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 S.B. No. 1046 entitled:

begs leave to report as follows:

The purpose of this measure is to clarify certain powers of the Board of Trustees of the Public Employees Health Fund.

This bill gives specific authority to the Board to contract for the performance of financial audits of the fund and claims audits of its insurance carriers rather than merely to pay for those audits.

Furthermore, this measure repeals the requirements that the fund audit be done by the Comptroller and that the audit costs be paid from the employers' portion of the fund's reserves. Audit costs are considered operating costs and should be paid from general funds.

Your Committee finds that these modifications to the Board's powers and duties will provide the Board with greater management flexibility with regard to the fund.

Your Committee has amended this measure by changing the effective date to July 4, 2076 to promote further discussion.

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. 1046, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 1046, S.D. 1.