REPORT TITLE:
UH Autonomy


DESCRIPTION:
Provides complete autonomy to the University of Hawaii, by making
its status comparable to that of the judiciary.  Makes all
employees subject to the university's personnel system, and
removes all university employees from civil service.  Eliminates
director of finance and governor from the university budgetary
process.  (SD1)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        538
THE SENATE                              S.B. NO.           S.D. 1
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                             
________________________________________________________________
________________________________________________________________


                     A BILL FOR AN ACT

RELATING TO THE UNIVERSITY OF HAWAII.


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

 1      SECTION 1.  The legislature finds that a strong university
 
 2 system can be a significant contributor to a robust economy,
 
 3 providing both quality higher education and dollars for the
 
 4 surrounding communities.  The legislature further finds that
 
 5 those universities that contribute to a significant degree to the
 
 6 community's economic well being have broad authority to respond
 
 7 to changing opportunities.
 
 8      In recent years, the University of Hawaii has been granted
 
 9 increasing fiscal autonomy from the executive branch.  Last year,
 
10 the legislature passed a broad-based measure that gave the
 
11 university increased authority to manage its assets, personnel,
 
12 and programs.  Although the university received increased
 
13 autonomy, the legislature further finds that it is necessary to
 
14 grant the University of Hawaii complete autonomy from the
 
15 executive branch to maximize the university's potential to grow
 
16 as a world-class institution and contribute to the State's
 
17 economic revitalization.
 
18      The purpose of this Act is to provide the University of
 
19 Hawaii with complete autonomy from the executive branch in order
 
20 to provide the university with opportunities and incentives for
 

 
Page 2                                                     538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 developing an entrepreneurial, competitive role and contributing
 
 2 to Hawaii's economic growth.
 
 3      SECTION 2.  Chapter 304, Hawaii Revised Statutes, is amended
 
 4 by adding a new section to be appropriately designated and to
 
 5 read as follows:
 
 6      "304-    Administration; budget preparation and submission.
 
 7 (a)  The board of regents shall make an annual report to the
 
 8 legislature, at each regular session thereof, of the business of
 
 9 the University of Hawaii and of the administration of the
 
10 university system throughout the State.  The board of regents
 
11 shall present to the legislature a unified budget, six-year
 
12 program and financial plan, and variance report for all of the
 
13 colleges, departments, and programs of the University of Hawaii.
 
14 The president of the university, who shall be appointed by the
 
15 board of regents, shall direct the administration of the
 
16 University of Hawaii with responsibility for the efficient
 
17 operation of all of the colleges, departments, and programs.
 
18      (b)  The president of the university shall possess the
 
19 following powers, that may be delegated by the board of regents:
 
20      (1)  To prescribe for all of the colleges, departments, and
 
21           programs, a uniform system of keeping and periodically
 
22           reporting statistics of their business;
 
23      (2)  To procure from all of the colleges, departments, and
 

 
Page 3                                                     538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1           programs, estimates for their appropriations; with the
 
 2           cooperation of the representatives of the colleges,
 
 3           departments, and programs concerned to review and
 
 4           revise them as the president deems necessary for the
 
 5           equitable provision for the various colleges,
 
 6           departments, or programs according to their needs and
 
 7           to present the estimates, as reviewed and revised by
 
 8           the board of regents, to the legislature as
 
 9           collectively constituting a unified budget for all of
 
10           the University of Hawaii;
 
11      (3)  To exercise exclusive authority over the preparation,
 
12           explanation, and administration of the University of
 
13           Hawaii budget, programs, plans, and expenditures,
 
14           including without limitation policies and practices of
 
15           financial administration and the establishment of
 
16           guidelines as to permissible expenditures; provided
 
17           that all expenditures of the University of Hawaii shall
 
18           be in conformance with program appropriations and
 
19           provisions of the legislature; and
 
20      (4)  To do all other acts which may be necessary or
 
21           appropriate for the administration of the University of
 
22           Hawaii.
 
23      (c)  The budget, six-year program and financial plan, and
 

 
Page 4                                                     538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 the variance report of the University of Hawaii shall be
 
 2 submitted by the board of regents to the legislature in
 
 3 accordance with the schedule of submission specified for the
 
 4 governor in chapter 37 and shall contain the program information
 
 5 prescribed in that chapter.  By November 1 of each year preceding
 
 6 a legislative session in which a budget is to be submitted, the
 
 7 board of regents shall provide written notification to the
 
 8 governor of the proposed total expenditures, by cost categories
 
 9 and sources of funding, and estimated revenues of the University
 
10 of Hawaii for each fiscal year of the next fiscal biennium.
 
11      (d)  If the governor in anticipation of a revenue shortfall
 
12 restricts the expenditures of general fund appropriations by
 
13 executive branch departments and agencies by a total
 
14 of        per cent or more of the total general fund
 
15 appropriation to the executive branch in a fiscal year, where at
 
16 the end of the fiscal year those funds will lapse into the
 
17 general fund, the governor shall inform the legislature and the
 
18 board of regents of this action.  Once the board of regents is
 
19 informed of the governor's action, then the board of regents
 
20 shall also restrict the expenditure of general fund
 
21 appropriations made to the university system by an equal
 
22 percentage.  If in the same fiscal year the governor increases
 
23 the percentage of general fund expenditures restricted to more
 

 
Page 5                                                     538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 than that         per cent and informs the legislature and the
 
 2 board of regents of this increase, the board of regents shall
 
 3 increase its restriction of the expenditure of general fund
 
 4 appropriations in an equal percentage."
 
 5      SECTION 3.  Section 26-4, Hawaii Revised Statutes, is
 
 6 amended to read as follows:
 
 7      "26-4 Structure of government.  Under the supervision of
 
 8 the governor, all executive and administrative offices,
 
 9 departments, and instrumentalities of the state government and
 
10 their respective functions, powers, and duties shall be allocated
 
11 among and within the following principal departments that are
 
12 hereby established:
 
13      (1)  Department of human resources development (Section
 
14           26-5)
 
15      (2)  Department of accounting and general services (Section
 
16           26-6)
 
17      (3)  Department of the attorney general (Section 26-7)
 
18      (4)  Department of budget and finance (Section 26-8)
 
19      (5)  Department of commerce and consumer affairs (Section
 
20           26-9)
 
21      (6)  Department of taxation (Section 26-10)
 
22     [(7)  University of Hawaii (Section 26-11)
 
23      (8)] (7)  Department of education (Section 26-12)
 

 
Page 6                                                     538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1     [(9)] (8)  Department of health (Section 26-13)
 
 2    [(10)] (9)  Department of human services (Section 26-14)
 
 3    [(11)] (10)  Department of land and natural resources (Section
 
 4           26-15)
 
 5    [(12)] (11)  Department of agriculture (Section 26-16)
 
 6    [(13)] (12)  Department of Hawaiian home lands (Section 26-17)
 
 7    [(14)] (13)  Department of business, economic development, and
 
 8           tourism (Section 26-18)
 
 9    [(15)] (14)  Department of transportation (Section 26-19)
 
10    [(16)] (15)  Department of labor and industrial relations
 
11           (Section 26-20)
 
12    [(17)] (16)  Department of defense (Section 26-21)
 
13    [(18)] (17)  Department of public safety (Section 26-14.6)"
 
14      SECTION 4.  Section 26-25, Hawaii Revised Statutes, is
 
15 amended to read as follows:
 
16      "[[]26-25[]]  Services to the judiciary [and],
 
17 legislature[.], and the University of Hawaii.  Any executive
 
18 department may provide services to the judiciary [and], the
 
19 legislature, and the University of Hawaii, but nothing in this
 
20 part and this chapter shall be construed as granting any
 
21 authority to the governor or any department to exercise control
 
22 over the organization, programs, functions, operations, and
 
23 expenditures of the judiciary [and], the legislature[.], and the
 

 
Page 7                                                     538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 University of Hawaii."
 
 2      SECTION 5.  Section 26-52, Hawaii Revised Statutes, is
 
 3 amended to read as follows:
 
 4      "26-52  Department heads and executive officers.  The
 
 5 salaries of the following state officers shall be as follows:
 
 6      (1)  The salary of the superintendent of education shall be
 
 7           $90,041 a year;
 
 8     [(2)  The salary of the president of the University of Hawaii
 
 9           shall be set by the board of regents;
 
10      (3)] (2)  The salaries of all department heads or executive
 
11           officers of the departments of accounting and general
 
12           services, agriculture, attorney general, budget and
 
13           finance, business, economic development, and tourism,
 
14           commerce and consumer affairs, Hawaiian home lands,
 
15           health, human resources development, human services,
 
16           labor and industrial relations, land and natural
 
17           resources, public safety, taxation, and transportation
 
18           shall be $85,302 a year; and
 
19     [(4)] (3)  The salary of the adjutant general shall be
 
20           $85,302 a year; provided that if this salary is in
 
21           conflict with the pay and allowance fixed by the tables
 
22           of the regular army or air force of the United States,
 
23           the latter shall prevail."
 

 
Page 8                                                     538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1      SECTION 6.  Section 37-31, Hawaii Revised Statutes, is
 
 2 amended to read as follows:
 
 3      "37-31  Intent and policy.  It is declared to be the policy
 
 4 and intent of the legislature that the total appropriations made
 
 5 by it, or the total of any budget approved by it, for any
 
 6 department or establishment, shall be deemed to be the maximum
 
 7 amount authorized to meet the requirements of the department or
 
 8 establishment for the period of the appropriation, excepting as
 
 9 may otherwise be provided by law, and that the governor and the
 
10 director of finance should be given the powers granted by
 
11 sections 37-32 to 37-41 in order that savings may be effected by
 
12 careful supervision throughout each appropriation period with due
 
13 regard to changing conditions; and by promoting more economic and
 
14 efficient management of state departments and establishments[.];
 
15 provided that this part shall not apply to the appropriations
 
16 made by the legislature to the University of Hawaii."
 
17      SECTION 7.  Section 37-34, Hawaii Revised Statues, is
 
18 amended to read as follows:
 
19      "37-34  Appropriations available for allotment; estimate of
 
20 expenses.(a)  No appropriation to which the allotment system is
 
21 applicable shall become available to any department or
 
22 establishment for expenditure during any allotment period until
 
23 the department or establishment submits an estimate to the
 

 
Page 9                                                     538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 director of finance, at whatever time prior to the beginning of
 
 2 the allotment period and in whatever form as the director may
 
 3 prescribe, of the amount required to carry on the work of the
 
 4 department or establishment during that period and until the
 
 5 estimate is approved, increased, or decreased by the director and
 
 6 funds are allotted pursuant to section 37-35.
 
