Honolulu, Hawaii

, 2002

RE: H.B. No. 2231



Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii


Your Committees on Education and Judiciary, to which was referred H.B. No. 2231 entitled:


beg leave to report as follows:

The purpose of this measure is to clarify the confidential nature of the Auditor's records in the education area by allowing the Auditor access to any student records that may be necessary in connection with any audit as an authorized representative of the Department of Education and Department of Health.

Your Committees received testimony favoring this measure from the State Auditor.

Your Committees find that the Auditor's restricted access to records in the education area has obstructed the constitutional duties of the Auditor in examining educational services.

Your Committees make note of the Auditor's following responses to prior testimony of other agencies:

(1) This measure does not attempt, nor was it intended to make the Auditor a contractor and answer to the Departments of Education and Health. It is only intended to clarify that the Auditor, in performing its audit functions, has access to the records and information reasonably required to conduct an audit of those entities;

(2) The Family Educational Rights and Privacy Act (FERPA) provisions pertinent to audits and to this measure are contained in 20 U.S.C. Sec. 1232g(b)(3) and (5), not in 20 U.S.C. Sec. 1232g(b)(1)(C);

(3) This measure does not pose a separation of powers issue because the Auditor would not be performing any executive branch functions; rather, this measure would better enable the Auditor to carry out its constitutional and statutory mandates to audit all departments, offices, and agencies of the State;

(4) The Attorney General has argued that the Department of Education's administrative rules in Chapter 8-34, Hawaii Revised Statutes, are a "codification" of FERPA. However, the rules terminology differs from FERPA terminology, making it debatable whether the rules are a "codification" of FERPA. This measure would clarify the FERPA term "State educational authorities" to include the Auditor; and

(5) The Health Insurance Portability and Accountability Act (HIPAA) and the Individuals with Disabilities Education Act (IDEA) are argued to preclude passage of this measure. HIPAA's regulations expressly state that HIPAA does not apply to information contained in records covered by FERPA, and HIPAA regulations expressly allow disclosure of confidential information for audit purposes. IDEA requires that certain information be kept confidential by FERPA standards. This measure complies with FERPA confidentiality standards and therefore does not conflict with IDEA.

As affirmed by the records of votes of the members of your Committees on Education and Judiciary that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 2231, and recommend that it pass Second Reading and be referred to the Committee on Ways and Means.


Respectfully submitted on behalf of the members of the Committees on Education and Judiciary,