STAND. COM. REP. NO. 964

                                   Honolulu, Hawaii
                                                     , 1999

                                   RE:  H.B. No. 1035
                                        H.D. 1
                                        S.D. 1




Honorable Norman Mizuguchi
President of the Senate
Twentieth State Legislature
Regular Session of 1999
State of Hawaii

Sir:

     Your Committee on Commerce and Consumer Protection, to which
was referred H.B. No. 1035, H.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO THE EMPLOYEES' RETIREMENT
     SYSTEM,"

begs leave to report as follows:

     The purpose of this measure is to ensure that the Employees'
Retirement System's (ERS) investment program objectives are met
by:

     (1)  Requiring the ERS Board of Trustees to appoint a chief
          investment officer and an assistant administrator not
          subject to civil service law; and

     (2)  Requiring the Attorney General to serve as legal
          advisor to the Board of Trustees.

     The Employees' Retirement System commented on this measure.

     Your Committee finds that the responsibilities of the
Employees' Retirement System, which provides for retirement
benefits of all public employees of the four counties and the
State, continue to expand as financial investments become more
complex.  Further, as retirants live longer, healthier lives,
they remain part of the retirement system for a longer period.


 
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                                   STAND. COM. REP. NO. 964
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     Your Committee has amended the measure by allowing the Board
of Trustees of the Employees' Retirement System to retain outside
counsel if necessary.  Your Committee would like to see
administrative flexibility continue if the Board requires legal
advice or services that the Department of the Attorney General
might be unable to provide due to time or budget constraints.

     As affirmed by the record of votes of the members of your
Committee on Commerce and Consumer Protection that is attached to
this report, your Committee is in accord with the intent and
purpose of H.B. No. 1035, H.D. 1, as amended herein, and
recommends that it pass Second Reading in the form attached
hereto as H.B. No. 1035, H.D. 1, S.D. 1, and be referred to the
Committee on Ways and Means.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Commerce and
                                   Consumer Protection,



                                   ______________________________
                                   BRIAN KANNO, Co-Chair



                                   ______________________________
                                   BRIAN T. TANIGUCHI, Co-Chair

 
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