STAND. COM. REP. NO. 3127

                                   Honolulu, Hawaii
                                                     , 2000

                                   RE:  S.C.R. No. 67
                                        




Honorable Norman Mizuguchi
President of the Senate
Twentieth State Legislature
Regular Session of 2000
State of Hawaii

Sir:

     Your Committee on Economic Development, to which was
referred S.C.R. No. 67 entitled:

     "SENATE CONCURRENT RESOLUTION REQUESTING THE DEPARTMENT OF
     BUSINESS, ECONOMIC DEVELOPMENT, AND TOURISM TO EXAMINE THE
     CAPITAL ACCESS PROGRAMS DEVELOPED IN OTHER STATES AND TO
     RECOMMEND TO THE LEGISLATURE WHETHER HAWAII SHOULD IMPLEMENT
     A SIMILAR PROGRAM,"

begs leave to report as follows:

     The purpose of this measure is to request the Department of
Business, Economic Development, and Tourism to study the Capital
Access Programs developed in other states and recommend whether
Hawaii should consider implementing a similar program.

     Testimony in support of the measure was received from the
Department of Business, Economic Development, and Tourism.

     Your Committee finds that the Capital Access Program (CAP)
is an alternative bank lending approach approved by the U.S.
Treasury and local banking regulators.  It allows a state agency
to match deposits made by a lender and a borrower and to place
them in a special bank loan reserve fund.  In this way, the CAP
acts like a loan guarantee that is less complicated for the
lender and the state agency and also costs less.

     Your Committee agrees that the CAP could provide a simple,
low-cost alternative to leverage funds for debt financing of
small business.

 
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                                   STAND. COM. REP. NO. 3127
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     As affirmed by the record of votes of the members of your
Committee on Economic Development that is attached to this
report, your Committee concurs with the intent and purpose of
S.C.R. No. 67, and recommends that it be referred to the
Committee on Ways and Means.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Economic
                                   Development,



                                   ______________________________
                                   LORRAINE R. INOUYE, Chair

 
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