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. 516, S.D. 1, entitled:

begs leave to report as follows:

The purpose of this measure is to change the manner in which the Board of Land and Natural Resources (Board) calculates lease rentals for private residential noncommercial piers in Kaneohe Bay.

Your Committee finds that the lease rent methodology utilized by the Board to determine private residential noncommercial lease rents in Kaneohe Bay values the submerged lands at fifty per cent of the value of the residential fast land. The Board noted that this fifty per cent rate is used by the Harbors Division of the Department of Transportation when leasing submerged lands for commercial purposes and by its Division of Boating and Ocean Recreation when leasing submerged lands for commercial and recreational boating activities.

Your Committee finds this multiplier rate unjustifiable for residential noncommercial property. This measure reduces the multiplier rate used to determine the value of the submerged lands from fifty per cent to ten per cent of the value of the fast lands.

Your Committee has amended this measure by changing the multiplier to an unspecified percentage in order to facilitate continuing discussion on this matter.

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. 516, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 516, S.D. 2.