Authorizes the issuance of general obligation bonds and appropriates funds for capital improvement projects for the high technology development corporation's international technology incubator of Hawaii project.

A BILL FOR AN ACT

SECTION 1. Both Japan and Korea are competitive in the high technology community, but it is very difficult to start a new business in either country. Accordingly, Japanese and Korean entrepreneurs may prefer to establish new businesses in the United States to facilitate doing business in their home countries. There is an opportunity to assist entrepreneurs who have the technology and capital to start a successful business, but who find their local bureaucracies too daunting to wade through to begin a new enterprise there.

There are high technology business opportunities in China as well. In September 2004, the high technology development corporation organized and conducted a "tech tour" for a group of Hawaii business executives and investors. The group toured four of the largest high-tech parks in the Peoples Republic of China.

Many of the companies in the high-tech parks are already linked with Western corporations through sourcing agreements or research and development relationships. A majority of the companies, however, do not have links to Western corporations, and many would be interested in having some sort of representation in the United States for their products and services.

The high technology development corporation proposes to establish a new incubation services program that focuses primarily on foreign technology companies, yet is open to any appropriate foreign enterprise seeking to gain a presence in the United States. First and foremost, the international technology incubator will target established technology companies in China and Japan that are seeking to phase in operations in the United States. Its secondary target will be potential businesses from Korea, Singapore, Malaysia, and other Asia Pacific nations.

The high technology development corporation will provide services through its international technology incubator to include a one-stop business formation service that assists with the legal and government processes required to establish a United States subsidiary of a foreign corporation or a new corporation in the State. The international technology incubator also will assist foreign companies throughout the process of learning how to operate and grow a business.

In addition, the high technology development corporation is working with a group of local investors to create merchant banking services that can provide financing and expert assistance with public offerings.

Hawaii offers advantages making it an attractive alternative for foreign-owned enterprises establishing a business in the United States. These advantages include a multi-lingual population, the time zone, quality of life, and Hawaii's aggressive tax structures for technology investments. In addition, because the international technology incubator is operated by an agency of the State, and not a for-profit private company, it will be especially attractive to companies in China and Japan that are accustomed to working almost exclusively with and within government entities.

The pharmaceutical industry is one of the most profitable sectors of the United States economy. The international technology incubator will offer the opportunity to collaborate with Japan in this field, which will make Hawaii the Pacific epicenter of this high-tech research and development activity.

The purpose of this Act is to authorize the issuance of general obligation bonds and appropriate funds for construction for the high technology development corporation's international technology incubator project.

SECTION 2. The director of finance is authorized to issue general obligation bonds in the sum of $25,000,000, or so much thereof as may be necessary, and the same sum, or so much thereof as may be necessary, is appropriated for fiscal year 2005-2006, for the purpose of construction funds for the high technology development corporation's international technology incubator of Hawaii project.

SECTION 3. The sum appropriated shall be expended by the high technology development corporation for the purposes of this Act.

SECTION 4. The appropriation made for the capital improvement project authorized by this Act shall not lapse at the end of the fiscal biennium for which the appropriation is made; provided that all moneys from the appropriation unencumbered as of June 30, 2008, shall lapse as of that date.

SECTION 5. This Act shall take effect on July 1, 2005.