Requires the director of finance to conduct a public hearing on any proposed restriction or withholding of funds appropriated by the legislature, prior to implementing the restriction or withholding. Requires budget allotment estimates to include all funds lawfully budgeted and appropriated. Also requires notice by the Governor to recipients of grants under chapter 42F on the status of unreleased grants. (SD1)

A BILL FOR AN ACT

SECTION 1. Chapter 37, Hawaii Revised Statutes, is amended by adding a new section to part II to be appropriately designated and to read as follows:

"§37- Restricting or withholding of funds lawfully budgeted and appropriated; public hearing required. (a) Prior to restricting or withholding any funds lawfully budgeted and appropriated by the legislature, the director of finance shall conduct a public hearing on the proposed restriction or withholding and the reasons therefor.

(b) The public hearing shall be subject to chapter 92."

SECTION 2. Chapter 42F, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§42F- Grants; release by the governor. If a grant awarded by the legislature pursuant to this chapter is not allocated or released by the governor within ninety days of the effective date of the legislation awarding the grant, the governor shall notify, in the manner prescribed in section 1-28.5, the recipient of the unreleased grant on the status of whether the grant is still pending or will not be released. The governor shall provide the notice once every quarterly allotment period (as the periods are defined in section 37-32), beginning on the ninety-first day after the effective date of the legislation awarding the grant and until a final determination is made on the status of the grant."

SECTION 3. Section 37-34, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) No appropriation to which the allotment system is applicable shall become available to any department or establishment for expenditure during any allotment period until the department or establishment submits an estimate to the director of finance, at whatever time prior to the beginning of the allotment period and in whatever form as the director may prescribe, of the amount required to carry on the work of the department or establishment during that period and until the estimate is approved, increased, or decreased by the director and funds are allotted pursuant to section 37-35[.]; provided that all allotment estimates required under this section shall include all funds lawfully budgeted and appropriated to the department or agency to fully fund the programs of the department or agency, as contained in the General Appropriations Act, the Supplemental Appropriations Act, or any other appropriation act by the legislature, as the case may be, for the respective fiscal year."

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect upon its approval.