STAND. COM. REP. NO. 3617

Honolulu, Hawaii

RE: H.B. No. 424

H.D. 1

S.D. 2

Honorable Ronald D. Kouchi

President of the Senate

Twenty-Ninth State Legislature

Regular Session of 2018

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred H.B. No. 424, H.D. 1, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO THE UNIVERSITY OF HAWAII,"

begs leave to report as follows:

The purpose and intent of this measure is to amend the laws relating to the procurement authority, governance, and financial structure of the University of Hawaii.

Specifically, this measure:

(1) Reinstates the authority of the President of the University of Hawaii to act as the chief procurement officer of the University of Hawaii for all procurement contracts under Chapter 103D, Hawaii Revised Statutes;

(2) Adds two faculty ex officio nonvoting members to the University of Hawaii Board of Regents;

(3) Prohibits the University of Hawaii Board of Regents from raising tuition fees until an unspecified date; and

(4) Requires the University of Hawaii to submit a report to the Legislature on the status of repair and maintenance costs and whether the 2018-2021 tuition increases are assisting in addressing the repair and maintenance backlog.

Your Committee received written comments in support of this measure from the State Procurement Office and Oahu County Committee Legislative Priorities Committee, Democratic Party of Hawai‘i.

Your Committee received written comments on this measure from the University of Hawaii System.

Your Committee finds that faculty representation on the University of Hawaii Board of Regents would be contradictory to the values and best practices of citizen trusteeship. Your Committee further finds that temporarily suspending the Board of Regents from raising tuition fees would severely limit the ability of the University to respond to changes in the economy and that the current process for increasing tuition, which involves multiple open meetings that allow for public input, is sufficient to address concerns regarding the rising costs of tuition.

Your Committee has amended this measure by replacing its entire contents with the provisions of Senate Bill No. 2831, Senate Draft 2. As amended, this measure retains the provisions that reinstate the authority of the President of the University of Hawaii to act as the chief procurement officer of the University of Hawaii, but otherwise differs substantively from the version of this measure as received by your Committee by:

(1) Adding the requirement that the University of Hawaii submit an annual report to the Legislature detailing a list of all capital improvement projects approved by the University of Hawaii Board of Regents, prioritized by each campus;

(2) Deleting language that expressly provides that the reinstatement of the University President's powers as chief procurement officer shall not be applied in a manner that would be an unconstitutional impairment of an existing contract;

(3) Deleting language that increases the composition of the University of Hawaii Board of Regents to include two faculty ex officio nonvoting members;

(4) Deleting language that prohibits the University of Hawaii Board of Regents from raising tuition fees until an unspecified date;

(5) Deleting language that requires the University of Hawaii Board of Regents to submit a report to the Legislature on the status of repair and maintenance costs and whether the 2018-2021 tuition increases are helping to address the repair and maintenance backlog; and

(6) Providing that the measure will take effect on July 1, 2050, and will be repealed on June 30, 2021.

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 H.B. No. 424, H.D. 1, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 424, H.D. 1, S.D. 2.

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

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DONOVAN M. DELA CRUZ, Chair