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HOUSE OF REPRESENTATIVES |
H.B. NO. |
2145 |
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TWENTY-SIXTH LEGISLATURE, 2012 |
H.D. 2 |
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STATE OF HAWAII |
S.D. 1 |
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Proposed |
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A BILL FOR AN ACT
RELATING TO ECONOMIC DEVELOPMENT.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
PART I.
SECTION 1. The purpose of this part is to address economic development by identifying, as state policy, the key economic sectors that are essential to the growth and diversification of the economy of Hawaii. Additionally, this part intends to create long-term support for the key economic sectors that are pillars for economic diversification in the State by identifying some of the essential projects within these economic sectors and expressing support for these projects as key elements in building these industries into successful economic drivers for Hawaii's people in the long term.
SECTION 2. It shall be the policy of the State to delineate the key economic sectors of importance for economic diversification in Hawaii and to identify some of the key projects within these sectors that are important to the long-term growth and success of these industries. It is the intent of the State to complete or facilitate completion of the following key projects within the following sectors by December 31, 2023, as a material way to support and advance these industries:
(1) Renewable energy:
Renewable energy production facilities that meet the goals of the first decade of the Hawaii clean energy initiative and facilitate the development of a smart grid system and electrical interconnectivity between Oahu and the neighbor islands.
(2) Broadband:
Fund and develop infrastructure that provides coverage for one hundred per cent of land in the State that is zoned for business, commercial, industrial, hotel, or resort use and land used for higher education instruction or research and to connect all key state facilities and buildings by high speed broadband with an emphasis on wireless connectivity.
(3) Infrastructure and construction:
Repair, upgrade, and build state-of-the-art harbors, airports, and other transportation projects that provide for the quick, reliable, and affordable transportation of people and goods, and the building of housing and other commercial facilities, including:
(A) The airport modernization project of the department of transportation, as it exists as of the effective date of this section;
(B) The harbor modernization project of the department of transportation, as it exists as of the effective date of this section;
(C) The locally preferred alternative mass transit system of the city and county of Honolulu; and
(D) The 690 Pohukaina street mixed-use transit-oriented development project.
(4) Aerospace:
To leverage Hawaii's position in the Pacific among thirty–eight other space-faring Pacific nations as well as the State's unique environment, which is essential for the development and testing of new technologies to be used in aerospace, lunar, and near- earth object exploration and research as well as economic development, including;
(A) The thirty-meter telescope on Mauna Kea;
(B) The pacific international space center for exploration systems aerospace research and development park in Hilo and the international lunar research park near Mauna Kea;
(C) A next generation avionics and pilot training facility in Oahu; and
(D) An extreme environments center and other earth science initiatives within the University of Hawaii.
(5) Visitor industry:
To ensure the continued development of the needed workforce for the various service industries that visitors demand of a world-class vacation destination, including:
(A) The Culinary Institute of the Pacific on the slope of Diamond Head; and
(B) A community college campus in West Hawaii.
(6) Film and digital media:
To grow and expand Hawaii's film and digital media industry by creating an environment that will incentivize more film production in Hawaii and transform it into a robust industry by facilitating the development of both the physical infrastructure as well as the workforce needed for the industry to grow, including:
(A) Development of two major film studios with at least one of the studios on a neighbor island; and
(B) Development of digital animation and post-production facilities with at least one facility on the neighbor islands.
(7) Military:
Work to support the United States military and other federal defense partners by continuing to support adequate training, repair, and building facilities to support the operational and defense capacity of the United States armed forces in the Pacific region, including:
(A) Supporting and incentivizing current and future use of Pearl Harbor shipyard for naval shipbuilding and ship repair; and
(B) Supporting the current uses at Pohakuloa training area and the pacific missile range facility at Barking Sands, Kauai.
PART II.
SECTION 3. The legislature finds that the State continues to suffer from the global economic recession. While some Hawaii businesses are showing modest signs of recovery, the construction industry, including construction workers, support staff, and construction-support businesses, is still suffering.
The legislature further finds that Hawaii is experiencing the lowest interest rates on record and that there were significant savings from the State's most recent bond authorization and issuance. In completing the bond transaction, the State:
(1) Reduced debt service by saving $59,000,000 on refunded outstanding debt;
(2) Kept debt service for fiscal 2012-2013 at legislatively appropriated levels;
(3) Restructured outstanding debt;
(4) Normalized the State's debt service profile;
(5) Built excess debt capacity from 2014 to 2019;
(6) Improved the State's financial position; and
(7) Garnered a positive credit rating.
The primary economic objective of the legislature this session is to immediately stimulate direct and indirect job creation to maintain and create local construction jobs for all stages of construction, including employment for painters, roofers, electricians, carpenters, architects, engineers, and other consultants to generate more personal income growth. The department of business, economic development, and tourism estimates that the last advancement of $1,800,000,000 in capital improvement projects by the State resulted in the creation of 12.9 direct and indirect jobs created for every $1,000,000 invested.
