Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committees on Transportation, Military Affairs and Government Operations and Tourism and Intergovernmental Affairs and Judiciary, to which was referred H.B. No. 2844, H.D. 1, entitled:

beg leave to report as follows:

The primary purposes of this measure are:

Your Committees received testimony in support of this measure from the League of Women Voters of Hawaii and Common Cause Hawaii. The Campaign Spending Commission submitted comments.

Your Committees remain dedicated to accommodating the desire of the public for fairness in the campaign spending laws. Your Committees are most concerned about large entities that can afford to make large contributions that could be interpreted as influencing the elected official. Even the appearance of impropriety is too much to tolerate. This measure is intended to correct the imbalances and inequities in the current law.

Your Committees find that this measure will bring Hawaii State election laws in line with federal election laws. Therefore, like its Senate companion measure, your Committees support the basic intent of this measure.

Your Committees have amended this measure in several ways. First, your Committees replaced the contents of this measure with the contents of S.B. No. 2431, S.D. 2, to reflect the Senate's position.

The Senate version of this measure differs from the House version substantively in that the Senate version repeals existing law limiting political fundraisers.

In addition, your Committees amended this measure to delete the requirement that corporations only contribute to a political candidate through a separate segregated fund. As amended, corporations may participate in the political process in the same manner in which they currently participate.

Your Committees also amended this measure to limit the restriction on contractor contributions. As amended, contractors are only prohibited from contributing to candidates for executive offices at the State and city levels or any other office having authority to award contracts on behalf of the State. For example, your Committees intend contractors to be prohibited from contributing to candidates for Governor, Lieutenant Governor, Mayor, the Chair of the Office of Hawaiian Affairs, and members of the Board of Education, or any other office with the authority to contract on behalf of the State. Your Committees find that these officials are the most susceptible to undue influence.

In order to continue discussion, the effective date is July 1, 2050.

Finally, your Committees amended the section making report falsification a Class C Felony. As amended, only falsification of a required report by an amount greater than $50,000 shall constitute a Class C Felony; all other violations shall remain misdemeanors.

As affirmed by the records of votes of the members of your Committees on Transportation, Military Affairs and Government Operations and Tourism and Intergovernmental Affairs and Judiciary that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 2844, H.D. 1, as amended herein, and recommend that it pass Second Reading in the form attached hereto as H.B. No. 2844, H.D. 1, S.D. 1, and be referred to the Committee on Ways and Means.