Honolulu, Hawaii
                                                     , 1999

                                   RE:  H.B. No. 37
                                        H.D. 1
                                        S.D. 2

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


     Your Committee on Ways and Means, to which was referred H.B.
No. 37, H.D. 1, S.D. 1, entitled:


begs leave to report as follows:

     The purpose of this bill is to promote the film production
industry in Hawaii.

     Specifically, this measure establishes the State of Hawaii
film revolving fund from which the Department of Business,
Economic Development, and Tourism may make loans and grants to
independent filmmakers who make films in Hawaii using local
creative talent and technical personnel.  This measure also
exempts revenue from the construction of film production
facilities from the general excise tax and exempts the
importation of related film equipment from the use tax.

     This measure also makes three appropriations of unspecified
amounts.  The first appropriation is to the fund, the second for
documentary films relating to the Pacific region made by Hawaii-
based film companies, and the third for internationally
recognized productions that can be used for tourism marketing.
Finally this measure requires the Department to report to the
Legislature before the Regular Session of 2000.

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                                   STAND. COM. REP. NO. 1548
                                   Page 2

     Your Committee finds that promotion of the film production
industry will diversify the economy as well as provide valuable
worldwide media exposure of the natural beauty of Hawaii.  Your
Committee has amended this bill by deleting all appropriations.

     Your Committee finds that the fund created in section 1 of
this measure is not intended to be replenished by the charges for
the grants and loans provided, but is intended to be a dedicated
source of funds that is set aside by law for the specific purpose
stated.  Your Committee agrees with the Department of Budget and
Finance's objections to the revolving fund and has amended this
measure by changing the revolving fund to a special fund.

     As affirmed by the record of votes of the members of your
Committee on Ways and Means that is attached to this report, your
Committee is in accord with the intent and purpose of H.B. No.
37, H.D. 1, S.D. 1, as amended herein, and recommends that it
pass Third Reading in the form attached hereto as H.B. No. 37,
H.D. 1, S.D. 2.

                                 Respectfully submitted on behalf
                                 of the members of the Committee
                                 on Ways and Means,

                                 CAROL FUKUNAGA, Co-Chair

                                 ANDREW LEVIN, Co-Chair

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