Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committee on Education, to which was referred H.B. No. 712 entitled:

begs leave to report as follows:

The purpose of this measure is to reduce the amount of general excise tax revenues deposited to the credit of the State Educational Facilities Improvement Special Fund by the amount of certificates of participation, in addition to the amount of general obligation bonds, authorized for that fiscal year.

The Department of Education submitted testimony in support of the intent of this measure with reservations. The Tax Foundation of Hawaii submitted comments on this measure.

Your Committee finds that the current economic climate has adversely impacted the availability of funds in all areas. However, additional funding is needed for the improvement of educational facilities in order to maintain our public schools and ensure a safe and suitable educational environment for our youth. The scarcity of funding requires the use of alternative approaches to securing moneys for departments, agencies, projects, and programs. Your Committee determines that the addition of certificates of participation as a source of funding for the State Educational Facilities Improvement Special Fund can provide the Department of Education with an additional option for funding school facilities.

As affirmed by the record of votes of the members of your Committee on Education that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 712, and recommends that it pass Second Reading and be referred to the Committee on Ways and Means.