STAND. COM. REP. NO. 788-00

                                 Honolulu, Hawaii
                                                   , 2000

                                 RE: H.B. No. 2741
                                     H.D. 1




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

Sir:

     Your Committees on Labor and Public Employment and Finance,
to which was referred H.B. No. 2741, H.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO PRIVATELY-OPERATED
     CORRECTIONAL FACILITIES,"

beg leave to report as follows:

     The purpose of this bill is to:

     (1)  Allow the Governor to contract with the private sector
          to operate minimum security correctional facilities;
          and 

     (2)  Establish criteria for an acceptable contract for a
          privatized correctional operation.

     The Hawaii Alliance for the Future, Government Efficiency
Teams, Inc., and two individuals testified in support of this
bill.  The Department of Budget and Finance supports the intent
of this bill but has concerns that portions of the bill may be in
conflict with federal tax laws regulating tax-exempt bond
financing.  The Chamber of Commerce of Hawaii supported the
intent of the bill.  The Hawaii Government Employees Association
testified in opposition to this bill.  E Ho'opakele (Project
Rescue) and an individual offered comments on the bill.

     As affirmed by the records of votes of the members of your
Committees on Labor and Public Employment and Finance that are
attached to this report, your Committees are in accord with the

 
 
                                 STAND. COM. REP. NO. 787-00
                                 Page 2

 
intent and purpose of H.B. No. 2741, H.D. 1, and recommend that
it pass Third Reading.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committees on Labor and Public
                                   Employment and Finance,

                                   
                                   
                                   
                                   
______________________________     ______________________________
DWIGHT Y. TAKAMINE, Chair          TERRY NUI YOSHINAGA, Chair