 7      [(b)  Before appropriations for the University of Hawaii
 
 8 become available to the university, the university shall advise
 
 9 the governor and the director of finance of the amount necessary
 
10 for payments for financing agreements under chapter 37D, the
 
11 governor, with the assistance of the director of finance, as may
 
12 be necessary, shall establish allotment ceilings for each source
 
13 of funding of all of the appropriations of the University of
 
14 Hawaii for each allotment period and shall advise the university
 
15 of these determinations.
 
16      (c)] (b)  Any other law to the contrary notwithstanding,
 
17 general fund appropriations for the operating expenses of public
 
18 health facilities shall be made available to the public health
 
19 facilities for expenditure during any allotment period."
 
20      SECTION 8.  Section 37-35, Hawaii Revised Statutes, is
 
21 amended to read as follows:
 
22      "37-35  Estimated expenditures; approval.  The director of
 
23 finance shall review all estimates submitted under section 37-34
 

 
Page 10                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 and, having due regard for:
 
 2      (1)  The probable further needs of the department or
 
 3           establishment for the remainder of the term for which
 
 4           the appropriation was made;
 
 5      (2)  The terms and purposes of the appropriation, the
 
 6           progress of collection of revenues, and condition of
 
 7           the treasury; and
 
 8      (3)  The probable receipts and total cash requirements for
 
 9           the ensuing quarter, shall approve, increase, or reduce
 
10           the amount of the estimate[;
 
11 provided that the director of finance shall approve the estimates
 
12 submitted by the University of Hawaii when:
 
13      (1)  The sum of the estimates for each funding source does
 
14           not exceed the applicable allotment ceilings
 
15           established by the governor under section 37-34;
 
16      (2)  The progress of collection of revenues, the condition
 
17           of the treasury, and the probable receipts and total
 
18           cash requirements for the ensuing quarter permit; and
 
19      (3)  All other legal requirements are satisfied].
 
20 The director shall act promptly upon all estimates and notify
 
21 each department or establishment of its allotment, and shall
 
22 notify the comptroller."
 
23      SECTION 9.  Section 37-36, Hawaii Revised Statutes, is
 

 
Page 11                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 amended by amending subsection (a) to read as follows:
 
 2      "(a)  The director of finance may modify or amend any
 
 3 previous allotment upon notice to the department or establishment
 
 4 concerned; provided that:
 
 5      [(1) For the University of Hawaii, the director of finance
 
 6           may modify or amend any previous allotment only upon
 
 7           application of or notice to the university, and upon
 
 8           public declaration, which shall be made ten days prior
 
 9           to the modification or amendment taking effect;
 
10      (2)] (1)  The modification or amendment shall be made only
 
11           to avoid an illegal result or in anticipation of a
 
12           revenue shortfall;
 
13     [(3)] (2)  No deficit or undue reduction of funds to meet
 
14           future needs of the department or establishment will
 
15           result from the modification or amendment; and
 
16     [(4)] (3)  No modification or amendment shall reduce an
 
17           allotment below the amount required to meet valid
 
18           obligations or commitments previously incurred against
 
19           the allotted funds."
 
20      SECTION 10.  Section 37-37, Hawaii Revised Statutes, is
 
21 amended to read as follows:
 
22      "37-37  Reduction.(a)  [Except as provided in subsection
 
23 (b), when] When the director of finance determines at any time
 

 
Page 12                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 that the probable receipts from taxes or any other sources for
 
 2 any appropriation will be less than was anticipated, and that
 
 3 consequently the amount available for the remainder of the term
 
 4 of the appropriation or for any allotment period will be less
 
 5 than the amount estimated or allotted therefor, the director
 
 6 shall, with the approval of the governor and after notice to the
 
 7 department or establishment concerned, reduce the amount allotted
 
 8 or to be allotted; provided that no reduction reduces any
 
 9 allotted amount below the amount required to meet valid
 
10 obligations or commitments previously incurred against the
 
11 allotted funds.
 
12      [(b)  For the University of Hawaii, when the director of
 
13 finance determines at any time that the probable receipts from
 
14 taxes or any other sources for any appropriation will be less
 
15 than was anticipated, and that consequently the amount available
 
16 for the remainder of the term of the appropriation or for any
 
17 allotment period will be less than the amount estimated or
 
18 allotted therefor, the director shall advise the governor of the
 
19 situation, and the governor shall redetermine the allotment
 
20 ceiling for the affected source or sources of funding pursuant to
 
21 section 37-34, and shall advise the university and make a public
 
22 declaration ten days prior to the effective date of the
 
23 redetermination.  The university, not more than twenty days after
 

 
Page 13                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 the governor's notification, shall submit revised estimates
 
 2 consistent with the governor's redetermination to the director of
 
 3 finance.  Otherwise, the director of finance shall modify, amend,
 
 4 or reduce any allotment of the university to comply with the
 
 5 governor's redetermination; provided that no reduction shall
 
 6 reduce any allotted amount below the amount required to meet
 
 7 valid obligations or commitments previously incurred against the
 
 8 allotted funds.
 
 9      (c)] (b)  Prior to the implementation of any reduction in
 
10 allotment proposed by the director of finance or the governor
 
11 pursuant to subsection (a) [or (b)], in which the sum of the
 
12 reductions exceed 2.5 per cent of the total general fund
 
13 appropriation made by the legislature in any fiscal year, the
 
14 director of finance shall notify the president of the senate, the
 
15 speaker of the house of representatives, and the chairpersons of
 
16 the senate committee on ways and means and the house of
 
17 representatives committee on finance, respectively, of the
 
18 director's intent."
 
19      SECTION 11.  Section 37-62, Hawaii Revised Statutes, is
 
20 amended by amending the definition of "agency" to read as
 
21 follows:
 
22      ""Agency" means any executive department, independent
 
23 commission, board, agency, authority, bureau, office, or other
 

 
Page 14                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 establishment of the state government (except the legislature
 
 2 [and], the judiciary[)], and the University of Hawaii), or any
 
 3 quasi-public institution which is supported in whole or in part
 
 4 by state funds."
 
 5      SECTION 12.  Section 37-74, Hawaii Revised Statutes, is
 
 6 amended by amending subsections (b) to (d) to read as follows:
 
 7      "(b)  The appropriations by the legislature for a biennium
 
 8 shall be allocated between the two fiscal years of the biennium
 
 9 in the manner provided in the budget or appropriations act and as
 
10 further prescribed by the director of finance.  The amounts
 
11 allocated for each fiscal year shall be subject to the allotment
 
12 system prescribed in chapter 37, part II.  Each agency (except
 
13 the courts[),] and the University of Hawaii), in estimating its
 
14 quarterly requirements under chapter 37, part II, shall prepare a
 
15 plan for the fiscal year for the operation of each of the
 
16 programs it is responsible for administering.  The operations
 
17 plan shall be in such form and content as the department of
 
18 budget and finance may prescribe.  It shall be submitted,
 
19 together with the estimated quarterly requirements, to the
 
20 department of budget and finance on such date as the department
 
21 may prescribe.
 
22      (c)  The department of budget and finance shall:
 
23      (1)  Review each operations plan to determine:
 

 
Page 15                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1           (A)  That it is consistent with the policy decisions of
 
 2                the governor and appropriations by the
 
 3                legislature;
 
 4           (B)  That it reflects proper planning and efficient
 
 5                management methods; and
 
 6           (C)  That appropriations have been made for the planned
 
 7                purpose and will not be exhausted before the end
 
 8                of the fiscal year;
 
 9           [provided that the department of budget and finance
 
10           shall review the operations plan submitted by the
 
11           University of Hawaii solely for consistency with the
 
12           allotment ceilings established by the governor under
 
13           section 37-34, appropriations by the legislature, and
 
14           the status of revenues to support operations plans for
 
15           all state programs;]
 
16      (2)  Approve the operations plan if satisfied that it meets
 
17           the requirements under paragraph (1).  Otherwise, the
 
18           department of budget and finance shall require revision
 
19           of the operations plan in whole or in part; and
 
20      (3)  Modify or withhold the planned expenditures at any time
 
21           during the appropriation period if the department of
 
22           budget and finance finds that the expenditures are
 
23           greater than those necessary to execute the programs at
 

 
Page 16                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1           the level authorized by the governor and the
 
 2           legislature, or that state receipts and surpluses will
 
 3           be insufficient to meet the authorized expenditure
 
 4           levels[; provided that the planned expenditures for the
 
 5           University of Hawaii may be modified or withheld only
 
 6           in accordance with sections 37-36 and 37-37].
 
 7      (d)  No appropriation transfers or changes between programs
 
 8 or agencies shall be made without legislative authorization;
 
 9 provided that:
 
10      (1)  Authorized transfers or changes, when made, shall be
 
11           reported to the legislature; and
 
12      (2)  [Except with respect to appropriations to fund
 
13           financing agreements under chapter 37D, the University
 
14           of Hawaii shall have the flexibility to transfer
 
15           appropriated funds and positions for the operating cost
 
16           category among programs, among cost elements in a
 
17           program, and between quarters, as applicable; and the]
 
18           The Hawaii health systems corporation shall have the
 
19           flexibility to transfer special fund appropriations
 
20           among community hospitals facilities as applicable;
 
21           provided that the Hawaii health systems corporation
 
22           shall maintain the integrity and services of each
 
23           individual facility and shall not transfer
 

 
Page 17                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1           appropriations out of any facility that would result in
 
 2           a reduction of services offered by the facility, with
 
 3           due regard for statutory requirements, changing
 
 4           conditions, the needs of the programs, and the
 
 5           effective utilization of resources[; and
 
 6      (3)  The university shall account for each transfer
 
 7           implemented under this subsection in quarterly reports
 
 8           to the governor and annual reports at the end of each
 
 9           fiscal year to the legislature and the governor, which
 
10           shall be prepared in the form and manner prescribed by
 
11           the governor and shall include information on the
 
12           sources and uses of the transfer]."
 
