STAND. COM. REP. NO. 405-00

                                 Honolulu, Hawaii
                                                   , 2000

                                 RE: H.B. No. 2453
                                     




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

Sir:

     Your Committee on Judiciary and Hawaiian Affairs, to which
was referred H.B. No. 2453 entitled: 

     "A BILL FOR AN ACT PROPOSING AMENDMENTS TO ARTICLE VII OF
     THE HAWAII CONSTITUTION REGARDING AN EMERGENCY AND BUDGET
     RESERVE FUND,"

begs leave to report as follows:

     The purpose of this bill is to repeal the excess revenue tax
refund, to establish a fund for emergency and budget reserve
purposes, and to clarify that appropriations to that fund are
excluded from the general fund expenditure ceiling, while
appropriations from that fund are included in the general fund
expenditure ceiling.  Further, no expenditures shall be made from
that fund except pursuant to appropriations approved by a three-
fourths vote of the members of each house of the legislature.

     Testimony in support of this measure was received from the
State Department of Budget and Finance, and Tax Foundation of
Hawaii.

     Your Committee finds that the provisions of this bill create
a mechanism for the State to build a financial reserve to be used
when there is an emergency, an economic downturn, or an
unforeseen reduction in revenue. 

     As affirmed by the record of votes of the members of your
Committee on Judiciary and Hawaiian Affairs that is attached to
this report, your Committee is in accord with the intent and

 
 
                                 STAND. COM. REP. NO. 405-00
                                 Page 2

 
purpose of H.B. No. 2453 and recommends that it pass Second
Reading and be referred to the Committee on Finance.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Judiciary &
                                   Hawaiian Affairs,



                                   ______________________________
                                   ERIC G. HAMAKAWA, Chair