STAND. COM. REP. NO.2812

Honolulu, Hawaii

, 2002

RE: S.B. No. 3061

S.D. 2

 

 

Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred S.B. No. 3061, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO ECONOMIC DEVELOPMENT,"

begs leave to report as follows:

The purpose of this measure is to implement various tax and other measures designed to stimulate Hawaii's economy.

In particular, this measure:

    1. Authorizes the issuance of general obligation bonds for macadamia nut processing, manufacturing, and production facilities;
    2. Appropriates funds for the formulation of a strategic plan to make Hawaii the "Geneva of the Pacific";
    3. Appropriates funds for the marketing of Hawaii products and services;
    4. Supports the activities of PACON International in the design and planning of an ocean park;
    5. Creates a statewide unifying entity of seventeen members from the public and private sectors to create a strategic economic development plan and to appropriate money for its development;
    6. Amends the hiring requirements for firms enrolled in the Hawaii enterprise zones partnership;
    7. Clarifies the application of certain high technology tax incentives;
    8. Exempts professional live musical performers from general excise taxation;
    9. Appropriates funds for the community-based economic development program of the Department of Business, Economic Development, and Tourism;
    10. Establishes a council to advise and assist the Legislature on the economy;
    11. Adds a new law on misleading electronic mail;
    12. Extends the general excise tax exemption of the enterprise zone to retailers in East Maui until June 30, 2007;
    13. Repeals the June 30, 2002, sunset date for the Regulatory Flexibility Act and the small business defender, and makes other changes to more effectively assist small businesses;
    14. Changes the frequency for adjustment of the loan interest rate for the Hawaii capital loan program from semiannual to the first of each month; and
    15. Allows the Department of Business, Economic Development, and Tourism to provide low interest loans to inventors or authors for the development of their new manufactured products, marks, works, works of authorship, or inventions.

Your Committee finds that this measure offers a multi-pronged approach to addressing both the intermediate and long-term needs of Hawaii's economy. Your Committee further finds that this measure will also provide needed economic relief to East Maui, help Hawaii's performing arts community, provide incentives to technology companies, assist small businesses, and generally increase the State's economic diversification and stability.

Upon further consideration, your Committee has amended this measure by:

    1. Deleting the contents of part XII of the bill, which added a new chapter, the "Misleading Electronic Mail Act", to the Hawaii Revised Statutes. While your Committee agrees with the intent of protecting Hawaii's consumers from unsolicited and misleading electronic mail, your Committee finds that this chapter exceeds the scope of the bill's title, and should be deleted;
    2. Adding in place of the Misleading Electronic Mail Act the substantive provisions of S.B. No. 2706, "Relating to the High Technology Development Corporation", which exempts lands held by the High Technology Development Corporation from chapter 171, Hawaii Revised Statutes, relating to the management and disposition of public lands.
    3. Your Committee finds that chapter 171 provides, among other things, that public lands be managed, administered, and controlled by the Department of Land and Natural Resources, unless the lands are specifically exempted in section 171-2. This measure accordingly amends that section to make it consistent with section 206M-3(a), which gives the Corporation the power to acquire, lease, hold, and improve real, personal, or mixed property.

      Your Committee further finds that since its inception in 1983, the Corporation has developed several high technology innovation centers and projects, including the Manoa Innovation Center and the Maui Research and Technology Center, which provide office and research space to private technology-based companies. Your Committee finds that exempting lands held by the Corporation from chapter 171 will further support the Corporation's purpose and mission without hindrance, as originally intended by the Legislature;

    4. Amending section 1(11) of the bill to reflect the above changes made by your Committee;
    5. Replacing the sums appropriated with blank amounts in order to facilitate further discussion on the funding necessary to carry out the purposes of this measure; and
    6. Making technical nonsubstantive changes for the purposes of clarity and consistency.

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 intent and purpose of S.B. No. 3061, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 3061, S.D. 2.

Respectfully submitted on behalf of the members of the Committee on Ways and Means,

____________________________

BRIAN T. TANIGUCHI, Chair