STAND. COM. REP. 60

Honolulu, Hawaii

, 2003

RE: H.B. No. 225

H.D. 1

 

 

 

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committee on Tourism and Culture, to which was referred H.B. No. 225 entitled:

"A BILL FOR AN ACT RELATING TO THE HAWAII TOURISM AUTHORITY,"

begs leave to report as follows:

The purpose of this bill is to enhance operational efficiency and flexibility and improve accountability for the Hawaii Tourism Authority (HTA) by:

(1) Exempting HTA from the provisions of chapter 38, Hawaii Revised Statutes (HRS), relating to deposits of public funds, and chapter 40, HRS, relating to audits and accounting;

(2) Requiring HTA to deposit funds in the Convention Center Enterprise Special Fund (CCESP) into interest-bearing accounts in any depository within the State;

(3) Establishing that disbursements from the CCESP and the Tourism Special Fund (TSF) shall be drawn upon checks prepared and signed as approved by the Executive Director, or the Executive Director's designee and another person authorized by HTA's Board of Directors;

(4) Increasing the percentage of the TSF moneys that may be used for administrative expenses to ten percent;

(5) Depositing all interest and any revenues or receipts derived by HTA from any project or project agreement into the TSF; and

(6) Requiring HTA to engage the services of a certified public accountant to conduct an annual audit of HTA's financial affairs, and to submit the audit report to the Legislature prior to each Regular Session.

HTA and the Waikiki Improvement Association supported this measure. The Department of Budget and Finance opposed this bill.

Your Committee notes that this measure will provide HTA additional flexibility in managing its operations, while at the same time improving accountability through the financial audit provisions. However, your Committee recognizes that some concerns exist regarding the increase in percentage of TSF moneys allowable for administrative expenses contained in this bill. Concerns centered on the large amount of the increase, from the current 3.5 percent to the proposed 10 percent, as well as the lack of specific details on how the additional administrative funds would be used should this bill be enacted into law. Your Committee urges HTA to provide a more detailed presentation of how additional administrative funds would be spent as this bill makes its way through the legislative process.

In light of these concerns, your Committee has amended this measure by reducing the percentage of TSF moneys allowable for administrative expenses to five percent. In addition, technical, nonsubstantive amendments were made for purposes of style and clarity.

As affirmed by the record of votes of the members of your Committee on Tourism and Culture that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 225, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 225, H.D. 1, and be referred to the Committee on Finance.

Respectfully submitted on behalf of the members of the Committee on Tourism and Culture,

 

____________________________

JERRY L. CHANG, Chair