STAND

STAND. COM. REP. NO. 1111

Honolulu, Hawaii

, 2005

RE: S.B. No. 1427

S.D. 1

H.D. 1

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Energy & Environmental Protection, to which was referred S.B. No. 1427, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO PROCUREMENT OF HIGH ENERGY EFFICIENT VEHICLES,"

begs leave to report as follows:

The purpose of this bill is to create savings in the procurement of state vehicles.

Specifically, this bill requires all state agencies to purchase an increasing percentage of new light duty vehicles that are hybrid or high energy efficient vehicles when increasing their vehicle fleets. By January 1, 2007, the required percentage is twenty per cent. By January 1, 2009, the percentage rises to forty per cent. For each year after January 1, 2009, each state agency must increase its purchases of alternative fuel vehicles by five per cent each year until the purchases reach sixty per cent of all newly purchased light duty vehicles.

Furthermore, "hybrid electric vehicles", "electric vehicles", and "fuel cell vehicles" are defined and qualify as alternative fuel vehicles.

Your Committee received testimony in support of this bill from the Sierra Club. Testimony in opposition was received from the Department of Transportation and the Department of Accounting and General Services.

Your Committee notes that the Department of Accounting and General Services has raised concerns about the additional costs that would be forced upon state agencies to procure highly efficient vehicles. Your Committee is aware that automobile manufacturers produce many vehicles, such as flexible fuel ethanol vehicles, at no additional cost to consumers. Purchase of these types of vehicles would position the State to purchase ethanol fuel blends like E85 in anticipation of local production of ethanol to meet mandated blends of E10 starting in 2006. Biodiesel fuel produced locally may also be used in light duty diesel vehicles available commercially.

Upon further consideration, your Committee has amended this bill by:

(1) Adding a purpose section as section 1 of the bill;

(2) Adding a provision allowing agencies to offset the purchase requirements for alternative fuel vehicles by successfully demonstrating percentage improvements in overall light duty vehicle fleet mileage economy. The offsets are to be measured against the fleet average mileage economy using calendar year 2004 as a baseline, on a percentage by percentage basis;

(3) Deleting section 103D- (b) on p. 2, lines 5-6, which qualifies "hybrid electric vehicles", "electric vehicles", and "fuel cell vehicles" as alternative fuel vehicles and correspondingly subsuming their definitions into an overall definition of "alternative fuel vehicle" for purposes of consistency;

(4) Adding a new definition of "agency" to mean a state agency, office, or department;

(5) Redesignating the sections of the bill and the subsection of section 103D- consecutively; and

(6) Making various technical, nonsubstantive amendments for the purposes of clarity and style.

As affirmed by the record of votes of the members of your Committee on Energy & Environmental Protection that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1427, S.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 1427, S.D. 1, H.D. 1, and be referred to the Committee on Finance.

Respectfully submitted on behalf of the members of the Committee on Energy & Environmental Protection,

		____________________________ HERMINA MORITA, Chair