SB1578 SD2

SECTION 1. The legislature finds that fifty years ago, Act 82, Session Laws of Hawaii 1975, established an educational non‑profit public corporation to administer and operate what is today known as the East-West center. The mission of the East‑West center is to benefit local residents and the State's international partners by strengthening the State's international ties and advancing cooperation across the Pacific. It has been an invaluable partner that is well suited to continuing to assist the State in building partnerships, expanding economic development and education, and collaborating abroad.

The legislature further finds that strong sister-state, sister-school, and similar relationships benefit the State's businesses and economy, improve access to flights and transportation, expand high school and college student educational exchanges, broaden access to Pacific culture and arts, preserve the State's relationships to the places of origin of its immigrant communities, and spur sub-national government collaborations to address common priorities, including the eradication of invasive species, promotion of economic development, advancement of clean energy, and preservation of peace between nations. Further, it is appropriate for the State to explore and take advantage of additional ways that Hawaii can benefit from international partnerships, including generating revenue abroad similar to many other jurisdictions. For example, hosting facilities abroad for local farmers and retailers to more easily sell Hawaii products in key markets, or investing in projects that generate a return. This enables direct financial benefit that can create revenue to support Hawaii programs and services without additional expense to local taxpayers.

The legislature also finds that international relations between East and West across the Pacific have been rapidly changing. Additionally, previous generations of the State's key community, business, and government leaders who have carefully fostered and maintained these important relationships are retiring or passing on. If local residents are going to continue to benefit from the State's international ties, and if Hawaii is going to take advantage of international business and revenue opportunities abroad as so many other jurisdictions currently do, it is critical that the State adjust its engagement strategy, ensure continuity with its sister-state communities and partners, and plan for the future.

Therefore, the legislature finds that in celebration of the fiftieth anniversary of the legislature's establishment of the East-West center, the State must update its international engagement strategy, and reaffirm its commitment to building and maintaining the international partnerships that have benefitted the State over the years, so they can continue to benefit local residents for generations to come.

Accordingly, the purpose of this Act is to:

(1) Engage local leaders with strong relationships abroad to support the governor and legislature in strengthening international partnerships, by redesignating the Hawaii sister-state committee as the Hawaii sister-state and international partnerships commission;

(2) Enable the East-West center to better help and maintain the State's international relationships, programs, and partnerships; and

(3) Enable the State to more easily generate revenue from international partnerships and investment as other jurisdictions do, where appropriate.

SECTION 2. Chapter 201, Hawaii Revised Statutes, is amended by adding two new sections to part I to be appropriately designated and to read as follows:

"§201- East-West center. (a) The official designation of the East-West center shall be the center for cultural and technical interchange between East and West, Inc.

(b) The qualifying standards and conditions related to the receipt of funds under chapter 42F shall not apply to funds received by the East-West center; provided that if the East-West center contracts with a recipient or provider, then the qualifying standards, conditions, and other provisions of chapter 42F shall apply to the recipient or provider and the contract.

(1) Be licensed or accredited, in accordance with federal, state, or county statutes, rules, or ordinances, to conduct the activities or provide the services for which state funds are appropriated;

(2) Comply with all applicable federal and state laws prohibiting discrimination against any person on the basis of race, color, national origin, religion, creed, sex, age, sexual orientation, or disability;

(3) Agree not to use the funds for entertainment or lobbying activities;

(4) Be incorporated under the laws of the State;

(5) Have bylaws or policies that describe the manner in which the activities or services for which a grant is awarded shall be conducted or provided;

(6) Have been determined and designated to be a tax-exempt organization by the Internal Revenue Service; and

(7) Have a governing board whose members shall have no material conflict of interest and serve without compensation.

(d) The comptroller and state auditor may examine the use of funds appropriated to the center for cultural and technical interchange between East and West, Inc.

(e) The allocation of state support shall not impinge on the autonomy of the center for cultural and technical interchange between East and West, Inc., nor imply state control over its programs or policies, except as provided in this section.