In contemplating capital improvement projects, the legislature finds that a main focus should include repair and maintenance projects as well as those projects that address health and safety concerns. Completion of those projects will ensure the existence of well-maintained state facilities and infrastructure, which are essential to maintaining a positive business climate and strong economic foundation. Funding would be provided statewide and include efforts to eliminate current repair and maintenance backlogs.
The estimated backlog of repair and maintenance or capital renewal and deferred maintenance projects for the department of education, Hawaii state library system, University of Hawaii system, University of Hawaii's athletic facilities, department of accounting and general services, department of agriculture, department of defense, department of health, Hawaii health systems corporation, department of human services, department of land and natural resources, department of public safety, and judiciary is well over $1,000,000,000.
Another priority of the legislature is to develop sustainable and renewable energy resources, such as photovoltaic technology, as well as initiatives to improve upon efficient energy consumption. Investing in energy and information technology initiatives throughout schools, hospitals, and office buildings would have significant impact and ultimately lead to cost savings, alleviating the drain on general funds, and a reduction of the State's carbon footprint.
The legislature also realizes that the public procurement process is lengthy and complicated, which adds considerable time to completing capital improvements and repairs and maintenance in the State's facilities and infrastructure. This Act requires procurements for goods, services, or construction for the repair and maintenance or capital renewal and deferred maintenance projects authorized by this Act that are less than $1,000,000 to be made pursuant to section 103D-305, Hawaii Revised Statutes.
The purpose of parts II to VIII of this Act is to issue $500,000,000 in general obligation bonds to fund the repair and maintenance or capital renewal and deferred maintenance projects of various departments, the University of Hawaii system, the Hawaii health systems corporation, and the judiciary and to streamline the procurement process.
SECTION 4. As used in this Act, "expending agency" means the executive department, agency, office, board, or other establishment of the state government, including the judiciary, that is authorized to expend specified appropriations made by this Act.
PART III.
SECTION 5. The following sums, or so much thereof as may be sufficient to accomplish the purposes designated herein, are hereby appropriated or authorized, as the case may be, from the general obligation bond fund to the expending agencies designated for the fiscal year beginning July 1, 2011, and ending June 30, 2012. The total expenditures shall not exceed the following sums, except as provided elsewhere in this Act:
Expending Agency Appropriations
PART IV.
SECTION 6. The sum of $500,000,000 appropriated or authorized in part III of this Act for capital improvement projects shall be expended for plans, design, construction, and equipment for the projects below.
A. $150,000,000 for repair and maintenance projects and to address infrastructure needs, such as science and technology, electricity, and other utility infrastructure improvements, within the public school system. The sum shall be expended by the department of education.
B. $3,000,000 for repair and maintenance projects within the Hawaii state library system. The sum shall be expended by the department of accounting and general services.
C. $90,000,000 for capital renewal and deferred maintenance projects of the University of Hawaii at Manoa and the University of Hawaii at Hilo. The sum shall be expended by the University of Hawaii.
D. $25,000,000 for capital renewal and deferred maintenance projects within the University of Hawaii community college system. The sum shall be expended by the University of Hawaii.
E. $12,000,000 for repair and maintenance projects for the University of Hawaii at Manoa's athletic facilities. The sum shall be expended by the University of Hawaii.
F. $60,000,000 for repair and maintenance projects of the department of accounting and general services. The sum shall be expended by the department of accounting and general services.
G. $5,000,000 for repair and maintenance projects of the department of agriculture. The sum shall be expended by the department of agriculture.
H. $5,000,000 for repair and maintenance projects of the department of defense. The sum shall be expended by the department of defense.
I. $30,000,000 for repair and maintenance projects of the department of health. The sum shall be expended by the department of health.
J. $40,000,000 for repair and maintenance projects of the Hawaii health systems corporation. The sum shall be expended by the department of health.
K. $40,000,000 for repair and maintenance projects of the department of human services. The sum shall be expended by the department of human services.
L. $20,000,000 for repair and maintenance projects of the department of land and natural resources. The sum shall be expended by the department of land and natural resources.
M. $15,000,000 for repair and maintenance projects of the department of public safety. The sum shall be expended by the department of public safety.
N. $5,000,000 for repair and maintenance projects of the judiciary. The sum shall be expended by the judiciary.
PART V.
SECTION 7. General obligation bonds may be issued, as provided by law, to yield the amount that may be necessary to finance projects authorized in part III and listed in part IV of this Act; provided that the sum total of the general obligation bonds so issued shall not exceed $500,000,000.
PART VI.