13      SECTION 13.  Section 37-92, Hawaii Revised Statutes, is
 
14 amended to read as follows: 
 
15      "37-92  Proposed general fund appropriations; executive
 
16 branch; judicial branch[.]; and University of Hawaii.  (a)  The
 
17 governor shall submit a plan of proposed appropriations for the
 
18 State to the legislature which shall accompany the state budget
 
19 in odd-numbered years and the supplemental budget in even-
 
20 numbered years.  The plan of proposed appropriations shall
 
21 include the executive budget, proposed grants to private
 
22 entities, and any specific appropriation measures to be proposed
 
23 by the executive branch, and estimates of the aggregate proposed
 

 
Page 18                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 appropriations of the the judicial and legislative branches of
 
 2 government[.], and the University of Hawaii.  In any year in
 
 3 which the plan of proposed appropriations from the general fund
 
 4 exceeds the expenditure ceiling, the governor shall set forth the
 
 5 dollar amount, the rate by which the expenditure ceiling would be
 
 6 exceeded, and the reasons for proposing appropriations in excess
 
 7 of those allowed under the expenditure ceiling.
 
 8      (b)  The proposed appropriations from the general fund for
 
 9 each year of the biennium or each supplementary budget fiscal
 
10 year for the executive and judicial branches and the University
 
11 of Hawaii shall not be increased over the appropriations from the
 
12 general fund for the preceding fiscal year for each branch[,] and
 
13 the University of Hawaii, respectively, by more than the state
 
14 growth, except as provided in this section.  For purposes of this
 
15 subsection, the appropriations from the general fund for the
 
16 executive and judicial branches and the University of Hawaii
 
17 shall not include any appropriations representing amounts
 
18 authorized by the legislature under section 37-93(b).
 
19      (c)  The governor shall submit a plan of proposed
 
20 appropriations for the executive branch to the legislature which
 
21 shall accompany the state budget in odd-numbered years and the
 
22 supplemental budget in even-numbered years.  The plan of proposed
 
23 appropriations shall include the executive budget, proposed
 

 
Page 19                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 grants to private entities, and any specific appropriation
 
 2 measures to be proposed by the executive branch.
 
 3      (d)  The budget documents presented by the governor to the
 
 4 legislature shall include a statement or summary showing (1) the
 
 5 total state personal income for each of the four calendar years
 
 6 immediately preceding the fiscal year for which appropriations
 
 7 from the state general fund are to be made, (2) the
 
 8 appropriations from the general fund for the previous fiscal
 
 9 year, (3) the appropriations from the general fund for the fiscal
 
10 year in progress, and (4) the general fund expenditure ceiling
 
11 for the fiscal year in progress and for the ensuing fiscal year
 
12 or, when necessary, for each fiscal year of the ensuing biennium.
 
13      (e)  The governor shall also include a statement or summary
 
14 showing (1) recommended appropriations from the general fund for
 
15 the executive branch for the ensuing fiscal year or fiscal
 
16 biennium, (2) actual appropriations from the general fund for the
 
17 executive branch plus any recommended appropriations from the
 
18 general fund for the executive branch for the fiscal year in
 
19 progress, (3) the appropriations from the general fund for the
 
20 executive branch for the previous fiscal year, and (4) the
 
21 general fund appropriation ceiling for the executive branch as
 
22 established by subsection (b) for the fiscal year in progress and
 
23 for the ensuing fiscal year or, when necessary, for each fiscal
 

 
Page 20                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 year of the ensuing biennium.
 
 2      (f)  The chief justice shall submit a plan of proposed
 
 3 appropriations of the judicial branch to the legislature which
 
 4 shall accompany the judiciary biennial budget in odd-numbered
 
 5 years and the supplemental budget in even-numbered years.  The
 
 6 plan of proposed appropriations shall include the judiciary
 
 7 budget, proposed grants to private entities, and any specific
 
 8 appropriation measures to be proposed by the judicial branch.
 
 9      (g)  The budget documents presented by the chief justice to
 
10 the legislature shall include a statement or summary showing (1)
 
11 recommended appropriations from the general fund for the judicial
 
12 branch for the ensuing fiscal year or fiscal biennium, (2) actual
 
13 appropriations from the general fund for the judicial branch plus
 
14 any recommended appropriations from the general fund for the
 
15 judicial branch for the fiscal year in progress, (3) the
 
16 appropriations from the general fund for the judicial branch for
 
17 the previous fiscal year, and (4) the general fund appropriation
 
18 ceiling for the judicial branch as established by subsection (b)
 
19 for the fiscal year in progress and for the ensuing fiscal year
 
20 or, when necessary, for each fiscal year of the ensuing biennium.
 
21      (h)  The board of regents of the University of Hawaii shall
 
22 submit a plan of proposed appropriations of the University of
 
23 Hawaii to the legislature which shall accompany the University of
 

 
Page 21                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 Hawaii biennial budget in odd-numbered years and the supplemental
 
 2 budget in even-numbered years.  The plan of proposed
 
 3 appropriations shall include the University of Hawaii budget,
 
 4 proposed grants to private entities, and any specific
 
 5 appropriation measures to be proposed by the board of regents of
 
 6 the University of Hawaii.
 
 7      (i)  The budget documents presented by the board of regents
 
 8 of the University of Hawaii to the legislature shall include a
 
 9 statement or summary showing (1) recommended appropriations from
 
10 the general fund for the University of Hawaii for the ensuing
 
11 fiscal year or fiscal biennium, (2) actual appropriations from
 
12 the general fund for the University of Hawaii plus any
 
13 recommended appropriations from the general fund for the
 
14 University of Hawaii for the fiscal year in progress, (3) the
 
15 appropriations from the general fund for the University of Hawaii
 
16 for the previous fiscal year, and (4) the general fund
 
17 appropriation ceiling for the University of Hawaii as established
 
18 by subsection (b) for the fiscal year in progress and for the
 
19 ensuing fiscal year or, when necessary, for each fiscal year of
 
20 the ensuing biennium.
 
21      [(h)] (j)  The governor [or], the chief justice, or the
 
22 board of regents may propose appropriations from the general fund
 
23 for the executive or judicial branches[,] or the University of
 

 
Page 22                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 Hawaii, respectively, in excess of those allowed by subsection
 
 2 (b) if the governor [or], the chief justice, or the board of
 
 3 regents sets forth the dollar amount and the percentage change in
 
 4 excess of the appropriations allowed by subsection (b), and the
 
 5 reasons for proposing appropriations in excess of those allowed
 
 6 by subsection (b)."
 
 7      SECTION 14.  Section 37D-1, Hawaii Revised Statutes, is
 
 8 amended by amending the definition of "agency" to read as
 
 9 follows:
 
10      ""Agency" means the judiciary, the University of Hawaii, any
 
11 executive department, any independent commission, any board, any
 
12 authority, any bureau, any office, any other establishment of the
 
13 State (except the legislature and its agencies), or any public
 
14 corporation that is supported in whole or in part by state funds,
 
15 or any agent thereof, authorized by law to expend available
 
16 moneys."
 
17      SECTION 15.  Section 40-1, Hawaii Revised Statutes, is
 
18 amended by amending subsections (b) and (c) to read as follows:
 
19      "(b)  With respect to the executive branch, except [the
 
20 University of Hawaii and] the department of education, the
 
21 comptroller shall have complete supervision of all accounts.  The
 
22 comptroller shall preaudit all proposed payments of $10,000 or
 
23 more to determine the propriety of expenditures and compliance
 

 
Page 23                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 with executive orders and rules that may be in effect.  When
 
 2 necessary, the comptroller shall withhold approval of any
 
 3 payment.  Whenever approval is withheld, the department or agency
 
 4 concerned shall be promptly notified.  With respect to [the
 
 5 University of Hawaii and] the department of education, the
 
 6 comptroller shall issue warrants for the release of funds for the
 
 7 operating costs of [the university or] the department of
 
 8 education[, as applicable,] in amounts and at times mutually
 
 9 agreed upon by the governor or director of finance and the
 
10 [university or] department of education[, as applicable];
 
11 provided:
 
12      (1)  The amounts released shall not exceed the allotment
 
13           ceilings for the respective funding sources of [the
 
14           university's or] the department of education's
 
15           appropriations established by the governor for an
 
16           allotment period pursuant to section 37-34; and
 
17      (2)  The comptroller may issue warrants as an advance from
 
18           the state treasury to [the University of Hawaii and]
 
19           the department of education to establish a checking
 
20           account and provide working capital in amounts and at
 
21           times mutually agreed upon by the governor or director
 
22           of finance and [the University of Hawaii and] the
 
23           department of education.
 

 
Page 24                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 The [University of Hawaii and the] department of education shall
 
 2 preaudit all proposed payments to determine the propriety of
 
 3 expenditures and compliance with applicable laws, executive
 
 4 orders, and rules as may be in effect.  The [University of Hawaii
 
 5 and the] department of education shall make disbursements for
 
 6 operating expenses from the amounts released by the comptroller
 
 7 and maintain records and documents necessary to support those
 
 8 disbursements at times mutually agreed upon by [the university
 
 9 president or] the superintendent of education[, as applicable,]
 
10 and the comptroller; provided that when requested by the
 
11 [university or] department of education, the comptroller shall
 
12 make all disbursements for the [university or] department of
 
13 education, as applicable, subject to available allotment.  Funds
 
14 released pursuant to this section shall be deposited by the
 
15 [university or] department of education[, as applicable,] in
 
16 accordance with the provisions applicable to the director of
 
17 finance by chapter 38.  Any interest earned on the deposit of
 
18 funds released pursuant to this section shall be deposited in the
 
19 state treasury at the end of each fiscal year.
 
20      (c)  With respect to the judiciary [and], the legislature,
 
21 and the University of Hawaii, the comptroller shall make
 
22 available to the judiciary [and], the legislature, and the
 
23 University of Hawaii the total amount appropriated to each,
 

 
Page 25                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 except that the judiciary [and], the legislature, and the
 
 2 University of Hawaii may request the comptroller's services in
 
 3 maintaining custody of the amount appropriated to each and in
 
 4 making payments therefrom.  When such services are requested, the
 
 5 comptroller shall make all disbursements requested by the
 
 6 judiciary [or], the legislature, or the University of Hawaii, but
 
 7 shall not make any disbursement for which no appropriation has
 
 8 been made or which would cause a specific appropriation to be
 
 9 exceeded."
 
