STAND. COM. REP. NO. 372-04

Honolulu, Hawaii

, 2004

RE: H.B. No. 2399

H.D. 1

 

 

 

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Sir:

Your Committee on Judiciary, to which was referred H.B. No. 2399 entitled:

"A BILL FOR AN ACT PROPOSING AMENDMENTS TO ARTICLE VII OF THE CONSTITUTION OF THE STATE OF HAWAII,"

begs leave to report as follows:

The purpose of this bill is to amend the State Constitution to allow the State and counties to issue general obligation refunding bonds with nonlevel principal or debt service payments to refund general obligation bonds and reimbursable general obligation bonds.

The Department of Budget and Finance testified in support of this bill.

Concerns were raised that this measure might allow for abuse, depending on the course taken by the financial director in charge. For example, there were concerns that the extended timeframes and unequal installments allowed under this measure could be used for purposes other than sound fiscal planning, such as creating a falsely-optimistic impression of a given fiscal situation.

Your Committee finds that because the constitutional authority to issue bonds is granted solely to the State, it is not proper to refer to the counties in the proposed amendment.

Your Committee has amended this measure by:

(1) Removing the authority of the counties and political entities other than the State to issue refunding general obligation bonds under this proposal; and

(2) Making technical, nonsubstantive changes for style and clarity.

As affirmed by the record of votes of the members of your Committee on Judiciary that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2399, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 2399, H.D. 1, and be referred to the Committee on Finance.

Respectfully submitted on behalf of the members of the Committee on Judiciary,

 

____________________________

ERIC G. HAMAKAWA, Chair