SB709

SECTION 1. The legislature finds that the focal points of Hawaii's economic policy have remained the same for decades: maximize visitor arrivals and spending, encourage strong construction and real estate industries, increase federal funding for military and civilian projects, monitor tax revenues and their impact on public sector employment, and maintain consistent job growth to keep the unemployment level low. Although these economic policies are still significant to the State's economic development and health, new economic objectives are needed in addition to these traditional policies for Hawaii to succeed in what is today characterized as the "global innovation economy."

The innovation economy requires learning to function in a world that is more technologically advanced, more global, and more knowledge-intensive. In A New Economy in Hawaii 2005 Indicators and Recommendations published by the Hawaii Institute for Public Affairs, five policy objectives are identified and recommended for Hawaii to compete in the global marketplace. These policy objectives are:

(1) Quickly develop high technology industries consisting of profitable and sustainable companies;

(2) Maximize competitiveness and overall efficiency by infusing all industries with technology;

(3) Prepare, employ, and retain a strong workforce for the global economy;

(4) Create a pervasive culture of innovation, initiative, and enterprise; and

(5) Help Hawaii companies survive and thrive in the global economy.

These new economic policy objectives require proper measurements to enable the State to set benchmarks and goals for Hawaii to grow and prosper in today's global economy.

Between 1998 and 2003, City Bank and Hawaii Business magazine targeted nine emerging industries in Hawaii, which represented a combined total of $2,700,000,000 in expenditures and thousands of new jobs. The combined total growth projections of these emerging industries are roughly comparable to the impact and magnitude of Hawaii's tourism industry and should be measured and developed as an equally significant pillar of Hawaii's economy. With a growing emphasis on stewardship and sustainability from a land use, resource allocation, and developmental perspective, Hawaii cannot afford to continue relying so heavily upon a dominant industry that depends almost exclusively upon fossil fuel-burning transportation (e.g., airline transportation) as the primary means by which Hawaii's millions of visitors arrive.

Currently, the State does not have consistent means of tracking progress, setting goals, and creating policies to achieve global innovation economy objectives. Data such as service exports, training and education outside of the traditional school system, self-sufficiency wages, job creation, impact of business tax credits, and quality of life indicators all can be used to establish new economic goals and determine priorities for public investments in workforce development and emerging industries development.

The purpose of this Act is to require the department of business, economic development, and tourism to collect, analyze, and disseminate appropriate data to measure the growth of targeted industries that have the potential to transform Hawaii's economy, and to accelerate their development into more robust pillars of Hawaii's society.

SECTION 2. Chapter 201, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§201- Research and statistics in emerging growth industries. (a) The department shall maintain a program for the purpose of:

(1) Investigating and compiling statistics and research data in the emerging growth industries, including:

(A) Research and development conducted at or in association with the University of Hawaii;

(B) Ocean sciences and technology;

(D) Astronomy;

(E) Internet and computer software and services;

(F) Film and creative media;

(G) Diversified agriculture;

(H) Aquaculture; and

(I) Educational tourism;

(2) Measuring and analyzing new economic development trends within targeted industries within the designated growth areas; and

(3) Providing economic information to policy makers, the public, and the various industries for use in setting policies, objectives, and goals. This includes collecting, analyzing, and publishing data on an annual basis relating to:

(A) Economic diversification, the availability of living wage jobs, and the State's environmental well being;

(B) High technology industries in the State, including but not limited to high technology jobs, scientists and engineers, and patents registered by high technology businesses;

(C) Technology infusion, including but not limited to information technology jobs in non-information technology industries, the infusion of technology in government, and Internet access;

(D) Technology-based workforce, including but not limited to management, technical and professional jobs, and technology education and training;

(E) Innovation and enterprise, including but not limited to startup companies, venture capital investment, private and government research and development activities, small business innovation research grants, and technology licensing;

(F) Global connections, including but not limited to diversification of export and visitor markets, foreign business travel, the manufacturing of export products; and

(G) Local venture investments, including but not limited to the size of local venture investments in any given year compared with the percentage of change with its prior year.

(b) The department shall submit to the legislature no later than twenty days prior to the convening of each legislative session a written report of any activities of the department and any of its divisions that support, promote, and facilitate the proliferation and long term viability of emerging growth industries and how these activities affect these industries."

SECTION 3. New statutory material is underscored.

SECTION 4. This Act shall take effect upon its approval.

INTRODUCED BY:	_____________________________

THE SENATE	S.B. NO.	709
TWENTY-FOURTH LEGISLATURE, 2007
STATE OF HAWAII