STAND. COM. REP. NO. 422

                                 Honolulu, Hawaii
                                                   , 1999

                                 RE: H.B. No. 801
                                     H.D. 1




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

Sir:

     Your Committee on Agriculture, to which was referred H.B.
No. 801 entitled: 

     "A BILL FOR AN ACT RELATING TO SPECIAL PURPOSE REVENUE BONDS
     FOR PROCESSING ENTERPRISES,"

begs leave to report as follows:

     The purpose of this bill is to authorize the issuance of
special purpose revenue bonds to assist CEATECH USA in:

     (1)  Planning and building a processing plant for shrimp;
          and

     (2)  Expanding its shrimp farm facilities;

on the island of Kauai.

     Your Committee notes that CEATECH USA is building a state-
of-the-art shrimp production facility located in Kekaha, Kauai.
Your Committee further notes that CEATECH USA has the potential
of becoming the largest domestic shrimp producer in the United
States and generating significant employment opportunities in the
State.

     The Office of Economic Development of the County of Kauai,
CEATECH USA, BOC Gases/Gaspro, and the Hawaii Aquaculture
Association submitted testimony in support of the bill.  The

 
 
 
 
                                 STAND. COM. REP. NO. 422
                                 Page 2

 
Department of Agriculture submitted testimony in support of the
intent of the bill.  The Department of Budget and Finance (B&F)
submitted comments on the measure and offered technical comments,
stating that:

               Article VII, Section 12, of the State
          Constitution provides that the legislature may
          enact, in separate legislative bills, general law
          which authorizes the issuance of special purpose
          revenue bonds for each single product or multi-
          project program of each special purpose entity.
          The State's Bond counsel construes the
          Constitution to mean a multi-project program must
          be for the same special purpose entity.

     Accordingly, your Committee has amended this bill by:

     (1)  Deleting provisions of the bill that provide for
          the issuance of special purpose revenue bonds to
          assist CEATECH USA in expanding its shrimp farm
          facilities;

     (2)  Decreasing the amount of the special purpose
          revenue bond issuance from $5,000,000 to
          $3,000,000, to assist CEATECH USA in planning and
          building a processing plant for shrimp; and

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

     As affirmed by the record of votes of the members of
your Committee on Agriculture that is attached to this
report, your Committee is in accord with the intent and
purpose of H.B. No. 801, as amended herein, and recommends
that it pass Second Reading in the form attached hereto as
H.B. No. 801, H.D. 1, and be referred to the Committee on
Finance.

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



                                   ______________________________
                                   FELIPE P. ABINSAY, JR., Chair