STAND. COM. REP. NO. 1353

Honolulu, Hawaii

RE: S.C.R. No. 142

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Sir:

Your Committee on Higher Education, to which was referred S.C.R. No. 142 entitled:

"SENATE CONCURRENT RESOLUTION REQUESTING THE OFFICE OF THE AUDITOR TO CONDUCT A FINANCIAL AND PERFORMANCE AUDIT OF THE UNIVERSITY OF HAWAII AT MANOA ATHLETICS DEPARTMENT,"

begs leave to report as follows:

The purpose and intent of this measure is to request the Office of the Auditor to conduct a financial and performance audit of the University of Hawaii at Manoa Athletics Department.

Your Committee received comments on this measure from the Office of the Auditor and University of Hawaiʻi System.

Your Committee finds that the University of Hawaii at Manoa Athletics Department (Athletics Department) receives funding through private donors, the University of Hawaii, legislative appropriations, and various sport-specific distributions for the purpose of supporting its operations and programs. Your Committee further finds that effective use and management of funds and resources to promote increased interest and participation in collegiate sports should be a priority of the Athletics Department. However, your Committee also finds that the Athletics Department does not have a master plan to address its various needs, nor does it have a clear plan to implement the Name, Image, and Likeness Program, under which student-athletes may earn compensation form third parties using their personal brand, subject to institutional policies, without affecting their eligibility to receive athletic scholarships, for the purposes of department and athlete exposure, or as a new source of revenue. This measure requests the Office of the Auditor to conduct a financial and performance audit of the Athletics Department to ensure that it is operating in an effective fiscally responsible, and comprehensively supportive manner for the success of the program and student athletes.

Your Committee notes the concerns raised by the Office of the Auditor regarding the scope of the requested audit; specifically, that it does not have the expertise or the funds to contract with independent firms to conduct financial audits and that it cannot audit the breadth of the areas identified in the resolution in the requested time frame. Therefore, there is a need to amend this measure to narrow the scope of the requested audit.

Accordingly, your Committee has amended this measure by:

(1) Deleting language that would have requested the Office of the Auditor to conduct a financial and performance audit of the University of Hawaii at Manoa Athletics Department to ensure that the Department is operating in an effective, fiscally responsible, and comprehensively supportive manner for the success of the program and its student athletes;

(2) Inserting language requesting the Office of the Auditor to conduct an audit of the University of Hawaii at Manoa Athletics Department's use and management of its funds, assessing:

(A) Whether the Department's actual expenditures are consistent with its policies and procedures; and

(B) The Department's Name, Image, and Likeness Program;

(3) Amending its title accordingly; and

(4) Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

As affirmed by the record of votes of the members of your Committee on Higher Education that is attached to this report, your Committee concurs with the intent and purpose of S.C.R. No. 142, as amended herein, and recommends that it be referred to your Committee on Ways and Means, in the form attached hereto as S.C.R. No. 142, S.D. 1.

Respectfully submitted on behalf of the members of the Committee on Higher Education,

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DONNA MERCADO KIM, Chair