Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Labor & Public Employment, to which was referred S.B. No. 1194, S.D. 1, entitled:

begs leave to report as follows:

The purpose of this bill is to improve the State Deferred Compensation System by allowing the public employee members of the Board of Trustees of the Deferred Compensation Plan (Board) to be elected rather than appointed.

The Hawaii Government Employees Association testified in support of this bill. The Board testified in opposition to this measure. The Department of Human Resources Development commented on this bill and expressed serious concerns.

Currently, the Board consists of seven trustees, five of whom are public employees appointed by the Governor with the advice and consent of the Senate. Public employees have complained that there is a lack of communication between the Board and the members they serve. Your Committee finds that by allowing the membership of the deferred compensation plan to elect five members of the Board, this problem will be addressed.

However, it is not the intent of your Committee that all five public employee members of the Board be elected at once so as to displace the current members who have recently been appointed. Accordingly, your Committee has amended this measure by:

As affirmed by the record of votes of the members of your Committee on Labor & Public Employment that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1194, S.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 1194, S.D. 1, H.D. 1, and be referred to the Committee on Finance.