Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committee on Judiciary and Hawaiian Affairs, to which was referred H.B. No. 1154, H.D. 1, entitled:

begs leave to report as follows:

The purpose of this measure is to increase the Unclaimed Property Trust Fund (UPTF) ceiling to $1,500,000, authorize deductions from proceeds for costs incurred in connection with the sale of unclaimed securities, and to appropriate unspecified sums in fiscal years 2003-2004 and 2004-2005 from the UPTF for administration and operation of the unclaimed property program.

Your Committee received testimony in support of this measure from the Department of Budget and Finance.

Your Committee finds that chapter 523A, Hawaii Revised Statutes, requires all holders of abandoned property to file an annual report with the Unclaimed Property program. All property remaining unclaimed is safeguarded until claimed. Payments received by the Unclaimed Property program from property holders range from nine million to twelve million dollars annually, and are deposited into the UPTF. Currently, only claims for abandoned property are deducted from the UPTF which total approximately three million annually. UPTF monies in excess of the authorized ceiling are transferred to the general fund.

Your Committee further finds that the definition of "trust fund" in §37-62, Hawaii Revised Statutes, does not bar the use of trust funds for operating expenses. Therefore, your Committee believes UPTF administration and operating expenses may be deducted from the UPTF as legitimate purposes of the trust fund.

Your Committee amended the bill pursuant to testimony received by:

As affirmed by the record of votes of the members of your Committee on Judiciary and Hawaiian Affairs that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1154, H.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1154, H.D. 1, S.D. 1, and be referred to the Committee on Ways and Means.