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. 336, S.D. 2, entitled:

begs leave to report as follows:

The purpose of this measure is to transfer responsibility for the tourism special fund to the Department of Business, Economic Development, and Tourism.

In addition, this bill:

Your Committee received testimony in favor of this measure from the Department of Business, Economic Development, and Tourism (supporting establishment of tourism marketing plan and a tourism registry, but expressed concerns regarding the transfer of responsibility for the tourism special fund to the

Department and the repeal of the Hawaii Tourism Authority); a Kauai County Council member; and one individual.

Testimony in opposition to the measure was received from the Hawaii Tourism Authority; the Kauai Economic Development Board; the Hawaii Hotel Association; Outrigger Enterprises, Inc.; the Maui Hotel Association; Maui Marriott Resort and Ocean Club; Aston Kaanapali Shores; Textron Systems Kauai; the Hawaii Restaurant Association; Retail Merchants of Hawaii; Yacht Harbor Towers; Hawaii Attractions Association; Ala Moana Residents Advisory Council; Visitor Industry Coalition; Visitor Aloha Society of Hawaii; The Ko`olau News; Hawaii's Thousand Friends (opposed to deletion of transient accommodations tax provision); the American Youth Soccer Organization; and three individuals.

Your Committee recognizes that the Hawaii Tourism Authority has been working hard to promote Hawaii's tourism industry, and has been successful at marketing and increasing visitor expenditures. Nevertheless, your Committee agrees with the findings of your Committees on Tourism and Intergovernmental Affairs and Economic Development and Technology that there has been a lack of accountability by the Authority in spending public dollars, a lack of communication among members of the Authority's board, and a failure on the part of the Authority to address current and future infrastructure problems under projected visitor growth scenarios.

Upon further consideration, your Committee has amended this bill by:

Your Committee has not included provisions relating to the transfer of unexpended and unencumbered funds from the tourism special fund; the disposition of transient accommodations taxes into that fund; the transfer of equipment, personnel, contracts, and related matters upon the sunset of the Hawaii tourism authority; and conforming amendments to sections of the Hawaii Revised Statutes that reference the Hawaii tourism authority, in order to make the bill defective to promote continuing 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. 336, S.D. 2, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 336, S.D. 3.