HB1918

SECTION 1. Two of the fastest-growing parts of the state are leeward Oahu and Lahaina, Maui. The rapid population growth in these areas has prompted tremendous residential development by the private sector. Tens of thousands of housing units are under construction and being planned. However, government has been unable to keep up with the pace of such growth, particularly with respect to essential infrastructural needs.

The purpose of this Act is to encourage the more rapid and effective building of infrastructure by allowing the use of performance-based contracts.

SECTION 2. Chapter 103D, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§103D- Performance-based contracts. (a) Notwithstanding any other provision of this chapter or chapter 36 to the contrary, any type of contract that will expedite the design, planning, or construction of public infrastructure in

the Lahaina and Ewa districts as described under section

4-1(2)(D) and 4-1(4)(B), respectively, shall be subject to the use of performance-based contracts.

(b) Performance-based contracts shall be used under this section when the director of transportation or the superintendent of education determines in writing that:

(1) Such contracts are likely to expedite the design, planning, or construction of public infrastructure;

(2) Such contracts are likely to be less costly than any other type of contract; or

(3) It is impracticable to obtain the goods, services, or construction required except by means of such contracts,

within their respective jurisdictions.

Performance-based contracts shall not be used if their use would jeopardize the receipt of federal assistance moneys or reduce the amount of such assistance under any applicable federal statute or regulation.

(c) Every performance-based contract under this section shall contain a provision with respect to the time by which all of the work or any specified portion of the work contemplated shall be completed and shall provide that for each day that completion of the work is delayed beyond the specified time, the contactor shall forfeit and pay to the State a specified sum of money, to be deducted from any payments due or to become due to the contractor. The sum so specified is valid as liquidated damages.

(d) Every performance-based contract under this section shall contain provisions:

(1) Prohibiting the contractor, in the completion of the contractor's work, from adversely affecting the general public to meet the requirements of subsection (c); and

(2) Specifying that if the contractor adversely affects the public in the completion of the contractor's work, the contractor shall pay to the State a surcharge, to be deducted from any payments due or to become due to the contractor, to cover the costs of adversely affecting the public.

(e) The director of transportation and superintendent of education shall adopt rules pursuant to chapter 91 to implement the provisions of this section within their respective jurisdictions."

SECTION 3. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun, before its effective date.

SECTION 4. New statutory material is underscored.

SECTION 5. This Act shall take effect upon its approval.

INTRODUCED BY:	_____________________________

HOUSE OF REPRESENTATIVES	H.B. NO.	1918
TWENTY-FOURTH LEGISLATURE, 2007
STATE OF HAWAII