Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Consumer Protection & Commerce, to which was referred H.B. No. 633 entitled:

begs leave to report as follows:

The purpose of this bill is to allow the Department of Commerce and Consumer Affairs (DCCA) to expeditiously maintain a reasonable relationship between revenues and the cost of services rendered by DCCA by increasing DCCA's authority to increase or decrease its fees and other nontax revenues, to include all DCCA fees and nontax revenues.

DCCA, Chamber of Commerce of Hawaii, Retail Merchants of Hawaii, Hawaii Association of Realtors, and Building Industry Association of Hawaii supported this bill.

Your Committee finds that in the past two years DCCA, using its current authority to increase or decrease fees and nontax revenues without rule making, has implemented savings of between 25 to 50 percent for initial business filings and on-line renewals, among other savings. Your Committee commends DCCA for its efforts, and supports its further efforts to align revenues with costs, and reduce the cost of doing business in Hawaii.

Although this bill would enhance DCCA's ability to reduce business costs, your Committee recognizes that it would also provide DCCA with comprehensive authority to increase those costs.

Although your Committee has few concerns about presently giving DCCA this authority given DCCA's commendable record of decreasing fees, your Committee believes it would be prudent to fix the current policy of reducing industry costs, in statute. Further, although increases could not exceed 50 percent of statutorily assessed fees or nontax revenues, those subject to the fee or other assessment would undoubtedly find any increase of this magnitude a considerable burden, and your Committee is concerned that no public hearing or other procedure giving the public notice and an opportunity to comment would precede the increase.

In light of these concerns, your Committee has amended this bill to allow DCCA to adjust fees and nontax revenues only when decreasing the fees or nontax revenues. Technical, nonsubstantive amendments have also been made for clarity, consistency, and style.

As affirmed by the record of votes of the members of your Committee on Consumer Protection & Commerce that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 633, as amended herein, and recommends that it be referred to the Committee on Finance in the form attached hereto as H.B. No. 633, H.D. 1.