STAND. COM. REP. NO. 886

Honolulu, Hawaii

RE:    H.B. No. 1039

       H.D. 1

       S.D. 1

Honorable Shan S. Tsutsui

President of the Senate

Twenty-Sixth State Legislature

Regular Session of 2011

State of Hawaii

Sir:

     Your Committee on Transportation and International Affairs, to which was referred H.B. No. 1039, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO TRANSPORTATION,"

begs leave to report as follows:

     The purpose and intent of this measure is to enact the federal highway revenue anticipation notes and bonds law.

     Prior to holding a hearing on this measure, a proposed S.D. 1 was prepared and made available for public review.  The purpose and intent of the proposed S.D. 1 is to provide rent relief to airport concessions that have a guaranteed rent formula with the State, and to extend the sunset date of Act 33, Special Session Laws of Hawaii 2009, from July 1, 2011, to July 1, 2012.  The proposed S.D. 1 takes effect on June 30, 2011.

     Your Committee received testimony in support of the proposed S.D. 1 from the Airports Concessionaires Committee; HMS Host; Tiare Enterprises, Inc.; International Currency Exchange; Greeters of Hawaii, Ltd.; DFS Hawaii Division; EAN Holdings, LLC; and Island Shoppers, Incorporated.  Your Committee received comments on the proposed S.D. 1 from the Department of Transportation and Airlines Committee of Hawaii.

     Act 33, Special Session Laws of Hawaii 2009, sought to provide the Department of Transportation with the discretion and flexibility to provide relief to various airport concessions due to sudden, extraordinary, and severe economic events.  The Legislature recognized that the Department of Transportation's relief efforts were not fair to all concessions in that some concessions had a self-adjusting eighty-five percent guaranteed rent adjusting formula that provided relief for adverse economic events.  Other concessions had a guaranteed rent formula that does not allow for fluctuations in economic circumstances.

     Your Committee has amended this measure by adopting the proposed S.D. 1 and further amending the proposed S.D. 1 by clarifying that the Governor, or the Director of Transportation if so requested by the Governor, shall have the discretion and authority to provide additional relief to airport concessions.

     As affirmed by the record of votes of the members of your Committee on Transportation and International Affairs that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1039, H.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1039, H.D. 1, S.D. 1, and be referred to the Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committee on Transportation and International Affairs,

____________________________

J. KALANI ENGLISH, Chair