Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committee on Agriculture, to which was referred S.B. No. 2228, S.D. 1, entitled:

begs leave to report as follows:

The purpose of this bill is to authorize the issuance of up to $2,300,000 in special purpose revenue bonds (SPRBs) to assist Gay & Robinson, Inc., in the purchase of a sugar and molasses terminal facility on Kauai.

The Kauai County Farm Bureau and Hawaii Farm Bureau Federation testified in support of this bill. The Hawaiian Sugar & Transportation Cooperative and Gay & Robinson, Inc., supported this measure but requested amendments. The Department of Budget and Finance offered comments.

Your Committee notes that the bill, as referred to your Committee, named Gay & Robinson, Inc., as the entity receiving assistance through the SPRB issuance. However, your Committee has received testimony stating that Gay & Robinson, Inc., intends to sell the sugar and molasses terminal facility on Kauai to Hawaiian Sugar & Transportation Cooperative. In light of this development, both Gay & Robinson, Inc., and Hawaiian Sugar & Transportation Cooperative have requested that the entity to be assisted through the SPRB issuance be changed to Hawaiian Sugar & Transportation Cooperative. This revision will assist Hawaiian Sugar & Transportation Cooperative in its purchase of the facility from Gay & Robinson, Inc.

Although your Committee agrees with the requested amendment to change the entity being assisted by the SPRBs, your Committee has reservations regarding this measure. Testimony submitted by the Department of Budget and Finance indicates that this project may not qualify under federal and state laws as an industrial enterprise. Furthermore, your Committee notes that several concerns were raised in the public hearing on this bill and recommends that additional testimony and information be submitted for deliberation in any future public hearing of this measure.

Your Committee has amended this measure by changing the entity that will receive the proceeds of the SPRB issuance to Hawaiian Sugar & Transportation Cooperative, instead of Gay & Robinson, Inc. In addition, your Committee has amended this measure by:

As affirmed by the record of votes of the members of your Committee on Agriculture that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2228, S.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 2228, S.D. 1, H.D. 1, and be referred to the Committee on Finance.