STAND. COM. REP. NO.  26

Honolulu, Hawaii

                , 2011

RE:   H.B. No. 423

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Sixth State Legislature

Regular Session of 2011

State of Hawaii

Sir:

     Your Committee on Energy & Environmental Protection, to which was referred H.B. No. 423 entitled:

"A BILL FOR AN ACT RELATING TO THE ISSUANCE OF SPECIAL PURPOSE REVENUE BONDS,"

begs leave to report as follows:

     The purpose of this measure is to authorize the Department of Budget and Finance to issue special purpose revenue bonds to assist Carbon Bio-Engineers Inc. with the establishment of cogeneration and related energy-production facilities at various locations in the State.

     Testimony in support of this measure was submitted by Carbon Bio-Engineers Inc.  The Department of Budget and Finance commented on the measure, noting in particular, that under section 144 of the Internal Revenue Code of 1986, as amended, tax exempt financing for industrial projects are limited to $10,000,000.

     Your Committee finds that this measure will ultimately help to reduce the State's dependence on fossil fuels, need for increased landfill space, and costs associated with transportation and disposal of waste, including organic feedstock and tires.

     As affirmed by the record of votes of the members of your Committee on Energy & Environmental Protection that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 423 and recommends that it pass Second Reading and be referred to the Committee on Finance.

Respectfully submitted on behalf of the members of the Committee on Energy & Environmental Protection,

____________________________

HERMINA MORITA, Chair