Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred H.B. No. 640, H.D. 1, S.D. 1, entitled:

begs leave to report as follows:

The purpose of this measure is to make an appropriation for the loss mitigation grant program.

The purpose of the loss mitigation grant program is to provide funds to make buildings more wind-resistive to protect them from hurricane damage. The bill would appropriate funds from the interest income from the hurricane reserve trust fund to the loss mitigation grant fund.

Your Committee finds that homes in Hawaii are vulnerable to hurricane damage and that after-the-fact insurance payments to repair homes are neither as economical nor effective as a prevention program. It has been estimated that for every dollar spent for prevention, there would be a six-fold reduction in hurricane-related losses and a concomitant savings in disaster relief funds.

Your Committee approves of the concept of this bill and has amended it to make the funding source the Hawaii Hurricane Relief Fund. Originally intended to provide a source of hurricane insurance during a time when it was difficult or impossible to get private hurricane insurance, the fund is now dormant due to the rise in the availability of private insurance. Your Committee believes that, rather than have the entire balance of the fund lying fallow, it is in the State's best interest to preserve lives, reduce property damage, and minimize disruption to the State's economy, business activity, and public services by using some of these funds for pre-loss mitigation grants.

As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 640, H.D. 1, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 640, H.D. 1, S.D. 2.