STAND. COM. REP. NO. 2832

                                   Honolulu, Hawaii
                                                     , 2000

                                   RE:  H.B. No. 2836
                                        H.D. 1
                                        S.D. 1




Honorable Norman Mizuguchi
President of the Senate
Twentieth State Legislature
Regular Session of 2000
State of Hawaii

Sir:

     Your Committee on Water, Land, and Hawaiian Affairs, to
which was referred H.B. No. 2836, H.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO CONVEYANCE TAX,"

begs leave to report as follows:

     The purpose of this measure is to authorize the use of a
portion of conveyance tax proceeds to fund watershed management
projects.

     The Department of Land and Natural Resources (DLNR), the
Land Use Research Foundation of Hawaii, the Board of Water Supply
of the City & County of Honolulu, and the Nature Conservancy of
Hawaii testified in support of the measure.  The Tax Foundation
commented on the measure.

     Your Committee finds that with over half of Hawaii's
remaining natural lands in private ownership, the Legislature in
1991, established the natural area partnership program and the
forest stewardship program to provide incentives for private
landowners to provide long-term protection of important natural
resources on private lands.  These incentives were in the form of
state matching funds to landowners willing to dedicate their
lands to conservation.

     The Legislature also provided for a permanent, dedicated
source of funding for the programs by earmarking twenty-five per
cent of the conveyance tax revenues for these programs.  The

 
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Legislature's intent was to enhance private participation in the
protection and management of conservation lands.

     Since the inception of the natural area partnership and
forest stewardship programs, significant efforts have given rise
to another innovative public-private undertaking involving the
collaboration of major landowners and stakeholders to protect
thousands of acres of critical watershed areas.  This effort
began with the formation of the East Maui Watershed Partnership
in 1991, followed by West Maui Watershed Partnership in 1998, and
Koolau Watershed Partnership and East Molokai Watershed
Partnership in 1999.  Collectively, these partnerships involve
some 260,000 acres of land and include an array of major
landowners and government agencies including the United States
Fish & Wildlife Services, National Park Services, the DLNR, the
Department of Hawaiian Home Lands, county boards of water supply,
and numerous other agencies.

     Your Committee believes that, just as the natural area
reserves system needed funds to accomplish its goals, so too does
the protection of critical watershed areas.

     Your Committee has amended the measure by:

     (1)  Amending both versions of Section 247-7, Hawaii Revised
          Statutes, one that will expire on June 30, 2001, and
          the other that will take effect on July 1, 2001;

     (2)  Adding the Youth Conservation Corps that is established
          under Chapter 193, Hawaii Revised Statutes, as one of
          the programs that will benefit from the proceeds of the
          conveyance tax allocation;

     (3)  Giving the Chair of DLNR discretionary authority to
          disburse conveyance tax allocations to the specified
          programs;

     (4)  Amending the effective date of the measure to reflect
          the insertion of the prospective change in statutory
          language; and

     (5)  Making a technical, nonsubstantive amendment for the
          purpose of style.

     The measure, as received by your Committee, amended the
version of Section 247-7, Hawaii Revised Statutes, that is to be
repealed on June 30, 2001, and section 2 of Act 170, Session Laws
of Hawaii 1998, which amended the same section of law but is
effective after June 30, 2001.

 
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     As affirmed by the record of votes of the members of your
Committee on Water, Land, and Hawaiian Affairs that is attached
to this report, your Committee is in accord with the intent and
purpose of H.B. No. 2836, H.D. 1, as amended herein, and
recommends that it pass Second Reading in the form attached
hereto as H.B. No. 2836, 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 Water, Land, and
                                   Hawaiian Affairs,



                                   ______________________________
                                   COLLEEN HANABUSA, Chair

 
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