STAND. COM. REP. NO.  1407

Honolulu, Hawaii

                , 2007

RE:   S.B. No. 896

      S.D. 1

      H.D. 1

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Fourth State Legislature

Regular Session of 2007

State of Hawaii

Sir:

     Your Committees on Economic Development & Business Concerns and Water, Land, Ocean Resources & Hawaiian Affairs, to which was referred S.B. No. 896, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO HIGH TECHNOLOGY,"

beg leave to report as follows:

     The purpose of this bill is to support the growth of a life sciences and technology industry in Hawaii by appropriating funds for the High Technology Development Corporation (HTDC) to enter into a lease and guaranty for, and to plan and operate a technology incubator and innovation center for life sciences start-up companies in Kakaako adjacent to the University of Hawaii John A. Burns School of Medicine (UH JABSOM).

     The Department of Business, Economic Development, and Tourism, UH JABSOM, UH Office of Technology Transfer and Economic Development (OTTED), High Technology Development Corporation, Hawaii Community Development Authority, Pacific Resource Partnership, Cardax Pharmaceuticals, Hawaii Science and Technology Council, Phase 3 Properties, KUD International, Kamehameha Schools, and Honolulu Seawater Air Conditioning, LLC, supported this bill.

     Your Committees find that the majority of the inventions that are brought to the UH OTTED for assistance in commercialization come from the life sciences, or have application in the biotech fields.  There is a critical need for affordable wet lab space in Honolulu for start-up companies that will take these promising new technologies into the commercial sector.  This bill will make that space available to these companies and will attract other life science and biotech entrepreneurs.

     HTDC noted in testimony that it may be preferable to include the appropriation in the bill as line items in each fiscal year of the 2007-2009 biennium budget.  Your Committees respectfully request the Committee on Finance to which this bill is referred, to examine this alternative.

     Your Committees have amended this bill by:

     (1)  Deleting the sections requiring HTDC and the developers to consider various means of reducing the cost to the State;

     (2)  Removing references to a guaranty;

     (3)  Specifying that the appropriations may be expended on initial development, planning, transitional, and operational costs of the technology incubator and innovation center;

     (4)  Requiring HTDC to submit an annual progress report to the Legislature on its plans, agreements, expenditures, and other activities under the Act for the duration of the lease agreement; and

     (5)  Making technical, nonsubstantive amendments for clarity, consistency, and style.

     As affirmed by the records of votes of the members of your Committees on Economic Development & Business Concerns and Water, Land, Ocean Resources & Hawaiian Affairs that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 896, S.D. 1, as amended herein, and recommend that it pass Second Reading in the form attached hereto as S.B. No. 896, S.D. 1, H.D. 1, and be referred to the Committee on Finance.

Respectfully submitted on behalf of the members of the Committees on Economic Development & Business Concerns and Water, Land, Ocean Resources & Hawaiian Affairs,

____________________________ KEN ITO, Chair

____________________________ KYLE T. YAMASHITA, Chair