STAND. COM. REP. NO. 1374-00

                                 Honolulu, Hawaii
                                                   , 2000

                                 RE: S.B. No. 2419
                                     S.D. 1
                                     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 S.B. No.
2419, S.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO CAPITAL ACCESS PROGRAM,"

begs leave to report as follows:

     The purpose of this bill is to encourage financial
institutions to make higher risk loans to small businesses and
nonprofit organizations in a cost-efficient and simple manner
through the Capital Access Program (CAP) to be operated by the
Department of Business, Economic Development, and Tourism
(DBEDT).

     Under CAP, a financial institution and a borrower pay an up-
front insurance premium which goes into a reserve account. The
State matches these contributions with a deposit into the same
account.  With the added protection provided by this account, a
financial institution would be more willing to make higher risk
loans.

     DBEDT testified in support of this measure.

     Your Committee has amended this bill by making technical,
nonsubstantive amendments for purposes of style and consistency.

     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 S.B. No.

 
 
                                 STAND. COM. REP. NO. 1374-00
                                 Page 2

 
2419, S.D. 1, as amended herein, and recommends that it pass
Third Reading in the form attached hereto as S.B. No. 2419, S.D.
1, H.D. 1.

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



                                   ______________________________
                                   DWIGHT Y. TAKAMINE, Chair