REPORT TITLE:
Harbors Division


DESCRIPTION:
Allows DOT to enter into cost-containment contracts with private
developers for public improvements that cost up to $2,000,000
without legislative approval.  Allows DOT to enter into such
contracts up to $5,000,000 with legislative approval.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        
THE SENATE                              S.B. NO.           2300
TWENTIETH LEGISLATURE, 2000                                
STATE OF HAWAII                                            
                                                             
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                   A  BILL  FOR  AN  ACT

RELATING TO HARBORS. 


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 or
 
 4 improvements.  The legislature further finds that private
 
 5 development would more likely result in projects being completed
 
 6 on time.
 
 7      The purpose of this Act is to allow the department of
 
 8 transportation's harbors division to enter into cost-containment
 
 9 contracts with private developers with a value that does not
 
10 exceed $2,000,000 for public improvements of harbor facilities
 
11 without legislative approval, and cost-containment contracts up
 
12 to $5,000,000 with legislative approval.
 
13      SECTION 2.  Chapter 266, Hawaii Revised Statutes, is amended
 
14 by adding a new section to part I to be appropriately designated
 
15 and to read as follows:
 
16      "�266-    Private financing of harbor improvements.  (a)
 
17 Notwithstanding any law to the contrary, the department of
 
18 transportation may enter into a cost-containment contract with a
 
19 private party for any public improvement to or construction of a
 

 
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 1 state harbor, commercial harbor, roadstead, or other waterfront
 
 2 improvement belonging to or controlled by the State, if the
 
 3 director of transportation determines that a cost-containment
 
 4 contract promotes the best interest of the State by a finding
 
 5 that:
 
 6      (1)  Private development is likely to be less costly than
 
 7           any other type of contract;
 
 8      (2)  Private development provides needed public improvements
 
 9           on a significantly timely basis; or
 
10      (3)  Public financing for public improvements is not
 
11           available on a timely basis.
 
12      (b)  A cost-containment contract under subsection (a) may be
 
13 financed by legislative appropriation to reimburse the private
 
14 party or by credit from the private party's future rental or
 
15 tariff payments to the State; provided that the terms of the
 
16 contract shall ensure that the State benefits financially from
 
17 the arrangement and that public use of the facility is
 
18 maintained.
 
19      (c)  A cost-containment contract under subsection (a) shall
 
20 be subject to the requirements of chapters 103 and 103D and
 
21 subject to the approval of the administrator of the state
 
22 procurement office, established under section 103D-204(a);
 
23 provided that all related transactions shall be subject to state
 

 
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 1 audit.
 
 2      (d)  The department of transportation may execute cost-
 
 3 containment contracts pursuant to subsection (a) with a total
 
 4 contract value of $2,000,000 or less without legislative
 
 5 approval.  If the total value of a cost-containment contract
 
 6 pursuant to subsection (a) exceeds $5,000,000 then the department
 
 7 of transportation shall obtain legislative approval in the form
 
 8 of the adoption of a concurrent resolution affirming the purpose,
 
 9 project, and contract issuance prior to executing the cost-
 
10 containment contract.  For the purposes of this subsection,
 
11 "total value" includes any contract extension, project redesign,
 
12 add-ons, or any other occurrence, act, or material cost that may
 
13 increase the cost of the contracted project."
 
14      SECTION 3.  New statutory material is underscored.
 
15      SECTION 4.  This Act shall take effect upon its approval.
 
16 
 
17                           INTRODUCED BY:  _______________________