STAND. COM. REP. NO. 1769

                                 Honolulu, Hawaii
                                                   , 1999

                                 RE: S.B. No. 1102
                                     S.D. 1
                                     H.D. 2




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

Sir:

     Your Committee on Finance, to which was referred S.B. No.
1102, S.D. 1, H.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO THE PUBLIC EMPLOYEES HEALTH
     FUND,"

begs leave to report as follows:

     The purpose of this bill is to transfer the responsibility
for funding the annual audit of the Hawaii Public Employees
Health Fund (Health Fund) from the Comptroller to the Health
Fund.

     The Department of Accounting and General Services and the
Health Fund Board of Trustees testified in support of this
measure.

     Your Committee has amended this bill by:

     (1)  Clarifying that the Health Fund Board of Trustees may
          make payments of periodic charges and pay for
          reasonable expenses incurred to perform financial
          audits of the Health Fund and claims audits of its
          insurance carriers;

     (2)  Specifying that the audit costs of the Health Fund be
          paid from the employers' portion of the Health Fund's
          reserves; and


 
 
                                 STAND. COM. REP. NO. 1769
                                 Page 2

 
     (3)  Making a technical, nonsubstantive amendment for
          clarity.

     As affirmed by the record of votes of the members of your
Committee on Finance that is attached to this report, your
Committee is in accord with the intent and purpose of S.B. No.
1102, S.D. 1, H.D. 1, as amended herein, and recommends that it
pass Third Reading in the form attached hereto as S.B. No. 1102,
S.D. 1, H.D. 2.

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



                                   ______________________________
                                   DWIGHT Y. TAKAMINE, Chair