STAND. COM. REP. NO. 219-00

                                 Honolulu, Hawaii
                                                   , 2000

                                 RE: H.B. No. 2878
                                     H.D. 1




Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 2000
State of Hawaii

Sir:

     Your Committees on Economic Development and Business
Concerns and Labor and Public Employment, to which was referred
H.B. No. 2878 entitled: 

     "A BILL FOR AN ACT RELATING TO PUBLIC CONTRACTS AND
     PROCUREMENT,"

beg leave to report as follows:

     The purpose of this bill is to ensure prompt payment on
state projects by contractors to subcontractors by:

     (1)  Specifying that subcontractors provide evidence to
          contractors of a valid union trust fund benefit payment
          bond, performance/payment bond, any other bond, or
          another mutually agreeable form of collateral; and

     (2)  Imposing penalties on contractors for failing to
          properly pay amounts owed to subcontractors.

     The Construction Industry Legislative Organization, the
Pacific Electrical Contractors' Association, the Plumbing and
Mechanical Contractors Association of Hawaii, the Subcontractors
Association of Hawaii, the General Contractors Association of
Hawaii, the Building Industry Association of Hawaii, Hidano
Construction, Inc., Hawaii Surety Association, and an individual
testified in support of this measure.  The Department of
Accounting and General Services testified in support of the
intent of the measure.  Comments were submitted by the State
Procurement Office.

 
 
                                 STAND. COM. REP. NO. 219-00
                                 Page 2

 

     Your Committees have amended this bill by:

     (1)  Deleting the section repealing Section 103-10.5, Hawaii
          Revised Statutes; and

     (2)  Making technical, nonsubstantive amendments to correct
          drafting errors and for clarity, consistency, and
          style.

     As affirmed by the records of votes of the members of your
Committees on Economic Development and Business Concerns and
Labor and Public Employment that are attached to this report,
your Committees are in accord with the intent and purpose of H.B.
No. 2878, as amended herein, and recommend that it pass Second
Reading in the form attached hereto as H.B. No. 2878, H.D. 1, and
be referred to the Committee on Finance.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committees on Economic
                                   Development and Business
                                   Concerns and Labor and Public
                                   Employment,

                                   
                                   
                                   
                                   
______________________________     ______________________________
TERRY NUI YOSHINAGA, Chair         ROBERT N. HERKES, Chair