REPORT TITLE:
Harbors Division


DESCRIPTION:
Allows harbors division to enter into cost-reimbursement
contracts with maritime operators or tenants for public
improvements.  (SD2)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        392
THE SENATE                              S.B. NO.           S.D. 2
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                             
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                   A  BILL  FOR  AN  ACT

RELATING TO TRANSPORTATION. 


BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1      SECTION 1.  The legislature finds that private development
 
 2 of harbor facilities on state lands should be encouraged to save
 
 3 taxpayers the burden of funding costly construction of
 
 4 improvement.  The legislature further finds that private
 
 5 development would more likely result in project being completed
 
 6 on time.
 
 7      The purpose of this Act is to allow the harbors division to
 
 8 enter into cost-reimbursement contracts with marine operators or
 
 9 tenants for public improvements of harbor facilities.
 
10      SECTION 2.  Chapter 266, Hawaii Revised Statutes, is amended
 
11 by adding a new section to part I to be appropriately designated
 
12 and to read as follows:
 
13      "�266-    Private financing of harbor improvements.  (a)
 
14 Notwithstanding any law to the contrary, the department of
 
15 transportation may enter into a cost-reimbursement contract with
 
16 a maritime operator or tenant for any public improvement to or
 
17 construction of a state harbor, commercial harbor, roadstead, or
 
18 other waterfront improvement belonging to or controlled by the
 
19 State, if the director of transportation determines that a
 

 
Page 2                                                     392
                                     S.B. NO.           S.D. 2
                                                        
                                                        

 
 1 cost-reimbursement contract promotes the best interest of the
 
 2 State by a finding that:
 
 3      (1)  Private development is likely to be less costly than
 
 4           any other type of contract;
 
 5      (2)  Private development provides needed public improvements
 
 6           in a significant timely basis; or
 
 7      (3)  Public financing for public improvements is not
 
 8           available on a timely basis.
 
 9      (b)  A cost-reimbursement contract under subsection (a) may
 
10 be financed by an offset from the marine operator's or tenant's
 
11 future rental or tariff payments to the State; provided that the
 
12 terms of the contract shall ensure that the State benefits
 
13 financially from the arrangement and that public use of the
 
14 facility is maintained.  Projects financed by the cost-
 
15 reimbursement method shall not in any way obligate the State for
 
16 repayment by a legislative appropriation.
 
17      (c)  A cost-reimbursement contract under subsection (a)
 
18 shall be subject to the applicable requirements of chapters 103
 
19 and 103D and subject to the approval of the administrator of the
 
20 state procurement office, established under section 103D-204(a);
 
21 provided that all related transactions shall be subject to state
 
22 audit.
 
23      (d)  Prior to entering into a cost-reimbursement contract
 

 
Page 3                                                     392
                                     S.B. NO.           S.D. 2
                                                        
                                                        

 
 1 under subsection (a) for more than $500,000 the department of
 
 2 transportation shall obtain prior approval from the legislature."
 
 3      SECTION 3.  New statutory material is underscored.
 
 4      SECTION 4.  This Act shall take effect upon its approval.