Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2006

State of Hawaii

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Third State Legislature

Regular Session of 2006

State of Hawaii

Sir:

Your Committee on Conference on the disagreeing vote of the Senate to the amendments proposed by the House of Representatives in S.B. No. 2948, S.D. 1, H.D. 2, entitled:

having met, and after full and free discussion, has agreed to recommend and does recommend to the respective Houses the final passage of this bill in an amended form.

The purpose of this measure is to establish the amount of interim revenue to be transferred to the Office of Hawaiian Affairs from the public land trust, each fiscal year beginning with fiscal year 2005-2006, at $15,100,000.

In addition, this measure also appropriates $17,500,000 as the amount of revenues owed to the Office of Hawaiian Affairs for the underpayment of the Office of Hawaiian Affairs' pro rata share of the public land trust revenues between July 1, 2001 and June 30, 2005.

Section 2 of this measure specifies that beginning in fiscal year 2005-2006, and until further legislative action is taken, the income and proceeds from the pro rata portion of the public land trust for expenditure by OHA pursuant to Article XII, Section 6 of the Hawaii Constitution shall be $15,100,000 per fiscal year. This amount shall be transferred from various state departments and agencies to OHA in four equal quarterly installments via voucher payments. According to the Attorney General,

The $15,100,000 also includes certain ancillary receipts from the state airports.

Also, according to the Attorney General, the approximate amount of funding actually transferred to OHA pursuant to Executive Order No. 03-03 and Act 34, Session Laws of Hawaii 2003, was as follows:

DAGS State Parking Revolving

Fund $ 43,676 $22,896 $ 23,730

DOA Agricultural Park Special Fund

General Fund $110,038 $66,659 $106,558

DBED&T Foreign Trade Zone Special

Fund

HCDA Revolving Fund

NELHA Special Fund $474,684 $291,906 $352,531

DOE Use of School Facilities

Special Fund $ 81,493 $ 48,400 $ 45,098

DLNR Boating Special Fund

Special Land & Development Fund

State Parks Special Fund

Beach Restoration Special Fund

General Fund    $3,054,738    $2,827,717   $3,404,405

DOT Harbors Special Fund   $11,737,324    $6,480,000   $6,866,384

Act 34, SLH 2002   $ 2,041,852 _________ ________  

General Fund

The approximate amounts of "analogous" ceded land receipts were as follows:

FYs 2002-2003 2004 2005

Hawaii Health Systems Corporation $ 665,687 $471,650 Unverified

Hilo Medical, Kula Hospital,

Samuel Mahelona

Non-Patient Food Sales

Catering Revenue

Parking Revenue

Data processing Services Revenue

Medical Records Abstract Sales

Non-Patient Room Rentals

Telephone & Telegraph Revenue

Restricted and Non-Restricted

Contributions

Employee Housing Rent Revenue

Clinical Rent Revenue

Other Space Rental

University of Hawaii $1,293,852 $1,182,121 Unverified

Manoa and Hilo Campuses

Parking

Faculty Housing

Non-Student Housing Rentals,

including food and vending

machine,telephone

commissions/collections

Hilo Bookstore – logo products,

sundries but not books or

school supplies

Other Revenue

HCDCH Housing $80,626 $40,091 $32,625

Public School Faculty

Housing Rentals

Public Rental Housing

Laundromat/Vending

Machine Receipts

Public Rental Housing

Antennae Rental Receipts

___________ ___________ ____________

Annual Totals $2,040,165 $1,693,862 Unverified

According to the Attorney General, the approximate amounts of ancillary receipts from the state airports were as follows:

FYs 2002-2003 2004 2005

HIA Terminal Rental Revenue $2,598,460 $1,290,018 $1,068,268

HIA Terminal Concession Revenue $ 857,152 $ 503,754 $ 525,671

Non-HIA Aeronautical Revenue $1,158,094 $ 671,564 $ 712,015

Non-HIA Concession/Other $18,241,417 $9,655,042 $10,159,033

Terminal Revenue

Annual Total Receipts $22,855,123 $12,120,378 $12,464,987

20% Share $4,571,025 $2,424,076 $2,492,997

Section 4 of this measure appropriates the sum of $17,500,000 to OHA in fiscal year 2005-2006. According to the Attorney General, this one-time appropriation raises the amount of ceded land receipts actually transferred to OHA during the fiscal years 2002 through 2005. The one-time appropriation of general funds is roughly equivalent to analogous rent-type receipts for the use of ceded lands collected by the Hawaii Health Systems Corporation, the Housing and Community Development Corporation of Hawaii, and the University of Hawaii, etc. during the relevant period which were not paid for legal reasons, interest, and negotiation and fairness considerations. In other words, this appropriation represents a "catch-up" of amounts that were underpaid during the specified time period.

Section 5 requires the DLNR to provide an annual accounting of revenues derived from the public land trust. At the present time, no single state department or agency is responsible for compiling such data. A single accounting will provide the Legislature, OHA, the general public, and even the state administration with a clearer financial picture of the public land trust.

Your Committee on Conferences notes that the agreement embodied in this measure does not extinguish past and future claims that the Office of Hawaiian Affairs may have regarding revenue payments from ceded lands. The agreed $17,500,000 should be considered a credit for payment owed the Office of Hawaiian Affairs for the period of July 1, 2001 through June 30, 2005. The payment of $17,500,000 should be construed as coming from ceded land revenues.

Your Committee on Conference has amended this measure to insert H.B. 2204, S.D. 1, which requires that the Department of Land and Natural Resources provide an accounting of revenues from the public land trust and appropriates funds to the Department to conduct the accounting. The Senate draft of H.B. 2204 also provides that the Office of Hawaiian Affairs is to provide additional funds for the accounting. Your Committee on Conference has amended this measure to:

As affirmed by the record of votes of the managers of your Committee on Conference that is attached to this report, your Committee on Conference is in accord with the intent and purpose of S.B. No. 2948, S.D. 1, H.D. 2, as amended herein, and recommends that it pass Final Reading in the form attached hereto as S.B. No. 2948, S.D. 1, H.D. 2, C.D. 1.