CONFERENCE COMMITTEE REP

CONFERENCE COMMITTEE REP. NO. 177

Honolulu, Hawaii

, 2005

RE: S.B. No. 1729

S.D. 2

H.D. 2

C.D. 1

Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Conference on the disagreeing vote of the Senate to the amendments proposed by the House of Representatives in S.B. No. 1729, S.D. 2, H.D. 2, entitled:

"A BILL FOR AN ACT RELATING TO TOURISM,"

having met, and after full and free discussion, has agreed to recommend and does recommend to the respective Houses the final passage of this bill in an amended form.

The purpose of this measure is to redistribute the transient accommodations tax (TAT) to facilitate the Hawaii Tourism Authority (HTA) with existing and expanded programs, repeal the TAT trust fund, place the convention center enterprise special fund and the tourism special fund outside the state treasury and allow them to be placed in interest-bearing accounts and invested, and clarify the administrative authority of the HTA.

Your Committee on Conference finds that the State's investment in tourism is critical to ensure that Hawaii maintains a successful and sustainable tourism industry. It is imperative that the HTA be given additional resources to effectively and efficiently implement its programs, which will contribute to an increased focus in areas such as safety and security, workforce development, communications, and state parks and trails.

Your Committee on Conference has amended this measure by:

(1) Deleting the limitations on the Governor's and executive agencies' oversight authority over the HTA's hiring of personnel, and deleting reference to general fund limitations, but allowing the HTA to appoint officers, agents, and employees subject to the approval of the HTA board if there is no anticipated revenue shortfall in the tourism special fund and funds have been appropriated by the Legislature and allotted as provided by law;

(2) Requiring excess revenues from the TAT, after distribution, be deposited into the general fund;

(3) Deleting changes to the 17.3 per cent distribution of revenues into the convention center enterprise special fund;

(4) Effective July 1, 2007, changing the 32.6 per cent to 34.2 per cent to be deposited into the tourism special fund; repealing the $62,292,000 cap; restoring the deposits into the state parks special fund and special land and development fund, but taking those deposits from the first $1,000,000 in TAT revenues deposited into the tourism special fund; requiring that of the 34.2 per cent, 0.5 per cent be transferred to a sub-account to fund safety and security programs; and deleting reference to deposits into the state parks special fund and special land and development fund taken from TAT;

(5) Deleting reference to an aloha aina patrol;

(6) Making the repeal of the TAT trust fund effective July 1, 2007;

(7) Changing the effective date to July 1, 2005;

(8) Making all ex officio members of the HTA board nonvoting; and

(9) Making technical, nonsubstantive amendments.

The H.D. 2 of this measure would have limited the power of the Governor and the executive agencies to interfere with the personnel appointment authority of the HTA Board. This measure deletes that provision and clarifies that the HTA has independent appointment authority subject to the availability of state funds. For example, if the Legislature creates a new administrative position in statute and provides an appropriation thereto, the Administration is prohibited from interfering with the filling of that position.

As affirmed by the record of votes of the managers of your Committee on Conference that is attached to this report, your Committee on Conference is in accord with the intent and purpose of S.B. No. 1729, S.D. 2, H.D. 2, as amended herein, and recommends that it pass Final Reading in the form attached hereto as S.B. No. 1729, S.D. 2, H.D. 2, C.D. 1.

Respectfully submitted on behalf of the managers:

ON THE PART OF THE HOUSE

ON THE PART OF THE SENATE

____________________________ Jerry L. Chang, Co-Chair		____________________________ Donna Mercado Kim, Chair
____________________________ Dwight Takamine, Co-Chair		____________________________ Brian T. Taniguchi, Co-Chair