Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Sir:

Your Committee on Consumer Protection and Commerce, to which was referred H.B. No. 1808 entitled:

begs leave to report as follows:

The purpose of this bill is to exempt property held by a member-owned utility consumer cooperative association from compliance with Part I of Chapter 523A, Hawaii Revised Statutes, Uniform Unclaimed Property Act.

Testimony in favor of the bill was provided by Kauai Island Utility Cooperative (KIUC). Testimony in support of the intent of the bill and stating concerns was submitted by the Department of Budget and Finance (B&F).

Your Committee finds that this bill would presently apply only to KIUC. Your Committee heard testimony that it would be better public policy to leave unclaimed customer deposits and vendor checks with the cooperative than to have them escheat to the State, who administers the unclaimed property program. The amount at issue is between $2,000 and $3,000 per annum.

However, there were also concerns that the rights of the unclaimed property owners were not sufficiently protected, and it was suggested that KIUC should be required to maintain a separate unclaimed property accounting and notification system and submit an annual report to B&F.

Your Committee has amended this bill, as recommended by B&F, by:

Technical, nonsubstantive amendments were also made for clarity, consistency, and style.

Your Committee finds that it is not clear whether B&F's amendments will require KIUC to maintain a separate unclaimed property accounting and notification system. However, B&F believes that by requiring an annual report of unclaimed property, and providing B&F the authority to prescribe the form of the report, the amendments will allow B&F to require the establishment and maintenance of an appropriate accounting and notification system.

Your Committee finds that both parties' understanding of the import of B&F's language and that the language itself, may be clarified, if necessary, as the bill progresses.

As affirmed by the record of votes of the members of your Committee on Consumer Protection and Commerce that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1808, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1808, H.D. 1, and be referred to the Committee on Finance.