Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committees on Commerce, Consumer Protection and Housing and Transportation, Military Affairs and Government Operations and Water, Land, Energy and Environment, to which was referred S.C.R. No. 58 entitled:

beg leave to report as follows:

The purpose of this measure is to authorize an Auditor's study on the effectiveness and efficiency of the State's risk management and on the feasibility of implementing a state captive insurance company.

The Insurance Commissioner, while taking no position on the merits of the measure, testified that the Insurance Division was willing to provide assistance with the Auditor's study.

Subsequent to the hearing on the measure as received, your Committees heard testimony on a proposed Senate draft of the measure. As originally drafted, the proposed draft replaced the contents of this measure with language establishing a joint legislative investigative committee on petroleum fuel prices pursuant to chapter 21, Hawaii Revised Statutes.

Testimony in support of the proposed Senate draft was received from the Department of Business, Economic Development and Tourism (DBEDT) and an individual. Tesoro Hawaii Corporation, Western States Petroleum Association, and two individuals opposed the proposed Senate draft. The Legislative Reference Bureau testified that it had no objection to providing policy analysis and drafting support to the investigative committee as requested in the proposed concurrent resolution.

Your Committees heard testimony that legislative proceedings on gas prices in the nature of an investigative committee are unnecessary and that information on this issue, including information obtained in the Attorney General's investigation of the oil industry and the State's recently settled antitrust action against the oil companies is already available to the Legislature. Therefore, this measure has been amended to provide for the establishment of a joint legislative review committee to gather and review publicly available information, studies, and reports relating to petroleum fuel prices, to evaluate this information, and to develop legislation to address the problem of high fuel prices in the State.

In addition, this measure as amended:

Finally, your Committees note that the title of this concurrent resolution has been changed to reflect its amended purpose.

As affirmed by the records of votes of the members of your Committees on Commerce, Consumer Protection and Housing and Transportation, Military Affairs and Government Operations and Water, Land, Energy and Environment that are attached to this report, your Committees concur with the intent and purpose of S.C.R. No. 58, as amended herein, recommend that it be referred to the Committee on Ways and Means, in the form attached hereto as S.C.R. No. 58, S.D. 1.