REPORT TITLE:
Legislative Analyst and Auditor


DESCRIPTION:
Appropriates funds for the office of the legislative analyst and
Auditor.  Transfers responsibility for analyzing new special and
revolving funds from Auditor to Legislative Analyst.  (SD1)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        1242
THE SENATE                              S.B. NO.           S.D. 1
TWENTIETH LEGISLATURE, 2000                                
STATE OF HAWAII                                            
                                                             
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                   A  BILL  FOR  AN  ACT

RELATING TO THE LEGISLATURE.



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

 1      SECTION 1.  In recognition that the legislature needs its
 
 2 own separate fiscal policy office to provide legislators with the
 
 3 information needed to develop sound economic and fiscal policies
 
 4 for the State, the office of the legislative analyst was
 
 5 established in Act 347, Session Laws of Hawaii 1990.
 
 6      Other states have established nonpartisan, highly
 
 7 specialized legislative fiscal analysis offices, in addition to
 
 8 the professional staffs of each chamber's money committees, to
 
 9 review executive branch proposals and to analyze economic impact
 
10 and policy of existing and proposed programs.
 
11      Since the legislature meets for only four months of the
 
12 year, it has come to rely heavily on the use of session-only
 
13 staff or employees on loan from the executive branch.  Hawaii is
 
14 the only state in the nation utilizing staff on temporary loan
 
15 from executive agencies to support the work of its money
 
16 committees.
 
17      As a result, the legislature has been at a disadvantage in
 
18 fulfilling its trust to the people of the State to ensure that
 
19 approved appropriations are executed in compliance with
 

 
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                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 legislative policy.  The legislature can provide effective
 
 2 legislative oversight only if it has its own capacity to review
 
 3 and analyze the budget, state economic conditions, and overall
 
 4 tax structure and attendant policies.
 
 5      Although the office of the legislative analyst was
 
 6 established statutorily, it has yet to be implemented.  More than
 
 7 ever before, it is critical that this office be made operational
 
 8 to enable the legislature to address the fiscal challenges facing
 
 9 the State.
 
10      The purpose of this Act is to transfer the responsibility
 
11 for analyzing new special, revolving, or trust funds from the
 
12 auditor to the legislative analyst, to specify additional
 
13 criteria for consideration by the legislative analyst, to
 
14 appropriate funds for the legislative analyst, and to appropriate
 
15 money for dues for the Council of State Governments.  This Act
 
16 also provides additional support to the auditor for continuing
 
17 audits or studies commissioned by the legislature.
 
18      SECTION 2.  Chapter 21F, Hawaii Revised Statutes, is amended
 
19 by adding a new section to be appropriately designated and to
 
20 read as follows:
 
21      "21F-     New special, revolving, or trust funds and trust
 
22 accounts.  Within five days after the deadline for the
 

 
 
 
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                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 introduction of bills in each legislative session, the clerks of
 
 2 each house of the legislature shall transmit, to the legislative
 
 3 analyst for analysis, copies of all legislative bills that were
 
 4 introduced in their respective houses during that session that
 
 5 propose to establish new special, revolving, or trust funds or
 
 6 trust accounts.
 
 7      The criteria to be used by the legislative analyst in
 
 8 analyzing each legislative bill shall include, but not be limited
 
 9 to, the extent to which the fund or account:
 
10      (1)  Serves the purpose for which it is being created; and
 
11      (2)  Reflects a clear link between the benefit sought and
 
12           charges made upon the users or beneficiaries of the
 
13           program, as opposed to serving primarily as a means to
 
14           provide the program or users with an automatic means of
 
15           support which is removed from the normal budget and
 
16           appropriations process.
 
17 Each analysis shall set forth the probable effects of the
 
18 proposed fund and shall also assess alternative forms of funding.
 
19      No later than the twenty-second day of each legislative
 
20 session, the legislative analyst shall submit the analysis of
 
21 each transmitted legislative bill to each house of the
 
22 legislature."
 

 
 
 
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 1      SECTION 3.  Section 21F-7, Hawaii Revised Statutes, is
 
 2 amended by amending subsection (a) to read as follows:
 
 3      "(a)  The purpose of the office of the legislative analyst
 
 4 shall be:
 
 5      (1)  To provide the legislature with research and analysis
 
 6           of current and projected state revenues and
 
 7           expenditures;
 
 8      (2)  To provide the legislature with a report analyzing the
 
 9           governor's proposed levels of revenue and expenditures
 
10           for biennial budgets submitted under chapter 37 as well
 
11           as other supplemental budget submittals to the
 
12           legislature by the governor;
 
13      (3)  To provide an analysis of the impact of the governor's
 
14           proposed revenue and expenditure plans for the next
 
15           biennium;
 
