STAND. COM. REP. NO.  1224

Honolulu, Hawaii

                , 2009

RE:   S.B. No. 705

      S.D. 1

      H.D. 1

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Fifth State Legislature

Regular Session of 2009

State of Hawaii

Sir:

     Your Committee on Economic Revitalization, Business, & Military Affairs, to which was referred S.B. No. 705, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO HAWAII PUBLIC PROCUREMENT CODE,"

begs leave to report as follows:

     The purpose of this bill is to prepare the State to promptly use federal stimulus funds to benefit Hawaii's economy by establishing, until July 1, 2011:

(1)  An exemption from the bid, request for proposals, and professional services procedures of the Hawaii State Procurement Code, for a General Services Administration-approved sole source vendor in any procurement funded by state and federal matching funds where the vendor was responsible for obtaining the federal funding; and

(2)  That procurements of $100,000 or less for goods and services, and construction contracts of less than $250,000 secured by a performance bond, are to be treated as small purchases under section 103D-305, Hawaii Revised Statutes.

     The State Procurement Office and Military Officers Association of America commented on this bill.

     Upon consideration, your Committee has amended this bill by removing its substance and replacing it with that of H.B. No. 1470, H.D. 1, a measure that was reported out of your Committee earlier in this session.

     As amended, this bill:

(1)  Exempts from the procurement code, contracts to procure goods, services, or construction from a source approved as the sole source by the federal government under a grant from the federal government in any procurement funded by state and federal matching funds or by federal funds alone; and

     (2)  Is effective on July 1, 2020.

     Technical, nonsubstantive amendments were also made for clarity and style.

     Your Committee also respectfully requests the Committee on Finance, to which this bill is next referred, to work with the State Procurement Office on their suggested amendments.

     As affirmed by the record of votes of the members of your Committee on Economic Revitalization, Business, & Military Affairs that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 705, S.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 705, S.D. 1, H.D. 1, and be referred to the Committee on Finance.

Respectfully submitted on behalf of the members of the Committee on Economic Revitalization, Business, & Military Affairs,

____________________________

ANGUS L.K. MCKELVEY, Chair