STAND. COM. REP. NO. 1610

Honolulu, Hawaii

, 2005

RE: H.B. No. 704

H.D. 1

S.D. 2

 

 

Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred H.B. No. 704, H.D. 1, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO EMPLOYMENT SECURITY,"

begs leave to report as follows:

The purpose of this measure is to conform the law relating to the use of unemployment insurance trust fund moneys to P.L. 107-147, the federal Temporary Extended Unemployment Compensation Act of 2002, to allow for the distribution and utilization of federal Reed Act moneys.

This measure also appropriates the sum of $10,000,000 from the unemployment insurance trust fund in each year of the 2005-2007 fiscal biennium to:

(1) Improve the administration and infrastructure of Hawaii's employee and employer services provided by the Department of Labor and Industrial Relations and the four counties; and

(2) Have the Leeward Community College provide education and job training for immigrants from the Freely Associated States, pursuant to the workforce development program established under Act 225, Session Laws of Hawaii 2004.

Your Committee finds that, in 2002, the Department of Labor and Industrial Relations received approximately $31,000,000 in federal Reed Act funds. These funds have been placed within the unemployment trust fund, which can be utilized for the payment of benefits and expenses incurred for the administration of the unemployment compensation laws, as well as for public employment offices. Your Committee further finds that Reed Act distributions made prior to P.L. 107-147 were restricted to unemployment insurance administration purposes only. Your Committee also finds that, under section 303(a)(8) of the Social Security Act, state laws must include provisions for the expenditure of all moneys. Therefore, your Committee understands that the State's existing law must be amended to allow for the utilization of the 2002 Reed Act funds.

In addition, your Committee finds that the utilization of these funds is necessary not only to improve the State's automated unemployment insurance and workforce development division services, but also to address the specific needs of the local workforce investment boards of the four counties and to educate and train immigrants from the Freely Associated States so that they may become skilled and qualified members of our workforce.

Your Committee has amended the measure by:

(1) Deleting section 1 of the measure;

(2) Paring down the uses for which the appropriated moneys may be used for to only include:

(A) The improved connectivity of the Department of Labor and Industrial Relations' automated unemployment insurance and workforce development division computer systems;

(B) The assisting of the local workforce investment boards of each county;

(C) The establishment of systems for the electronic payment of employer taxes and the direct deposit of claimant benefit payments; and

(D) The provision of education and job training services to immigrants from the Freely Associated States through the Leeward Community College;

(3) Clarifying that the moneys appropriated to the Department of Labor and Industrial Relations are to improve the State's automated unemployment insurance and workforce development division services and to establish systems for the electronic payment of employer taxes and the direct deposit of claimant benefit payments are seed moneys;

(4) Deleting the $1,000,000 appropriation to the Leeward Community College;

(5) Specifying that, of the $10,000,000 appropriated in each year of the fiscal biennium:

(A) The sum of $4,795,000 shall be allocated to the City and County of Honolulu's workforce investment board; provided that the workforce investment board partners with the Leeward Community College for education and job training for immigrants from the Freely Associated States, pursuant to the workforce development program established under Act 225, Session Laws of Hawaii 2004;

(B) The sum of $1,252,775 shall be allocated to the County of Maui's workforce investment board;

(C) The sum of $1,000,000 shall be allocated to the County of Kauai's workforce investment board;

(D) The sum of $1,500,000 shall be allocated to the County of Hawaii's workforce investment board; and

(E) The sum of $452,225 shall be allocated for the establishment of systems for the electronic payment of employer taxes and the direct deposit of claimant benefit payments; and

(6) Making technical, nonsubstantive amendments for purposes of clarity and style.

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 H.B. No. 704, H.D. 1, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 704, H.D. 1, S.D. 2.

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

____________________________

BRIAN T. TANIGUCHI, Chair