STAND. COM. REP. NO. 2761

                                   Honolulu, Hawaii
                                                     , 2000

                                   RE:  S.B. No. 445
                                        S.D. 1




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

Sir:

     Your Committee on Ways and Means, to which was referred S.B.
No. 445 entitled:

     "A BILL FOR AN ACT RELATING TO FUNDS,"

begs leave to report as follows:

     The purpose of this short form bill is to effectuate its
title.

     Your Committee has amended this bill by inserting provisions
that, among other things, will abolish a number of special and
revolving funds, and provide that all moneys needed to meet
operating expenses of their respective programs will be allocated
by the Legislature through appropriations out of the state
general fund or from the proceeds of bond sales.

     In addition, this bill changes the amount of reserves that
are allowed to accumulate in these special and revolving funds.

     It is not the intent of your Committee to jeopardize the
receipt of any federal aid nor to impair the obligation of the
State or any agency thereof to the holders of any bond issued by
the State or by any agency.  Rather, it is the intent of your
Committee to initiate a serious discussion about the necessity
and advisability of maintaining these special and revolving funds
when, in fact, they contribute to the erosion of legislative
oversight of budgetary matters.

 
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     Your Committee is aware of the fact that these provisions
were originally drafted in 1997, and that this bill contains
references to a number of laws that have been repealed or
substantially amended since 1997.  In the interest of expediency,
your Committee has chosen to focus on the policy issues
surrounding the maintenance of these special and revolving funds,
and to leave the technical nuances to be corrected later.

     As affirmed by the record of votes of the members of your
Committee on Ways and Means that is attached to this report, your
Committee is in accord with the intent and purpose of S.B. No.
445, as amended herein, and recommends that it pass Second
Reading in the form attached hereto as S.B. No. 445, S.D. 1, and
be placed on the calendar for Third Reading.

                                 Respectfully submitted on behalf
                                 of the members of the Committee
                                 on Ways and Means,



                                 ________________________________
                                 CAROL FUKUNAGA, Co-Chair



                                 ________________________________
                                 ANDREW LEVIN, Co-Chair

 
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