Honolulu, Hawaii
                                                     , 1999

                                   RE:  S.B. No. 426
                                        S.D. 1

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 S.B.
No. 426 entitled: 


begs leave to report as follows:

     This bill was introduced as a short-form bill, which is
sometimes referred to as a "vehicle" bill primarily used to
introduce a bill containing only a general idea as to the purpose
of the bill without specific details in long form.

     Your Committee has amended the bill to provide the
substantive contents in long form so that a public hearing may be
properly held.

     As amended, the purpose of this bill is to establish a
program for the specific purpose of maximizing the receipt of
federal revenues for state agencies and programs.

     The program, which would be placed within the Research
Corporation of the University of Hawaii, is intended to secure
eligible federal funds and grants for various state programs.  In
particular, the bill provides for this program to serve as a
facilitator in state government responsible for applying for and
maximizing federal funds and as the State's clearinghouse for
information on federal funds; serve as an "early alert" on
opportunities for obtaining federal funds to appropriate state

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agencies; coordinate all state efforts in applying for federal
funds; and monitor federal compliance, including following-up
with applicable federal agencies on behalf of state departments.

     The bill further provides that the program will help pool
applicable agency applications for federal funds into one or more
multi-agency applications to maximize the target populations that
are served by those agencies in applying for federal funds.  The
bill also offers incentives to state agencies to work with the
program in aggressively pursuing federal funds; provides for the
temporary transfer of personnel from other state agencies into
this program; requires it to prepare comprehensive annual reports
to the legislature; requires each state agency to designate
employees as federal funds coordinators; and creates a grant
writing team in the program.  Finally, this bill makes permanent
the interagency federal revenue maximization revolving fund by
repealing the June 30, 1999, sunset date for that fund.

     Your Committee agrees with the intent of this bill to create
a permanent agency in state government to aggressively seek
federal dollars on behalf of state programs.  Your Committee
finds that there is often a very limited time period in which to
secure federal assistance for many state programs, much of which
is available on a matching basis with state funds, and that the
existing piecemeal approach to seeking new federal funds and
grants is often counterproductive.  The creation of a
coordinating program within the Research Corporation of the
University of Hawaii would allow state agencies to pool their
applications as appropriate into a consortium of agencies to
become more competitive with state agencies on the Mainland
representing larger populations.  Finally, the creation of a
professional grant writing team would help to consolidate these
important functions in one office that has established an
expertise in seeking grant funding.

     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 action to report out S.B. No.
426, as amended herein, and recommends that it pass Second
Reading in the form attached hereto as S.B. No. 426, S.D. 1, and
be recommitted to the Committee on Ways and Means for further

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                                   STAND. COM. REP. NO. 561
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                                 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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