Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committee on Tourism, to which was referred S.B. No. 38 entitled:

begs leave to report as follows:

The purpose of this measure is to authorize the Hawaii Tourism Authority (Authority) to retain private legal counsel, independent of the Attorney General (AG).

Your Committee received testimony in support of this measure from the HTA. The AG submitted testimony in opposition to this measure.

Your Committee finds that the responsibilities of the Authority, particularly with regard to negotiating complex contracts, require specialized legal expertise and the services of an attorney able to focus attention exclusively on the legal needs of the Authority.

While the AG retains over one hundred fifty deputies to handle the legal affairs of the State, your Committee finds that the office has been unable to satisfactorily complete the Authority's legal work in a timely manner.

For example, the issue of the adequacy of the Authority's legal representation recently arose during the negotiation of the Authority's contract with the Hawaii Visitors Convention Bureau, which was supposed to be in place by January 1, 2003.

As of the end of January, 2003, the contract has not been signed, and your Committee finds that at least part of the reason is that the Authority lacked adequate legal representation in negotiating the contract.

While your Committee agrees that, in general, the AG's office should advise and represent all state agencies, it is more important to ensure that our state agencies are able to function effectively and efficiently.

Furthermore, although the Hawaii Revised Statutes contain a provision allowing the AG and the Governor to authorize retention of outside counsel, your Committee finds that procedure insufficient. Not only has the approval process been too lengthy in the past, but separate approval may be required for every project for which outside counsel is necessary.

Your Committee is hopeful that with the appointment of a new AG under Governor Lingle's administration, legal services to state agencies may improve. In the meantime, however, your Committee agrees that it is appropriate to authorize the Authority to retain full-time outside counsel.

Your Committee notes that this measure contains no separate allocation of funds to pay the salary and retainer for outside counsel for the Authority. The Authority has not requested additional funds to retain outside counsel, and your Committee agrees that the Authority should pay its outside counsel using its existing funds.

As affirmed by the record of votes of the members of your Committee on Tourism that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 38 and recommends that it pass Second Reading and be referred to the Committees on Judiciary and Hawaiian Affairs and Ways and Means.