10      SECTION 16.  Section 40-2, Hawaii Revised Statutes, is
 
11 amended to read as follows:
 
12      "40-2 Accounting systems and internal control; enforcing
 
13 the use of and inspection of the same.  The accounting system
 
14 installed by the commission on public accountancy under Act 181,
 
15 Session Laws of Hawaii 1923, as amended by Act 220, Session Laws
 
16 of Hawaii 1925, for use in the offices of the comptroller,
 
17 director of finance, departmental and agency services of the
 
18 State, and the auditors, treasurers, departmental and agency
 
19 services of the several counties shall be the accounting and
 
20 reporting systems of the State and counties; provided [that the
 
21 University of Hawaii may install a different accounting system
 
22 which shall be in conformity with generally accepted accounting
 
23 principles as applied to colleges and universities; and provided
 

 
Page 26                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 further] that the department of education may install a different
 
 2 accounting system which shall be in conformity to generally
 
 3 accepted accounting principles.  The comptroller shall make such
 
 4 changes and modifications in the accounting system as shall from
 
 5 time to time appear to be in the best interest of the State and
 
 6 counties.
 
 7      The departments and agencies of the executive branch are
 
 8 respectively charged with the responsibility to maintain an
 
 9 adequate system of internal control and with the further
 
10 responsibility to see that the internal control system continues
 
11 to function effectively as designed.  The comptroller shall make
 
12 such investigations and audits from time to time to enforce the
 
13 use of the accounting system and internal control systems in the
 
14 executive branch.
 
15      The judiciary, the legislature, the University of Hawaii,
 
16 and each county shall be responsible for the establishment and
 
17 maintenance of its respective internal control system."
 
18      SECTION 17.  Section 40-6, Hawaii Revised Statutes, is
 
19 amended to read as follows:
 
20      "40-6 Approval of business and accounting forms.  The
 
21 comptroller shall determine the forms required to adequately
 
22 supply accounting and statistical data for the state government.
 
23 The comptroller shall require heads of departments and
 

 
Page 27                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 establishments of the state government to submit proposed new
 
 2 forms or proposed changes in current business and accounting
 
 3 forms for review and approval before ordering the same printed;
 
 4 except that [the University of Hawaii and] the department of
 
 5 education shall be subject to this requirement only with respect
 
 6 to uniform business and accounting forms of statewide use in the
 
 7 State's accounting system.  All standard state forms shall be
 
 8 classified, numbered, and standardized in design, dimensions,
 
 9 color, and grade of paper and recorded in a catalogue of
 
10 accounting and statistical forms by the comptroller."
 
11      SECTION 18.  Section 40-51, Hawaii Revised Statutes, is
 
12 amended to read as follows:
 
13      "40-51  Money drawn only on warrants.  Excepting moneys
 
14 paid for the redemption of bonds of the state debt, and the
 
15 interest coupons of the same, and for interest on overdue
 
16 warrants, and drafts against special deposits and for the
 
17 expenses of the legislature [and], the judiciary, and the
 
18 University of Hawaii, and payment authorized by the comptroller
 
19 by means of electronic funds transfers and through automated
 
20 clearinghouses for the purposes of implementing an electronic
 
21 benefits transfer system for the department of human services, no
 
22 money shall be drawn from or out of the treasury except upon
 
23 warrants, substantially in the form of section 40-52, issued from
 

 
Page 28                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 the comptroller's office; provided that upon request, the
 
 2 comptroller shall provide financial services involving the
 
 3 issuance of warrants on behalf of the legislature [and], the
 
 4 judiciary[.], and the University of Hawaii.  Every warrant shall
 
 5 be signed by the comptroller or the comptroller's deputy or by
 
 6 means of any mechanical check signer that may be adopted by the
 
 7 comptroller, and shall be made payable upon such date as may be
 
 8 approved by the director of finance to the order of the person to
 
 9 whom the State is directly indebted."
 
10      SECTION 19.  Section 40-58, Hawaii Revised Statutes, is
 
11 amended to read as follows:
 
12      "40-58  In favor of assignees.  No assignment of moneys by
 
13 a person to whom the State is directly indebted shall be
 
14 effective unless the assignment is first approved by the
 
15 comptroller or, in the case of [the University of Hawaii and] the
 
16 department of education, by [their] its respective chief
 
17 financial [officers.] officer.  The comptroller or the chief
 
18 financial [officers of the University of Hawaii and] officer of
 
19 the department of education may prescribe the form for an
 
20 assignment, and may approve the assignment within a reasonable
 
21 time period if, in their respective discretion, the rights or
 
22 obligations of the State[, the University of Hawaii,] or the
 
23 department of education under any contract or other undertaking
 

 
Page 29                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 or under any law, rule, or order by a competent authority will
 
 2 not be prejudiced thereby.  Upon approval of the assignment, the
 
 3 comptroller or the respective chief financial [officers of the
 
 4 University of Hawaii and] officer of the department of education
 
 5 shall draw a warrant payable to the assignee.  Except as to
 
 6 contracts encumbered by the comptroller[, the University of
 
 7 Hawaii,] or the department of education, each expending agency,
 
 8 upon notification of the comptroller's approval of an assignment,
 
 9 shall prepare a claim for payment in accordance with the terms of
 
10 the assignment."
 
11      SECTION 20.  Section 40-81, Hawaii Revised Statutes, is
 
12 amended to read as follows:
 
13      "40-81  Report by agencies receiving special moneys.  All
 
14 state officers, departments, boards, bureaus, commissions, or
 
15 agencies collecting or receiving any moneys not required by law
 
16 to be deposited in the state treasury shall report to the
 
17 comptroller all receipts and disbursements on account thereof for
 
18 each quarterly period of the calendar year not later than the
 
19 fifteenth day following the end of each quarterly period on such
 
20 forms and under such rules as may be prescribed by the
 
21 comptroller; provided that with respect to all moneys held
 
22 outside the state treasury by [the University of Hawaii or] the
 
23 department of education pursuant to the authority granted to [the
 

 
Page 30                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 university and] the department of education by this chapter, [the
 
 2 University of Hawaii and] the department of education shall
 
 3 report to the comptroller all transactions for each quarterly
 
 4 period not later than the fifteenth day following the end of each
 
 5 quarterly period on such forms and under such rules as may be
 
 6 prescribed by the comptroller."
 
 7      SECTION 21.  Section 40-84, Hawaii Revised Statutes, is
 
 8 amended to read as follows:
 
 9      "40-84  Petty cash funds; regulations.  Whenever the head
 
10 of any state department, board, bureau, commission, or other
 
11 agency deems it necessary to have a petty cash fund for the
 
12 proper transaction of the business of the agency, a written
 
13 application therefor shall be made to the comptroller setting
 
14 forth the details covering the purposes and uses of and for the
 
15 fund.  The comptroller, before issuing a state warrant for that
 
16 purpose, shall determine whether or not the business of the
 
17 agency warrants the establishment of such a fund, and if the
 
18 comptroller is satisfied that such a fund is necessary, the
 
19 comptroller shall issue a state warrant to such agency for an
 
20 amount as the comptroller shall determine, not to exceed the sum
 
21 of $100,000, except that this limitation of $100,000 shall not
 
22 apply to [the University of Hawaii and] the stadium authority.
 
23      The comptroller may prescribe such rules as the comptroller
 

 
Page 31                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 may deem necessary for the proper administration and
 
 2 accountability of these funds."
 
 3      SECTION 22.  Section 76-4, Hawaii Revised Statutes, is
 
 4 amended to read as follows:
 
 5      "76-4 Agreements of state, county departments, judiciary,
 
 6 [and] the Hawaii health systems corporation[.], and the
 
 7 University of Hawaii.  The state department of human resources
 
 8 development, the judiciary, the several departments of civil
 
 9 service of the counties, [and] the Hawaii health systems
 
10 corporation, and the University of Hawaii may enter into
 
11 agreements for the joint administration of matters that may be
 
12 practicable and consistent with this chapter and chapter 77,
 
13 including the conducting of examinations and other procedures for
 
14 the establishment and use of eligible lists, reciprocity in the
 
15 use of eligible lists, and the conducting of salary studies.  All
 
16 eligible lists established or used under the agreements shall be
 
17 as fully effective as those established or used separately."
 
18      SECTION 23.  Section 76-5, Hawaii Revised Statutes, is
 
19 amended to read as follows:
 
20      "76-5 Furnishing of services and facilities.  Subject to
 
21 the rules of the state department of human resources development,
 
22 the director of human resources development may enter into
 
23 agreements with the judiciary, any county, [and] the Hawaii
 

 
Page 32                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 health systems corporation, and the University of Hawaii to
 
 2 furnish services and facilities of the state department to the
 
 3 judiciary, any county, [and] the Hawaii health systems
 
 4 corporation, and the University of Hawaii in the administration
 
 5 of civil service including position classification in the
 
 6 judiciary, any county, [and] the Hawaii health systems
 
 7 corporation[.], and the University of Hawaii.  The agreements may
 
 8 provide for the reimbursement to the State of the reasonable
 
 9 value of the services and facilities furnished, as determined by
 
10 the director.  The judiciary, all counties, [and] the Hawaii
 
11 health systems corporation, and the University of Hawaii are
 
12 authorized to enter into the agreements."
 
13      SECTION 24.  Section 76-5.5, Hawaii Revised Statutes, is
 
14 amended to read as follows:
 
15      "76-5.5  Recruitment flexibility for the counties, the
 
16 judiciary, [and] the Hawaii health systems corporation[.], and
 
17 the University of Hawaii.  Notwithstanding section 76-23, or any
 
18 other provision to the contrary, the directors of the county
 
19 departments of civil service, the administrative director of the
 
20 courts, [and] the Hawaii health systems corporation chief
 
21 executive officer's designee, and the designee of the president
 
22 of the University of Hawaii may determine, establish, and
 
23 maintain the manner in which positions shall be filled in
 

 
Page 33                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 accordance with section 78-1 and the following standards:
 
 2      (1)  Equal opportunity for all regardless of race, sex, age,
 
 3           religion, color, ancestry, physical handicap, or
 
 4           politics;
 
 5      (2)  First consideration for competent employees already
 
 6           within public service; and
 
 7      (3)  Impartial selection of the ablest person through
 
 8           competitive means which are fair, objective, and
 
 9           practical."
 
