STAND. COM. REP. NO. 444-00

                                 Honolulu, Hawaii
                                                   , 2000

                                 RE: H.B. No. 3019
                                     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 Education, to which was referred H.B. No.
3019 entitled: 

     "A BILL FOR AN ACT RELATING TO EDUCATION,"

begs leave to report as follows:

     The purpose of this bill is to authorize the issuance of a
bond pursuant to federal law that allows:

     (1)  State agencies to take advantage of the federal
          Taxpayer Relief Act of 1997, as amended, as an interest
          free loan;

     (2)  The Department of Education to reconstruct existing
          structures at Molokai High and Intermediate School to
          create two separate schools, Molokai High School and
          Molokai Middle School;

     (3)  Students of both levels, high and middle schools, to
          benefit from a campus that has distinct facilities for
          the two grade level groups; and

     (4)  Bondholders to enjoy as federal tax credits the amount
          that the state would otherwise pay as interest to the
          bondholders.
 
     The Maui District Superintendent, the Molokai Enterprise
Community Governance Board, the Molokai Community Service

 
 
                                 STAND. COM. REP. NO. 444-00
                                 Page 2

 
Council, and the Center for Gifted and Talented Native Hawaiian
Children testified in support of this bill.  A trustee of the
Office of Hawaiian Affairs, a council member of the Maui County
Council, the Chair of the Maui County Council, and numerous
individuals testified in support of this bill.  The Department of
Education testified in support of the intent of this bill.  The
Department of Budget and Finance commented on this bill.

     Your Committee amended this bill by:

     (1)  Including the United States Code citation that governs
          the issuance of the bond;

     (2)  Describing how the Molokai school will be divided into
          two distinct schools;

     (3)  Authorizing the exact dollar amount of the bond of
          $4,615,000;

     (4)  Appropriating the bond amount under the general
          obligation bond fund of the State; and

     (5)  Including an anti-lapse section.

     Your Committee feels that the endeavor of creating two
separate school entities from the one combined middle and high
school has overwhelming support from the Molokai community.  The
concerns raised by the Department of Budget and Finance have been
addressed by the proposed draft except for the issues of:

     (1)  Whether this bond will be a stand-alone general
          obligation bond; and 

     (2)  Whether there will be underwriting and legal bond
          counsel fees and expenses that could be addressed in
          committee.

     As affirmed by the record of votes of the members of your
Committee on Education that is attached to this report, your
Committee is in accord with the intent and purpose of H.B. No.
3019, as amended herein, and recommends that it pass Second
Reading in the form attached hereto as H.B. No. 3019, H.D. 1, and
be referred to the Committee on Finance.


 
 
 
 
 
                                 STAND. COM. REP. NO. 444-00
                                 Page 3

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



                                   ______________________________
                                   KEN ITO, Chair