Report Title:
Special Purpose Revenue Bond; Hawaiian Sugar & Transportation Cooperative
Description:
Authorizes $2,300,000 for purchase of a sugar and molasses terminal facility at Nawiliwili, Kauai. (SD1)
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HOUSE OF REPRESENTATIVES |
H.B. NO. |
1976 |
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TWENTY-FIRST LEGISLATURE, 2002 |
S.D. 1 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
relating to the issuance of special purpose revenue bonds to assist INDUSTRIAL enterprises.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The legislature finds that the sugar and molasses terminal facility at Nawiliwili on the island of Kauai was constructed around 1950, and prior to 1994, provided receiving, storing, and shipping services for both sugar and molasses for all five producers on the island. With the demise of four of these operations by the year 2000, Gay & Robinson, Inc., the remaining producer on Kauai, by necessity acquired the terminal facility in the year 2001 from Amfac in order to preserve the facility as an operating entity. Gay & Robinson, Inc., is committed to the sugar industry and is increasing its investment by farming an additional 4,300 acres of state-owned lands formerly leased to Kekaha Sugar. The company has hired forty additional employees and will hire more when the entire 4,300 acres are fully cultivated. Gay & Robinson, Inc., now employs over 300 full-time employees and provides subsidized housing for 350 current and retired employees. By remaining in business and hiring people during these depressed times, the company is contributing significantly to the economy of the island of Kauai and the State. However, it is financially imperative that Gay and Robinson, Inc., sell the terminal facility to an owner that will maintain the operations as a sugar and molasses terminal facility.
Hawaiian Sugar & Transportation Cooperative (HS&TC) is a nonprofit marketing and transportation cooperative, incorporated in Hawaii in 1981, whose purpose is to market and transport sugar to the U.S. mainland and other markets. HS&TC has agreed to purchase the terminal facility from Gay and Robinson, Inc., with a lease back provision. Issuance of special purpose revenue bonds to assist HS&TC in purchasing the facility will greatly support Gay and Robinson, Inc.'s, long-term plans for increased productivity and financial stability. Furthermore, HS&TC's purchase of this terminal facility will help ensure the financial stability of HS&TC and Hawaii's remaining sugar producers because HS&TC is the owner of the bulk cargo vessel, the Moku Pahu, and the greater the volume of sugar to be transported to the U.S. mainland, the lower the unit costs of operating the vessel. This also results in lower shipping costs to the sugar producers.
The legislature finds and declares that the issuance of special purpose revenue bonds under this Act is in the public interest and for the public health, safety, and general welfare.
SECTION 2. Pursuant to part V, chapter 39A, Hawaii Revised Statutes, the department of budget and finance, with the approval of the governor, is authorized to issue special purpose revenue bonds in a total amount not to exceed $2,300,000, in one or more series, for the purpose of assisting Hawaiian Sugar & Transportation Cooperative, a nonprofit marketing and transportation cooperative, for purchase of the sugar and molasses terminal facility at Nawiliwili on the island of Kauai. The legislature hereby finds and determines that the sugar and molasses terminal facility at Nawiliwili constitutes a project as defined in part V, chapter 39A, Hawaii Revised Statutes, and the financing thereof is assistance to an industrial enterprise.
SECTION 3. The special purpose revenue bonds and the refunding special purpose revenue bonds issued under this Act shall be issued pursuant to part V, chapter 39A, Hawaii Revised Statutes, relating to the power to issue special purpose revenue bonds to assist industrial enterprises.
SECTION 4. The department of budget and finance is authorized, from time to time, including times subsequent to June 30, 2005, to issue special purpose revenue bonds in whatever principal amounts the department shall determine to be necessary to refund the special purpose revenue bonds authorized in section 2 and to refund special purpose revenue bonds authorized in this section, regardless of whether the outstanding special purpose revenue bonds or refunding special purpose revenue bonds have matured or are the subject of redemption or whether the refunding special purpose revenue bonds shall be bonds for the program described in section 2. In making this determination, the department shall comply with federal law relating to the exemption from federal income taxation of the interest on bonds of the nature authorized by this section.
SECTION 5. The authorization to issue special purpose revenue bonds under this Act shall lapse on June 30, 2005.
SECTION 6. This Act shall take effect upon its approval.