STAND. COM. REP. NO. 919-04

Honolulu, Hawaii

, 2004

RE: S.B. No. 3080

S.D. 2

H.D. 1

 

 

 

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Sir:

Your Committee on Transportation, to which was referred S.B. No. 3080, S.D. 2, entitled:

"A BILL FOR AN ACT RELATING TO TRANSPORTATION,"

begs leave to report as follows:

The purpose of this bill is to provide further economic relief to airport concessionaires. Among other things, this bill:

(1) Provides retroactive relief for previously qualified airport concessionaires still suffering from the events of September 11, 2001, who have not negotiated relief with the Department of Transportation (DOT) and whose gross receipts are still 15 percent or more below their gross receipts prior to September 11, 2001;

(2) Allows airport concessionaires suffering from the events of September 11, 2001, whose agreements were terminated and who were replaced by a new concession operator to recover their bonds and deposits and not be barred from doing business with the State for a period of five years as provided by present law;

(3) Ensures that DOT, as landlord, treats all airport tenants fairly;

(4) Clarifies that lei vendors may also sell Hawaii floral products;

(5) Provides DOT with the flexibility to negotiate lei greeting service contracts;

(6) Clarifies that the period from which relief may be measured is the date a person submits a bid;

(7) Provides flexibility to DOT to grant economic relief to concessionaires if a number of conditions are met; and

(8) Gives DOT the flexibility to further extend revocable permits for an additional period of up to one year.

The Airport Concessionaires Committee and Greeters of Hawaii testified in support of this bill. The Department of the Attorney General, DOT, and Airlines Committee of Hawaii testified in opposition to this measure.

Your Committee finds that some airport concessionaires have never fully recovered from the events of September 11, 2001. Continued restricted access to areas of the airport due to increased security measures has resulted in a large loss of customers for concessionaires, which translates into lost earnings for these companies. Moreover, recent global events and the war in Iraq continue to affect these concessionaires.

In 2003, the Legislature passed legislation to provide further economic relief to qualified, multi-year airport tenants. Although that measure was eventually vetoed by the Governor, many concessionaires were able to negotiate either direct or indirect relief with DOT. Your Committee understands that one vendor still remains in negotiations with DOT.

Your Committee was informed by DOT and proponents of this measure, mainly Greeters of Hawaii and Airport Concessionaires Committee, that agreement has been reached on a compromise draft of this bill that addresses the needs of both the State and lei vendors. Accordingly, your Committee has amended this measure by deleting its contents and replacing it with language that:

(1) Gives the Governor the ability to grant relief by waiving or modifying any term of concessionaire's lease for airport concession leases that do not contain provisions for relief; and

(2) Provides DOT with flexibility to negotiate airport florist and lei greeting service concession leases.

As affirmed by the record of votes of the members of your Committee on Transportation that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 3080, S.D. 2, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 3080,

S.D. 2, H.D. 1, and be referred to the Committee on Finance.

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

 

____________________________

JOSEPH M. SOUKI, Chair