10      SECTION 25.  Section 76-11, Hawaii Revised Statutes, is
 
11 amended by amending the definition of "department" to read as
 
12 follows:
 
13      "(4) "Department" includes the judicial branch, the
 
14           University of Hawaii, and any department, board,
 
15           commission, or agency of the State;"
 
16      SECTION 26.  Section 76-16, Hawaii Revised Statutes, is
 
17 amended to read as follows:
 
18      "76-16  Civil service and exemptions.  The civil service to
 
19 which this part applies shall comprise all positions in the State
 
20 now existing or hereafter established and embrace all personal
 
21 services performed for the State, except the following:
 
22      (1)  Commissioned and enlisted personnel of the Hawaii
 
23           national guard as such, and positions in the Hawaii
 

 
Page 34                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1           national guard that are required by state or federal
 
 2           laws or regulations or orders of the national guard to
 
 3           be filled from those commissioned or enlisted
 
 4           personnel;
 
 5      (2)  Positions filled by persons employed by contract where
 
 6           the director of human resources development has
 
 7           certified that the service is special or unique or is
 
 8           essential to the public interest and that, because of
 
 9           circumstances surrounding its fulfillment, personnel to
 
10           perform the service cannot be obtained through normal
 
11           civil service recruitment procedures.  Any such
 
12           contract may be for any period not exceeding one year;
 
13      (3)  Positions of a temporary nature needed in the public
 
14           interest where the need for the position does not
 
15           exceed one year, but before any person may be employed
 
16           to render the temporary service, the director shall
 
17           certify that the service is of a temporary nature and
 
18           that recruitment through normal civil service
 
19           recruitment procedures is not practicable;
 
20      (4)  Positions filled by the legislature or by either house
 
21           or any committee thereof;
 
22      (5)  Employees in the office of the governor and household
 
23           employees at Washington Place;
 

 
Page 35                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1      (6)  Positions filled by popular vote;
 
 2      (7)  Department heads, officers, and members of any board,
 
 3           commission, or other state agency whose appointments
 
 4           are made by the governor or are required by law to be
 
 5           confirmed by the senate;
 
 6      (8)  Judges, referees, receivers, masters, jurors, notaries
 
 7           public, land court examiners, court commissioners, and
 
 8           attorneys appointed by a state court for a special
 
 9           temporary service;
 
10      (9)  One bailiff for the chief justice of the supreme court
 
11           who shall have the powers and duties of a court officer
 
12           and bailiff under section 606-14; one secretary or
 
13           clerk for each justice of the supreme court, each judge
 
14           of the intermediate appellate court, and each judge of
 
15           the circuit court; one secretary for the judicial
 
16           council; one deputy administrative director of the
 
17           courts; three law clerks for the chief justice of the
 
18           supreme court, two law clerks for each associate
 
19           justice of the supreme court and each judge of the
 
20           intermediate appellate court, one law clerk for each
 
21           judge of the circuit court, two additional law clerks
 
22           for the civil administrative judge of the circuit court
 
23           of the first circuit, two additional law clerks for the
 

 
Page 36                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1           criminal administrative judge of the circuit court of
 
 2           the first circuit, one additional law clerk for the
 
 3           senior judge of the family court of the first circuit,
 
 4           two additional law clerks for the civil motions judge
 
 5           of the circuit court of the first circuit, two
 
 6           additional law clerks for the criminal motions judge of
 
 7           the circuit court of the first circuit, and two law
 
 8           clerks for the administrative judge of the district
 
 9           court of the first circuit; and one private secretary
 
10           for the administrative director of the courts, the
 
11           deputy administrative director of the courts, each
 
12           department head, each deputy or first assistant, and
 
13           each additional deputy, or assistant deputy, or
 
14           assistant defined in paragraph (16);
 
15     (10)  First deputy and deputy attorneys general, the
 
16           administrative services manager of the department of
 
17           the attorney general, one secretary for the
 
18           administrative services manager, an administrator and
 
19           any support staff for the criminal and juvenile justice
 
20           resources coordination functions, and law clerks;
 
21     (11)  Teachers, principals, vice-principals, district
 
22           superintendents, chief deputy superintendents, other
 
23           certificated personnel, and not more than twenty
 

 
Page 37                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1           noncertificated administrative, professional, and
 
 2           technical personnel not engaged in instructional work
 
 3           in the department of education, the special assistant
 
 4           to the state librarian, one secretary for the special
 
 5           assistant to the state librarian, and members of the
 
 6           faculty of the University of Hawaii, including research
 
 7           workers, extension agents, personnel engaged in
 
 8           instructional work, and administrative, professional,
 
 9           [and] technical personnel, and classified staff of the
 
10           university;
 
11     (12)  Employees engaged in special, research, or
 
12           demonstration projects approved by the governor;
 
13     (13)  Positions filled by inmates, kokuas, patients of state
 
14           institutions, persons with severe physical or mental
 
15           handicaps participating in the work experience training
 
16           programs, and students and positions filled through
 
17           federally funded programs that provide temporary public
 
18           service employment such as the federal Comprehensive
 
19           Employment and Training Act of 1973;
 
20     (14)  A custodian or guide at Iolani Palace, the Royal
 
21           Mausoleum, and Hulihee Palace;
 
22     (15)  Positions filled by persons employed on a fee,
 
23           contract, or piecework basis, who may lawfully perform
 

 
Page 38                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1           their duties concurrently with their private business
 
 2           or profession or other private employment and whose
 
 3           duties require only a portion of their time, if it is
 
 4           impracticable to ascertain or anticipate the portion of
 
 5           time to be devoted to the service of the State;
 
 6     (16)  Positions of first deputies or first assistants of each
 
 7           department head appointed under or in the manner
 
 8           provided in section 6, Article V, of the State
 
 9           Constitution; three additional deputies or assistants
 
10           either in charge of the highways, harbors, and airports
 
11           divisions or other functions within the department of
 
12           transportation as may be assigned by the director of
 
13           transportation, with the approval of the governor; four
 
14           additional deputies in the department of health, each
 
15           in charge of one of the following:  behavioral health,
 
16           environmental health, hospitals, and health resources
 
17           administration, including other functions within the
 
18           department as may be assigned by the director of
 
19           health, with the approval of the governor; an
 
20           administrative assistant to the state librarian; and an
 
21           administrative assistant to the superintendent of
 
22           education;
 
23     (17)  Positions specifically exempted from this part by any
 

 
Page 39                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1           other law; provided that all of the positions defined
 
 2           by paragraph (9) shall be included in the position
 
 3           classification plan;
 
 4     (18)  Positions in the state foster grandparent program and
 
 5           positions for temporary employment of senior citizens
 
 6           in occupations in which there is a severe personnel
 
 7           shortage or in special projects;
 
 8     (19)  Household employees at the official residence of the
 
 9           president of the University of Hawaii;
 
10     (20)  Employees in the department of education engaged in the
 
11           supervision of students during lunch periods and in the
 
12           cleaning of classrooms after school hours on a less
 
13           than half-time basis;
 
14     (21)  Employees hired under the tenant hire program of the
 
15           housing and community development corporation of
 
16           Hawaii; provided that not more than twenty-six per cent
 
17           of the corporation's work force in any housing project
 
18           maintained or operated by the corporation shall be
 
19           hired under the tenant hire program;
 
20     (22)  Positions of the federally funded expanded food and
 
21           nutrition program of the University of Hawaii that
 
22           require the hiring of nutrition program assistants who
 
23           live in the areas they serve;
 

 
Page 40                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1     (23)  Positions filled by severely handicapped persons who
 
 2           are certified by the state vocational rehabilitation
 
 3           office that they are able to perform safely the duties
 
 4           of the positions;
 
 5     (24)  One public high school student to be selected by the
 
 6           Hawaii state student council as a nonvoting member on
 
 7           the board of education as authorized by the State
 
 8           Constitution;
 
 9     (25)  Sheriff, first deputy sheriff, and second deputy
 
10           sheriff; and
 
11     (26)  A gender and other fairness coordinator hired by the
 
12           judiciary.
 
13      The director shall determine the applicability of this
 
14 section to specific positions.
 
15      Nothing in this section shall be deemed to affect the civil
 
16 service status of any incumbent as it existed on July 1, 1955."
 
17      SECTION 27.  Section 77-1, Hawaii Revised Statutes, is
 
18 amended by amending the definitions of "chief executive officer",
 
19 "department", "director", and "fiscal officer" to read as
 
20 follows:
 
21      ""Chief executive officer" means the governor in the case of
 
22 the State, the chief justice of the supreme court in the case of
 
23 the judiciary, the chief executive officer in the case of the
 

 
Page 41                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 Hawaii health systems corporation, the board of regents in the
 
 2 case of the University of Hawaii, the mayor in the case of the
 
 3 city and county of Honolulu or the counties of Hawaii, Maui, and
 
 4 Kauai.
 
 5      "Department" includes the judicial branch, the Hawaii health
 
 6 systems corporation, the University of Hawaii, and any
 
 7 department, board, commission, or agency of the State or any of
 
 8 its political subdivisions.
 
 9      "Director" means the director of human resources development
 
10 in the case of the State, the administrative director of the
 
11 courts in the case of the judiciary, the chief executive officer
 
12 in the case of the Hawaii health systems corporation, the
 
13 president in the case of the University of Hawaii, the director
 
14 of civil service in the case of the city and county of Honolulu,
 
15 or the respective personnel directors in the case of the counties
 
16 of Hawaii, Maui, and Kauai.
 
17      "Fiscal officer" means the director of finance in the case
 
18 of the State, the administrative director of the courts in the
 
19 case of the judiciary, the chief executive officer in the case of
 
20 the Hawaii health systems corporation, the president in the case
 
21 of the University of Hawaii, the director of finance in the case
 
22 of the city and county of Honolulu and the counties of Hawaii,
 
23 Maui, and Kauai."
 

 
Page 42                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1      SECTION 28.  Section 78-51, Hawaii Revised Statutes, is
 
 2 amended to read as follows:
 
 3      "78-51  Applicability of chapter to the judiciary [and],
 
 4 the Hawaii health systems corporation[.], and the University of
 
 5 Hawaii.  All of the provisions of this chapter apply with equal
 
 6 force to the judiciary [and], the Hawaii health systems
 
 7 corporation, and the University of Hawaii as to the State.  The
 
 8 powers and duties assigned in this chapter shall, with respect to
 
 9 the judiciary, be assigned to the chief justice of the supreme
 
10 court in the place and stead of the governor or chief executive
 
11 officer for the State, and to the administrative director of the
 
12 courts in the place and stead of the director of human resources
 
13 development.  The powers and duties assigned in this chapter,
 
14 with respect to the Hawaii health systems corporation, shall be
 
15 assigned to the chief executive officer of the Hawaii health
 
16 systems corporation in the place and stead of the governor or
 
17 chief executive officer for the State, and to the Hawaii health
 
18 systems chief executive officer's designee in the place and stead
 
19 of the director of human resources development.  The powers and
 
20 duties assigned in this chapter, with respect to the University
 
21 of Hawaii, shall be assigned to the board of regents of the
 
22 University of Hawaii in the place and stead of the governor or
 
23 chief executive officer for the State, and to the president of
 

 
Page 43                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 the University of Hawaii in the place and stead of the director
 
 2 of human resources development."
 