SECTION 8. Any provision of this Act to the contrary notwithstanding, the appropriations made for capital improvement projects authorized in part III and listed in part IV of this Act shall not lapse at the end of the fiscal year for which the appropriations are made; provided that all appropriations made for fiscal year 2011-2012 that are unencumbered as of June 30, 2014, shall lapse as of that date.
SECTION 9. Designated expending agencies for capital improvement projects authorized in this Act may delegate to other state or county agencies the implementation of projects when it is determined advantageous to do so by the original expending agency and the agency to which expending authority is to be delegated.
SECTION 10. In carrying out the purposes of this Act, expending agencies, when possible, shall use energy-efficient materials and sustainable and renewable energy strategies to reduce energy consumption.
PART VII.
SECTION 11. The legislature finds that the public procurement approval process can take longer than may be necessary. A streamlined procurement approval process would assist in expediting implementation of projects to help stimulate growth of the workforce and the State's economy. The purpose of this part is to provide a temporary, expedited process for the capital improvement projects authorized under this Act, for contracts for goods, services, or construction that are less than $1,000,000.
SECTION 12. Notwithstanding the contract value limitation in section 103D‑305, Hawaii Revised Statutes, procurements of less than $1,000,000 for goods or services, or less than $1,000,000 for construction, for the capital improvement projects authorized by this Act shall be:
(1) Made pursuant to section 103D‑305, Hawaii Revised Statutes, including provisions relating to performance and payment bond requirements thereunder;
(2) Conducted through an electronic system; and
(3) Exempt from section 103D‑701, Hawaii Revised Statutes.
SECTION 13. Capital improvement projects authorized pursuant to this Act that are less than $1,000,000 shall be exempt from all county permit, license, and certificate requirements; provided that the capital improvement projects shall meet all federal and state permits, license, and certificate requirements, and other applicable county code requirements.
PART VIII.
SECTION 14. (a) There is established a legislative capital improvements program oversight committee, to be comprised of seven voting members as follows:
(1) One member of the senate, to be appointed by the president of the senate;
(2) One member of the house of representatives to be appointed by the speaker of the house of representatives; and
(3) Five members, one each to be appointed by the governor, president of the senate, speaker of the house of representatives, senate minority leader, and house of representatives minority leader.
(b) Legislative staff offices as determined by the president of the senate and the speaker of the house of representatives shall provide administrative assistance to the committee.
(c) In providing oversight of funds appropriated by this Act and the implementation of expenditures, the committee may:
(1) Evaluate the coordination and timeliness of the implementation of capital improvement projects;
(2) Determine the adequacy of public notice; opportunity for contractors to submit bids for work; and capacity for a broad spectrum of trades to be awarded contracts;
(3) Evaluate the efficiency and transparency of the bidding and the contracting process; and
(4) Undertake any other tasks or efforts to ensure the integrity and appropriateness of the distribution and expenditure of all funds and implementation of all capital improvement projects.
(d) Executive and judicial branch agencies shall provide information on the receipt and expenditure of funds and implementation of projects appropriated by this Act upon request of the committee.
(e) The committee may request specific audit services from the state auditor.
(f) The committee shall submit reports of its findings to the legislature no later than twenty days prior to the convening of the 2013 and 2014 regular sessions.
(g) The committee shall cease to exist on June 30, 2014.
(h) For the purposes of this section, "committee" means the legislative capital improvements program oversight committee.
SECTION 15. The department of accounting and general services shall prepare quarterly reports, beginning with the first quarter of fiscal year 2012-2013, and every three months thereafter through fiscal year 2013-2014, to include the status of all appropriations made by this Act, including amounts appropriated, appropriated but not allotted, allotted, encumbered, and expended by project as designated in part IV of this Act; provided that the department of accounting and general services shall submit the reports to the legislature no later than thirty days after the last day of each quarter and post the reports on its website.
PART IX.
SECTION 16. This Act shall take effect upon its approval.
Report Title:
Economic Development; Specific Ten-Year Projects; State Funds; Capital Improvement Projects; General Obligation Bonds; Procurement; Appropriation
Description:
Expresses as state policy the delineation of the key economic sectors of importance for economic diversification in Hawaii and identification of key projects within those sectors that are important to the long-term growth and success of those industries. Issues general obligation bonds to fund the repair and maintenance or capital renewal and deferred maintenance projects of various departments, the University of Hawaii, Hawaii health systems corporation, and the judiciary. Applies small purchase procurement requirements to capital improvement projects authorized pursuant to this Act for goods, services, or construction less than $1,000,000. Requires procurements of less than $1,000,000 to be conducted through an electronic system. Exempts capital improvement projects that are less than $1,000,000 from the provisions of section 103D-701, HRS, relating to protests. Provides for certain exemptions from county permitting, licensing, and certification requirements. Creates oversight committee. Requires DAGS to prepare quarterly reports. (Proposed SD1)
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.