STAND. COM. REP. NO. 357-00

                                 Honolulu, Hawaii
                                                   , 2000

                                 RE: H.B. No. 2068
                                     H.D. 1




Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 2000
State of Hawaii

Sir:

     Your Committee on Higher Education, to which was referred
H.B. No. 2068 entitled: 

     "A BILL FOR AN ACT RELATING TO ETHICS,"

begs leave to report as follows:

     The purpose of this bill is to remove a barrier for faculty
of the University of Hawaii (UH) by enabling them to collaborate
on projects with private entities, participate in private startup
enterprises, and devise a system of allocation of intellectual
property without being in violation of the State Ethics Code.

     The University of Hawaii Professional Assembly supported the
measure.  The State Ethics Commission and The League of Women
Voters of Hawaii opposed the bill.  UH commented on the bill.

     Your Committee recognizes that UH should continue to be
provided with the ability to be flexible in their activities and
thus, encourage entrepreneurial activities.  This is consistent
with the flexibility provided to UH concerning procurement, legal
services, fund control and other processes.

     Your Committee also notes that the State Ethics Commission
makes every effort to accommodate UH employees on the complex
issue of ethics in higher education.

     Your Committee further recommends that UH work more closely
with their employees on matters of ethics.


 
 
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     Consistent with efforts toward autonomy, your Committee has
amended this bill by deleting its contents and replacing them
with the authority for UH to establish its own ethics review.
While your Committee continues to believe the University should
remain under State Ethics Laws, the amendment requires the Board
of Regents to establish an ethics system for the faculty and
other employees of UH, excluding the President and Board of
Regents.

     As affirmed by the record of votes of the members of your
Committee on Higher Education that is attached to this report,
your Committee is in accord with the intent and purpose of H.B.
No. 2068, as amended herein, and recommends that it pass Second
Reading in the form attached hereto as H.B. No. 2068, H.D. 1, and
be referred to the Committee on Judiciary and Hawaiian Affairs.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Higher Education,



                                   ______________________________
                                   DAVID MORIHARA, Chair