Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2006

State of Hawaii

Sir:

Your Committee on Commerce, Consumer Protection, and Housing, to which was referred S.B. No. 2224 entitled:

begs leave to report as follows:

The purpose of this measure is to amend the definition of "principal balance" to clarify that negative equity may be financed as part of a motor vehicle retail installment sale contract.

Testimony in support of this measure was provided by the Hawaii Automobile Dealers' Association. No testimony in opposition to this measure was submitted to your Committee.

Your Committee finds that this clarifying language is contained in similar statutes in thirty-eight states and that passage of this measure conforms chapter 476, Hawaii Revised Statutes to industry practice.

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 S.B. No. 2224 and recommends that it pass Second Reading and be placed on the calendar for Third Reading.