STAND. COM. REP. NO.1365-02

Honolulu, Hawaii

, 2002

RE: S.C.R. No. 43

H.D. 1




Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii


Your Committee on Transportation, to which was referred S.C.R. No. 43 entitled:


begs leave to report as follows:

The purpose of this measure is to encourage state agencies to do everything possible to foster competition and new entrants in the interisland air transportation market.

Your Committee finds that the September 11, 2001, terrorist attacks significantly adversely affected the State's already weakened economy, particularly the airline and visitor industries. This, coupled with consideration of a merger between Aloha Airlines and Hawaiian Airlines earlier this year, has served as a warning signal to the State of the critical need to protect Hawaii's interisland air service market and to foster competition within that market to better serve Hawaii's residents and visitors.

Your Committee further finds that, during the 2001 Regular Session, the Legislature passed legislation authorizing the Governor, mayors, and heads of public jurisdictions to contract services to private entities as appropriate and authorizing the Board of Land and Natural Resources, subject to approval, to issue leases for small boat harbors and other boating facility properties for maritime and non-maritime related activities. With respect to state boating facilities, your Committee notes that the Auditor has reported that more than $130,000,000 is needed for repair and maintenance of the various facilities maintained and operated by the Department of Land and Natural Resources, Division of Boating. Moreover, in numerous reports dating back to 1993, the Auditor has continually emphasized the need to rectify inadequacies in the state boating facilities by correcting operational deficiencies in the boating facilities program.

Furthermore, your Committee is cognizant that private companies continue to express interest in managing and redeveloping the marina areas in Hawaii, and are committed to investing tens of millions of dollars in construction projects within the Honokohau small boat harbor. In view of the limited state funds available, this may be the only means to effect the needed repairs and development of this valuable state resource. Your Committee believes that the creation of additional jobs, increased tax revenues, and the value added to existing facilities produced by any private capital investment in these small boat facilities would be a great benefit to the State during this time of economic uncertainty.

Accordingly, your Committee has amended this measure to encourage all relevant state agencies to take action on transportation issues that affect the economy and, more specifically, to:

(1) Foster competition in the interisland air transportation market, including offering counter space and other facilities at Hawaii's airports to potential airline market entrants; and

(2) Authorize the Board of Land and Natural Resources to lease submerged and tidal lands of the Honokohau small boat harbor to private entities as it deems necessary for commercial, recreational, educational, and research purposes, consistent with all applicable state and federal laws.

As affirmed by the record of votes of the members of your Committee on Transportation that is attached to this report, your Committee concurs with the intent and purpose of S.C.R. No. 43, as amended herein, and recommends its adoption in the form attached hereto as S.C.R. No. 43, H.D. 1.

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