Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-First State Legislature

Regular Session of 2001

State of Hawaii

Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2001

State of Hawaii

Sir:

Your Committee on Conference on the disagreeing vote of the House of Representatives to the amendments proposed by the Senate in H.B. No. 596, H.D. 2, S.D. 1, entitled:

having met, and after full and free discussion, has agreed to recommend and does recommend to the respective Houses the final passage of this bill in an amended form.

The purpose of this bill is to:

Your Committee on Conference finds that HHRF, established in response to hurricane Iniki, has stabilized Hawaii's hurricane insurance market. Private insurers are now offering policies of hurricane insurance and HHRF will be terminating its insurance program as of December 1, 2001. The HHRF special mortgage recording fee, which was enacted to allow HHRF to issue policies of hurricane insurance, will thus become unnecessary. This bill provides for its prompt suspension.

This bill also allows HHRF to continue prudent management of its affairs as it winds down its operations, recognizes that a hurricane like Iniki will strike Hawaii again, and reflects the growing consensus that HHRF must retain the ability to protect Hawaii when this occurs.

The measure accordingly ends legislative suspension of the special mortgage recording fee on December 31, 2001, and provides HHRF with the authority and flexibility to suspend and reactivate the special mortgage recording fee as necessary. Your Committee on Conference understands that at the same time that HHRF terminates its insurance program, HHRF will use its new powers to continue the suspension of the special mortgage recording fee.

Your Committee on Conference has amended the bill to expressly allow HHRF to reactivate the special mortgage recording fee. Your Committee on Conference emphasizes that this power is to be exercised only as necessary to respond to another hurricane like Iniki.

To ensure that HHRF is able to make a prompt response when needed, your Committee on Conference has also provided that HHRF's special mortgage recording fee suspension and reactivation powers are not subject to rulemaking and may be exercised pursuant to resolution of the HHRF Board.

Technical, nonsubstantive amendments were also made for purposes of clarity and consistency.

As affirmed by the record of votes of the managers of your Committee on Conference that is attached to this report, your Committee on Conference is in accord with the intent and purpose of H.B. No. 596, H.D. 2, S.D. 1, as amended herein, and recommends that it pass Final Reading in the form attached hereto as H.B. No. 596, H.D. 2, S.D. 1, C.D. 1.