HB 412: State Ethics Commission Package; Lobbying; Transparency; Procurement

A BILL FOR AN ACT

RELATING TO LOBBYING.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  The legislature finds that transparent disclosure of lobbying activities is in the public interest.  Under the state lobbying law, chapter 97, Hawaii Revised Statutes, "lobbying" an administrative agency only regards formal rulemaking or other actions governed by section 91-3, Hawaii Revised Statutes.  Including procurement discussions in the list of actions subject to influence within the statutory definition of "lobbying" promotes government transparency by providing the public with additional information regarding lobbying at the administrative agency level and promoting a level playing field for all businesses.

     Accordingly, the purpose of this Act is to enhance government transparency by:

     (1)  Establishing certain presumptions regarding lobbying on behalf of private clients;

     (2)  Making certain contracts voidable when entered into in violation of the state lobbying law; and

     (3)  Expanding the definition of "lobbying" under the state lobbying law to include certain communications with high-level government officials regarding procurement decisions.

     SECTION 2.  Chapter 97, Hawaii Revised Statutes, is amended by adding two new sections to be appropriately designated and to read as follows:

     "§97-    Presumption of lobbying on behalf of private clients.  Any individual with a substantial ownership interest in or a paid employee, officer, or director of an organization, who actively participates in lobbying activities that directly benefit that organization, shall be presumed to be receiving compensation from the organization for their lobbying efforts.  This presumption shall not include communications made solely for informational purposes, ceremonial interactions, or routine relationship building that do not involve advocacy for or against specific outcomes.

     §97-    Contracts voidable.  In addition to any other penalty provided by law, any contract or other action entered into by the State in violation of this chapter shall be voidable on behalf of the State; provided that in any action to void a contract pursuant to this section, the interests of third parties who may be damaged thereby shall be taken into account; provided further that the action to void the contract shall be initiated no later than sixty days after the determination of a violation under this chapter.  The attorney general, in consultation with the head of the purchasing agency impacted, shall have the authority to enforce this section."

     SECTION 3.  Section 97-1, Hawaii Revised Statutes, is amended by amending the definition of "lobbying" to read as follows:

     ""Lobbying" means communicating directly or through an agent, or soliciting others to communicate, with any official in the legislative or executive branch, for the purpose of attempting to influence legislative or administrative action or a ballot issue.  "Lobbying" includes communicating with any person identified in section 84-17(d) concerning the solicitation or award of a contract by or proposal before an administrative agency or a potential future vendor relationship with an administrative agency if any of the communications are not governed by chapter 103D or 103F.

     "Lobbying" [shall] does not include [the]:

     (1)  Communications about a request for proposals, contract, or vendor relationship if the communications are initiated by a legislator or state employee; or

     (2)  The preparation and submission of a grant application pursuant to chapter 42F by a representative of a nonprofit organization."

     SECTION 4.  This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

     SECTION 5.  If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of the Act that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

     SECTION 6.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 7.  This Act shall take effect on January 1, 2027.

Report Title:

State Ethics Commission Package; Lobbying; Transparency; Procurement

Description:

Establishes certain presumptions regarding lobbying on behalf of private clients.  Makes certain contracts voidable when entered into in violation of the state lobbying law under certain conditions.  Expands the definition of "lobbying" in the state lobbying law to include certain communications with certain government officials regarding procurement decisions.  Effective 1/1/2027.  (SD2)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

A BILL FOR AN ACT

RELATING TO LOBBYING.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  The legislature finds that transparent disclosure of lobbying activities is in the public interest.  Under the state lobbying law, chapter 97, Hawaii Revised Statutes, "lobbying" an administrative agency only regards formal rulemaking or other actions governed by section 91-3, Hawaii Revised Statutes.  Including procurement discussions in the list of actions subject to influence within the statutory definition of "lobbying" promotes government transparency by providing the public with additional information regarding lobbying at the administrative agency level and promoting a level playing field for all businesses.

     Accordingly, the purpose of this Act is to enhance government transparency by:

     (1)  Establishing certain presumptions regarding lobbying on behalf of private clients;

     (2)  Making certain contracts voidable when entered into in violation of the state lobbying law; and

     (3)  Expanding the definition of "lobbying" under the state lobbying law to include certain communications with high-level government officials regarding procurement decisions.

     SECTION 2.  Chapter 97, Hawaii Revised Statutes, is amended by adding two new sections to be appropriately designated and to read as follows:

     "§97-    Presumption of lobbying on behalf of private clients.  Any individual with a substantial ownership interest in or a paid employee, officer, or director of an organization, who actively participates in lobbying activities that directly benefit that organization, shall be presumed to be receiving compensation from the organization for their lobbying efforts.

