Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2006

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred S.B. No. 3040 entitled:

begs leave to report as follows:

The purpose of this measure is to propose an amendment to the Hawaii Constitution relating to excess state revenue.

Specifically, the measure proposes to amend article VII, section 6, of the state constitution to provide that whenever the general fund balance, at the close of two successive fiscal years, exceeds five per cent of general fund revenues, the Legislature, in its next regular session, shall have, as an alternative to refunding or crediting an amount to state taxpayers, the authority to deposit the amount that would have been refunded or credited into the emergency and budget reserve fund.

Your Committee finds that the measure will provide the Legislature with the necessary flexibility to determine the best way to dispose of excess revenue.

As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 3040 and recommends that it pass Third Reading.