STAND. COM. REP. NO. 2788

Honolulu, Hawaii

RE: S.B. No. 3230

S.D. 2

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2026

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred S.B. No. 3230, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO PROCUREMENT,"

begs leave to report as follows:

The purpose and intent of this measure is to increase the effectiveness of public procurement in the State.

Specifically, this measure:

(1) Authorizes governmental bodies and public employees to procure project management services through non-governmental third-party contracts under certain conditions;

(2) Requires every budget transfer to receive prior written certification from an appropriate fiscal officer as to the effect the budget transfer will have on the total project budget or the total contract budget; and

(3) Appropriates moneys to establish a Special Project Branch within the Public Works Division of the Department of Accounting and General Services to provide specialized expertise and staff resources to support certain complex, high-profile capital improvement program projects.

Your Committee received written comments in support of this measure from the Department of Accounting and General Services.

Your Committee received written comments in opposition to this measure from the Chamber of Commerce Hawaii.

Your Committee received written comments on this measure from the Department of Education and State Procurement Office.

Your Committee finds that certain agencies procure external consultants to provide project management services that agency staff are unable to provide due to limited staffing or lack of highly specialized technical skills, experience, or knowledge. Your Committee further finds that these external consultants assist agencies to deliver projects in a timely and efficient manner.

Your Committee has amended this measure by:

(1) Clarifying that all governmental agencies, rather than only state agencies, retain ultimate and final authority and accountability for project management, as suggested in written comments from the State Procurement Office; and

(2) Changing the appropriation amount to an unspecified amount to facilitate further discussion on the measure.

As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 3230, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 3230, S.D. 2.

Respectfully submitted on behalf of the members of the Committee on Ways and Means,

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DONOVAN M. DELA CRUZ, Chair