STAND. COM. REP. NO.1268

Honolulu, Hawaii

, 2001

RE: S.B. No. 838

S.D. 2

H.D. 1

 

 

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-First State Legislature

Regular Session of 2001

State of Hawaii

Sir:

Your Committee on Finance, to which was referred S.B. No. 838, S.D. 2, entitled:

"A BILL FOR AN ACT RELATING TO HAWAII HURRICANE RELIEF FUND,"

begs leave to report as follows:

The purpose of this bill is to make a variety of changes to the Hawaii Hurricane Relief Fund (Fund) law.

More specifically, this bill:

(1) Prohibits the dissolution of the Fund except through legislation;

(2) Excludes investment income from the accumulation of reserves or funds to be used to pay for expenses, making or repaying loans or other obligations, providing loss mitigation incentives, and paying valid claims for covered events insured by the fund;

(3) Requires the Fund to use its investment income for grants to residential property owners and small business owners to install wind damage mitigation devices, reinvestment into the Fund, and deposit into the general fund;

(4) Requires the plan of operation of the Fund to accumulate through investment and reinvestment, the amount of funds necessary to cover the claims of a covered event;

(5) Requires the Fund to develop a program to provide grants to residential property owners and small business owners to install wind damage mitigation devices;

(6) Appropriates moneys out of the Hurricane Reserve Trust Fund for the Hazard Grant Mitigation Program.

The Kauai County Housing Agency, Hawaii Security Shutters, LLC, Hurricane Defense Systems, Building Industry Association of Hawaii, Hurricane Hazard Mitigation Ad Hoc Work Group, and several individuals submitted testimony in support of this bill. The Hawaii Hurricane Relief Fund submitted testimony in support of the intent of this bill.

The Department of Budget and Finance and the Department of Commerce and Consumer Affairs submitted testified in opposition to this bill. The Hawaii Association of Realtors, Hawaii Independent Insurance Agents Association, and an individual commented on this bill.

Your Committee has amended this bill by deleting its contents and inserting the substance of H.B. No. 1156, H.D. 2. As amended this bill:

(1) Establishes a two-year pilot program to provide grants on a dollar-for-dollar matching funds basis to residential property owners, up to a maximum of $3,500 per insured location, for installation of wind damage mitigation devices that are approved by the Fund;

(2) Requires the Fund to submit a report to the Legislature on the status of the pilot project;

(3) Appropriates $5,000,000 for fiscal year 2001-2002 and $5,000,000 for fiscal year 2002-2003 to develop and implement the pilot program; and

(4) Provides that the program will be repealed on July 1, 2003.

As affirmed by the record of votes of the members of your Committee on Finance that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 838, S.D. 2, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 838, S.D. 2, H.D. 1, and be placed on the calendar for Third Reading.

Respectfully submitted on behalf of the members of the Committee on Finance,

____________________________

DWIGHT Y. TAKAMINE, Chair