Government Operations

Amends Act 230, SLH 1998, to: require the committee to transform
the State's accounting procurement and budgeting systems, and the
managed process committee, to annually report to legislature;
establish specific duties for the managed process committee;
specify further duties of the managed process committee; and
delete the sunset date.  (SD1)

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

                   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 5 to read:
 4      "SECTION 5.  The committee shall submit annual reports of
 5 its plans, recommendations, and implementing actions to the
 6 legislature no fewer than fifteen days before the convening of
 7 [the] each regular [sessions of 1999, 2000, and 2001.] session."  
 8      2.  By amending section 6 to read:
 9      "SECTION 6.  (a)  There is created a committee that shall
10 develop, monitor, and review a managed process that enables state
11 and county governments to implement public-private competition
12 for government services through the managed process that
13 determines whether a particular service can be provided more
14 efficiently, effectively, and economically by a public agency or
15 a private enterprise.  The managed process shall [consider]:
16      (1)  Consider all relevant costs, [identify] develop a
17           costing model that accurately estimates and accounts
18           for the total cost of providing a government function
19           and develop methods by which government in-house costs

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                                     S.B. NO.           S.D. 1

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

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                                     S.B. NO.           S.D. 1

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

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                                     S.B. NO.           S.D. 1

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

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                                     S.B. NO.           S.D. 1

 1      "SECTION 17.  This Act shall take effect upon approval[;
 2 provided that Part III and IV shall be repealed on
 3 June 30, 2001]."
 4      SECTION 2.  Statutory material to be repealed is bracketed.
 5 New statutory material is underscored.
 6      SECTION 3.  This Act shall take effect upon its approval.