STAND. COM. REP. NO. 2940

                                   Honolulu, Hawaii
                                                     , 2000

                                   RE:  H.B. No. 2447
                                        S.D. 1




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

Sir:

     Your Committee on Commerce and Consumer Protection, to which
was referred H.B. No. 2447 entitled: 

     "A BILL FOR AN ACT RELATING TO THE EMPLOYEES' RETIREMENT
     SYSTEM,"

begs leave to report as follows:

     The purpose of this measure is to clarify the Legislature's
intent with respect to the calculation of the Employees'
Retirement System's excess investment earnings under Act 100,
Session Laws of Hawaii 1999.

     Testimony in support of the measure was received from the
State Department of Budget and Finance and the State Attorney
General.  The City and County of Honolulu testified in opposition
to the measure.  The Employees' Retirement System submitted
comments.

     Your Committee finds that considerable concerns were
expressed by the City and County of Honolulu over the
calculations prepared by the Employees' Retirement System and its
actuary.  There is dispute over the interpretation of Act 100,
Session Laws of Hawaii 1999, and the application of excess
investment earnings.  The City and County of Honolulu has
challenged this matter in the State Circuit Court.

     Your Committee has amended the measure by defecting its
effective date to not only ensure further discussion on the

 
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                                   STAND. COM. REP. NO. 2940
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issues, but also to consider deferring any action until a
decision has been reached by the court.

     As affirmed by the record of votes of the members of your
Committee on Commerce and Consumer Protection that is attached to
this report, your Committee is in accord with the intent and
purpose of H.B. No. 2447, as amended herein, and recommends that
it pass Second Reading in the form attached hereto as
H.B. No. 2447, S.D. 1, and be referred to the Committee on Ways
and Means.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Commerce and
                                   Consumer Protection,



                                   ______________________________
                                   BRIAN KANNO, Co-Chair



                                   ______________________________
                                   BRIAN T. TANIGUCHI, Co-Chair

 
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