Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred S.B. No. 1065 entitled:

begs leave to report as follows:

The purpose of this measure is to establish a managed competition process for the provision of government services.

In particular, this measure requires that a single, uniform process for managed competition be established for the State and each of the counties. The directors of finance of the State and of each county are responsible for establishing a uniform system for identifying and quantifying the costs of providing the government services in-house. They must also specify direct and indirect costs common to agencies within the State and each county, and standards of performance and other objective accountability measures for evaluating whether efficiencies and economies have been achieved.

Your Committee finds that Act 230, Session Laws of Hawaii 1998, established a committee to develop a managed process allowing state and county agencies to contract with the private sector for the provision of government services, and to make government more efficient and cost-effective. This measure implements the recommendations of that committee.

Your Committee finds that the managed competition process set forth in this measure will help to ensure that when government decides to seek services from the private sector, it relies on accurate assessments of the government's financial condition and informed and responsible cost comparisons, and makes every effort to minimize the impact of decisions on public employees.

As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1065 and recommends that it pass Third Reading.