RESOLUTION

WHEREAS, Maui Memorial Medical Center is the oldest and the largest of the acute care facilities operated by the Hawaii Health Systems Corporation; and

WHEREAS, Maui Memorial Medical Center is also the largest health care provider on the island of Maui, providing acute, rural, and long-term care for the residents of Maui; and

WHEREAS, Maui Memorial Medical Center currently has a parking shortage and the shortage will increase with plans to add a new four-story wing and a new medical office building to the present hospital site; and

WHEREAS, a new parking structure is needed for Maui Memorial Medical Center to meet the demand added by the new four-story wing and the medical office building and to address current parking shortages on the site; and

WHEREAS, a lease/purchase agreement would permit the Hawaii Health Systems Corporation to construct and deliver this much-needed new parking structure at Maui Memorial Medical Center, with the assistance of the private sector; and

WHEREAS, lease/purchase agreements using certificates of participation have proven to be an efficient and expeditious alternative mechanism for funding the construction of needed public facilities; and

WHEREAS, a certificate of participation is an arrangement in which private investors buy certificates that entitle them to a participation, or share, in the lease payments from a particular construction project. These lease payments are passed through the lessor to the certificate holders with the tax advantages intact (i.e. in the case of the State -- tax-exempt interest). The lessor typically assigns the lease and lease payment to a trustee, who then distributes the lease payments to the certificate holders. Much like a bond, each certificate or share entitles an investor to periodic payment of principal and tax-exempt interest; and

WHEREAS, public-private efforts to fund and construct public facilities in a manner that is prudent and conservative and that directly benefit the State and the health and well-being of our residents are to be applauded and encouraged; now, therefore,

BE IT RESOLVED by the House of Representatives of the Twenty-third Legislature of the State of Hawaii, Regular Session of 2006, the Senate concurring, that the Hawaii Health Systems Corporation is urged to enter into a lease/purchase agreement for the acquisition of a new parking structure consisting of approximately nine hundred stalls for Maui Memorial Medical Center and related facilities, to be funded by the issuance of certificates of participation; and

BE IT FURTHER RESOLVED the Hawaii Health Systems Corporation is requested to submit a copy of any lease/purchase agreement to the Legislature no later than twenty days prior to the convening of the Regular Session of 2007; and

BE IT FURTHER RESOLVED that the Hawaii Health Systems Corporation is requested to refrain from using moneys from its operating budget to pay for debt service on the certificates of participation; and

BE IT FURTHER RESOLVED that certified copies of this Concurrent Resolution be transmitted to the President of the Hawaii Health Systems Corporation, the Governor, the Comptroller, and the Chief Executive Officer of Maui Memorial Medical Center.

Report Title:

Maui Memorial Medical Center; Parking Structure; Lease/Purchase