HOUSE OF REPRESENTATIVES	H.B. NO.	701
TWENTY-EIGHTH LEGISLATURE, 2015
STATE OF HAWAII

A BILL FOR AN ACT

 

 

relating to the state private investment fund.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 

     SECTION 1.  Through Act 240, Session Laws of Hawaii 1990, the legislature required the auditor to review all special and revolving funds and to recommend whether a fund should be continued, modified, or repealed.  This was in response to concerns raised regarding the proliferation of these funds as a financing mechanism because moneys deposited into and spent from these funds are not subject to the level of legislative scrutiny as those funds contained in the State general fund.

     In 1993, regular reviews of revolving and trust funds administered by the State were required to be conducted by the auditor once every five years by Act 280, Session Laws of Hawaii 1993, which was codified as section 23-12, Hawaii Revised Statutes.

     In 2014, a review of chapter 211G, Hawaii Revised Statutes, was conducted by the auditor.  Chapter 211G, Hawaii Revised Statutes, established the capital formation revolving fund to provide a mechanism for the Hawaii strategic development corporation to mobilize equity capital in order to expand the growth of commerce.  Capital was to be raised by issuing tax credits.  However, tax credits and the borrowing capacity of the program were never enacted through legislation.  As such, the auditor found that the fund had never been opened and no investment program had been activated.  Additionally, the auditor noted that the revolving fund did not serve the purpose for which it was created and did not meet the statutory criteria for a revolving fund.  Accordingly, the recommendation of the auditor was that chapter 211G, Hawaii Revised Statutes, should be repealed as the fund was inactive.

     The purpose of this Act is to adopt the recommendations of the auditor contained in auditor's report number 14-13 and repeal chapter 211G, Hawaii Revised Statutes.

     SECTION 2.  Chapter 211G, Hawaii Revised Statutes, is repealed.

     SECTION 3.  This Act shall take effect upon its approval.

 

INTRODUCED BY:	_____________________________

 

 

Report Title:

State Private Investment Fund; Capital Formation Revolving Fund; Repeal

 

Description:

Repeals Chapter 211G, Hawaii Revised Statutes, which established the Capitol Formation Revolving Fund.

 

 

 

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