Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Third Special Session of 2001

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred S.B. No. 12 entitled:

begs leave to report as follows:

The purpose of this measure is to appropriate $33,270,403 from the Hawaii tobacco settlement special fund to the emergency budget and reserve fund.

Your Committee finds that the terrorist attacks on America of September 11 have had a serious and negative impact on the economy of the nation and of our State. Hawaii's economy is heavily dependent on tourism, and with the current reluctance to fly and the general downturn in the economy, our visitor industry is in a precarious posture. The recent bankruptcy announcement of Hawaii's primary cruise line has added hundreds of workers to the thousands in the visitor industry who have lost their jobs recently due to the attacks, accentuating the downward economic spiral the State is facing.

The purpose of the emergency budget and reserve fund is to be a temporary supplemental source of funds during times of emergency or economic downturn. This appropriation to the fund is necessary for the State to provide for the health, safety, and welfare of its people.

The amount of the transfer consists of the present balance of $13,256,478 from fiscal year 2000-2001, and $20,013,925 for the projected tobacco settlement payments due for the current fiscal year.

Testimony in support of this bill was received from the Director of the Department of Budget and Finance, and the Chamber of Commerce of Hawaii. Testimony in opposition of the bill was received from the Hawaii Medical Association.

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 concurs with the intent and purpose of S.B. No. 12 and recommends that it pass Second Reading and be placed on the calendar for Third Reading.