Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committees on Agriculture and Economic Development and Technology, to which was referred H.B. No. 1976 entitled:

beg leave to report as follows:

The purpose of this measure is to authorize the issuance of special purpose revenue bonds to assist Gay & Robinson, Inc., a Hawaii Corporation, in purchasing the sugar and molasses terminal facility at Nawiliwili on the island of Kauai.

Testimony supporting this measure was received from the Hawaii Farm Bureau Federation, Kauai County Farm Bureau, Hawaii Agriculture Research Center, Hawaiian Sugar and Transportation Cooperative, and Gay & Robinson, Inc.

The Department of Budget and Finance submitted testimony citing concerns regarding this measure.

Your Committees find that sugar production continues to represent a significant segment of Hawaii's agriculture industry. Gay & Robinson, Inc., is the only remaining sugar producer on the island of Kauai employing hundreds of residents and contributing to the state economy. The planned agricultural use of the sugar and molasses terminal facility at Nawiliwili, Kauai, evidences the strength of the sugar production industry and the State should continue to nurture its development.

Since the introduction of this measure, Gay & Robinson, Inc. (G&R), and the Hawaiian Sugar & Transportation Cooperative (HS&TC) have structured an agreement that will allow for the most productive and cost-effective use of the sugar and molasses terminal facility. HS&TC has agreed to purchase the terminal facility from G&R, with a lease back provision. Your Committees believe that this is an acceptable arrangement that will further support the agriculture industry in Hawaii.

Therefore, your Committees have amended this measure by:

As affirmed by the records of votes of the members of your Committees on Agriculture and Economic Development and Technology that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 1976, as amended herein, and recommend that it pass Second Reading in the form attached hereto as H.B. No. 1976, S.D. 1, and be referred to the Committee on Ways and Means.