Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committee on Labor, to which was referred H.B. No. 2501, H.D. 1, entitled:

begs leave to report as follows:

The purpose of this measure is to allow the State to meet its fiscal obligation to provide for the health and welfare of state employees.

Testimony in support of the measure was received from the Department of Human Resources Development (department).

Specifically, the measure amends Act 259, Session Laws of Hawaii 2001, by transferring $1 million into the department's workforce attraction, selection, classification and effectiveness fiscal year 2001-2002 appropriation (HRD 102) (section 82 of Act 259), from the department's fiscal year 2001-2002 appropriation for unemployment compensation claims of former state employees (section 83 of Act 259.

Your Committee finds that a critical funding emergency exists. The State Workers' Compensation Fund will be exhausted by approximately March 31, 2002, and the department will not be able to meet its fiscal obligation to provide for the health and welfare of state employees.

The department testified that the transfer of funds from the unemployment compensation claims allocation should not adversely impact the State's ability to pay unemployment compensation claims to its former employees.

Your Committee has amended the measure by making technical, nonsubstantive amendments for the purposes of clarity and style and to correctly reflect existing session law.

As affirmed by the record of votes of the members of your Committee on Labor that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2501, H.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 2501, H.D. 1, S.D. 1, and be referred to the Committee on Ways and Means.