STAND. COM. REP. NO. 707

                                 Honolulu, Hawaii
                                                   , 1999

                                 RE: H.B. No. 247
                                     H.D. 1




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

Sir:

     Your Committees on Consumer Protection and Commerce and
Judiciary and Hawaiian Affairs, to which was referred H.B. No.
247 entitled:

     "A BILL FOR AN ACT RELATING TO TELECOMMUNICATIONS,"

beg leave to report as follows:

     The purpose of this bill is to require the Public Utilities
Commission, after due process, to decertify and replace a
telecommunications provider that is providing less than adequate
services in a service area.

     The bill also provides eminent domain powers to
telecommunications providers who replace another provider
pursuant to this bill.  The powers allow the new provider to
acquire the former provider's real and personal property and
other rights in the service area.

     Your Committees find that this bill is in part, the result
of efforts to address the problem of providing telecommunications
services to the Ka'u community on the Big Island.  Rural areas
like Ka'u do not enjoy the benefits of economies of scale that
could otherwise provide enhanced and affordable services with a
reasonable return to the provider.  On the other hand, your
Committees are mindful of the obligations and duties of
telecommunications providers and their responsibility to provide

 
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services that will ensure the health, safety and welfare of those
that they service.

     Your Committees are therefore supportive of the intent of
this bill but have certain reservations with respect to the
rights of present providers and the services they are allowed to
provide under varying circumstances under the bill.  Accordingly,
your Committees have amended the bill by:

     (1)  Deleting all references to eminent domain powers given
          to providers.  Instead, present providers will be
          allowed to negotiate the use or sale of their real and
          personal property;

     (2)  Deleting the retroactivity clause in section 5 of the
          bill; 

     (3)  Qualifying the definition of "decertify" to apply only
          to local exchange services.  This change would allow a
          decertified provider to service other areas, such as
          long distance services; and

     (4)  Making technical, nonsubstantive amendments.

     Your Committees received testimonies from the Department of
Business, Economic Development, and Tourism, the Department of
Commerce and Consumer Affairs, AT&T, GST Telecom Hawaii, the
International Brotherhood of Electrical Workers, the Ka'u Federal
Credit Union, GTE, Oceanic Communications, a TelHawaii employee
and three private citizens.

     As affirmed by the records of votes of the members of your
Committees on Consumer Protection and Commerce and Judiciary and
Hawaiian Affairs that are attached to this report, your
Committees are in accord with the intent and purpose of H.B. No.
247, as amended herein, and recommends that it be referred to the
Committee on Finance in the form attached hereto as H.B. No. 247,
H.D. 1.


 
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                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committees on Consumer
                                   Protection and Commerce and
                                   Judiciary and Hawaiian
                                   Affairs,

                                   
                                   
                                   
                                   
______________________________     ______________________________
PAUL T. OSHIRO, Chair              RON MENOR, Chair

 
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