STAND. COM. REP. NO. 3103

Honolulu, Hawaii

RE:    H.B. No. 2015

       H.D. 1

       S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Twenty-Eighth State Legislature

Regular Session of 2016

State of Hawaii

Sir:

     Your Committees on Judiciary and Labor and Government Operations, to which was referred H.B. No. 2015, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO THE HAWAII EMPLOYER-UNION HEALTH BENEFITS TRUST FUND,"

beg leave to report as follows:

     The purpose and intent of this measure is to:

     (1)  Exempt certain procurements of the Hawaii Employer-Union Health Benefits Trust Fund (EUTF) from the state procurement code;

     (2)  Specify the fiduciary duties of EUTF trustees;

     (3)  Amend the composition, appointing authorities, vacancy-filling procedure, and quorum requirements of the EUTF Board of Trustees;

     (4)  Authorize the establishment of a sub-board of the EUTF Board of Trustees to administer contributions and benefits of a particular bargaining unit if the exclusive bargaining representative negotiates a specific contribution to apply to only that bargaining unit;

     (5)  Authorize the EUTF Board of Trustees to appoint attorneys independent of the Attorney General; and

     (6)  Amend the administration of EUTF monies and transfer control of EUTF from the Department of Budget and Finance to the Office of Collective Bargaining.

     Your Committees received testimony in support of this measure from the Hawaii Government Employees Association, AFSCME Local 152, AFL-CIO; Hawaii Fire Fighters Association, IAFF Local 1463, AFL-CIO; and University of Hawaii Professional Assembly.  Your Committees received testimony in opposition to this measure from the Department of Budget and Finance and Department of the Attorney General.  Your Committees received comments on this measure from the Office of Collective Bargaining and State Procurement Office.

     Your Committees find that there is concern regarding the operation of the EUTF and reforms are necessary to control costs, encourage preventive care, implement wellness programs, and provide information on provider performance and efficiency.  Implementation of this measure will help reduce some of the concerns associated with the operation of the EUTF.

     Your Committees have amended this measure by:

     (1)  Deleting its contents and inserting the contents of S.B. No. 2434, S.D. 1, Regular Session of 2016, which:

          (A)  Amends the composition, appointing authorities, and quorum requirements of the EUTF Board of Trustees; and

          (B)  Has an effective date of January 7, 2059; and

     (2)  Making a technical, nonsubstantive amendment for the purposes of clarity and consistency.

     As affirmed by the records of votes of the members of your Committees on Judiciary and Labor and Government Operations that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 2015, H.D. 1, as amended herein, and recommend that it pass Second Reading in the form attached hereto as H.B. No. 2015, H.D. 1, S.D. 1, and be referred to your Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committees on Judiciary and Labor and Government Operations,

________________________________ DONNA MERCADO KIM, Chair

________________________________ GILBERT S.C. KEITH-AGARAN, Chair