(f) The center for cultural and technical interchange between East and West, Inc. shall submit to the legislature an annual report no later than twenty days prior to the convening of each regular session, which shall include an explanation of the facility maintenance and other functions accomplished by state fund expenditures in the previous fiscal year."

SECTION 3. Section 201-17, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

"(b) The office shall:

(1) Develop policies that promote and strengthen relations with other countries in the areas of international business, economy, culture, and the arts;

(2) Develop policies that promote transportation between, and tourism with, other countries;

(3) Develop and promote international telecommunications and high technology exchanges;

(4) Encourage the development of international sister-city programs, pairing Hawaii cities with cities around the globe for artistic, cultural, economic, educational, and faith-based exchanges;

(5) Develop and promote Hawaii as the economic, trade, commerce, transportation, banking, and tourism hub of the Pacific;

(6) Develop an international affairs and peace education curriculum that includes studies of international affairs and peace initiatives and takes a proactive, strategic approach to the development of policies that promote the prevention of national and international conflict, nonviolent intervention, mediation, peaceful resolution of conflict, and structured mediation of conflict; [~~and~~]

(7) Provide for exchanges of individuals between Hawaii and other nations to develop international and peace‑based initiatives[.]; and

(8) Provide support to the Hawaii sister-state and international partnerships commission."

SECTION 4. Section 201-81, Hawaii Revised Statutes, is amended to read as follows:

"§201-81 Establishment of out-of-state offices; purposes. The department of business, economic development, and tourism may establish and operate offices and facilities in out-of-state locations, including foreign nations, to effectuate the following purposes:

(1) Develop programs to reach targeted companies or industries in the respective area and surrounding regions;

(2) Monitor out-of-state government policies and regulations that have an impact on business, markets, sales, tourism, and related activities;

(3) Host government and business officials at conferences, meetings and social occasions, or other events on matters pertaining to business opportunities and attraction of investments for the State;

(4) Develop and conduct advertising efforts, promotional events, media coverage, and educational programs regarding commerce in the State; [~~and~~]

(5) Conduct related operations as needed, [~~such as~~] including hiring or contracting for consultants[.];

(6) Support sister-state, -province, and other partnerships that promote and enrich the people, cultures, environments, and economies of the State and its international partners; and

(7) Generate revenue for the State."

SECTION 5. Section 201-82, Hawaii Revised Statutes, is amended to read as follows:

"§201-82 Powers of the department. The department, subject to the approval of the director of budget and finance, shall have the following general powers to operate out-of-state offices and facilities established:

(1) To enter into contracts, leases, or cooperative agreements, or perform other transactions with any person, firm, partnership, association, company, corporation, or foreign nation, as may be necessary in the conduct of its business and on [~~such~~] any terms as the department may deem appropriate, using competitive procurement practices, to the extent practicable, in accordance with rules adopted by the policy board;

(2) To establish operational bank accounts in out-of-state locations, including foreign denomination accounts, as may be necessary in the conduct of its business, notwithstanding the provisions of chapter 38;

(3) To receive by gifts, grants, devises, bequests, or otherwise from private sources or a foreign nation, any property, real, personal, or mixed, intangible or tangible, absolutely or in trust, to be used and disposed of, either the principal or the income therefrom, in accordance with the conditions under which it was received;

(4) To buy, sell, lease, rent, hold, maintain, use, and operate any property, real, personal, or mixed, tangible or intangible, in accordance with the conditions under which it was received;

(5) To hire such personnel as may be necessary in the conduct of its business and on [~~such~~] any terms as the department may deem appropriate; and

(6) To do any or all other acts reasonably necessary to carry out the objects and purposes of this part, provided that the department shall not obligate any funds of the State not appropriated to the department."

SECTION 6. Section 229-2, Hawaii Revised Statutes, is amended to read as follows:

"[[]§229-2[]] Hawaii sister-state [~~committee~~] and international partnerships commission. [[(a)] There shall be established the Hawaii sister-state committee, to be placed within the department of business, economic development, and tourism for administrative purposes only, consisting of five members appointed by the governor as provided in section 26-34.

