Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2001

State of Hawaii

Sir:

Your Committee on Transportation, Military Affairs and Government Operations, to which was referred H.B. No. 1686, H.D. 1, entitled:

begs leave to report as follows:

The purpose of this measure is to authorize the issuance of special facility revenue bonds for improvements to harbor facilities for use by Rainbow Island Express Company, Inc. to operate interisland and intraisland ferry services.

Your Committee received testimony in support of this measure from the Department of Transportation, the Chair and three members of the Maui County Council, the Maritime Committee of the Hawaii Chamber of Commerce, and Rainbow Island Express Company, Inc.

Your Committee finds that as an island state, it is inexcusable that Hawaii lacks a viable ferry service for interisland and intraisland travel. Residents and visitors traveling between the islands are forced to use air transportation, which is costly and a less pleasant way to travel.

For persons commuting within an island, an intraisland ferry system would help to reduce traffic congestion and attendant problems. Therefore, your Committee supports the intent of this measure, which will enable Rainbow Island Express to create the infrastructure necessary to begin regular ferry service.

At the hearing on this measure, your Committee was informed that the Department of Transportation and Rainbow Island Express have not yet reached a final agreement for ferry services. Absent such an agreement, issuance of special facility revenue bonds is premature, but both parties assured your Committee that a final agreement would be reached prior to this measure passing both houses of the Legislature.

Your Committee made technical, nonsubstantive amendments for clarity.

As affirmed by the record of votes of the members of your Committee on Transportation, Military Affairs and Government Operations that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1686, H.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1686, H.D. 1, S.D. 1, and be referred to the Committee on Ways and Means.