Hawaii House Bill HB2314

Hawaii 2022 Regular Session

• Introduced: 1/26/22
• Refer: 1/28/22

Caption

Relating To Certificates Of Participation.

Impact

The implications of HB 2314 extend to various state agencies involved in financing agreements. By placing a limit on the amount of certificates of participation that can be approved, the bill aims to prevent excessive borrowing that could strain the state’s fiscal resources. This may lead to a more cautious approach in financial management, as agencies will need to prioritize projects within the new financial confines. Local governments may also be impacted, as their ability to finance projects through these certificates will be restricted under the new $10 million threshold.

Summary

House Bill 2314 introduces significant amendments to Section 37D-3 of the Hawaii Revised Statutes, specifically addressing the issuance and approval of certificates of participation by the Director of Finance. The bill establishes a new cap, prohibiting the issuance or approval of any certificate of participation that exceeds $10 million. This change is aimed at enhancing fiscal responsibility and ensuring that financing agreements align with the budgetary constraints of the state.

Contention

Notably, while supporters of the bill argue that it is a necessary measure to ensure disciplined financial governance, critics contend that this cap could hinder local governments and agencies from pursuing essential projects that require larger financing. The debate centers on finding a balance between fiscal responsibility and the need for adequate funding for state projects. Additionally, there may be concerns regarding the administration of the new financing structures and whether they will adequately address the needs of various stakeholders involved in local development projects.