HB400.DOC

PART I

SECTION 1. The Hawaii Revised Statutes is amended by adding a new chapter to be appropriately designated and to read as follows:

"Chapter

state investment board

§ -1 Definitions. As used in this chapter:

"Board" means the state investment board.

"Fund" means the state investment special fund.

"Qualified person" means any individual, firm, partnership, corporation, association, cooperative, or other legal entity, governmental body or public agency, or any combination of the foregoing, possessing the competence, expertise, experience, and resources, including financial, personnel, and tangible resources, required for the purposes of managing the board's investments.

"State" means the State of Hawaii.

§ -2 Establishment of state investment board; purpose. (a) There is established the state investment board, which shall be a public body corporate and politic and an instrumentality and agency of the State. The board shall be placed within the department of accounting and general services for administrative purposes only. The purpose of the board shall be to encourage economic development by generating revenue through the investment of public funds. The funds shall be invested with the goal of maximizing long-term return on investment.

(b) The board shall consist of six members, to be appointed by the governor, pursuant to section 26-34, to serve for a term of six years each, one of the terms to expire January 1 of each year.

(c) The members of the board appointed under subsection (b) shall serve without compensation, but may be reimbursed for expenses, including travel expenses, incurred in the performance of their duties.

(d) The board shall elect a chairperson from among its members.

§ -3 Duties of the board. The board shall:

(1) Administer the fund;

(2) Contract with a qualified person to manage investments made with moneys in the fund;

(3) Develop criteria for selecting a qualified person;

(4) Develop investment policy; and

(5) Adopt rules necessary to carry out the purposes of this chapter.

§ -4 State investment special fund. (a) There shall be established the state investment special fund, into which shall be deposited:

(1) Appropriations made by the legislature to the fund;

(2) All interest earned on or accrued to moneys deposited in the fund;

(3) All moneys earned on investments; and

(4) Any other moneys made available to the fund from other sources.

(b) Moneys in the fund shall be expended by the board for the following purposes:

(1) Investments; and

(2) Expenses necessary to carry out the purposes of the board.

(c) Moneys in the fund may be transferred to the general fund by legislative act; provided that moneys deposited into the fund pursuant to subsection (a)(1) may not be transferred, except upon repeal of the fund.

§ -5 Contracts for services necessary for management and operation of board. The board may contract with public or private persons for the provision of all or a portion of the services necessary for the management and operation of the board. The board shall have the power to use all appropriations, grants, contractual reimbursements, and all other funds not appropriated for a designated purpose to pay for the proper general expenses and to carry out the purposes of the board.

§ -6 Limitation on liability. Chapters 661 and 662 or any other law to the contrary notwithstanding, nothing in this chapter shall create an obligation, debt, claim, cause of action, claim for relief, charge, or any other liability of any kind whatsoever in favor of any person or entity, against the State or its officers and employees, without regard to whether that person or entity receives any benefits under this chapter. The State and its officers and employees shall not be liable for the results of any investment made pursuant to this chapter. Nothing in this chapter shall be construed as authorizing any claim against the corporation in excess of any note, loan, or other specific indebtedness incurred by the board or in excess of any insurance policy acquired for the board or its employees.

§ -7 Annual report. The board shall submit a complete and detailed report of the board's activities to the legislature. The report shall be submitted not later than twenty days before the convening of the regular session of 2016, and every year thereafter.

§ -8 Annual audit. The books and records of the board shall be subject to an annual audit by an independent auditor.

§ -9 Construction of chapter. The powers conferred by this chapter shall be in addition and supplemental to other powers conferred by any other law. Insofar as the provisions of this chapter are inconsistent with the provisions of any other law, this chapter shall be controlling."

PART II

SECTION 2. There is appropriated out of the general revenues of the State of Hawaii the sum of $1,000,000 or so much thereof as may be necessary for fiscal year 2015-2016 and the same sum or so much thereof as may be necessary for fiscal year 2016-2017 for deposit into the state investment special fund.

The sums appropriated shall be expended by the state investment board for the purposes of this Act.

PART III

SECTION 3. This Act shall take effect upon its approval; provided that part II shall take effect on July 1, 2015.

INTRODUCED BY:	_____________________________

HOUSE OF REPRESENTATIVES	H.B. NO.	400
TWENTY-EIGHTH LEGISLATURE, 2015
STATE OF HAWAII