STAND. COM. REP. NO. 1770

                                 Honolulu, Hawaii
                                                   , 1999

                                 RE: S.B. No. 1607
                                     S.D. 2
                                     H.D. 2




Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 1999
State of Hawaii

Sir:

     Your Committee on Finance, to which was referred S.B. No.
1607, S.D. 2, H.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO ECONOMIC DEVELOPMENT AND
     PRIVATE INVESTMENT ATTRACTION,"

begs leave to report as follows:

     The purpose of this bill is to support high technology
ventures in the State by:

     (1)  Appropriating funds to be paid into the Hawaii
          Strategic Development Corporation (HSDC) Revolving Fund
          to provide additional venture capital funding for
          Hawaii businesses, primarily high technology
          businesses; and

     (2)  Requiring the Board of Trustees of the Employees'
          Retirement System (ERS) to invest retirement system
          funds in qualified high technology businesses, subject
          to minimum and maximum limits, as a means of providing
          venture capital for those businesses.

     The Honolulu Japanese Chamber of Commerce, the Hawaii
Venture Capital Association, and an individual testified in
support of this measure.  The Department of Business, Economic
Development, and Tourism and the High Technology Development
Corporation testified in support of the intent of the measure.


 
 
                                 STAND. COM. REP. NO. 1770
                                 Page 2

 
     Your Committee has amended this bill by:

     (1)  Deleting provisions requiring the ERS Board to invest
          funds in qualified high technology businesses; and

     (2)  Making technical, nonsubstantive amendments for clarity
          and style.

     Even though the ERS Board will not be required to invest in
high technology businesses, your Committee encourages the ERS to
invest in these businesses as this would be beneficial to the
ERS, the businesses, and the State.

     As affirmed by the record of votes of the members of your
Committee on Finance that is attached to this report, your
Committee is in accord with the intent and purpose of S.B. No.
1607, S.D. 2, H.D. 1, as amended herein, and recommends that it
pass Third Reading in the form attached hereto as S.B. No. 1607,
S.D. 2, H.D. 2.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Finance,



                                   ______________________________
                                   DWIGHT Y. TAKAMINE, Chair