HB2411 HD1.DOC

SECTION 1. The purpose of this Act is to authorize the use of capital improvement project appropriations, including bond fund appropriations, for contracting activities for these projects. The legislature finds that the provisions of this Act will stimulate the economy and create jobs by accelerating the construction of capital improvement projects.

SECTION 2. Section 37-62, Hawaii Revised Statutes, is amended as follows:

1. By adding a new definition of "contracting" to be appropriately inserted and to read:

""Contracting" means the procurement, preparation, negotiation, execution, amendment, or enforcement of contracts for the commencement, implementation, construction, or acquisition of a capital improvement project or any phase of a capital improvement project."

2. By amending the definition of "capital investment costs" to read:

""Capital investment costs" means costs, beyond the research and development phase, associated with capital improvements, including the acquisition and development of land, the design and construction of new facilities, [~~and~~] the making of renovations or additions to existing facilities[.], and contracting. Capital investment costs for a program are the sum of the program's capital improvement project costs."

3. By amending the definition of "cost elements" to read:

""Cost elements" means the major subdivisions of a cost category. The category "capital investment" includes plan, land acquisition, design, contracting, construction, and equipment and furnishing. The categories "research and development" and "operating" include personal services, current lease payments, other current expenses, equipment, and motor vehicles."

4. By amending the definition of "phases of capital improvement project" to read:

""Phases of capital improvement project" means land acquisition, design, contracting, construction, and occupancy."

SECTION 3. Section 39-53, Hawaii Revised Statutes, is amended to read as follows:

"§39-53 Additional powers of departments. In addition to the powers which departments may otherwise have, any department shall have the power pursuant to this part:

(1) To construct, acquire by gift, purchase, or the exercise of the right of eminent domain, reconstruct, improve, better, or extend any undertaking within its jurisdiction, and to acquire by gift, purchase, or the exercise of the right of eminent domain, lands or rights in land or water in connection therewith within its jurisdiction or to undertake the establishment and administration of a loan program as authorized by law within its jurisdiction;

(2) To operate and maintain any undertaking or administer, operate, and maintain a loan program as authorized by law within its jurisdiction and furnish the services, facilities, and commodities thereof for its own use and for the use of public and private consumers;

(3) To issue revenue bonds of the State in the amounts authorized by specific act or acts of the legislature to finance in whole or in part the cost of the acquisition, purchase, construction, reconstruction, improvement, betterment, or extension of any undertaking or the establishment and administration of any loan program as authorized by law;

(4) Subject to the provisions of section 39-61, to impose, prescribe, and collect rates, rentals, fees, and charges for the use and services of, and the facilities and commodities furnished by, the undertaking or for the use and services of the loan program as authorized by law; and

(5) To pledge to the punctual payment of the revenue bonds and interest thereon, or to covenant to pay into any special funds from which any of the revenue bonds may be payable, all or any portion of the revenue of the undertaking or loan program or of any part thereof, or the user taxes derived therefrom, or any combination of both (including improvements, betterments, or extensions thereto thereafter constructed or acquired) sufficient, among other things, to pay the revenue bonds and interest as they shall become due and to create and maintain reasonable reserves to pay the principal and interest; provided that no user taxes shall be pledged to the payment unless the legislature in the specific act or acts authorizing the issuance of the revenue bonds shall have provided that the revenue bonds may be payable from and secured by user taxes.

The department, in determining the cost, may include all costs and estimated costs of the issuance of the revenue bonds, all architectural, engineering, contracting, inspection, financial and legal expenses, all costs of establishing or administering a loan program authorized by law, the cost of causing the payment of the principal or interest or both of the revenue bonds to be insured or guaranteed, the initial cost of any support facility obtained as permitted by section 39-59, and interest which it is estimated will accrue during the construction period and for six months thereafter on money borrowed or which it is estimated will be borrowed pursuant to this part. For the purposes of this section, "contracting" has the same meaning as defined in section 37-62."

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect on July 1, 2012.

HOUSE OF REPRESENTATIVES	H.B. NO.	2411
TWENTY-SIXTH LEGISLATURE, 2012		H.D. 1
STATE OF HAWAII