STAND. COM. REP. NO. 2729

Honolulu, Hawaii

RE:    S.B. No. 2337

       S.D. 1

Honorable Shan S. Tsutsui

President of the Senate

Twenty-Sixth State Legislature

Regular Session of 2012

State of Hawaii

Sir:

     Your Committee on Ways and Means, to which was referred S.B. No. 2337, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO TRANSPORTATION,"

begs leave to report as follows:

     The purpose and intent of this measure is to provide the Department of Transportation with the authority and discretion to reach an agreement with an airport concession to extend the term of the concession and to modify and amend terms of any concession contract, lease, or permit in exchange for revenue-enhancing improvements that are made or paid for by the concession.

     Your Committee finds that modernization and improvements at Hawaii's airport concessions have not kept pace with passenger needs and demands.  A recent study indicates that the State's public airports are lacking in concession space and are not maximizing the revenues they could be receiving from airport concession operations with additional concession spaces and improved locations.  Reportedly, these changes would not only pay for themselves, but would also generate additional revenues for the State's public airports.  Your Committee recognizes the need to fast-track these improvements and simultaneously acknowledges the inconvenience and financial hardships that current public airport concessions may face in undertaking improvements at this time.  Thus, your Committee believes that it is important that the Department of Transportation and airport concessions work together to achieve the improvements contemplated by this Act in an expeditious but fair and equitable manner, including extending the term of a concession lease or permit at the Department's discretion.

     As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2337, S.D. 1, and recommends that it pass Third Reading.

Respectfully submitted on behalf of the members of the Committee on Ways and Means,

____________________________

DAVID Y. IGE, Chair