STAND. COM. REP. NO. 659

                                 Honolulu, Hawaii
                                                   , 1999

                                 RE: H.B. No. 1008
                                     




Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 1999
State of Hawaii

Sir:

     Your Committee on Health, to which was referred H.B. No.
1008 entitled: 

     "A BILL FOR AN ACT RELATING TO TOBACCO LIABILITY,"

begs leave to report as follows:

     The purposes of this bill are to 1) require tobacco
manufacturers who determine not to enter into the November 23,
1998 "Master Settlement Agreement" with the State, to establish a
reserve fund to guarantee a source of compensation and 2) to
prevent such manufacturers from deriving large, short-term
profits and then becoming judgement-proof before liability may
arise.

     The Department of the Attorney General testified in strong
support of the bill and presented important facts on this matter.
Indeed, should Hawaii fails to pass this legislation, its share
of the national settlement will be reduced in accordance with a
market share factor for sales by non-settling tobacco
manufacturers.  Under this provision of the national settlement,
it is possible for Hawaii to lose its entire allocation.  

     Taking this compelling argument into account, your Committee
has determined that the passage of this measure is absolutely
essential to assure that Hawaii's receive its share of the Master
Tobacco Settlement. 

 
 
 
 
 
                                 STAND. COM. REP. NO. 659
                                 Page 2

 

     As affirmed by the record of votes of the members of your
Committee on Health that is attached to this report, your
Committee is in accord with the intent and purpose of H.B. No.
1008 and recommends that it pass Second Reading and be referred
to the Committee on Finance.

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



                                   ______________________________
                                   ALEXANDER C. SANTIAGO, Chair