STAND. COM. REP. NO. 547

Honolulu, Hawaii

RE: S.B. No. 763

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirtieth State Legislature

Regular Session of 2019

State of Hawaii

Sir:

Your Committees on Energy, Economic Development, and Tourism and Agriculture and Environment, to which was referred S.B. No. 763 entitled:

"A BILL FOR AN ACT RELATING TO ADVERTISING AND MARKETING,"

beg leave to report as follows:

The purpose and intent of this measure is to require the Department of Business, Economic Development, and Tourism, in consultation with the Department of Agriculture, to conduct a study assessing the economic impact of companies selling products in the United States using place-based marketing without any material ties to the State.

Your Committees received testimony in support of this measure from the Department of Agriculture, Hawai‘i Farm Bureau, Hawaii Coffee Association, O‘ahu County Committee on Legislative Priorities of the Democratic Party of Hawai‘i, and one individual. Your Committees received comments on this measure from the Department of Business, Economic Development, and Tourism.

Your Committees find that many products manufactured in Hawaii use locally grown or produced agricultural products, despite the often higher costs of manufacturing those products within the State or using a particular quality of locally sourced ingredients. The State has policies and educational and marketing campaigns in place to increase local food production and decrease food imports, and many consumers have embraced the call to buy locally made and grown products. However, products without such material ties to the State have also been introduced into commerce and falsely use Hawaii place-based marketing, which has taken advantage of the Hawaii brand and misled many consumers. This measure will require the Department of Business, Economic Development, and Tourism, in collaboration with the Department of Agriculture, to conduct a study of impacts and recommendations to maintain and protect the integrity of Hawaii-branded products and support Hawaii's economy.

Your Committees have amended this measure by inserting an appropriation amount of $250,000 for the study.

As affirmed by the records of votes of the members of your Committees on Energy, Economic Development, and Tourism and Agriculture and Environment that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 763, as amended herein, and recommend that it pass Second Reading in the form attached hereto as S.B. No. 763, S.D. 1, and be referred to your Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committees on Energy, Economic Development, and Tourism and Agriculture and Environment,

________________________________ MIKE GABBARD, Chair

________________________________ GLENN WAKAI, Chair