16      (4)  To conduct research matters of economic and fiscal
 
17           policy and to report to the legislature on the result
 
18           of the research;
 
19      (5)  To provide economic reports and studies on the state of
 
20           the State's economy, including trends and forecasts for
 
21           consideration by the legislature;
 
22      (6)  To conduct budget and tax studies and provide general
 

 
 
 
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                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1           fiscal and budgetary information; and
 
 2     [(7)  To review and make recommendations on the operation of
 
 3           state programs in order to appraise the implementation
 
 4           of state laws regarding the expenditure of funds and to
 
 5           recommend means of improving their efficiency; and
 
 6      (8)] (7)  To recommend to the legislature changes in the mix
 
 7           of revenue sources for programs, in the percentage of
 
 8           state expenditures devoted to major programs, and in
 
 9           the role of the legislature in overseeing state
 
10           government expenditures and revenue projections."
 
11      SECTION 4.  Section 21F-7, Hawaii Revised Statutes, is
 
12 amended by amending subsection (b) to read as follows:
 
13      "(b)  In performing the duties under subsection (a), the
 
14 legislative analyst shall consider, among other things:
 
15      (1)  The relative dependence on state tax revenues, federal
 
16           funds, and user fees to support state-funded programs,
 
17           and whether the existing mix of revenue sources is
 
18           appropriate, given the purposes of the programs;
 
19      (2)  Focusing on departmental outcomes as measured by
 
20           tangible performance audits;
 
21      (3)  Leveraging resources to stretch public dollars such as
 
22           public-private partnerships and joint state-county
 

 
 
 
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                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1           projects;
 
 2      (4)  Purchasing more services in a cost-effective manner;
 
 3      (5)  Reducing or eliminating unnecessary procedures and red
 
 4           tape to streamline government services, combined with
 
 5           increased flexibility for departments and agencies
 
 6           willing to try new approaches;
 
 7     [(2)] (6)  The relative percentages of state expenditures
 
 8           that are devoted to major programs such as education,
 
 9           assistance to local government, aid to individuals,
 
10           state agencies and institutions, and debt service; and
 
11     [(3)] (7)  The role of the legislature in overseeing state
 
12           government expenditures, including legislative
 
13           appropriation of money from the general fund,
 
14           legislative appropriation of money from funds other
 
15           than the general fund, state agency receipt of money
 
16           into revolving and other dedicated funds and
 
17           expenditure of money from these funds, and state agency
 
18           expenditure of federal funds."
 
19      SECTION 5.  Section 23-11, Hawaii Revised Statutes, is
 
20 repealed.
 
21      ["[23-11]  New special or revolving funds.  Within five
 
22 days after the deadline for the introduction of bills in each
 

 
 
 
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                                     S.B. NO.           S.D. 1
                                                        
                                                        

 
 1 legislative session, the clerks of each house of the legislature
 
 2 shall transmit, to the legislative auditor for analysis, copies
 
 3 of all legislative bills that were introduced in their respective
 
 4 houses during that session that propose to establish new special
 
 5 or revolving funds.
 
 6      The criteria to be used by the auditor in analyzing each
 
 7 legislative bill shall include, but not be limited to, the extent
 
 8 to which the fund:
 
 9      (1)  Serves the purpose for which it is being created; and
 
10      (2)  Reflects a clear link between the benefit sought and
 
11           changes made upon the users or beneficiaries of the
 
12           program, as opposed to serving primarily as a means to
 
13           provide the program or users with an automatic means of
 
14           support which is removed from the normal budget and
 
15           appropriations process.
 
16 Each analysis shall set forth the probable effects of the
 
17 proposed fund and shall also assess alternative forms of funding.
 
18      No later than thirty days prior to the adjournment sine die
 
19 of each legislative session, the legislative auditor shall submit
 
20 the analysis of each transmitted legislative bill to each house
 
21 of the legislature."]
 
22      SECTION 6.  There is appropriated out of the general
 

 
 
 
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 1 revenues of the State of Hawaii the sum of $      , or so much
 
 2 thereof as may be necessary for fiscal year 2000-2001, for
 
 3 studies by the office of the auditor.  The sum appropriated shall
 
 4 be expended by the office of the auditor for the purposes of this
 
 5 Act.
 
 6      SECTION 7.  There is appropriated out of the general
 
 7 revenues of the State of Hawaii the sum of $        , or so much
 
 8 thereof as may be necessary for fiscal year 2000-2001, for the
 
 9 Council of State Government dues.  The sum appropriated shall be
 
10 expended by the legislature for the purposes of this Act.
 
11      SECTION 8.  Statutory material to be repealed is bracketed.
 
12 New statutory material is underscored.
 
13      SECTION 9.  This Act shall take effect on July 1, 2000.