STAND. COM. REP. NO. 1121

Honolulu, Hawaii

, 2005

RE: H.B. No. 1548

H.D. 1

S.D. 1

 

 

Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Labor, to which was referred H.B. No. 1548, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO THE EMPLOYER-UNION HEALTH BENEFITS TRUST FUND,"

begs leave to report as follows:

The purpose of this measure is to change the composition of the Board of Trustees (Board) of the Employer-Union Health Benefits Trust Fund (EUTF) from ten to twelve members.

This measure also:

(1) Amends the appointment procedures of the trustees by requiring that eleven be appointed by the Governor and one be appointed by the counties on a rotational basis;

(2) Prohibits the Governor from reducing the term of the trustee appointed by a county; and

(3) Permits a county to appoint a replacement in the case of a vacancy of a county-appointed trustee.

Testimony in support of this measure was submitted by the Department of Human Resources of the City and County of Honolulu and the Hawaii State Teachers Association. Testimony in opposition to this measure was submitted by the Hawaii Government Employees Association. Comments on this measure were also submitted by the Department of Budget and Finance and the EUTF.

Your Committee finds that better representation of the employee-beneficiaries of the EUTF is necessary to protect the interests of the employee-beneficiaries. The expansion of the Board will provide more broad and fair representation by allowing a trustee to be selected by each of the six exclusive representatives of the bargaining units under section 89-6(a), Hawaii Revised Statutes. Your Committee further finds that the current four-year term limit does not allow ample time for the Board to truly benefit from a trustee's knowledge and abilities obtained and developed regarding the complex subject matters involving in the health care industry and plan administration. Therefore, at will terms will better serve the EUTF and its members.

Accordingly, your Committee has amended this measure by:

(1) Changing the composition of the Board from twelve to fourteen trustees;

(2) Providing that seven of the trustees shall represent the public employers and shall be appointed by the Governor;

(3) Providing that seven trustees shall represent the employee-beneficiaries, one of whom shall represent retirees, and shall be selected as follows:

(A) One trustee shall be selected by each of the six exclusive representatives for the collective bargaining units; and

(B) One trustee shall be selected by two-thirds majority vote of the six exclusive representatives of the collective bargaining units;

(4) Providing that the terms of the trustees shall be at the pleasure of the appointing or selecting entity;

(5) Providing that a vacancy shall be filled in the same manner as the trustee who vacated the position was appointed or selected;

(6) Amending the numbers required for quorum due to the change in the composition of the Board; and

(7) Changing the effective date of the Act from July 1, 2010 to effective upon its approval.

As affirmed by the record of votes of the members of your Committee on Labor that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1548, H.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1548, H.D. 1, S.D. 1, and be referred to the Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committee on Labor,

____________________________

BRIAN KANNO, Chair