Honolulu, Hawaii
                                                     , 1999

                                   RE:  H.B. No. 833
                                        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 Education and Technology, to which was
referred H.B. No. 833, H.D. 1, entitled: 


begs leave to report as follows:

     The purpose of this measure is to authorize the University
of Hawaii to borrow moneys from financial institutions and to
carry over unexpended funds from one fiscal period to the next.  

     The University of Hawaii and the Department of Budget and
Finance testified in support of the measure's intent.

     This measure would provide the University of Hawaii with
greater flexibility in managing its resources by authorizing the
University to establish an activities revolving fund, borrow
funds from financial institutions in an aggregate amount not to
exceed $10 million, expend funds in excess of its allotments, and
carry over unexpended funds.
     This measure further provides that loans made by the
University are not "bonds" within the meaning of section 12 of
article VII of the State Constitution, in order to avoid having
the University's loan amounts counted against the State's debt
limit.  However, your Committee finds that because exceptions to
the State Constitution cannot be established by State statute,
loans made by the University would still be counted against the
State's debt limit, notwithstanding the exclusionary language of

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the measure, thereby reducing the amount the State is able to
borrow.  Accordingly, your Committee has amended this measure by:

     (1)  Deleting the provisions relating to the University's
          authority to borrow funds and establish a University
          activities revolving fund;

     (2)  Making changes in the purpose section and in the
          provision amending section 37-32, Hawaii Revised
          Statutes (HRS), consistent with the above amendment;

     (3)  Deleting amendments to section 37-42, HRS, that lie
          beyond the scope of the title of this measure; and

     (4)  Making technical, nonsubstantive changes.    

     As affirmed by the record of votes of the members of your
Committee on Education and Technology that is attached to this
report, your Committee is in accord with the intent and purpose
of H.B. No. 833, H.D. 1, as amended herein, and recommends that
it pass Second Reading in the form attached hereto as H.B.
No. 833, 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 Education and

                                   DAVID Y. IGE, Chair

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