STAND. COM. REP. NO. 639

Honolulu, Hawaii

RE:    S.B. No. 757

       S.D. 2

Honorable Shan S. Tsutsui

President of the Senate

Twenty-Sixth State Legislature

Regular Session of 2011

State of Hawaii

Sir:

     Your Committee on Ways and Means, to which was referred S.B. No. 757, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO SMALL BUSINESS,"

begs leave to report as follows:

     The purpose and intent of this measure is to assist Hawaii's small business concerns by:

     (1)  Reestablishing the Hawaii capital loan revolving fund, with principal and interest payments made on any outstanding loans to be directed into the fund to lower or eliminate the need for future general fund appropriations;

     (2)  Authorizing the Department of Business, Economic Development, and Tourism to contract with any financial institution for services including servicing or administering loans; and

     (3)  Appropriating moneys to the Hawaii capital loan revolving fund for operations of the Hawaii Capital Loan Program.

     Your Committee received testimony in support of this measure from the Chamber of Commerce of Hawaii.  Your Committee received comments on this measure from Richard C. Lim, Interim Director, Department of Business, Economic Development, and Tourism.

     Your Committee finds that small businesses in Hawaii account for a majority of all new jobs and embody the spirit of innovation, entrepreneurship, and individual initiative.  The Hawaii Capital Loan Program was established in 1963 to provide loans to small businesses for plant construction or expansion and the purchase of buildings, land, equipment, machinery, supplies, materials, and working capital.

     Your Committee also finds that the Hawaii Capital Loan Program serves an important public purpose by helping small business to grow with the necessary financing that would otherwise not be available.  Reestablishing the Hawaii capital loan revolving fund, and requiring that principal and interest payments on outstanding loans be paid into the fund, will help to lower the need for future general fund appropriations to the Hawaii Capital Loan Program.

     Your Committee has amended this measure by changing the effective date to July 1, 2050, to facilitate further discussion on the measure.

     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. 757, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 757, S.D. 2.

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

____________________________

DAVID Y. IGE, Chair