STAND. COM. REP. 437

Honolulu, Hawaii

, 2003

RE: H.B. No. 391

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 Labor and Public Employment, to which was referred H.B. No. 391 entitled:

"A BILL FOR AN ACT RELATING TO COLLECTIVE BARGAINING,"

begs leave to report as follows:

The purpose of this bill is to:

(1) Delay from July 1, 2003, to July 1, 2004, the transfer of civil service employees from the Public Employees Health Fund (PEHF) to the Hawaii Employer-Union Health Benefits Trust Fund (EUTF); and

(2) Delay from July 1, 2004, to July 1, 2005, the implementation of statutorily set and automatically computed amounts for employer contributions to the EUTF.

The Royal State Corporation, Mutual Benefit Association of Hawaii, HGEA-AFSCME Local 152, Hawaii State Teachers Association, and Voluntary Employees' Benefit Association of Hawaii testified in support of this measure. The Department of Budget and Finance testified in opposition to this measure.

Act 88, Session Laws of Hawaii 2001, created EUTF as a means of addressing escalating health benefit costs. EUTF was to begin operations on July 1, 2003. However, various circumstances have resulted in delays, seriously jeopardizing the implementation of EUTF. If the EUTF Board of Trustees are not able to administer health benefits at the time PEHF is repealed, approximately 177,000 government employees and their dependents could lose their health care coverage. This would pose a significant danger to the health and welfare of the State.

Your Committee has some concerns regarding the calculation of the base monthly contributions for retirees as well as the emergency appropriation this delay in transfer will require. Accordingly, your Committee has amended this measure by:

(1) Making the effective dates relating to the base monthly contributions for retirees retroactive to July 1, 2001, and July 1, 2002, to allow for the base monthly contributions to be sufficiently adjusted so that retiree health benefits can be maintained at present levels when EUTF becomes effective on July 1, 2004;

(2) Amending language relating to the calculation of the base monthly contributions so that proper adjustments can be made to the base monthly contributions of retirees;

(3) Inserting a blank appropriation to be expended by PEHF to cover the unanticipated and unbudgeted PEHF payments resulting from the extension of PEHF; and

(4) Making technical, nonsubstantive amendments for purposes of clarity, conformity, and style.

As affirmed by the record of votes of the members of your Committee on Labor and Public Employment that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 391, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 391, H.D. 1, and be referred to the Committee on Finance.

Respectfully submitted on behalf of the members of the Committee on Labor and Public Employment,

 

____________________________

MARCUS R. OSHIRO, Chair