 3      SECTION 29.  Section 79-31, Hawaii Revised Statutes, is
 
 4 amended to read as follows:
 
 5      "79-31  Judiciary [and], the Hawaii health systems
 
 6 corporation[;], and the University of Hawaii; powers and duties.
 
 7 All of the powers and duties assigned in this chapter to the
 
 8 governor or the director of human resources development, with
 
 9 respect to the judiciary, shall be assigned to the chief justice
 
10 of the supreme court or the administrative director of the
 
11 courts, [and] with respect to the Hawaii health systems
 
12 corporation, shall be assigned to the chief executive officer of
 
13 the Hawaii health systems corporation or designee[.], and with
 
14 respect to the University of Hawaii, shall be assigned to the
 
15 board of regents of the University of Hawaii or the president."
 
16      SECTION 30.  Section 80-21, Hawaii Revised Statutes, is
 
17 amended to read as follows:
 
18      "80-21  Judiciary [and], the Hawaii health systems
 
19 corporation[;], and the University of Hawaii; powers and duties.
 
20 All of the powers and duties assigned in this chapter to the
 
21 governor or the department or director of human resources
 
22 development, with respect to the judiciary, shall be assigned to
 
23 the chief justice of the supreme court or the administrative
 

 
Page 44                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 director of the courts, [and] with respect to the Hawaii health
 
 2 systems corporation, shall be assigned to the chief executive
 
 3 officer of the Hawaii health systems corporation or designee[.],
 
 4 and with respect to the University of Hawaii, shall be assigned
 
 5 to the board of regents of the University of Hawaii or the
 
 6 president."
 
 7      SECTION 31.  Section 81-21, Hawaii Revised Statutes, is
 
 8 amended to read as follows:
 
 9      "81-21  Judiciary [and], the Hawaii health systems
 
10 corporation[;], and the University of Hawaii; powers and duties.
 
11 All of the powers and duties assigned in this chapter to the
 
12 governor or the director of human resources development, with
 
13 respect to the judiciary, shall be exercised by the chief justice
 
14 of the supreme court or the administrative director of the
 
15 courts, [and] with respect to the Hawaii health systems
 
16 corporation, shall be assigned to the chief executive officer of
 
17 the Hawaii health systems corporation or designee[.], and with
 
18 respect to the University of Hawaii, shall be assigned to the
 
19 board of regents of the University of Hawaii or the president."
 
20      SECTION 32.  Section 82-6, Hawaii Revised Statutes, is
 
21 amended to read as follows:
 
22      "82-6 Judiciary [and], the Hawaii health systems
 
23 corporation[;], and the University of Hawaii; powers and duties.
 

 
Page 45                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 All of the powers and duties assigned in this chapter to the
 
 2 governor or the director of human resources development shall
 
 3 with respect to the judiciary be assigned to the chief justice of
 
 4 the supreme court or the administrative director of the courts[,
 
 5 and with].  With respect to the Hawaii health systems
 
 6 corporation, these duties shall be assigned to the chief
 
 7 executive officer of the Hawaii health systems corporation or a
 
 8 designee.  With respect to the University of Hawaii, these duties
 
 9 shall be assigned to the board of regents of the University of
 
10 Hawaii or the president."
 
11      SECTION 33.  Section 83-4, Hawaii Revised Statutes, is
 
12 amended to read as follows:
 
13      "83-4 Judiciary [and], the Hawaii health systems
 
14 corporation[;], and the University of Hawaii; powers and duties.
 
15 All of the powers and duties assigned in this chapter to the
 
16 governor or the director of human resources development, with
 
17 respect to the judiciary, shall be exercised by the chief justice
 
18 of the supreme court or the administrative director of the
 
19 courts, [and] with respect to the Hawaii health systems
 
20 corporation, shall be assigned to the chief executive officer of
 
21 the Hawaii health systems corporation or designee[.], and with
 
22 respect to the University of Hawaii, shall be assigned to the
 
23 board of regents of the University of Hawaii or the president."
 

 
Page 46                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1      SECTION 34.  Section 103F-102, Hawaii Revised Statutes, is
 
 2 amended by amending the definition of "agency" to read as
 
 3 follows:
 
 4      ""Agency" means any department, authority, commission,
 
 5 council, board, committee, institution, legislative body, agency,
 
 6 or other establishment or office of the executive, legislative,
 
 7 or judicial branch of the State, and includes the University of
 
 8 Hawaii and the office of Hawaiian affairs."
 
 9      SECTION 35.  Section 304-3, Hawaii Revised Statutes, is
 
10 amended to read as follows:
 
11      "304-3 Regents; appointment; tenure; qualifications;
 
12 meetings.  (a)  The affairs of the university shall be under the
 
13 general management and control of the board of regents consisting
 
14 of twelve members who shall be appointed and may be removed by
 
15 the governor.  No more than six of the members shall be members
 
16 of the same political party and at least part of the membership
 
17 of the board shall represent geographic subdivisions of the
 
18 State.  At least one member shall be a University of Hawaii
 
19 student at the time of the initial appointment.
 
20      (b)  The term of each member shall be for four years;
 
21 provided that the term of the student member shall be for two
 
22 years[.]; and provided further that the student member may be
 
23 reappointed for one additional term even though the member may no
 

 
Page 47                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 longer be a student at the time of reappointment.  Except as
 
 2 otherwise provided by statute, state officers shall be eligible
 
 3 to appointment and membership.  Every member may serve beyond the
 
 4 expiration date of the member's term of appointment until the
 
 5 member's successor has been appointed and has qualified.  The
 
 6 board shall at its first meeting after June 30, elect a
 
 7 chairperson and vice-chairperson, who shall serve until
 
 8 adjournment of its first meeting after June 30 of the next year
 
 9 or thereafter until their successors are appointed and have
 
10 qualified and whose election shall be immediately certified by
 
11 the board to the chief election officer.  The board shall appoint
 
12 a secretary, who shall not be a member of the board.  The
 
13 president of the university shall act as executive officer of the
 
14 board.
 
15      (c)  The board shall meet not less often than ten times
 
16 annually, and may from time to time meet in each of the counties
 
17 of Hawaii, Maui, and Kauai.
 
18      (d)  The members of the board shall serve without pay but
 
19 shall be entitled to their traveling expenses within the State
 
20 when attending meetings of the board or when actually engaged in
 
21 business relating to the work of the board."
 
22      SECTION 36.  Section 304-4, Hawaii Revised Statutes, is
 
23 amended to read as follows:
 

 
Page 48                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1      "304-4 Powers of regents; official name.(a)  The board
 
 2 of regents shall have management and control of the general
 
 3 affairs, and exclusive jurisdiction over the internal
 
 4 organization and management[,] of the university[.] through its
 
 5 executive officer.
 
 6      (b)  The board of regents shall appoint and may remove an
 
 7 executive officer to be known as the president of the University
 
 8 of Hawaii, and shall set the salary of the president.  It may
 
 9 appoint a treasurer and such other officers as it deems
 
10 necessary.  It may authorize any officer, elected or appointed by
 
11 it, to approve and sign on its behalf any voucher or other
 
12 document which the board may approve and sign.  It may delegate
 
13 to the president or the president's designee to authority to
 
14 render the final decision in contested case proceedings subject
 
15 to chapter 91, as it deems appropriate.  It may purchase or
 
16 otherwise acquire lands, buildings, appliances, and other
 
17 property for the purposes of the university and expend such sums
 
18 of money as may be from time to time placed at the disposal of
 
19 the university from whatever source.  All lands, buildings,
 
20 appliances, and other property so purchased or acquired shall be
 
21 and remain the property of the university to be used in
 
22 perpetuity for the benefit of the university.  The board of
 
23 regents, in accordance with law, shall manage the inventory,
 

 
Page 49                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 equipment, surplus property, and expenditures of the university
 
 2 and, subject to chapter 91, may adopt rules, further controlling
 
 3 and regulating the same.
 
 4      [(b)] (c)  The board may charge resident and nonresident
 
 5 tuition fees for regular courses of instruction at any University
 
 6 of Hawaii campus, including any community college.
 
 7      The board may also charge other fees for special programs of
 
 8 instruction, as well as laboratory fees, course fees, fees for
 
 9 student activities, and an information technology user fee.  The
 
10 board may charge other fees for summer session or evening
 
11 courses, including differential fees for nonresident students.
 
12      The board may waive entirely or reduce the tuition fee or
 
13 any of the other fees for graduate teaching and research
 
14 assistants.  The board may enter into agreements with government
 
15 and university officials of any other state or foreign country to
 
16 provide for reciprocal waiver of the nonresident tuition and fee
 
17 differential.  The board may waive the nonresident tuition and
 
18 fee differential for selected students from Pacific and Asian
 
19 jurisdictions when their presence would be beneficial to the
 
20 university or the State.  The board may waive entirely or reduce
 
21 the tuition fee or any of the other fees for students, resident
 
22 or nonresident.  The board shall determine the percentage of
 
23 allowable tuition and fee waivers for financial need and other
 

 
Page 50                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 university priorities.  These tuition waivers and waivers of the
 
 2 nonresident tuition and fee differential shall be awarded in
 
 3 accordance with guidelines established by the board.
 
 4      [(c)] (d)  The board shall adopt the necessary rules
 
 5 defining residence for tuition purposes herein; provided that the
 
 6 basic rule shall be that a student shall qualify for the resident
 
 7 tuition fee only if the following criteria are met:
 
 8      (1)  The adult student, or in the case of a minor student,
 
 9           the student's parents or guardians, has been a bona
 
10           fide resident of this State for at least twelve
 
11           consecutive months next preceding the student's first
 
12           day of officially scheduled instruction for any
 
13           semester or term in which the student is enrolling at
 
14           the particular college or campus; and
 
15      (2)  The adult or minor student has not been claimed as a
 
16           dependent for tax purposes for at least twelve months
 
17           next preceding the student's first day of officially
 
18           scheduled instruction for any semester or term in which
 
19           the student is enrolling at the particular college or
 
20           campus by the student's parents or guardians who are
 
21           nonresidents of the State; provided that this provision
 
22           shall not apply in cases where the parent claiming the
 
23           student as a dependent is entitled to do so under a
 

 
Page 51                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1           child support order or agreement issued or entered into
 
 2           in conjunction with a divorce proceeding or legal
 
 3           separation agreement, and the other parent and the
 
 4           student meet the criteria set forth in paragraph (1).
 
