Honolulu, Hawaii
                                                     , 1999

                                   RE:  S.B. No. 1117
                                        S.D. 1

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


     Your Committee on Government Operations and Housing, to
which was referred S.B. No. 1117 entitled: 


begs leave to report as follows:

     The purpose of S.B. No. 1117 is to exempt contracts for
legal service performed for the State, a state agency, or a state
official, outside the State, from the requirements of the State
Procurement Code.

     Prior to the hearing on this measure, your Committee
circulated a proposed S.B. No. 1117, S.D. 1, with entirely new
contents.  Testimony was received on the proposed S.D. 1.

     The purpose of the proposed S.B. No. 1117, S.D. 1, is to
require the procurement policy office to adopt rules for a
managed procurement process that evaluates the efficiency,
effectiveness, and economy of the purchase using uniform
accounting standards.
     Testimony in support of the proposed S.D. 1 was received
from Consulting Engineers Council of Hawaii, Consulting
Structural Hawaii, Inc., Fewell Geotechnical Engineering, Ltd.,
Jas W. Glover, Ltd., Pacific Geotechnical Engineers, Inc., and
Paul Louie, and Associates.  Testimony opposed to the proposed
S.D. 1 was received from the State Procurement Office, the Office

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of the State Attorney General, and the Kauai County Department of

     Your Committee finds that the State uses the procurement
code to ensure that state purchases meet certain standards, but
it has thus far not required any type of determination that the
procurement of certain services or goods is the most effective,
efficient, and economical path to take.

     Your Committee finds that the current economic situation
requires the State to have a managed process for procurement and
to adopt standard methods for evaluation to ensure the effective,
efficient, and economical procurement of services.

     Your Committee finds that the proposed S.D. 1 will help
empower state government in the delivery of competitive and cost
efficient services.  In turn, this will help to assure that
Hawaii's citizens receive the highest quality of government
provided goods, services, and construction at the lowest costs.

     Your Committee finds that using uniform accounting standards
will be the most equitable method of determining whether a
service or function can be provided more efficiently,
effectively, and economically by the government or private

     Your Committee has amended this measure by deleting its
contents and inserting the proposed S.D. 1.

     As affirmed by the record of votes of the members of your
Committee on Government Operations and Housing that is attached
to this report, your Committee is in accord with the intent and
purpose of S.B. No. 1117, as amended herein, and recommends that
it pass Second Reading in the form attached hereto as S.B.
No. 1117, S.D. 1, and be placed on the calendar for Third

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Government
                                   Operations and Housing,

                                   ROD TAM, Chair

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