SB1031

SECTION 1. The Hawaii Revised Statutes is amended by adding a new chapter to be appropriately designated and to read as follows:

"Chapter

JOBS, TRADE, AND DEMOCRACY ACT

§ -1 Title. This Act may be cited as the "Jobs, Trade and Democracy Act.

§ 2 Findings. The legislature finds that:

(1) States have traditionally enjoyed a large degree of autonomy to set their own procurement policies under the United States system of federalism;

(2) Recent international trade agreements threaten to erode this traditional state autonomy by requiring state governments to accord foreign suppliers of goods and services treatment no less favorable than that afforded to in-state suppliers. In addition, the agreements stipulate that state contract specifications must not burden trade any more than necessary, and limit supplier qualifications to those that are "essential" to the performance of the contract;

(3) The governor and not the legislature has chosen to bind the State to the terms of various international trade agreements upon the request of the United States Trade Representative;

(4) The legislature has an important role to play in preserving state authority over procurement policy. These critical decisions should be made only with the involvement of the legislature and only after the public has been adequately informed and has openly debated the issues involved;

(5) It is critical for residents, state agencies, the legislature, and other elected officials in the State to have access to information about how trade impacts legislative authority, the State's economy, and existing state laws in order to participate in an informed debate about international trade issues;

(6) The current encroachment on state regulatory authority by international commercial and trade agreements has been exacerbated because United States trade policy is being formulated and implemented under "fast track" United States Trade Authority procedures. The current grant of fast track is scheduled to sunset in July 2007; and

(7) Fast track, first established in 1974 by then-President Richard Nixon, is outdated and inappropriate, given the diverse range of nontrade issues now affected by trade agreements. These agreements broadly affect federal and state regulatory authority over nontrade areas, such as public health and procurement policies. Fast track should be replaced with a more democratic model for negotiating and implementing trade agreements so that an elected legislature and ordinary residents can have a meaningful voice in determining the content of trade policies.

§ -3 Legislature; role in trade policy. (a) It shall be the policy of the State of Hawaii that approval for the State to be bound by any trade agreement requires the consent of the legislature.

(b) The majority and minority leaders of the Senate and the majority and minority leaders of the house of representatives shall select two legislators, respectively, as points of contact at the beginning of each regular legislative session. The legislature declares that the purposes of the points of contact shall be to:

(1) Serve as the State's official liaisons with the federal government and as the legislature's liaisons with the governor on trade-related matters;

(2) Serve as the designated recipients of federal requests for consent or consultation regarding investment, procurement, services, or other provisions of international trade agreements that impinge on state law or regulatory authority reserved to the State;

(3) Transmit information regarding federal consultation with the States to the governor, the attorney general, all appropriate legislative committees, and the office of trade enforcement;

(4) Issue a formal request to the office of trade enforcement and other appropriate state agencies to provide analysis of all proposed trade agreements' impact on state legislative authority and the economy of the State;

(5) Inform the legislature on a regular basis about ongoing trade negotiations and dispute settlement proceedings with implications for the State more generally;

(6) Communicate the interests and concerns of the legislature to the United States Trade Representative regarding ongoing and proposed trade negotiations; and

(7) Notify the United States Trade Representative of the outcome of any legislative action.

(1) In a timely fashion, concurrent with trade negotiations, the governor, majority or minority leader, or ranking member of the appropriate committee of jurisdiction, shall submit to the legislature during a regular session, a copy of the final legal text of the agreement, together with:

(A) A report by the office of trade enforcement including an analysis of how the agreement of the State to the specific provisions of the trade agreement will change or affect existing state law;

(B) A statement of any administrative action proposed to implement these trade agreement provisions in the State; and

(C) A draft of legislation authorizing the State to agree to the specific listed provisions of the trade agreement in question;

(2) A public hearing shall be held before the legislature votes on the bill; and

(3) The bill authorizing the State to agree to specific listed provisions of an agreement is enacted into law.

