Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Commerce, Consumer Protection, and Housing, to which was referred H.B. No. 633, H.D. 2, entitled:

begs leave to report as follows:

The purpose of this measure is to extend the Department of Commerce and Consumer Affairs' authority to adjust fees and other nontax revenues to all fees and nontax revenues within its jurisdiction and to repeal the authority of the Department to effect an adjustment in fees through an increase.

The Building Industry Association of Hawaii testified in support of the measure. The Department of Commerce and Consumer Affairs (DCCA), Retail Merchants of Hawaii, The Chamber of Commerce of Hawaii, and Hawaii Association of Realtors supported the measure in its original form.

Subject to the approval of the governor, DCCA is currently authorized under section 92-28, Hawaii Revised Statutes (HRS), to adjust some of its fees and other nontax revenues by an amount no greater than fifty per cent in order to maintain a reasonable relationship between the cost of providing services and revenues collected. This measure proposes to extend that authority to all fees and nontax revenues collected by the Department, thereby establishing a more equitable system of regulation.

Additionally, this measure proposes to repeal DCCA's authority to effect an adjustment through an increase in fees, thereby permitting the Department to expeditiously adjust fees only in a downward direction.

Your Committee finds that DCCA has responsibly exercised its authority to adjust fees under section 92-28, HRS, and implemented savings of between twenty-five and fifty per cent in fees this year for initial business filings and on-line renewals. Your Committee further finds that the prohibition on fee increases proposed by this measure would impair the Department's ability to expeditiously align revenues with expenses and may jeopardize the efficient operation of the Department.

Accordingly, your Committee has amended this measure by replacing its language with the contents of S.B. No. 742 (2005), which reflects the original language of this measure. As amended, this measure:

As affirmed by the record of votes of the members of your Committee on Commerce, Consumer Protection, and Housing that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 633, H.D. 2, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 633, H.D. 2, S.D. 1, and be referred to the Committee on Ways and Means.