Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2001

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred H.B. No. 11, H.D. 2, S.D. 1, entitled:

begs leave to report as follows:

The purpose of this measure is to establish an education research and development revolving fund into which will be deposited all revenues from the commercial exploitation of products and services developed by the Department of Education.

More specifically, the revolving fund will be used to support research and development of innovative curriculum, instructional aids, and related technologies, and the related administrative costs of seeking and maintaining such commercialization.

Your Committee believes that this measure will encourage the Board of Education, the Superintendent of Education, program administrators, and principals to be supportive of employees, programs, and schools that engage in research and development of innovative curriculum, instructional aids, and related technologies.

Your Committee raised some concerns for the Department of Education to consider when establishing this program. One issue is the distribution of income or royalties from patents or licensing agreements, and whether the distribution ratio should be an item for collective bargaining. Your Committee notes that potential income for the State will not come from ownership of the patent but how a licensing agreement is negotiated, and your Committee hopes the Department of Education will seek advice from attorneys who are knowledgeable on licensing of patents whenever there is a potential marketable product.

Your Committee has amended this measure by adding a provision requiring appropriations or authorization from the revolving fund to be expended by the Superintendent of Education.

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 H.B. No. 11, H.D. 2, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 11, H.D. 2, S.D. 2.