STAND. COM. REP. NO.  25

Honolulu, Hawaii

                , 2011

RE:   H.B. No. 855

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. 855 entitled:

"A BILL FOR AN ACT RELATING TO THE ISSUANCE OF SPECIAL PURPOSE REVENUE BONDS TO ASSIST PACIFIC POWER AND WATER COMPANY, INC., IN THE DEVELOPMENT OF HYDROPOWER FACILITIES IN HAWAII,"

begs leave to report as follows:

     The purpose of this measure is to assist Pacific Power and Water Company, Inc., with the planning, permitting, designing, constructing, equipping, and operating of hydropower plants throughout the State by authorizing the Department of Budget and Finance to issue special purpose revenue bonds in a total amount not to exceed $25,000,000.

     Testimony in support of the measure was submitted by Pacific Power and Water Company, Inc., and Oceanit.  The Department of Budget and Finance and Life of the Land submitted comments on the measure.

     Your Committee finds that the development of clean and renewable energy is in the best interests of the public and that hydropower projects would help achieve the State's renewable energy targets.

Your Committee notes that, although special purpose revenue bonds generally lapse after five years, the authorization to issue special purpose revenue bonds under this measure lapses on June 30, 2013.  Your Committee further notes 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.

     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. 855 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