Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committee on Transportation, to which was referred H.B. No. 2197 entitled:

begs leave to report as follows:

The purpose of this bill is to provide economic relief to airport concessionaires. Specifically this bill:

The Airport Concessionaires Committee, Travelex, DFS Hawaii, Island Heritage, Host International, Apcoa, and Catrala-Hawaii testified in support of this measure. The Department of Transportation (DOT) and the Airlines Committee of Hawaii testified in opposition to this bill.

The events of September 11, 2001, affected our entire nation. These events took an especially devastating toll on Hawaii, whose economy is largely based upon tourism, and more specifically, the transportation, travel, and tourism related industries.

The Legislature held a special session in October 2001, to attempt to deal with the economic crisis that was facing the state. Act 15, Third Special Session Laws of Hawaii 2001, passed in an attempt to assist airport concessionaires who, due to decreased travel and increased security measures, saw an average decline in sales of approximately 47 percent. This Act provided economic relief to airport concessionaires until April 30, 2002, when it was believed improvements in the economy of the state would no longer make these relief efforts necessary. However, recent economic projections seem to indicate that this economic downturn will not be subsiding in the very near future, and some concessionaires will need assistance beyond April 30, 2002.

Although your Committee feels that the continuation of economic relief efforts is necessary, concerns were raised regarding the ability of the State airports to attract interested competitors for airport concessions because of the events of September 11^th.

Your Committee has amended this bill by:

1. Giving to the Director of the Transportation the discretion of extending the term of concessionaires now on revocable permits for a period not to exceed one year beyond June 30, 2002; and
2. Making technical, nonsubstantive amendments for clarity & style.

As affirmed by the record of votes of the members of your Committee on Transportation that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2197, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 2197, H.D. 1, and be referred to the Committee on Finance.