition of nonprofits and other advocates is urging lawmakers to change that.

“It is my belief that all businesses operating in Hawaii should pay income tax,” said Michael Fergus, who has lobbied for years to eliminate the REIT tax break. “There is $18 billion of REIT property in Hawaii not paying income tax, up from $10 billion 10 years ago. While the REIT structure can be beneficial to small investors, it is a huge loophole for big investors.”

Others warn that REITs may scale back their investments in Hawaii if the bill passes.

Scott Winer, senior vice president for Park Hotels & Resorts Inc. said Wednesday that if SB 301 passes, that would put Park’s plans for a new hotel tower next to its Hilton Hawaiian Village Waikiki Beach Resort “in significant jeopardy.”

Park acquired land next to Hilton Hawaiian Village and is developing plans for that new tower, but imposing the state income tax on REITs “would impact the return on investment, and it would cause us to pause if not cancel the project altogether,” Winer said in an interview.

A House-Senate conference committee that is considering the bill is scheduled to meet again at 10 a.m. Friday.

In other developments at the state Capitol:

>> House Democratic Majority Leader Della Au Belatti announced Wednesday the House plans to give final approval to a bill requiring the state Department of Public Safety to notify the governor within 48 hours of any deaths of inmates or staff in state facilities or private prisons that house Hawaii inmates.

Under House Bill 336 the governor would then be required to report to state lawmakers the cause of death as well as whether there was any indication that a sexual assault was involved. Corrections officials would be required to submit more detailed reports to the governor within 30 days of the incident.

>> House leaders also signaled Wednesday that they will agree to the latest draft of House Bill 748, which would make changes to Hawaii’s civil asset forfeiture program.

That program allows law enforcement to seize cash and property when it is believed to be connected to criminal activity, and the system “frequently” results in property being permanently confiscated even when the owners are not charged or convicted of a crime, according to the bill.

HB 748 would allow property to be forfeited only if the owner is convicted of a felony.