STAND. COM. REP. NO. 2961

                                   Honolulu, Hawaii
                                                     , 2000

                                   RE:  H.B. No. 2422
                                        H.D. 1
                                        S.D. 1




Honorable Norman Mizuguchi
President of the Senate
Twentieth State Legislature
Regular Session of 2000
State of Hawaii

Sir:

     Your Committees on Judiciary and Health and Human Services,
to which was referred H.B. No. 2422, H.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO THE ENFORCEMENT OF THE
     TOBACCO SETTLEMENT AGREEMENT,"

beg leave to report as follows:

     The purpose of this bill is to designate a portion of the
tobacco settlement proceeds for use by the Department of the
Attorney General to enforce the tobacco Master Settlement
Agreement and related implementing laws.

     In particular, this bill seeks to ensure that legal and
enforcement activities continue following the 1998 settlement
with the major tobacco products manufacturers by creating the
tobacco enforcement special fund to be used by the Attorney
General to administer, operate, monitor, and ensure compliance
with the Master Settlement Agreement, the state Tobacco Liability
Act, tobacco prevention programs, and other requirements.  This
bill also appropriates an unspecified amount for the current
fiscal year to the tobacco enforcement special fund.

     Your Committees received testimony in favor of this measure
from the Attorney General.


 
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                                   STAND. COM. REP. NO. 2961
                                   Page 2


     Your Committees find that this bill is necessary to enforce
the tobacco Master Settlement Agreement and related laws.  Your
Committees agree with the Attorney General on the issue of
imposing a cap of $500,000.  While the actual amount needed is
unknown at this time, a cap of $500,000 reasonably protects
against overfunding and allows for a sufficient amount to cover
potential funding shortfalls.  Your Committees find that there
are many unknown factors that will impact on the personnel and
time spent by the Attorney General's office on various
enforcement and monitoring activities.  However, the activities
of that office are critical and extremely time-sensitive to
Hawaii receiving its settlement moneys, and any delays for
necessary funding could have an adverse effect.

     Accordingly, your Committees have deleted the contents of
this bill and substituted the substance of the Senate companion
measure, S.B. No. 2763, S.D. 1, which your Committees had
previously jointly passed but which did not cross over to the
House of Representatives.  As amended, this bill establishes a
$500,000 cap and provides that the entire source of funding comes
directly from the State's emergency and budget reserve ("rainy
day") fund established under section 328L-3, Hawaii Revised
Statutes.

     As affirmed by the records of votes of the members of your
Committees on Judiciary and Health and Human Services that are
attached to this report, your Committees are in accord with the
intent and purpose of H.B. No. 2422, H.D. 1, as amended herein,
and recommend that it pass Second Reading in the form attached
hereto as H.B. No. 2422, H.D. 1, S.D. 1, and be referred to the
Committee on Ways and Means.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committees on Judiciary and
                                   Health and Human Services,



____________________________       ______________________________
SUZANNE CHUN OAKLAND, Chair        AVERY B. CHUMBLEY, Co-Chair



                                   ______________________________
                                   MATTHEW M. MATSUNAGA, Co-Chair

 
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