STAND. COM. REP. NO. 160-00

                                 Honolulu, Hawaii
                                                   , 2000

                                 RE: H.B. No. 2579
                                     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 Ocean Recreation and Marine Resources, to
which was referred H.B. No. 2579 entitled: 

     "A BILL FOR AN ACT RELATING TO LEASING OF SMALL BOAT
     HARBORS,"

begs leave to report as follows:

     The purpose of this bill is to authorize the Department of
Land and Natural Resources (DLNR)to lease by public auction or
direct negotiation the Ala Wai and Keehi small boat harbors for
redevelopment.  This bill also clarifies that:

     (1)  Leases issued for these small boat harbors may include
          uses, other than maritime-related activities, that
          complement or support the purpose of the lease; and

     (2)  The revenue due to the State from these leases shall be
          deposited into the Boating Special Fund. 
 
     The estimated cost required to redevelop and create "world
class" facilities at Ala Wai and Keehi small boat harbors is over
$24,000,000.  Redevelopment of Ala Wai small boat harbor is
considered a key element in overall efforts to revitalize
Waikiki, and redevelopment of Keehi small boat harbor is a
necessary first step in transforming Keehi Lagoon into a major
water recreation area.  Since funding in this amount exceeds the
capability of present state resources, leasing Ala Wai and Keehi
small boat harbors to private interests is an alternative means

 
 
                                 STAND. COM. REP. NO. 160-00
                                 Page 2

 
of accomplishing the redevelopment of these facilities at no cost
to the State. 

     The DLNR, the Waikiki Improvement Association, Hilo Hattie,
and several concerned individuals testified in support of this
bill.  The Ala Wai Marina Committee, the Hawaii Boaters Political
Action Association, and many concerned individuals testified in
opposition to this bill.  The Hawaii Government Employees
Association offered comments on this bill.

     Your Committee has amended this bill by:

     (1)  Requiring that the Board of Natural Resources (BLNR),
          in an issuing a lease, shall comply with the provisions
          of Section 171-53, Hawaii Revised Statutes.  This
          section requires the prior approval of the Governor and
          the prior authorization of the Legislature by
          concurrent resolution before leasing submerged lands or
          lands beneath tidal waters. 
     
     This bill will allow the State to solicit proposals for
privatization of the Ala Wai and Keehi small boat harbors.  Any
proposal will have to address concerns about public access,
traffic, noise pollution, and safety through the conditions of
the lease and must be approved by the BLNR, and by the
Legislature. 
     
     As affirmed by the record of votes of the members of your
Committee on Ocean Recreation and Marine Resources that is
attached to this report, your Committee is in accord with the
intent and purpose of H.B. No. 2579, as amended herein, and
recommends that it pass Second Reading in the form attached
hereto as H.B. No. 2579, H.D. 1, and be referred to the
Committees on Labor and Public Employment and Finance.



                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Ocean Recreation
                                   and Marine Resources,



                                   ______________________________
                                   ROY M. TAKUMI, Chair