STAND. COM. REP. NO. 3499

Honolulu, Hawaii

RE: H.B. No. 117

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirtieth State Legislature

Regular Session of 2020

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred H.B. No. 117 entitled:

"A BILL FOR AN ACT RELATING TO STATE FUNDS,"

begs leave to report as follows:

The purpose and intent of this measure is to make technical amendments to the state law regarding the deposit of state funds into the state treasury.

Prior to the hearing on this measure, your Committee posted and made available for public review a proposed S.D. 1 of this measure, which amends this measure by deleting its contents and inserting language to defer the implementation of the Commission on Salaries' recommendations for the executive and judicial branches, and planned adjustments for the Legislature, until July 1, 2021.

Your Committee received testimony in support of the proposed S.D. 1 from the Office of the Governor and Judiciary.

Your Committee finds that the global respiratory disease pandemic named "coronavirus disease 2019", or COVID-19, has deeply impacted Hawaii's health and economy. The adjusted fiscal year 2021 forecast includes an expected loss of $225,000,000 in state revenues. Your Committee further finds that, as constitutionally required, the Commission on Salaries convened and reported to the Legislature in 2019 the recommended increased salary adjustments for officers of the executive and judicial branches for the following six years and members of the Legislature for four years. Implementation of the Commission's salary recommendations began for the executive and judicial branches on July 1, 2019, with the second of six planned raises for the executive and judicial branches scheduled for July 1, 2020. The first recommended raise for members of the Legislature is scheduled for January 1, 2021. Due to the unprecedented economic downturn resulting from the COVID-19 pandemic, your Committee believes that continued implementation of the Commission's recommendations for the executive and judicial branches, and planned adjustments for the Legislature, is irresponsible at this time and should be deferred.

Your Committee has amended this measure by adopting the proposed S.D. 1 and further amending the measure by making a technical, nonsubstantive amendment for the purposes of clarity and consistency.

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. 117, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 117, S.D. 1, and be placed on the calendar for Third Reading.

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

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DONOVAN M. DELA CRUZ, Chair