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. 731, H.D. 1, S.D. 1, entitled:

begs leave to report as follows:

The purpose of this measure is to authorize the University of Hawaii to transfer all funds at its disposal, except general funds, into its commercial enterprises revolving fund in order to finance the establishment of new enterprises.

Your Committee finds that under present law, the University is authorized to transfer only private funds into the revolving fund. Your Committee further finds that the present law limits the University's ability to exploit commercial opportunities as they arise. Your Committee understands from the University that the flexibility granted under this measure will enable the University to generate increased revenues from the operation of commercial enterprises and enhance the University's ability to develop alternative revenue sources. If the purpose of creating the fund is to generate revenues for the University, then the University does not need permanent authority for the resource allocation provided by this measure.

Accordingly, your Committee has amended this measure by deleting its contents and replacing it with those of S.B. No. 1206 S.D. 1, which was previously reported out of your Committee. S.B. No. 1206, S.D. 1 also authorizes non-general fund transfers into that revolving fund.

As amended, this measure places a two-year time limit on the University's transfer of all non-general funds at its disposal into the commercial enterprises revolving fund. Specifically, the measure now restricts inter-fund transfers to the period from July 1, 2001 to June 30, 2003.

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. 731, H.D. 1, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 731, H.D. 1, S.D. 2.