STAND. COM. REP. NO. 681-00

                                 Honolulu, Hawaii
                                                   , 2000

                                 RE: H.B. No. 2088
                                     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 Finance, to which was referred H.B. No.
2088 entitled: 

     "A BILL FOR AN ACT RELATING TO PROCUREMENT,"

begs leave to report as follows:

     The purpose of this bill, as received by your Committee, is
to:

     (1)  Require that when contracts are awarded in high
          capitalization industries and other industries where
          contract awards have a substantial effect on
          competition in the marketplace, the evaluation of bids
          must include consideration of the effect on cost,
          availability, and quality, of the goods and services
          provided under the contract; and

     (2)  Allow a contract to be awarded to an offeror other than
          the lowest bidder.

     The Hawaii School Bus Association testified in support of
this bill.  The Department of Accounting and General Services
supported the intent of this bill and suggested amendments.  The
Hawaii Chapter of Associated Builders and Contractors, Inc.,
submitted testimony in opposition to this bill.

     Your Committee has amended this bill by:


 
 
 
                                 STAND. COM. REP. NO. 681-00
                                 Page 2

 
     (1)  Requiring that each purchasing agency compare all
          relevant factors, in addition to price, so that the
          contract with the best overall benefit to the State is
          selected;

     (2)  Requiring that in instances where a contract is awarded
          to avoid a monopoly or promote competition pursuant to
          section 103D-301(1), Hawaii Revised Statutes (HRS), the
          Attorney General shall evaluate the proposal using the
          guidelines established in section 103D-301(1), HRS; and

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

     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 H.B. No.
2088, as amended herein, and recommends that it pass Second
Reading in the form attached hereto as H.B. No. 2088, H.D. 1, and
be placed on the calendar for Third Reading.

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



                                   ______________________________
                                   DWIGHT Y. TAKAMINE, Chair