STAND. COM. REP. NO. 398

                                   Honolulu, Hawaii
                                                     , 1999

                                   RE:  S.B. No. 1635
                                        S.D. 1




Honorable Norman Mizuguchi
President of the Senate
Twentieth State Legislature
Regular Session of 1999
State of Hawaii

Sir:

     Your Committee on Water, Land, and Hawaiian Affairs, to
which was referred S.B. No. 1635 entitled: 

     "A BILL FOR AN ACT Relating to Public Land Trust,"

begs leave to report as follows:

     The purpose of this measure is to sunset section 10-13.3,
Hawaii Revised Statutes, relating to paying the Office of
Hawaiian Affairs (OHA) a set interim revenue amount while the
dispute over ceded land revenues between the State and OHA is
being resolved.

     Testimony in support of the measure was received from the
Office of Hawaiian Affairs, the Association of Hawaiian Civic
Clubs, the Native Hawaiian Chamber of Commerce, the Hawaiian
Political Action Council of Hawaii, and the Kukahi Coalition.  A
private citizen testified in support of the intent of the
measure.

     The Attorney General and a private citizen testified in
opposition to the measure.

     Your Committee finds that Act 329, Session Laws of Hawaii
1997 (Act 329), established a process to finally resolve the
dispute over the pro rata share of ceded land revenues to which
OHA is entitled.  While the dispute was to be resolved, Act 329
provided for an interim revenue amount to be paid to OHA which
was fixed at $15,100,000 in each year of Fiscal Biennium
1997-1999.  The interim revenue authorization, codified as

 
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                                   STAND. COM. REP. NO. 398
                                   Page 2


section 10-13.3, Hawaii Revised Statutes, and Act 329, only
provided specified amounts, and appropriated funds for that
fiscal biennium.

     Your Committee believes that a resolution to this
longstanding dispute must be forged in the very near future in
order for the State to be able to effectively plan for its
financial future.  Unfortunately, your Committee finds that the
two parties are no closer to resolving this dispute than they
were two years ago.  To this end, your Committee believes that in
order for any resolution to occur, a "safe" negotiating
environment must be maintained.

     In light of this belief, your Committee has amended the
measure by deleting the proposed sunset of the interim revenue
provision and inserted in its stead, provisions that;

     (1)  Reconvene the Joint Committee established under Act 329
          to resolve the ceded land revenue dispute between OHA
          and the State;

     (2)  Require the Auditor to recommend the scope of the
          settlement negotiations, and then to coordinate the
          comprehensive inventory of ceded lands;

     (3)  Extend the interim revenue paid to OHA and increase the
          amount to $16,060,000 annually for the next two fiscal
          years; and

     (4)  Appropriate moneys to fund the provision of interim
          revenue to OHA.

     As affirmed by the record of votes of the members of your
Committee on Water, Land, and Hawaiian Affairs that is attached
to this report, your Committee is in accord with the intent and
purpose of S.B. No. 1635, as amended herein, and recommends that
it pass Second Reading in the form attached hereto as S.B.
No. 1635, S.D. 1, and be referred to the Committee on Ways and
Means.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Water, Land, and
                                   Hawaiian Affairs,



                                   ______________________________
                                   COLLEEN HANABUSA, Chair

 
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