Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2006

State of Hawaii

Sir:

Your Committees on Labor and Transportation and Government Operations, to which was referred S.B. No. 2209 entitled:

beg leave to report as follows:

The purpose of this measure is to require the Department of Labor and Industrial Relations (DLIR) to enforce the laws of chapter 104, Hawaii Revised Statutes (HRS), and to collect and maintain the certified copies of payrolls for any public work project subject to chapter 104, HRS, that was not directly built or developed by a governmental contracting agency.

Testimony in support of this measure was submitted by the IBEW Local 1186, IBEW Local 1260, and the Hawaii State AFL-CIO. Testimony in opposition to this measure was submitted by DLIR, the Department of Accounting and General Services, and the Hawaii Chapter of Associated Builders and Contractors, Inc.

Your Committees find that contractors on certain public work projects have been able to avoid compliance with prevailing wages laws, largely due to a lack of monitoring and enforcement. Your Committees further find that certain public work projects, including those that are funded through the use of special purpose revenue bonds, lack an identifiable governmental contracting agency. Contractors on public work projects without a governmental contracting agency are able to avoid compliance with the law, as there is no entity to enforce or monitor compliance with chapter 104, Hawaii Revised Statutes. Your Committees believe that laborers on these public work projects should be receiving the payment of prevailing wages to ensure equity and uniformity in the execution of all public works projects. Therefore, your Committees determine that DLIR is the appropriate entity to enforce and monitor compliance with the law for these types of projects in order to close the existing loophole in the system.

As affirmed by the records of votes of the members of your Committees on Labor and Transportation and Government Operations that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 2209 and recommend that it pass Second Reading and be referred to the Committee on Ways and Means.