     §97-    Contracts voidable.  In addition to any other penalty provided by law, any contract or other action entered into by the State in violation of this chapter shall be voidable on behalf of the State; provided that in any action to void a contract pursuant to this section, the interests of third parties who may be damaged thereby shall be taken into account; provided further that the action to void the contract shall be initiated no later than sixty days after the determination of a violation under this chapter.  The attorney general, in consultation with the head of the purchasing agency impacted, shall have the authority to enforce this section."

     SECTION 3.  Section 97-1, Hawaii Revised Statutes, is amended by amending the definition of "lobbying" to read as follows:

     ""Lobbying" means communicating directly or through an agent, or soliciting others to communicate, with any official in the legislative or executive branch, for the purpose of attempting to influence legislative or administrative action or a ballot issue.  "Lobbying" includes communicating with any person identified in section 84-17(d) concerning the solicitation or award of a contract by or proposal before an administrative agency or a potential future vendor relationship with an administrative agency if any of the communications are not governed by chapter 103D or 103F.

     "Lobbying" [shall] does not include [the]:

     (1)  Communications about a request for proposals, contract, or vendor relationship if the communications are initiated by a legislator or state employee; or

     (2)  The preparation and submission of a grant application pursuant to chapter 42F by a representative of a nonprofit organization."

     SECTION 4.  This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

     SECTION 5.  If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of the Act that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

     SECTION 6.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 7.  This Act shall take effect on January 1, 2027.

Report Title:

State Ethics Commission Package; Lobbying; Transparency; Procurement

Description:

Establishes certain presumptions regarding lobbying on behalf of private clients.  Makes certain contracts voidable when entered into in violation of the state lobbying law under certain conditions.  Expands the definition of "lobbying" in the state lobbying law to include certain communications with certain government officials regarding procurement decisions.  Effective 1/1/2027.  (SD1)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

A BILL FOR AN ACT

RELATING TO LOBBYING.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  The legislature finds that transparent disclosure of lobbying activities is in the public interest.  Under the lobbying law, chapter 97, Hawaii Revised Statutes, "lobbying" an administrative agency only regards formal rulemaking or other actions governed by section 91-3, Hawaii Revised Statutes.  Including procurement discussions in the definition of "lobbying" promotes government transparency by providing the public with additional information regarding lobbying at the administrative agency level and promotes a level playing field for all businesses.

     Accordingly, the purpose of this Act is to enhance government transparency by:

     (1)  Establishing certain presumptions regarding lobbying on behalf of private clients;

     (2)  Making certain contracts voidable when entered into in violation of the state lobbying law; and

     (3)  Expanding the definition of "lobbying" in section 97‑1, Hawaii Revised Statutes, to include certain communications with high-level government officials regarding procurement decisions.

     SECTION 2.  Chapter 97, Hawaii Revised Statutes, is amended by adding two new sections to be appropriately designated and to read as follows:

     "§97-     Presumption of lobbying on behalf of private clients.  Any individual with a substantial ownership interest in or a paid employee, officer, or director of an organization who actively participates in lobbying activities that directly benefit that organization shall be presumed to be receiving compensation from the organization for their lobbying efforts.

     §97-     Contracts voidable.  In addition to any other penalty provided by law, any contract or other action entered into by the State in violation of this chapter shall be voidable on behalf of the State; provided that in any action to void a contract pursuant to this section the interests of third parties who may be damaged thereby shall be taken into account, and the action to void the contract is initiated within sixty days after the determination of a violation under this chapter.  The attorney general shall have the authority to enforce this section."

     SECTION 3.  Section 97-1, Hawaii Revised Statutes, is amended by amending the definition of "lobbying" to read as follows:

     ""Lobbying" means communicating directly or through an agent, or soliciting others to communicate, with any official in the legislative or executive branch, for the purpose of attempting to influence legislative or administrative action or a ballot issue.  "Lobbying" includes communicating with any person identified in section 84-17(d) concerning the solicitation or award of a contract or proposal before an administrative agency or a potential future vendor relationship with an administrative agency if any of the communications are not governed by chapter 103D or 103F.  "Lobbying" does not include:

     (1)  Communications about a request for proposals, contract, or vendor relationship if the communications are initiated by a legislator or state employee; or

     ["Lobbying" shall not include the]

     (2)  The preparation and submission of a grant application pursuant to chapter 42F by a representative of a nonprofit organization."

     SECTION 4.  This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

     SECTION 5.  If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of the Act that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

     SECTION 6.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 7.  This Act shall take effect on January 1, 2027.

