STAND. COM. REP. NO.364

Honolulu, Hawaii

, 2003

RE: S.B. No. 1491

 

 

Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committees on Transportation, Military Affairs, and Government Operations and Economic Development, to which was referred S.B. No. 1491 entitled:

"A BILL FOR AN ACT RELATING TO STATE GOVERNMENT,"

beg leave to report as follows:

The purpose of this measure is to remove the limit on the total amount of interest that may be charged to state agencies that fail to pay their debts on time.

Your Committees received testimony in support of this measure from the Department of Accounting and General Services.

Your Committees find that many vendors and contractors have experienced difficulty obtaining payment from the State, despite provisions in the law that mandate that the State will pay its debts within thirty days of becoming due.

Obviously, this situation is unfair, and your Committees support interest charges against the State for untimely payment. Since 1996, the interest chargeable to state agencies has been tied to the prime rate, and capped at twelve per cent per year. Since state agencies are still delinquent in paying their debts, your Committees support removing the ceiling on the amount of interest that may be charged.

As affirmed by the records of votes of the members of your Committees on Transportation, Military Affairs, and Government Operations and Economic Development that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 1491 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 Transportation, Military Affairs, and Government Operations and Economic Development,

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CAROL FUKUNAGA, Chair

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CAL KAWAMOTO, Chair