STAND. COM. REP. NO. 471

Honolulu, Hawaii

, 2021

RE: H.B. No. 611

H.D. 1

Honorable Scott K. Saiki

Speaker, House of Representatives

Thirty-First State Legislature

Regular Session of 2021

State of Hawaii

Sir:

Your Committee on Education, to which was referred H.B. No. 611 entitled:

"A BILL FOR AN ACT RELATING TO EDUCATION FUNDING,"

begs leave to report as follows:

The purpose of this measure is to:

(1) Establish maintenance of effort provisions for free education in the State;

(2) Establish a Public Education Stabilization Trust Fund; and

(3) Appropriate funds for the maintenance of effort for K-12 educational programs.

Your Committee received testimony in support of this measure from the Department of Education, State Public Charter School Commission, and one individual. Your Committee received testimony in support of the intent of this measure from the Hawaii State Teachers Association, Kamehameha Schools, and Democratic Party of Hawaii Education Caucus. Your Committee received comments on this measure from the Department of Budget and Finance, Tax Foundation of Hawaii, and Hui for Excellence in Education.

Your Committee finds that a vibrant K-12 public education system enables the fulfillment of educational goals and aspirations far beyond a student's successful completion of secondary education requirements. Your Committee further finds that to promote predictability and stability of K-12 education revenues, a commitment to a base of annual funding in the face of changing circumstances is needed to ensure the continuous and uninterrupted equitable distribution of educational resources for all public school students.

Your Committee has amended this measure by:

(1) Clarifying the procedure to remit general exercise tax revenues to the Public Education Stabilization Trust Fund, stating that if appropriations to the Department of Education for the current fiscal year are less than the preceding fiscal year, the sum from all general excise tax revenues realized by the State that represents the difference between the preceding fiscal year appropriation and the current fiscal year appropriation shall be deposited to the credit of the Trust Fund;

(2) Requiring Board of Education approval of all expenditures made from the Public Education Stabilization Fund;

(3) Changing its effective date to July 1, 2050; and

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

As affirmed by the record of votes of the members of your Committee on Education that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 611, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 611, H.D. 1, and be referred to your Committee on Finance.

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

____________________________

JUSTIN H. WOODSON, Chair