Report Title:

Grants and Subsidies; Limits; Application Deadline

Description:

Sets an annual deadline of 1/31 to apply for grants/subsidies.  Clarifies that only nonprofit organizations may receive grants or subsidies.  Requires an applicant to show that an award will not be the applicant's sole source of funding, that services will not be duplicative, that all obligations to the State are satisfied, and that the applicant has operated in the State for at least      years.  Requires certain applicant information to be posted on the legislature's website before first lateral.  Requires each expending agency to develop performance standards for each grant/subsidy.  Requires recipients to report within 30 days of grant expiration, an accounting of expenditures, including meeting performance standards.  Permits acceptance of public comments during selection process.  (SB2615 SD1)

THE SENATE	S.B. NO.	2615
TWENTY-FOURTH LEGISLATURE, 2008		S.D. 1
STATE OF HAWAII

A BILL FOR AN ACT

RELATING TO GRANTS AND SUBSIDIES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  Section 42F-101, Hawaii Revised Statutes, is amended by amending the definition of "recipient" to read as follows:

     "Recipient" means any nonprofit organization [or person] receiving a grant or subsidy."

     SECTION 2.  Section 42F-102, Hawaii Revised Statutes, is amended to read as follows:

     "[[]§42F-102[]]  Applications for grants and subsidies[.]; deadline.  Requests for grants and subsidies shall be submitted to the appropriate standing committees of the legislature [at the start of each regular session of the legislature.] not later than January 31 or if January 31 falls on a Saturday, Sunday, or holiday, by the immediately preceding business day.  Each request shall state:

     (1)  The name of the requesting nonprofit organization;

     (2)  The public purpose for the grant or subsidy[;], including a description of the problem or need to be addressed;

     (3)  The services to be supported by the grant or subsidy;

     (4)  The target group; and

     (5)  The cost of the grant or subsidy and the budget."

     SECTION 3.  Section 42F-103, Hawaii Revised Statutes, is amended to read as follows:

     "§42F-103  Standards for the award of grants and subsidies.  (a)  Grants and subsidies shall be awarded only to [individuals who, and] nonprofit organizations that:

     (1)  Are licensed or accredited, in accordance with federal, state, or county statutes, rules, or ordinances, to conduct the activities or provide the services for which a grant or subsidy is awarded;

     (2)  Comply with all applicable federal and state laws prohibiting discrimination against any person on the basis of race, color, national origin, religion, creed, sex, age, sexual orientation, or disability;

     (3)  Agree not to use state funds for entertainment or lobbying activities; [and]

(4) Demonstrate that the grant or subsidy will not be the sole source of funding for the services for which a grant or subsidy is awarded;

(5) Demonstrate that the services to be supported by the grant or subsidy are not already being adequately provided and thus are not duplicative;

    [(4)] (6)  Allow the state agency to which funds for the grant or subsidy were appropriated for expenditure, legislative committees and their staff, and the auditor full access to their records, reports, files, and other related documents and information for purposes of monitoring, measuring the effectiveness, and ensuring the proper expenditure of the grant or subsidy[.];

     [(b)  In addition, a grant or subsidy may be made to an organization only if the organization:

(1)  Is] (7)  Are incorporated under the laws of the State; [and

(2)  Has] (8)  Have bylaws or policies that describe the manner in which the activities or services for which a grant or subsidy is awarded shall be conducted or provided[.];

(9) Have satisfied all obligations to the State, including but not limited to making all necessary tax payments, and have completed and submitted all required documentation with respect to the requesting nonprofit organization's business with any state department or agency;

     [(c)  Further, a grant or subsidy may be awarded to a non-profit organization only if the organization:

(1) Has] (10)  Have been determined and designated to be a non-profit organization by the Internal Revenue Service; [and]

(11) Have operated in the State for at least      years; and

    [(2) Has]  (12)  Have a governing board whose members have no material conflict of interest and serve without compensation.

     [(d)] (b)  If a grant or subsidy is used by [an] the nonprofit organization for the acquisition of land, when the nonprofit organization discontinues the activities or services on the land acquired for which the grant or subsidy was awarded and disposes of the land in fee simple or by lease, the nonprofit organization shall negotiate with the expending agency for a lump sum or installment repayment to the State of the amount of the grant or subsidy used for the acquisition of the land.  This restriction shall be registered, recorded, and indexed in the bureau of conveyances or with the assistant registrar of the land court as an encumbrance on the property.  Amounts received from the repayment of a grant or subsidy under this subsection shall be deposited into the general fund.

(c)  Public comment on all applications may be accepted to assist the legislature in the selection process.  A list of applicants, a brief description of the request, and the amount of each grant or subsidy applied for shall be posted on the legislature's website before first lateral; provided that if the respective chambers of the legislature have differing first lateral deadlines, then the information shall be posted before the later deadline.  Once the date of the first lateral deadline is determined for each subsequent legislative session, that date shall be posted with the grant in aid application information on the legislature's website."

     SECTION 4.  Section 42F-106, Hawaii Revised Statutes, is amended to read as follows:

     "[[]§42F-106[]]  Monitoring and evaluation. (a)  Every grant or subsidy shall be monitored by the expending agency to ensure compliance with this chapter and the public purpose and legislative intent of the grant or subsidy.  Each expending agency shall develop or identify performance measures for each operating grant or subsidy.

(b)  Within thirty days after the expiration of each grant or subsidy, each recipient shall submit a report to the expending agency and the legislature that shall include:

(1) An accounting for all expenditures;

(2) A description of the accomplishments achieved under the grant or subsidy; and

(3) An assessment of the extent to which the provision of services funded by the grant or subsidy has met the performance standards established pursuant to subsection (a).

(c)  Within thirty days of receipt of each recipient's report, the expending agency shall submit comments on the recipient's report to the legislature."

     SECTION 5.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 6.  This Act shall take effect upon its approval.