STAND. COM. REP. NO. 1439

Honolulu, Hawaii

RE:    H.B. No. 13

       H.D. 1

       S.D. 1

Honorable Colleen Hanabusa

President of the Senate

Twenty-Fourth State Legislature

Regular Session of 2007

State of Hawaii

Madam:

     Your Committee on Ways and Means, to which was referred H.B. No. 13, H.D. 1, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO EDUCATION,"

begs leave to report as follows:

The purpose of this measure is to create a revolving fund for the collection and distribution of generated revenue to support the administration and operation of the Department of Education's Food Distribution Program.

Specifically, the fund, which is limited to $2,000,000, would generate revenues through the collection of administrative fees from recipient agencies for the distribution of federal commodity foods.  This bill also makes an appropriation out of the fund of $2,000,000 in fiscal year 2007-2008 and fiscal year 2008-2009 for the payment of services provided by state contracted warehouses for the distribution of federal commodity foods to recipient agencies under the Department of Education Food Distribution Program.

     Comments in support of this measure were submitted by the Department of Education.  The Department of Budget and Finance submitted comments in opposition to this measure.

Your Committee finds that commodity foods to be distributed by the Department of Education through the National School Lunch Program are stored in warehouses within the State.  The Department of Education is prohibited from using federal funds for fees associated with state-contracted warehouses for the storage of these foods.  Increasing costs associated with the warehouse charges have necessitated a means by which those costs may be paid separate from passing along the cost to the recipient agencies. 

     Accordingly, your Committee finds that the establishment of a revolving fund into which fees collected for, interest earned on, and other moneys associated with the Department of Education's Food Distribution Program may be deposited and utilized to allow the program to become self-sustaining.

     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 H.B. No. 13, H.D. 1, S.D. 1, and recommends that it pass Third Reading.

Respectfully submitted on behalf of the members of the Committee on Ways and Means,

____________________________

ROSALYN H. BAKER, Chair