The purpose of the committee shall be to advise the governor and the legislature on matters relating to sister-state or province relations and relations, in general, between the State and the states or provinces of foreign countries.

~~[(b)] The governor shall appoint five members, one member from each of five lists of nominees submitted respectively by the following:~~

~~(1)~~ ~~Speaker of the house of representatives;~~

~~(2)~~ ~~President of the senate;~~

~~(3)~~ ~~Native Hawaiian cultural organization;~~

~~(4)~~ ~~East-West Center; and~~

~~(5)~~ ~~Hawaii State Association of Counties.~~

A chair and vice chair of the committee shall be appointed by the committee members from among themselves. Members shall serve without compensation but shall be reimbursed for expenses, including travel expenses, necessary for the performance of their duties.]

(a) There is established within the department of business, economic development, and tourism for administrative purposes only the Hawaii sister-state and international partnerships commission.

(b) The commission shall support the governor, legislature, and office of international affairs in building and maintaining strategic long-term sister-state, -province, and other partnerships that promote and enrich the people, cultures, environments, and economies of the State and its international partners.

(1) Three members appointed by the governor, with the advice and consent of the Senate; provided that two of the three members appointed by the governor shall be from a list of at least three nominees submitted respectively by the:

(A) Office of Hawaiian affairs; and

(B) East-West center;

(2) One member appointed by the president of the senate;

(3) One member appointed by the speaker of the house of representatives; and

(4) The chairs of the respective senate and house committees with jurisdiction over international affairs who shall serve as ex-officio, non-voting members of the commission.

(d) The commission shall elect from among its members a chairperson and vice-chairperson.

(e) Members of the commission shall serve without compensation but shall be reimbursed for expenses, including travel expenses, necessary for the performance of their duties."

SECTION 7. Section 229-3, Hawaii Revised Statutes, is amended to read as follows:

"[[]§229-3[]] Initiating sister-state relationships. The Hawaii sister-state [~~committee~~] and international partnerships commission shall evaluate and develop recommendations for the initiation of all sister-state or province relationships and forward its recommendation to the legislature. The legislature, if it so chooses, shall implement the recommendation to initiate a sister-state or province relationship by either adopting a concurrent resolution or by enacting session law to that effect."

SECTION 8. Section 229-4, Hawaii Revised Statutes, is amended to read as follows:

"[[]§229-4[]] Maintaining sister-state relationships. The Hawaii sister-state [~~committee~~] and international partnerships commission shall periodically evaluate established sister-state relationships and forward its recommendations on maintaining sister-state relationships to the governor and to the legislature."

SECTION 9. Section 229-5, Hawaii Revised Statutes, is amended to read as follows:

"[[]§229-5[]] Dissolving sister-state relationships. The Hawaii sister-state [~~committee~~] and international partnerships commission may make a recommendation to terminate a sister-state relationship it deems to be defunct, moribund, or not beneficial and forward its recommendation to the legislature. The legislature, if it so chooses, shall implement the recommendation to terminate a sister-state relationship either by adopting a concurrent resolution or by enacting session law to that effect."

SECTION 10. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2025-2026 and the same sum or so much thereof as may be necessary for fiscal year 2026-2027 for the office of international affairs to develop an:

(1) Updated strategy for the State's international engagement in the twenty-first century; and

(2) Analysis of potential investment and revenue generation abroad.

The sums appropriated shall be expended by the department of business, economic development, and tourism for the purposes of this Act.

SECTION 11. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2025-2026 and the same sum or so much thereof as may be necessary for fiscal year 2026-2027 for the East-West center to assist in the development and maintenance of the State's international relationships, programs, and partnerships.

The sums appropriated shall be expended by the university of Hawaii for the purposes of this Act.

SECTION 12. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 13. This Act shall take effect on July 1, 2050.

THE SENATE	S.B. NO.	1578
THIRTY-THIRD LEGISLATURE, 2025		S.D. 2
STATE OF HAWAII