Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committee on Water, Land, and Agriculture, to which was referred S.B. No. 538 entitled:

begs leave to report as follows:

The purpose of this measure is to provide that when public lands are transferred to the Agribusiness Development Corporation (ADC), the ADC will not be subject to the procurement Code (103D, Hawaii Revised Statutes, (HRS)), the chapter on public Lands, Management and Disposition (171, HRS), and similar laws that would otherwise apply to a state agency with respect to the transferred lands.

Testimony in support of this measure was submitted by the Hawaii Agriculture Research Center, Gay & Robinson, the Hawaii Farm Bureau, Maui County Farm Bureau, and the Hawaiian Commercial and Sugar Company. Testimony in support of the intent of this measure was submitted by the ADC, which also submitted suggested amendments.

Your Committee finds that this measure would give ADC the same special exemptions to state lands being transferred or leased from another state agency to the ADC as private lands being acquired by the ADC. This exemption allows the ADC to negotiate subleases with potential tenants instead of having to put the land through the auctioning process.

Your Committee also finds that the Legislature established ADC to facilitate the transfer of agricultural lands vacated by the sugar and pineapple industries to new, productive agricultural enterprises. To carry out its legislative mandate and make optimal use of agricultural assets, the ADC needs the flexibility to administer these lands and corresponding infrastructure systems in a timely and meaningful manner. Exempting public lands leased from a State agency will allow the ADC that flexibility and control.

Your Committee finds that the amendments suggested by the ADC came from the Attorney General's office, which found that the exemption would be better situated in section 171-2, HRS, than section 163D-6, HRS. Accordingly, your Committee has amended this measure by replacing its contents with the amendments suggested by the ADC.

As affirmed by the record of votes of the members of your Committee on Water, Land, and Agriculture that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 538, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 538, S.D. 1, and be placed on the calendar for Third Reading.