Federal construction

Defines local resident in the State procurement code. (SB675 HD1)

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

                   A  BILL  FOR  AN  ACT



 1      SECTION 1.  The legislature finds that there exists in the
 2 State continuing high unemployment, underutilization of resident
 3 construction and supply firms, and high costs unfavorable to the
 4 welfare of Hawaii residents and to the economic health of the
 5 State.  The legislature further finds that as construction is one
 6 of the mainstays of Hawaii's economy, supporting and promoting
 7 this industry will help to boost the State's overall economy.
 8      As locally-financed building projects have slowed down,
 9 local contractors look toward federal military contracts as a
10 primary source of income.  Section 8077 of the Federal Defense
11 Appropriations Act of 1998, requires that when the unemployment
12 rate in Hawaii exceeds the national rate of unemployment,
13 contractors are required to employ local residents who possess or
14 would be able to acquire promptly the necessary skills to perform
15 the federal contract.
16      Despite this provision, local contractors argue that local
17 contractors and local laborers are not benefitting from either
18 Section 8077 of the Federal Defense Appropriations Act of 1998 or
19 the influx of millions of dollars in federal funds for military
20 construction projects in Hawaii.  Local contractors claim that

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 1 federal projects in Hawaii are being awarded instead to large
 2 mainland contractors, using their own subcontractors and bringing
 3 in mainland workers instead of hiring Hawaii residents.
 4      The legislature finds that as a result of this situation, a
 5 large percentage of federal moneys appropriated for defense
 6 projects in Hawaii leave Hawaii without a favorable effect on its
 7 economy.  The legislature further finds that one way to mitigate
 8 this outflow effect is to define what a "local resident" is in
 9 the Hawaii Revised Statutes.
10      The purpose of this Act is to define "local resident" in the
11 State's procurement code.
12      SECTION 2.  Section 103D-104, Hawaii Revised Statutes, is
13 amended by adding a new definition to be appropriately inserted
14 and to read as follows:
15      ""Local resident" means a person who:
16      (1)  Holds a current Hawaii business or contracting license;
17      (2)  Submits a bid for goods, service, or construction under
18           the name appearing on the person's current Hawaii
19           business or contracting license;
20      (3)  Has maintained a place of business within the State
21           staffed by the bidder or an employee of the bidder for
22           a period of six months immediately preceding the date
23           of the bid;

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 1      (4)  Is incorporated or registered to do business under the
 2           laws of the State, is a sole proprietorship and the
 3           proprietor is a resident of the State, or is a
 4           partnership and all partners are residents of the
 5           State; and
 6      (5)  If a joint venture, is composed entirely of entities
 7           that qualify under paragraphs (1) through (4) of this
 8           definition."
 9      SECTION 3.  New statutory material is underscored.
10      SECTION 4.  This Act shall take effect upon its approval.