Government Operations

Amends Act 230, SLH 1998, to establish specific duties for the
managed process committee and specifies deadlines by which the
committee must complete reports and findings to the legislature.

THE SENATE                              S.B. NO.           S.D. 1
TWENTIETH LEGISLATURE, 1999                                H.D. 2
STATE OF HAWAII                                            C.D. 1

                   A  BILL  FOR  AN  ACT



 1      SECTION 1.  Act 230, Session Laws of Hawaii 1998, is amended
 2 as follows:
 3      1.  By amending section 6 to read:
 4      "SECTION 6.  (a)  There is created a committee that shall
 5 develop a managed process that enables state and county
 6 governments to implement public-private competition for
 7 government services through the managed process that determines
 8 whether a particular service can be provided more efficiently,
 9 effectively, and economically by a public agency or a private
10 enterprise.  The managed process shall [consider] include but not
11 be limited to:
12      (1)  Consideration of all relevant costs, [identify]
13           development of a costing model that accurately
14           estimates and accounts for the total cost of providing
15           a government function, and development of methods by
16           which government in-house costs can be compared to
17           private sector costs;
18      (2)  Consideration of the costs of conversion to the private
19           sector, including transaction costs, disruption costs,

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 1           contract monitoring costs, and revenue increases or
 2           decreases;
 3      (3)  Identification of the types of contracts which may be
 4           exempt from the managed process[, establish];
 5      (4)  Establishment of protections for the affected state and
 6           county employees[, and ensure];
 7      (5)  Ensuring that civil service laws, merit principles, and
 8           collective bargaining laws are not violated[.];
 9      (6)  Ensuring that all costs, including the costs of
10           liability insurance, product and performance liability,
11           fringe and employee retirement, disability benefits,
12           and other allocated direct and indirect overhead costs
13           are realistic and fair; and
14      (7)  Development of a handbook and training program that
15           educates government agencies in the competitive
16           government process.
17      (b)  The committee members shall be appointed by the
18 governor within sixty days from the date of this Act.
19      The members of the committee shall include:
20      (1)  The director of finance;
21      (2)  The comptroller;
22      (3)  The director of human resources development;
23      (4)  One representative from each of the four major counties

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 1           to be appointed by the respective mayors;
 2      (5)  Two public-sector union representatives;
 3      (6)  One private-sector union representative;
 4      (7)  Two representatives for private-sector businesses; and
 5      (8)  One representative for nonprofit organizations that is
 6           a recipient or is entitled to be a recipient under
 7           chapters 42D and 42F, Hawaii Revised Statutes.
 8      The committee shall elect a chairperson and vice-chairperson
 9 from among its members.  A majority of the members shall
10 constitute a quorum.  The department of accounting and general
11 services shall provide administrative support for the committee.
12 Members of the committee shall serve without compensation.  The
13 committee shall complete a draft of the managed process by
14 December 31, 2000, and complete the managed process by
15 December 31, 2001.  The committee shall submit [its report,
16 including its] a report of its findings, plans, implementations,
17 and recommendations for statutory changes to civil service laws
18 and such other laws as may be necessary to implement the managed
19 process, to the legislature not less than twenty days prior to
20 the convening of [the 1999] each regular session of the
21 legislature."
22      2.  By amending subsections (b) and (c) of section 14 to
23 read:

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 1      "(b)  All new contracts for goods, services, or construction
 2 which are entered into by the State or county after the effective
 3 date of this Act [and prior to July 1, 2001, which extend beyond
 4 June 30, 2001,] shall include a provision stating that the
 5 contract, during its term, is subject to a single review by the
 6 State or county pursuant to the managed process in Part III,
 7 Section 6.  Pursuant to the managed process review, the contract
 8 may be canceled, renegotiated, continued, or extended by the
 9 State or county.  All of these contracts shall continue to be
10 exempt from civil service laws, merit principles, and collective
11 bargaining laws for the duration of the contract even if a
12 managed process is not implemented.
13      (c)  All contracts for goods, services, or construction
14 which are entered into by the State or county on or before the
15 effective date of this Act[, including contracts which extend
16 beyond June 30, 2001,] shall not be subject to review by the
17 State or county pursuant to the managed process in Part III,
18 Section 6.  All of these contracts shall continue to be exempt
19 from civil service laws and merit principles for the duration of
20 the contract."
21      3.  By amending section 17 to read:
22      "SECTION 17.  This Act shall take effect upon approval[;
23 provided that Part III and IV shall be repealed on June 30,

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 1 2001]."
 2      SECTION 2.  Statutory material to be repealed is bracketed.
 3 New statutory material is underscored.
 4      SECTION 3.  This Act shall take effect upon its approval.