 5      [(d)] (e)  The board shall develop internal policies and
 
 6 procedures for the procurement of goods, services, and
 
 7 construction, consistent with the goals of public accountability
 
 8 and public procurement practices, but not subject to chapter
 
 9 103D.  However, where possible, the board is encouraged to use
 
10 the provisions of chapter 103D; provided that the use of one or
 
11 more provisions of chapter 103D shall not constitute a waiver of
 
12 the exemption of chapter 103D and shall not subject the board to
 
13 any other provision of chapter 103D.
 
14      [(e)] (f)  The board may enter into concession agreements
 
15 without regard to chapter 102.
 
16      (g)  The board shall develop internal policies and
 
17 procedures for personnel management, consistent with the goals of
 
18 public accountability and public civil service management, but
 
19 not subject to chapters 76 and 77, for classified staff currently
 
20 employed by the university and those employed in the future.
 
21 However, where possible, the board is encouraged to use the
 
22 provisions of chapters 76 and 77; provided that the use of one or
 
23 more provisions of chapters 76 and 77 shall not constitute a
 

 
Page 52                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 waiver of the exemption of chapters 76 and 77 and shall not
 
 2 subject the board to any other provision of chapters 76 and 77.
 
 3      [(f)] (h)  The official name of the board shall be Board of
 
 4 Regents, University of Hawaii, and the board shall adopt and use
 
 5 a common seal by which all official acts shall be authenticated."
 
 6      SECTION 37.  Section 304-7, Hawaii Revised Statutes, is
 
 7 amended by amending subsection (c) to read as follows:
 
 8      "(c)  The board shall cause to be kept suitable books of
 
 9 account wherein shall be recorded each gift, the essential facts
 
10 of the management thereof, and the expenditure of the income, and
 
11 a statement of all trust funds shall be included in the annual
 
12 report to [the governor and] the legislature."
 
13      SECTION 38.  Section 304-7.5, Hawaii Revised Statutes, is
 
14 amended to read as follows:
 
15      "304-7.5  Budget appropriations; University of Hawaii.(a)
 
16 Beginning in fiscal year 1998-1999, and every year thereafter,
 
17 the general fund budget appropriations for the University of
 
18 Hawaii shall be an amount not less than three times and not
 
19 greater than five times the amount of regular tuition and related
 
20 fee revenues estimated for that fiscal year.
 
21      (b)  Any general fund budget appropriation for the
 
22 University of Hawaii for operating purposes for any fiscal year
 
23 shall include the consideration of:
 

 
Page 53                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1      (1)  The fiscal condition of the State;
 
 2      (2)  Enrollment;
 
 3      (3)  Access to educational opportunity;
 
 4      (4)  The mix of resident and nonresident students; and
 
 5      (5)  Community service and noninstruction programs.
 
 6      [(c)  No revenue received by the University of Hawaii
 
 7 pursuant to the University of Hawaii tuition and fees special
 
 8 fund established under section 304-16.5 may be used by the
 
 9 governor or the director of finance as a justification for
 
10 reducing any budget request or allotment to the University of
 
11 Hawaii unless the university requests such a reduction.]"
 
12      SECTION 39.  Section 304-7.8, Hawaii Revised Statutes, is
 
13 amended to read as follows:
 
14      "[[]304-7.8[]]  Appropriations for special and revolving
 
15 funds of the University of Hawaii.  In any fiscal year if the
 
16 amount of revenues deposited into a special or revolving fund of
 
17 the university exceeds the amount appropriated from that fund for
 
18 that year, the president may approve expenditures in excess of
 
19 the amount appropriated, up to the amount by which revenues for
 
20 that fund exceed the appropriations from that fund for a fiscal
 
21 year; provided the university shall submit annually a report to
 
22 [the governor and] the legislature of all expenditures in excess
 
23 of each fund's appropriation for each fiscal year."
 

 
Page 54                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1      SECTION 40.  Section 304-8, Hawaii Revised Statutes, is
 
 2 amended by amending subsection (a) to read as follows:
 
 3      "(a)  Moneys appropriated by the legislature for the
 
 4 university shall be payable by the director of finance, upon
 
 5 vouchers approved by the board of regents or by any officer
 
 6 elected or appointed by the board under section 304-4 and
 
 7 authorized by the board to approve such vouchers on behalf of the
 
 8 board.  All moneys received by or on behalf of the board of the
 
 9 university shall be deposited with the director of finance,
 
10 except that any moneys received from the federal government or
 
11 from private contributions shall be deposited and accounted for
 
12 in accordance with conditions established by the agencies or
 
13 persons from whom the moneys are received and except that [with
 
14 the concurrence of the director of finance,] moneys received from
 
15 the federal government for research, training, and other related
 
16 purposes of a transitory nature and moneys in trust, special, or
 
17 revolving funds administered by the university may be deposited
 
18 in depositories other than the state treasury[; provided that the
 
19 university informs the director of finance of the depositories in
 
20 which moneys from the funds have been deposited, and submits
 
21 copies of annual statements from each of the depositories in
 
22 which the moneys from the funds are deposited].  All income from
 
23 regular credit tuition and tuition related course and fee charges
 

 
Page 55                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 against students shall be deposited to the credit of the
 
 2 University of Hawaii tuition and fees special fund pursuant to
 
 3 section 304-16.5.  Income from university projects as defined and
 
 4 described in sections 306-1 to 306-12, may be credited to special
 
 5 or other funds."
 
 6      SECTION 41.  Section 304-8.1, Hawaii Revised Statutes, is
 
 7 amended to read as follows:
 
 8      "304-8.1  Research and training revolving fund.(a)  There
 
 9 is established a University of Hawaii research and training
 
10 revolving fund into which shall be deposited one hundred per cent
 
11 of the total amount of indirect overhead revenues generated by
 
12 the university from research and training programs.  The board of
 
13 regents of the University of Hawaii is authorized to expend
 
14 eighty-four per cent of the revenues deposited in the fund for:
 
15      (1)  Research and training purposes which may result in
 
16           additional research and training grants and contracts;
 
17           and
 
18      (2)  Facilitating research and training at the university.
 
19      (b)  The University of Hawaii shall prepare and submit an
 
20 annual report on the status of the research and training
 
21 revolving fund to the legislature twenty days before the
 
22 convening of each regular session.  The annual report shall
 
23 include but not be limited to a breakdown of travel expenses.
 

 
Page 56                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1      (c)  Notwithstanding sections 304-10, 304-8.92, and 304-8.96
 
 2 to the contrary, the board of regents or its designee, may
 
 3 establish a separate account within the research and training
 
 4 revolving fund for the purpose of providing advance funding to
 
 5 meet reimbursable costs incurred in connection with federally
 
 6 financed research and training projects.  Any reimbursement
 
 7 received as a result of providing advance funding shall be
 
 8 deposited into the research and training revolving fund to be
 
 9 used for the purpose of meeting reimbursable costs incurred in
 
10 connection with federally financed projects.
 
11      [(d)  Revenues deposited into the fund shall not be used as
 
12 a basis for reducing any current or future budget request or
 
13 allotment to the University of Hawaii unless the university
 
14 requests such a reduction.]"
 
15      SECTION 42.  Section 304-8.4, Hawaii Revised Statutes, is
 
16 amended to read as follows:
 
17      "304-8.4  Vocational and technical training projects
 
18 revolving fund.  There is established a revolving fund for the
 
19 vocational and technical training projects of the community
 
20 colleges and the University of Hawaii at Hilo into which shall be
 
21 deposited the receipts from fees for services, supplies, and use
 
22 of equipment provided by or in connection with these projects.
 
23 Funds deposited in this account shall be expended for vocational
 

 
Page 57                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 and technical training projects, and supplies, equipment, and
 
 2 services related thereto.
 
 3      The University of Hawaii at Hilo shall report as of the
 
 4 close of each fiscal year to [the governor and] the legislature
 
 5 on the revolving fund's revenues and expenditures for the
 
 6 reported year.  These reports shall be submitted not later than
 
 7 twenty days prior to the convening of each regular session."
 
 8      SECTION 43.  Section 304-8.92, Hawaii Revised Statutes, is
 
 9 amended to read as follows:
 
10      "304-8.92  Discoveries and inventions revolving fund.(a)
 
11 There is established a discoveries and inventions revolving fund
 
12 into which shall be deposited four per cent of the total indirect
 
13 overhead funds generated by the university for research and
 
14 training purposes in the prior fiscal year.  Appropriations by
 
15 the state legislature [subject to the approval of the governor],
 
16 proceeds from the commercial exploitation of inventions and
 
17 intellectual property developed at the university, gifts,
 
18 donations, fees collected, and grants from public agencies and
 
19 private persons may also be deposited into the fund for the
 
20 purposes of supporting innovation and research commercialization
 
21 and the patenting, copyrighting, licensing, and marketing of
 
22 discoveries, inventions, and technologies developed at the
 
23 university.  The fund shall be used to develop technologies which
 

 
Page 58                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 have potential commercial value, support the administration of
 
 2 technology transfer activities, and facilitate economic
 
 3 development through education and research undertaken at the
 
 4 university.
 
 5      (b)  The University of Hawaii shall provide an annual report
 
 6 to [the governor and] the legislature describing all transactions
 
 7 and activities involved in the administration of the discoveries
 
 8 and inventions revolving fund."
 
 9      SECTION 44.  Section 304-8.96, Hawaii Revised Statutes, is
 
10 amended by amending subsection (b) to read as follows:
 
11      "(b)  The University of Hawaii shall provide an annual
 
12 report to [the governor and] the legislature describing all
 
13 transactions and activities involved in the administration of the
 
14 housing assistance revolving fund."
 
15      SECTION 45.  Section 304-16.5, Hawaii Revised Statutes, is
 
16 amended by amending subsection (a) to read as follows:
 
17      "(a)  There is established the University of Hawaii tuition
 
18 and fees special fund into which shall be deposited all revenue
 
19 collected by the university for regular, summer, and continuing
 
20 education credit tuition, tuition related course and fee charges,
 
21 and any other charges to students, except as provided by law.
 
