STAND. COM. REP. NO. 387

                                 Honolulu, Hawaii
                                                   , 1999

                                 RE: H.B. No. 1082
                                     




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

Sir:

     Your Committee on Consumer Protection and Commerce, to which
was referred H.B. No. 1082 entitled: 

     "A BILL FOR AN ACT RELATING TO FINANCIAL INSTITUTIONS,"

begs leave to report as follows:

     The purpose of this bill is to allocate forty per cent of
all revenues and amounts received from financial institutions
under the franchise tax law, to be credited to the financial
institution examiners' revolving fund.  This measure will allow
the Division of Financial Institutions (DFI) to become self-
funding.

     The Department of Commerce and Consumer Affairs's testimony
in support of the bill emphasized the importance of insulating
DFI from the fluctuations of funding out of the general fund, in
order that DFI can maintain examination and support staff
adequate to effectively supervise state-chartered financial
institutions, and can maintain its accreditation status.  Hawaii
Financial Services Association, Hawaii Credit Union League, and
Hawaii Bankers Association also testified in support of the bill.
The Tax Foundation of Hawaii submitted testimony in opposition to
the bill.

     As affirmed by the record of votes of the members of your
Committee on Consumer Protection and Commerce that is attached to
this report, your Committee is in accord with the intent and
purpose of H.B. No. 1082 and recommends that it pass Second
Reading and be referred to the Committee on Finance.

 
 
                                 STAND. COM. REP. NO. 387
                                 Page 2

 
                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Consumer
                                   Protection and Commerce,



                                   ______________________________
                                   RON MENOR, Chair