STAND. COM. REP. NO. 179

Honolulu, Hawaii

RE:    S.B. No. 1214

       S.D. 1

Honorable Shan S. Tsutsui

President of the Senate

Twenty-Sixth State Legislature

Regular Session of 2011

State of Hawaii

Sir:

     Your Committees on Energy and Environment and Commerce and Consumer Protection, to which was referred S.B. No. 1214 entitled:

"A BILL FOR AN ACT RELATING TO THE ISSUANCE OF SPECIAL PURPOSE REVENUE BONDS TO ASSIST PACIFIC POWER AND WATER COMPANY, INC,"

beg leave to report as follows:

     The purpose and intent of this measure is to authorize the issuance of special purpose revenue bonds to assist Pacific Power and Water Company, Inc., with the planning, permitting, designing, construction, equipping, and operating of hydropower facilities throughout the State.

     Your Committees received testimony in support of this measure from Dr. Patrick Sullivan, Pacific Power and Water Company, Inc.; and John Kuriyama, Oceanit.  Your Committees received comments on this measure from Kalbert K. Young, Department of Budget and Finance.

     Your Committees find that the hydropower projects for which assistance is requested will produce renewable energy, generate revenue for much needed dam maintenance and repair, generate jobs in the renewable energy sector, and reduce the State's overall dependence on fossil fuels.  Your Committees also find, however, that Pacific Power and Water Company, Inc. needs to provide clarifying information to your Committees by April 15, 2011, and that this information shall include statements, without rendering opinions, from the Department of Business, Economic Development, and Tourism and the Department of Budget and Finance stating that both agencies have reviewed the project's business plan and, in the statement from the Department of Budget and Finance, that the agency has reviewed the company's financial statements.  Your Committees also recognize that under the Internal Revenue Code there is a limitation on the amount of tax-exempt financing for industrial projects.

     Your Committees have amended this measure by:

     (1)  Deleting the dollar amount up to which the issuance of special purpose revenue bonds is authorized and leaving it blank; and

     (2)  Changing the effective date to upon approval.

     As affirmed by the records of votes of the members of your Committees on Energy and Environment and Commerce and Consumer Protection that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 1214, as amended herein, and recommend that it pass Second Reading in the form attached hereto as S.B. No. 1214, S.D. 1, and be referred to the Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committees on Energy and Environment and Commerce and Consumer Protection,

____________________________ ROSALYN H. BAKER, Chair

____________________________ MIKE GABBARD, Chair