Honolulu, Hawaii

, 2002

RE: S.R. No. 19

S.D. 1



Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii


Your Committee on Transportation, Military Affairs and Government Operations, to which was referred S.R. No. 19 entitled:


begs leave to report as follows:

The purpose of this measure, as introduced, was to request the State Auditor to review the implementation of the Performance Information Procurement System (PIPS) by the Department of Accounting and General Services (DAGS).

Prior to the hearing on this measure, your Committee circulated a Proposed S.D. 1 version that amended this measure to request DAGS to form an Advisory Committee to perform an internal audit rather than requesting an external audit by the State Auditor.

Testimony in support of the Proposed S.D. 1 version of this measure was received from DAGS, the Plumbing and Mechanical Contractors Association of Hawaii, the Hawaii Building and Construction Trades Council, AFL-CIO, BUILD-PAC Hawaii, and RSI Roofing and Building Supply. Testimony in opposition to the Proposed S.D. 1 was received from the Hawaii Construction Coalition.

Testimony in support of this measure as introduced was received from Manufacturers Agency Pacific, Roofing Solutions International, the Hawaii Construction Coalition, Unitek Installation, Inc., West Pac Hawaii, Architectural Design Associates, Hi-Tec Roofing Services, Johns Manville, and a concerned citizen.

Your Committee finds that the implementation of PIPS shall be evaluated to determine whether the system has met the goals of greater accountability, reduced costs, fewer change orders, and better overall work product. During the hearing it became evident that PIPS shall also be reviewed to determine whether state contracts under PIPS are being awarded to only a small handful of contractors.

Therefore, your Committee supports the Proposed S.D. 1 version of this measure. DAGS testified that it has already begun searching for an independent audit firm to conduct an external audit of PIPS, and plans to proceed with the independent audit as soon as possible.

Your Committee amended this measure to insert a requirement that the Advisory Committee report to the Legislature prior to the 2003 regular session regarding its findings and whether PIPS is meeting its goals of lower costs, greater accountability, fewer change orders, and better work product. Also to be included in the report is whether state contracts are equitably distributed under PIPS.

Your Committee also amended the title of this measure for accuracy.

As affirmed by the record of votes of the members of your Committee on Transportation, Military Affairs and Government Operations that is attached to this report, your Committee concurs with the intent and purpose of S.R. No. 19, as amended herein, and recommends that it be referred to the Committee on Ways and Means, in the form attached hereto as S.R. No. 19, S.D. 1.


Respectfully submitted on behalf of the members of the Committee on Transportation, Military Affairs and Government Operations,