22 Moneys deposited into the fund shall be expended to maintain or
 
23 improve the university's programs and operations and shall not
 

 
Page 59                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 be[:
 
 2      (1)  Used as a justification for reducing any budget request
 
 3           or allotment to the University of Hawaii unless the
 
 4           university requests such a reduction;
 
 5      (2)  Transferred] transferred unless otherwise authorized by
 
 6           the legislature[; and
 
 7      (3)  Restricted by the governor or the director of finance
 
 8           without the prior approval of the legislature].
 
 9      Any rule, policy, or action of any agency or individual in
 
10 contravention of this subsection shall be void as against public
 
11 policy."
 
12      SECTION 46.  Section 304-19, Hawaii Revised Statutes, is
 
13 amended to read as follows:
 
14      "304-19  Reporting of exempt fees of scholarship holders.
 
15 In computing its budget requests, the board of regents shall not
 
16 show amounts of tuition and registration fees from which holders
 
17 of scholarships are exempted.  These amounts shall be reported
 
18 for information purposes to the [department of budget and
 
19 finance] legislature but shall not be included in the statement
 
20 of university income."
 
21      SECTION 47.  Section 304-75, Hawaii Revised Statutes, is
 
22 amended to read as follows:
 
23      "304-75  Powers and duties of agency.  The board of regents
 

 
Page 60                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 may:
 
 2      (1)  Formulate, pursuant to the standards therefor set forth
 
 3           in section 7(a) of the Act of Congress, agricultural
 
 4           plans for this State for each calendar year, and from
 
 5           time to time make such revisions in the agricultural
 
 6           plans as may be necessary to conform to such standards;
 
 7      (2)  Utilize, in formulating and revising the agricultural
 
 8           plans, the assistance of the agricultural extension
 
 9           service and the agricultural experiment station;
 
10      (3)  Designate in such agricultural plans the board of
 
11           regents, University of Hawaii, as the agency of this
 
12           State to administer the agricultural plans;
 
13      (4)  Submit the agricultural plans to the Secretary of
 
14           Agriculture of the United States, prior to such time
 
15           and in such manner and form as the Secretary may
 
16           prescribe;
 
17      (5)  Receive on behalf of the State any grants made pursuant
 
18           to section 7 of the Soil Conservation and Domestic
 
19           Allotment Act, and utilize and expend the grants in
 
20           accordance with such agricultural plans as may have
 
21           been approved by the Secretary of Agriculture;
 
22      (6)  Make provision for establishment of state, county, and
 
23           community committees or associations of agricultural
 

 
Page 61                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1           producers, organized for such purpose, and for
 
 2           participation by them in the administration of the
 
 3           agricultural plans;
 
 4      (7)  Employ such personal services and incur such other
 
 5           expenses as it finds necessary for the efficient
 
 6           exercise of its powers and duties under this section;
 
 7      (8)  Utilize in the administration of the provisions hereof
 
 8           available services and assistance of other agencies of
 
 9           this State and of the agricultural extension service
 
10           and the agricultural experiment station of the
 
11           University of Hawaii;
 
12      (9)  Delegate to committees, associations, individuals,
 
13           corporations, or other agencies of this State, such
 
14           functions in carrying out sections 304-73 to 304-75 as
 
15           it deems suitable, and exercise all other powers and
 
16           authorities and do any and all other things which it
 
17           may deem necessary or proper to the performance of its
 
18           duties and functions hereunder;
 
19     (10)  Provide for the submission to the Secretary of
 
20           Agriculture of such reports as may be deemed requisite,
 
21           including such reports as may be required to ascertain
 
22           whether the agricultural plans are being carried out
 
23           according to their terms;
 

 
Page 62                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1     (11)  Prescribe such rules and regulations as may be
 
 2           necessary or expedient for the effective administration
 
 3           of the agricultural plans, and assure the correctness
 
 4           of and make possible the verification of such reports
 
 5           as may be required by the terms of the agricultural
 
 6           plans;
 
 7     (12)  Submit to the [governor of the State] legislature an
 
 8           annual report for each year covering the administration
 
 9           and operation of such program.
 
10      The board shall perform its duties and functions as such
 
11 agency under sections 304-73 to 304-75 separately and distinctly
 
12 from the performance of its duties and functions under any other
 
13 act or in any other capacity, except that the board may utilize
 
14 the services and the assistance of the personnel and faculties
 
15 normally used by it in the performance of such other functions if
 
16 it finds that the utilization of such services and assistance is
 
17 necessary to, or is calculated to assist substantially in, the
 
18 effective administration of such sections and that such personnel
 
19 or faculties may be utilized without interference with the
 
20 effective performance of such other duties and functions."
 
21      SECTION 48.  Section 304-93, Hawaii Revised Statutes, is
 
22 amended by amending subsection (b) to read as follows:
 
23      "(b)  The university may spend out of the state higher
 

 
Page 63                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 education loan fund up to two per cent of the total amount of
 
 2 loans outstanding for collection and administrative expenses.
 
 3 [In accordance with chapter 103D, the] The university may enter
 
 4 into written contracts with collection agencies for the purpose
 
 5 of collecting delinquent student loans.  All payments collected,
 
 6 exclusive of a collection agency's commissions, shall revert, and
 
 7 be credited, to the loan fund."
 
 8      SECTION 49.  Section 661-12, Hawaii Revised Statutes, is
 
 9 amended by amending the definition of "agency" in subsection (f)
 
10 to read as follows:
 
11      ""Agency" means any state or county board, commission,
 
12 department, or officer authorized by law to make rules or to
 
13 adjudicate contested cases except those in the legislative or
 
14 judicial branches[.] or the University of Hawaii."
 
15      SECTION 50.  Section 12 of Act 321, Session Laws of Hawaii
 
16 1986, as amended by section 69 of Act 283, Session Laws of Hawaii
 
17 1987, by section 7 of Act 371, Session Laws of Hawaii 1989, by
 
18 section 3 of Act 163, Session Laws of Hawaii 1991, by section 2
 
19 of Act 314, Session Laws of Hawaii 1993, by section 22 of Act 8,
 
20 Special Session Laws of Hawaii 1993, by section 1 of Act 180,
 
21 Session Laws of Hawaii 1997, and by section 24 of Act 115,
 
22 Session Laws of Hawaii 1998, is amended to read as follows:
 
23      "SECTION 12.  This Act shall take effect on July 1, 1986[,
 

 
Page 64                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 and shall be repealed as of June 30, 2005; provided that on
 
 2 repeal sections 40-1, 40-2, 40-4, 40-6, and 40-81, Hawaii Revised
 
 3 Statutes, are reenacted in the form in which they read on
 
 4 June 30, 1986, and section 40-85, Hawaii Revised Statutes, is
 
 5 reenacted in the form in which it read on June 30, 1991.];
 
 6 provided that:
 
 7      (1)  Section 3 of this Act is repealed on June 30, 2005;
 
 8      (2)  Section 40-1(b), Hawaii Revised Statutes, is repealed
 
 9           on June 30, 2005; provided that it is reenacted in the
 
10           form in which it read on June 30, 1986;
 
11      (3)  Sections 40-2, 40-6, and 40-81, Hawaii Revised
 
12           Statutes, are repealed on June 30, 2005; provided that
 
13           they are reenacted in the form in which they read on
 
14           June 30, 1986; and provided that amendments made by
 
15           Act    , Session Laws of Hawaii 1999, shall not be
 
16           repealed;
 
17      (4)  Section 40-4, Hawaii Revised Statutes, is repealed on
 
18           June 30, 2005; provided that it is reenacted in the
 
19           form in which it read on June 30, 1986; and provided
 
20           that the amendment made to that section adding the
 
21           University of Hawaii shall not be repealed; and
 
22      (5)  Section 40-58, Hawaii Revised Statutes, is repealed on
 
23           June 30, 2005; provided that it is reenacted in the
 

 
Page 65                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1           form in which it read on June 30, 1991; and provided
 
 2           that amendments made by Act    , Session Laws of Hawaii
 
 3           1999, shall not be repealed."        
 
 4      SECTION 51.  Section 26-11, Hawaii Revised Statutes, is
 
 5 repealed.
 
 6      ["26-11  University of Hawaii.  (a)  The University of
 
 7 Hawaii shall be headed by an executive board to be known as the
 
 8 board of regents.
 
 9      The board shall consist of twelve members.  No more than six
 
10 of the members shall be members of the same political party and
 
11 at least part of the membership of the board shall represent
 
12 geographic subdivisions of the State.  At least one member shall
 
13 be a University of Hawaii student at the time of the initial
 
14 appointment.  This member may be reappointed for one additional
 
15 term even though the member may no longer be a student at the
 
16 time of reappointment.
 
17      The board shall have power, in accordance with the
 
18 Constitution of the State and with law, to formulate policy, and
 
19 to exercise control over the university through its executive
 
20 officer, the president of the university.  The board shall have
 
21 exclusive jurisdiction over the internal organization and
 
22 management of the university.
 
23      (b)  The board of regents shall appoint and may remove an
 

 
Page 66                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 executive officer to be known as the president of the University
 
 2 of Hawaii.
 
 3      The University of Hawaii as heretofore constituted as a body
 
 4 corporate is continued as the University of Hawaii established by
 
 5 this chapter."]
 
 6      SECTION 52.  Except as modified in sections 22, 23, 24, 25,
 
 7 26, and 27 of this Act, no part of this Act shall contravene any
 
 8 part of chapters 76, 77, 89, Hawaii Revised Statutes, or any
 
 9 collective bargaining agreement that may have been or may be
 
10 negotiated under chapter 89, Hawaii Revised Statutes.
 
11      SECTION 53.  No regular civil service employees shall lose
 
12 their status or have their statutory rights and benefits reduced
 
13 as a result of this Act.
 
14      SECTION 54.  If any provision of this Act, or the
 
15 application thereof to any person or circumstance is held
 
16 invalid, the invalidity does not affect other provisions or
 
17 applications of the Act which can be given effect without the
 
18 invalid provision or application, and to this end the provisions
 
19 of this Act are severable.
 
20      SECTION 55.  Following approval of this Act, the revisor of
 
21 statutes shall insert the number of this Act in the blank spaces
 
22 in paragraphs (3) and (5) of Section 50.
 
23      SECTION 56.  Statutory material to be repealed is bracketed.
 

 
Page 67                                                    538
                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 New statutory material is underscored.
 
 2      SECTION 57.  This Act shall take effect on July 1, 1999.