STAND. COM. REP. NO. 1289

Honolulu, Hawaii

, 2001

RE: H.B. No. 695

H.D. 1

S.D. 1

 

 

Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2001

State of Hawaii

Sir:

Your Committees on Transportation, Military Affairs and Government Operations and Water, Land, Energy and Environment and Economic Development and Technology, to which was referred H.B. No. 695, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO DISPLACED LESSEES,"

beg leave to report as follows:

The purpose of this measure is to designate a portion of the Kapalama Military Reservation as an eligible relocation site and as an industrial park, primarily so that the Produce Center can relocate from Kakaako to Kapalama.

Your Committees received testimony in support of this measure from the Department of Transportation (DOT), the Board of Agriculture, the Board of Land and Natural Resources, and the Hawaii Community Development Authority. The Maritime Committee of the Hawaii Chamber of Commerce submitted testimony in opposition. In addition, ten current lessees at Kapalama appeared at the hearing to oppose this measure.

Your Committees understand that the Produce Center sits on the proposed site for the University of Hawaii Medical School at Kakaako. Your Committees also find that the Produce Center is the primary supplier of fresh produce in the State, and must be located near a sea port since much of its stock is shipped in refrigerated containers. Your Committees believe that it makes sense to relocate the Produce Center to Kapalama.

At the same time, your Committees are concerned about the businesses currently leasing space at Kapalama Military Reservation under revocable month-to-month leases. These small businesses will have their leases terminated by this measure.

This measure's companion, Senate Bill No. 1170, was passed out of your Committees on Transportation, Military Affairs and Government Operations (TMG) and Economic Development and Technology, but did not pass three readings in the Senate. As passed by TMG, the Senate measure required the DOT to use its "best efforts" to relocate Kapalama tenants whose permits will be revoked by this measure.

The House of Representatives apparently was also concerned about the current Kapalama lessees, because the House measure contains a provision that the DOT may waive or reimburse up to three months' rent for the displaced Kapalama lessees. Your Committees note that the House measure authorizes such waiver or reimbursement, but does not legally require either.

At the hearing on this measure, the DOT testified that they have been making a good faith effort to relocate the displaced Kapalama lessees. The DOT produced a letter that had been sent earlier this month to each current Kapalama lessee, urging them to contact the Managing Agent for Kapalama Military Reservation. The Kapalama property manager testified at the hearing that the DOT has sufficient space to relocate each current Kapalama lessee at another site within the reservation.

Your Committees believe that the best solution is to include language requiring the DOT to use its best efforts to relocate the displaced lessees. Therefore, your Committees have amended this measure by replacing its contents with the contents of Senate Bill No. 1170, S.D. 1, as passed by your Committee on TMG. Both measures are substantially the same, except for the manner in which the displaced Kapalama lessees are treated.

Your Committees note that this measure will next be referred to your Committee on Ways and Means (WAM). Based on the concerns raised by the Kapalama tenants at the public hearing, several members of your Committees would like WAM to examine whether it is advisable to give the current Kapalama lessees more time to relocate, up to six months from the effective date of this measure, and longer notice before their permits are terminated, perhaps up to 90 days.

In addition, your Committees believe that during the remainder of this process the DOT or its designated representative should make efforts to communicate more effectively with the Kapalama tenants.

Finally, some Committee members expressed their preference for inclusion of language to require the DOT to waive or reimburse up to six months' rent for the displaced lessees. WAM may want to examine both of these issues further.

As affirmed by the records of votes of the members of your Committees on Transportation, Military Affairs and Government Operations and Water, Land, Energy and Environment and Economic Development and Technology that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 695, H.D. 1, as amended herein, and recommend that it pass Second Reading in the form attached hereto as H.B. No. 695, H.D. 1, S.D. 1, and be referred to the Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committees on Transportation, Military Affairs and Government Operations and Water, Land, Energy and Environment and Economic Development and Technology,

____________________________

LORRAINE R. INOUYE, Chair

____________________________

CAL KAWAMOTO, Chair

____________________________

ROD TAM, Chair