STAND. COM. REP. NO. 810

Honolulu, Hawaii

RE: S.B. No. 477

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Second State Legislature

Regular Session of 2023

State of Hawaii

Sir:

Your Committee on Commerce and Consumer Protection, to which was referred S.B. No. 477 entitled:

"A BILL FOR AN ACT RELATING TO THE PUBLIC UTILITIES COMMISSION,"

begs leave to report as follows:

The purpose and intent of this measure is to require the Public Utilities Commission (PUC) to complete its review and issue a decision within nine months from the date that a public utility, other than an investor-owned electric utility company, files its completed application seeking approval for a merger, consolidation, acquisition, or other change of control, and within twelve months from the date of the application for an investor-owned electric utility company.

Your Committee received testimony in support of this measure from Hawaiian Telcom. Your Committee received testimony in opposition to this measure from Life of the Land. Your Committee received comments on this measure from the Department of Commerce and Consumer Affairs and Public Utilities Commission.

Your Committee finds that the telecommunications market in the State is highly competitive both in terms of consumer and business service offerings and workforce talent. There are currently more than two hundred companies authorized by the Public Utilities Commission to provide telecommunications services in the State. Greater certainty on the maximum length of time it takes to process change of control or merger applications would be beneficial to telecommunications companies to minimize loss of customers and employees. This measure requires the PUC to complete its review within nine months for certain public utility applications seeking approval for a merger, consolidation, acquisition or other change of control or within twelve months for investor-owned electric utility companies.

Your Committee acknowledges the concerns raised in testimony that placing a time restriction on the PUC's application review may hamper the PUC's ability to make an informed decision on what could be a complicated merger. Thus, amendments to this measure are necessary to address this concern.

Accordingly, your Committee has amended this measure by:

(1) Clarifying that, rather than completing its review and issuing a decision within the prescribed time period, the PUC shall make every effort to complete its review of applications for merger, consolidation, acquisition, or other change of control, within the prescribed time;

(2) Inserting a provision requiring the PUC to, if a decision is rendered after the relevant nine- or twelve-month period, submit a report to the Legislature in writing, on paper or electronically, detailing the reasons for failing to meet the prescribed time period within thirty days after rendering the decision;

(3) Inserting an effective date of July 1, 2050, to encourage further discussion; and

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

As affirmed by the record of votes of the members of your Committee on Commerce and Consumer Protection that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 477, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 477, S.D. 1, and be placed on the calendar for Third Reading.

Respectfully submitted on behalf of the members of the Committee on Commerce and Consumer Protection,

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JARRETT KEOHOKALOLE, Chair