Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Sir:

Your Committee on Conference on the disagreeing vote of the Senate to the amendments proposed by the House of Representatives in S.B. No. 1239, S.D. 1, H.D. 2, entitled:

having met, and after full and free discussion, has agreed to recommend and does recommend to the respective Houses the final passage of this bill in an amended form.

The purpose of this measure is to allow the delivery of biodiesel to state harbors; reduce harbor fees for alternative fuel vessels; reduce total fuel taxes for ethanol, methanol, biodiesel, and other alternative fuels, other than liquefied petroleum gas; and establish a preference in public contracts for the use of biofuels.

Your Committee on Conference finds that supporting the production and use of alternative fuels promotes the State's public interest by reducing its dependence on traditional fossil fuels.

Your Committee on Conference amended the measure by deleting the provisions pertaining to the delivery of biodiesel to state harbors, reducing harbor fees for alternative fuel vessels, establishing a preference for the use of biofuels in public contracts, and the savings clause. Your Committee on Conference further amended the measure by changing its effective date to July 1, 2004 and making it applicable to taxable years beginning after December 31, 2003.

As affirmed by the record of votes of the managers of your Committee on Conference that is attached to this report, your Committee on Conference is in accord with the intent and purpose of S.B. No. 1239, S.D. 1, H.D. 2, as amended herein, and recommends that it pass Final Reading in the form attached hereto as S.B. No. 1239, S.D. 1, H.D. 2, C.D. 1.