Honolulu, Hawaii
                                                     , 1999

                                   RE:  H.B. No. 830
                                        H.D. 1
                                        S.D. 1

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


     Your Committee on Economic Development, to which was
referred H.B. No. 830, H.D. 1, entitled: 


begs leave to report as follows:
     The purpose of this measure is to enable businesses to raise
growth capital through a simplified filing under the Small
Corporate Offerings Registration (SCOR) program, which allows a
company to raise up to $1,000,000 by selling common stock
directly to the public.

     Your Committee received testimony in support of this measure
from the Department of Business, Economic Development, and
Tourism, the Department of Commerce and Consumer Affairs, and the
Committee on Capital Formation.

     Your Committee finds that there is a severe shortage of
private equity capital in Hawaii to support the growth of
emerging companies, and that Hawaii is one of only two states not
utilizing the SCOR program.  In addition to providing a source of
new capital, SCOR documents will be allowed by the Small Business
Administration to establish the Angel Capital Electronic Network
(ACE-Net), a nationwide directory of high net worth individual
investors searching for high growth companies.

     Your Committee is supportive of the program, which will
supplement current venture capital programs and serve to attract

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additional private sector investment for expanding Hawaii

     Your Committee has amended this measure by deleting the
proposed language in section 485-6(16), Hawaii Revised Statutes,
and replacing it with new language that more accurately reflects
the intent to specify that the offerings under SCOR will be for
sale only to "accredited investors", as defined in title 17 Code
of Federal Regulations section 230.501(a), and to clarify the
terms of sales to accredited investors.  Your Committee has also
made a technical, nonsubstantive amendment.

     As affirmed by the record of votes of the members of your
Committee on Economic Development that is attached to this
report, your Committee is in accord with the intent and purpose
of H.B. No. 830, H.D. 1, as amended herein, and recommends that
it pass Second Reading in the form attached hereto as H.B.
No. 830, H.D. 1, S.D. 1, and be referred to the Committee on
Commerce and Consumer Protection.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Economic

                                   LORRAINE R. INOUYE, Chair

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