STAND. COM. REP. NO. 1150

Honolulu, Hawaii

RE: S.B. No. 553

S.D. 2

Honorable Ronald D. Kouchi

President of the Senate

Thirtieth State Legislature

Regular Session of 2019

State of Hawaii

Sir:

Your Committees on Ways and Means and Commerce, Consumer Protection, and Health, to which was referred S.B. No. 553, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO BROADBAND SERVICE INFRASTRUCTURE,"

beg leave to report as follows:

The purpose and intent of this measure is to establish the broadband infrastructure grant program to provide grants for the purpose of subsidizing the costs of installing broadband infrastructure in locations that lack high speed internet access.

Your Committees received written comments in support of this measure from the Department of Business, Economic Development, and Tourism; Aloha Broadband; Oahu County Committee on Legislative Priorities of the Democratic Party of Hawaii; Oahu County Democrats; and one individual.

Your Committees received written comments on this measure from the Department of Commerce and Consumer Affairs.

Your Committees find that certain rural areas of the State lack broadband service due, in part, to the excessively high cost to install infrastructure to serve a small number of subscribers. This measure will help to reduce infrastructure installation costs for those communities so they may benefit from the opportunities afforded by high-speed internet access.

Your Committees note that the broadband infrastructure grant program will require an appropriation of $5,000,000 for fiscal year 2019-2020.

Your Committees have amended this measure by:

(1) Changing the definitions of "broadband service" and "broadband infrastructure" to reference section 440J-1, Hawaii Revised Statutes;

(2) Changing the definition of "underserved area" to require minimum speeds in proportion to the minimum broadband service speeds established by the Federal Communications Commission;

(3) Deleting a duplicative provision authorizing a non-government infrastructure provider to be considered an eligible applicant;

(4) Including a requirement that applicants to the broadband infrastructure grant program commit to complying with net neutrality principles;

(5) Clarifying, with respect to a written challenge to an application, that the federal or state funding refers to the funds that are available to the applicant;

(6) Clarifying the criteria of the scoring system used by the Department of Business, Economic Development, and Tourism to award the grants;

(7) Changing the effective date to July 1, 2050, to facilitate further discussion on the measure; and

(8) Making technical nonsubstantive amendments for purposes of clarity, consistency, and style.

As affirmed by the records of votes of the members of your Committees on Ways and Means and Commerce, Consumer Protection, and Health that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 553, S.D. 1, as amended herein, and recommend that it pass Third Reading in the form attached hereto as S.B. No. 553, S.D. 2.

Respectfully submitted on behalf of the members of the Committees on Ways and Means and Commerce, Consumer Protection, and Health,

________________________________ ROSALYN H. BAKER, Chair

________________________________ DONOVAN M. DELA CRUZ, Chair