(d) It is the intent of the legislature that the Congress of the United States should pass legislation instructing the United States Trade Representative to fully and formally consult individual state legislatures regarding procurement, services, investment, or any other trade agreement rules that impact state laws or authority before negotiations begin and as they develop, and to seek consent from state legislatures in addition to governors prior to binding states to conform their laws to the terms of international commercial agreements. Such legislation is necessary to ensure the prior informed consent of the State with regard to future international trade and investment agreements.

(e) The attorney general shall notify the United States Trade Representative of the policies set forth in subsection (d) in writing no later than September 30, 2007 and shall provide copies of the notice to the president of the senate, speaker of the house of representatives, the governor and Hawaii's congressional delegation.

§ -4 Office of trade enforcement and citizens' commission on globalization. (a) There is established the office of trade enforcement and a citizens' commission on globalization to be placed administratively within the department of business, economic development, and tourism.

(b) The office of trade enforcement shall:

(1) Monitor trade negotiations and disputes impacting the state economy;

(2) Analyze pending trade agreements the State is considering signing and provide the analysis to the governor, the legislature, the citizens' commission, and the public;

(3) Provide technical assistance to workers and firms impacted by unfair trade practices;

(4) Provide a trade impact report to the governor, the legislature, the citizens' commission, and the public no later than December 31, 2007 and annually thereafter; and

(5) Provide additional research and analysis as requested by the governor, the legislature, and the citizens' commission.

(1) An audit of the amount of public contract work being performed overseas;

(2) An audit of government goods being procured from overseas;

(3) A study of the impacts of trade on state and local employment levels, tax revenues, and retraining and adjustment costs;

(4) An analysis of the constraints trade rules place on state regulatory authority, including but not limited to the State's ability to preserve the environment, protect public health and safety and workers' rights, and provide high-quality public services; and

(5) Findings and recommendations of specific actions for the State to take in response to the impacts of trade on the State. These actions may include, but shall not be limited to:

(A) Revocation of the State's consent to be bound by the procurement rules of international trade agreements;

(B) Prohibition of offshore performance of state contract work and preferences for domestic content in state purchasing;

(D) State advocacy for reform of trade agreements and trade laws at the federal level; and

(E) Implementation of an ethical growth strategy formulated with business, labor, and community participation. Such a strategy may include, but not be limited to:

(i) More effective early warning and layoff aversion measures;

(ii) Increased assistance and adjustment programs for displaced workers and trade-impacted communities;

(iii) Stronger standards and accountability for recipients of state subsidies and incentives;

(iv) Investments in workforce training and development;

(v) Investments in technology and infrastructure; and

(vi) Increased access to capital for local producers.

(d) Within thirty days of receipt of the annual trade impact report:

(1) The governor shall review the report and issue a public statement explaining which of the report's recommendations for specific action under subsection (c)(5) the governor shall act upon in the next thirty days, whether through executive action or proposed legislation; and

(2) The legislature shall review the report, hold public hearings on the report's recommendations for specific action under subsection (c)(5), and introduce legislation to enact those recommendations accepted by the legislature.

(e) A citizens' commission on globalization shall be appointed by the governor. The governor shall ensure that the following stakeholders shall be equally represented on the citizens' commission: employers, labor organizations, community organizations, and government.

The citizens' commission shall:

(1) Assess the legal and economic impacts of trade agreements;

(2) Provide input on the annual trade impact report;

(3) Hold public hearings on the impacts of trade on the State as well as on the annual trade impact report; and

(4) Make policy recommendations to the governor, legislature, Hawaii's congressional delegation, and United States trade negotiators.

SECTION 2. The governor shall notify the revisor of statutes of the obligations of the State specified in international trade agreements to which the State is a consenting party. The revisor of Statutes shall annotate the Hawaii Revised Statutes in regards to these obligations, as deemed necessary."

SECTION 3. This Act shall take effect upon its approval.

INTRODUCED BY:	_____________________________

THE SENATE	S.B. NO.	1031
TWENTY-FOURTH LEGISLATURE, 2007
STATE OF HAWAII