STAND. COM. REP. NO. 1081-00

                                 Honolulu, Hawaii
                                                   , 2000

                                 RE: S.B. No. 2905
                                     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 Economic
Development and Business Concerns, to which was referred S.B. No.
2905 entitled: 

     "A BILL FOR AN ACT RELATING TO EMPLOYMENT SECURITY,"

beg leave to report as follows:

     The purpose of this bill is to extend from December 31, 2000
to December 31, 2003, the period during which employers must make
assessments to the Employment and Training Fund (Fund).

     The Department of Labor and Industrial Relations, the
Oceanic Institute, The Arc in Hawaii, Subcontractors Association
of Hawaii, Hui Malama Learning Center, Maui Hotel Association,
United Public Workers, Kiahuna Plantation Castle Resorts, Kauai
Marriott Resort and Beach Club, Kauai Coconut Beach Resort, Kauai
Builders, Ltd., Easter Seals Hawaii, Copiers Hawaii, Inc., Lemke
Insurance Co., Princeville Corporation, Sheraton Kauai Resort,
Universal Tour and Travel Service, Inc., People Attentive to
Children, Waipahu Variety, Inc., DBA Kiso Store, St. Francis
Medical Center-West, Communication Consulting Services, Inc.,
Employees of the Grand Wailea Resort, First American Long and
Melone Title Company, Ltd., and several individuals supported
this bill.  The National Federation of Independent Business
opposed this bill.

     Your Committees find that it is in the best interests of
business in Hawaii to extend assessments to the Fund through
2003.  This Fund provides many companies with the ability to

 
 
                                 STAND. COM. REP. NO. 1081-00
                                 Page 2

 
provide training to employees that they would otherwise be unable
to afford.  

     Upon further consideration, your Committees have amended
this bill by deleting its contents and inserting the substantive
provisions of H.B. 2564, H.D. 1.  As amended, this bill:

     (1)  Specifies that the sunset date for the fund shall be
          December 31, 2003; and

     (2)  Reduces the amount of assessments to the Fund to .034
          percent and .016 percent of taxable wages for 2001 and
          2002, respectively.

     Additionally, your Committees have included a provision
requiring the Auditor to perform an audit of the Fund to address
concerns raised by conflicting testimony from the business
community regarding the utility and equitableness of the
assessment.
 
     As affirmed by the records of votes of the members of your
Committees on Labor and Public Employment and Economic
Development and Business Concerns that are attached to this
report, your Committees are in accord with the intent and purpose
of S.B. No. 2905, as amended herein, and recommend that it pass
Second Reading in the form attached hereto as S.B. No. 2905,
H.D. 1, and be referred to the Committee on Finance.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committees on Labor and Public
                                   Employment and Economic
                                   Development and Business
                                   Concerns,

                                   
                                   
                                   
                                   
______________________________     ______________________________
ROBERT N. HERKES, Chair            TERRY NUI YOSHINAGA, Chair