STAND. COM. REP. NO. 2024

                                   Honolulu, Hawaii
                                                     , 2000

                                   RE:  S.B. No. 2842
                                        




Honorable Norman Mizuguchi
President of the Senate
Twentieth State Legislature
Regular Session of 2000
State of Hawaii

Sir:

     Your Committee on Water, Land, and Hawaiian Affairs, to
which was referred S.B. No. 2842 entitled: 

     "A BILL FOR AN ACT RELATING TO THE HAWAIIAN HOMES COMMISSION
     ACT, 1920, AS AMENDED,"

begs leave to report as follows:

     The purpose of this bill is to allow the Department of
Hawaiian Home Lands to set the interest rate it charges on loans
by rule.

     Testimony in support of the measure was received from the
Department of Hawaiian Home Lands.

     Your Committee finds that Section 215 of the Hawaiian Homes
Commission Act of 1920, as amended, established in law, a loan
interest rate of two and one-half percent.  This statutorily
established rate requires the Department of Hawaiian Home Lands
to provide a qualified loan applicant with this exceptionally low
interest rate, regardless of the applicant's ability to pay.

     Your Committee believes that the bill would provide the
Department of Hawaiian Home Lands with the flexibility to set by
rules adopted pursuant to Chapter 91, Hawaii Revised Statutes,
the interest rates on loans from the Hawaiian Home Loan Fund and
other loan sources.  Rates would be based on interest rates in
the marketplace and the needs and financial qualifications of the
loan applicant.


 
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                                   STAND. COM. REP. NO. 2024
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     As affirmed by the record of votes of the members of your
Committee on Water, Land, and Hawaiian Affairs that is attached
to this report, your Committee is in accord with the intent and
purpose of S.B. No. 2842 and recommends that it pass Second
Reading and be referred to the Committee on Ways and Means.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Water, Land, and
                                   Hawaiian Affairs,



                                   ______________________________
                                   COLLEEN HANABUSA, Chair

 
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