Honolulu, Hawaii
                                                     , 1999

                                   RE:  S.B. No. 1144
                                        S.D. 1

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


     Your Committee on Commerce and Consumer Protection, to which
was referred S.B. No. 1144 entitled: 


begs leave to report as follows:

     The purpose of this measure is to dedicate a portion of the
franchise tax revenues to the financial institution examiners'
revolving fund.

     Testimony in support of this measure was presented at the
hearing by a representative of the Department of Commerce and
Consumer Affairs, the Hawaii Financial Services Association, and
the Hawaii Bankers Association.  Though not present at the
hearing, written testimony in support of this measure was
received from the Hawaii Credit Union League.  The Tax Foundation
submitted written comments on the measure.

     Your Committee finds that this measure moves the Division of
Financial Institutions to self-sufficiency and provides the
flexibility to effectively regulate the constantly changing and
complex financial institution industry.  This measure provides
for that flexibility by providing a dedicated source of funding
for the division.

     Your Committee also finds that it is more judicious for the
measure's effective date to correspond with the beginning of the
fiscal year, July 1, 1999.

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                                   STAND. COM. REP. NO. 304
                                   Page 2

     Your Committee has amended this measure by:

     (1)  Deleting the specified percentage to be deposited into
          the special fund;

     (2)  Changing the effective date to July 1, 1999; and

     (3)  Making technical, nonsubstantive changes to conform to
          preferred drafting style.

     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 S.B. No. 1144, as amended herein, and recommends that
it pass Second Reading in the form attached hereto as S.B.
No. 1144, S.D. 1, and be referred to the Committee on Ways and

                                   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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