Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred S.B. No. 1117, S.D. 1, entitled:

begs leave to report as follows:

The purpose of this measure is to authorize the issuance of up to $160,000,000 in special purpose revenue bonds to assist Hawaiian Electric Company, Inc., Maui Electric Company, Ltd., and Hawaii Electric Light Company, Inc. with financing multi-project capital improvement construction necessary for the furnishing of electricity.

Your Committee understands that the use of the proceeds from the sale of tax-exempt special purpose revenue bonds significantly reduces the cost of financing electric utility projects. Hawaiian Electric Company, Inc. and its subsidiary electric utilities estimate an overall savings of $250,000 for every $1,000,000 of bonds sold, or total estimated savings of $40,000,000 over the thirty-year life of the bonds. All savings from this less expensive form of financing will benefit the ratepayers through lower electricity rates.

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. 1117, S.D. 1, and recommends that it pass Third Reading.