STAND. COM. REP. NO.  645

Honolulu, Hawaii

                , 2017

RE:   H.B. No. 1042

      H.D. 1

Honorable Joseph M. Souki

Speaker, House of Representatives

Twenty-Ninth State Legislature

Regular Session of 2017

State of Hawaii

Sir:

     Your Committee on Economic Development & Business, to which was referred H.B. No. 1042 entitled:

"A BILL FOR AN ACT RELATING TO THE SMALL BUSINESS REGULATORY FLEXIBILITY ACT,"

begs leave to report as follows:

The purpose of this measure is to increase the effectiveness and clarity of the Small Business Regulatory Review Board (Review Board) by:

(1)  Providing a more explicit definition of "small business";

(2)  Clarifying the powers of the Review Board when reviewing administrative rules that impact small business;

(3)  Increasing the membership of the Review Board to eleven from nine members; and

(4)  Clarifying when agencies are required to submit reports to the Review Board and when the Review Board is required to submit reports to the Legislature.

The Department of Business, Economic Development, and Tourism, Small Business Regulatory Review Board, The Chamber of Commerce Hawaii, The Hawaii Business League, and Ocean Tourism Coalition supported this bill.  The Department of Taxation submitted comments.

     Your Committee has amended this measure by:

     (1)  Requiring the Governor to appoint the two additional members from a list submitted by the Review Board;

     (2)  Amending the effective date to July 1, 2038, to facilitate further discussion; and

     (3)  Making technical, nonsubstantive amendments for consistency, clarity, and style.

     The Department of Taxation expressed concern as to the applicability of this measure on its current rulemaking process.  If the Committee on Finance decides to deliberate further on this measure, your Committee respectfully requests that the effective date of this measure be changed to January 1, 2018, to avoid unnecessarily complicating the current ongoing rulemaking actions of the various agencies.

     As affirmed by the record of votes of the members of your Committee on Economic Development & Business that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1042, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1042, H.D. 1, and be referred to your Committee on Finance.

Respectfully submitted on behalf of the members of the Committee on Economic Development & Business,

____________________________

MARK M. NAKASHIMA, Chair