Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committee on Transportation, Military Affairs and Government Operations, to which was referred S.B. No. 47 entitled:

begs leave to report as follows:

The purpose of this measure is to exempt shipping cargo from wharfage fees at the port of Honolulu when the cargo is shipped through the port of Honolulu for final delivery at another port within the State.

Your Committee received testimony in support of this measure from Young Brothers, Ltd., Meadow Gold Dairies, the Hawaii Farm Bureau, and the Hawaii Food Industry Association. The Department of Transportation and Matson Navigation Company submitted testimony in opposition to this measure.

Your Committee finds that a significant portion of the shipping cargo destined for the various islands of the State is shipped into the port of Honolulu, where it may be held for a short period of time prior to being shipped to its final destination.

Your Committee further finds that such cargo is assessed a wharfage fee at the port of Honolulu. Conversely, cargo shipped into the islands on a through bill of lading is not assessed a wharfage fee at the port of Honolulu, even though the same facilities and infrastructure must be used in both cases.

Your Committee agrees that this situation is unfair, and therefore supports this equitable measure. This measure exempts all cargo from wharfage fees at the port of Honolulu, regardless of whether the cargo is shipped on a through bill of lading, when the cargo is shipped through the Honolulu port for final delivery to another port in the State.

Based on concerns raised during the hearing on this measure, your Committee has amended the measure to clarify the language so that there is no confusion regarding its intent and effect.

As affirmed by the record of votes of the members of your Committee on Transportation, Military Affairs and Government Operations that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 47, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 47, S.D. 1, and be referred to the Committee on Ways and Means.