STAND. COM. REP. NO. 805-00

                                 Honolulu, Hawaii
                                                   , 2000

                                 RE: H.B. No. 2793
                                     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 Finance, to which was referred H.B. No.
2793 entitled: 

     "A BILL FOR AN ACT RELATING TO AGRICULTURE,"

begs leave to report as follows:

     The purpose of this bill is to carry over to fiscal year
2000-2001, any unexpended or unencumbered funds at the close of
fiscal year 1999-2000 for expenses incurred in the performance of
the duties of the Agribusiness Development Corporation (ADC)
Board.

     Testimony in support of this measure was received from the
Hawaii Farm Bureau Federation, the Hamakua Farm Bureau, and
several individuals.  ADC testified in support of this measure
but with a proposed amendment.

     Your Committee finds that the principal reasons for the
establishment of ADC included assisting in the revitalization of
agriculture in the State by:

     (1)  Providing planning and financial assistance to
          agricultural operations; and

     (2)  Facilitating the transition of agricultural
          infrastructure from plantation operations to other
          agricultural enterprises. 


 
 
 
                                 STAND. COM. REP. NO. 805-00
                                 Page 2

 
As part of Act 117, Session Laws of Hawaii (SLH) 1999, an
appropriation of $400,000 was made to ADC for fiscal year 1999-
2000 for this purpose.

     Your Committee also finds that the original intent of the
appropriation in this bill included the provision of grant money
for the planning, design, and construction of an agricultural
subdivision in the Hamakua District on the island of Hawaii, as
referenced in Conference Committee Report No. 147 for H.B. No.
1280, C.D. 1, which was enacted into law as Act 117, SLH 1999.

     Recently, the ADC Board of Directors was approached by the
Hamakua-North Hilo Agricultural Cooperative, a group composed of
small farmers and former sugar workers who are seeking additional
agricultural acreage for development.  This bill enables ADC to
create an agricultural subdivision as intended by the
Legislature, and developed in a cost-effective and expeditious
manner in accordance with County of Hawaii Ordinance 95-136,
which could serve as a model for the establishment of other
agricultural subdivisions throughout the State.

     Furthermore, your Committee finds that the federally-funded
Lower Hamakua Ditch Watershed Project, now near completion, will
allow for the irrigation of many more acres than are currently
being farmed.  Therefore, the development of an agricultural
subdivision is timely as the increased farming acreage would help
maximize use of the available irrigation capacity.  Additionally,
by increasing the number of farmers, the cost of operating the
Hamakua Ditch could be dispersed and individual user assessments
lowered.

     Accordingly, your Committee has amended this bill by:

     (1)  Specifying that up to $250,000 of the appropriation may
          be used for grants for the development of an
          agricultural subdivision in the Hamakua District on the
          island of Hawaii; and

     (2)  Reinstating the provision specifying the Department of
          Agriculture as the expending agency of these funds.

     As affirmed by the record of votes of the members of your
Committee on Finance that is attached to this report, your
Committee is in accord with the intent and purpose of H.B. No.
2793, as amended herein, and recommends that it pass Third
Reading in the form attached hereto as H.B. No. 2793, H.D. 1.


 
 
                                 STAND. COM. REP. NO. 805-00
                                 Page 3

 
                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Finance,



                                   ______________________________
                                   DWIGHT Y. TAKAMINE, Chair