Report Title:

State Ethics Commission Package; Lobbying; Transparency

Description:

Establishes certain presumptions regarding lobbying on behalf of private clients.  Makes certain contracts voidable when entered into in violation of the state lobbying law.  Expands the definition of "lobbying" in the state lobbying law to include certain communications with high-level government officials regarding procurement decisions.  Effective 1/1/2027.  (HD1)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

A BILL FOR AN ACT

RELATING TO LOBBYING.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  The legislature finds that transparent disclosure of lobbying activities is in the public interest.  Under the lobbying law, chapter 97, Hawaii Revised Statutes, "lobbying" an administrative agency only regards formal rulemaking or other actions governed by section 91-3, Hawaii Revised Statutes.  Including procurement discussions in the definition of "lobbying" promotes government transparency by providing the public with additional information regarding lobbying at the administrative agency level and promotes a level playing field for all businesses.

     Accordingly, the purpose of this Act is to enhance government transparency by:

     (1)  Establishing certain presumptions regarding testimony when provided by a lobbyist;

     (2)  Making certain contracts voidable when entered into in violation of the state lobbying law; and

     (3)  Expanding the definition of "lobbying" in section 97‑1, Hawaii Revised Statutes, to include certain communications with high-level government officials regarding procurement decisions.

     SECTION 2.  Chapter 97, Hawaii Revised Statutes, is amended by adding two new sections to be appropriately designated and to read as follows:

     "§97-     Presumption of lobbying on behalf of private clients.  Any individual with a substantial ownership interest in or a paid employee, officer, or director of an organization, who actively participates in lobbying activities that directly benefit that organization shall be presumed to be receiving compensation from the organization for their lobbying efforts.

     §97-     Contracts voidable.  In addition to any other penalty provided by law, any contract or other action entered into by the State in violation of this chapter is voidable on behalf of the State; provided that in any action to void a contract pursuant to this section the interests of third parties who may be damaged thereby shall be taken into account, and the action to void the contract is initiated within sixty days after the determination of a violation under this chapter.  The attorney general shall have the authority to enforce this section."

     SECTION 3.  Section 97-1, Hawaii Revised Statutes, is amended by amending the definition of "lobbying" to read as follows:

     ""Lobbying" means communicating directly or through an agent, or soliciting others to communicate, with any official in the legislative or executive branch, for the purpose of attempting to influence legislative or administrative action or a ballot issue.  Lobbying also includes communicating with any person identified in section 84-17(d) concerning the solicitation or award of a contract or proposal before an administrative agency or a potential future vendor relationship with an administrative agency if any of the communications are not governed by chapter 103D or 103F.  Communications about a request for proposals, contract, or vendor relationship are not considered lobbying if they are initiated by a legislator or state employee.

     "Lobbying" shall not include the preparation and submission of a grant application pursuant to chapter 42F by a representative of a nonprofit organization."

     SECTION 4.  This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

     SECTION 5.  If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of the Act that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

     SECTION 6.  New statutory material is underscored.

     SECTION 7.  This Act shall take effect on January 1, 2027.

Report Title:

State Ethics Commission Package; Lobbying; Transparency

Description:

Establishes certain presumptions regarding testimony when provided by a lobbyist.  Makes certain contracts voidable when entered into in violation of the state lobbying law.  Expands the definition of "lobbying" in the state lobbying law to include certain communications with high-level government officials regarding procurement decisions.

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

STAND. COM. REP. NO. 1662

Honolulu, Hawaii

RE:    H.B. No. 412

       H.D. 1

       S.D. 2

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Sir:

     Your Committee on Judiciary, to which was referred H.B. No. 412, H.D. 1, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO LOBBYING,"

begs leave to report as follows:

     The purpose and intent of this measure is to:

     (1)  Establish certain presumptions regarding lobbying on behalf of private clients;

     (2)  Make certain contracts voidable when entered into in violation of the state lobbying law under certain conditions; and

     (3)  Expand the definition of "lobbying" in the state lobbying law to include certain communications with certain government officials regarding procurement decisions.

     Your Committee received testimony in support of this measure from the Hawaiʻi State Ethics Commission, Ohana Unity Party, and two individuals.

     Your Committee received testimony in opposition to this measure from the Hawaiʻi Primary Care Association.

     Your Committee finds that transparent disclosure of lobbying activities is in the public interest.  Under existing law, "lobbying" an administrative agency only regards formal rulemaking or other actions governed by section 91-3, Hawaii Revised Statutes, but does not include certain communications in the procurement context.  Your Committee believes that including procurement discussions in the list of actions subject to influence within the statutory definition of "lobbying" will promote government transparency by providing the public with additional information regarding lobbying at an administrative agency level and promoting a level playing field for all businesses.  This measure will enhance transparency and accountability in pre-procurement communications, curb undue influence, and support fairer, more competitive contracting practices that ultimately benefit taxpayers and strengthen public trust.

     Your Committee has amended this measure by clarifying that the presumption of lobbying on behalf of private clients established by this measure does not include communications made solely for informational purposes, ceremonial interactions, or routine relationship building that do not involve advocacy for or against specific outcomes.

     As affirmed by the record of votes of the members of your Committee on Judiciary that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 412, H.D. 1, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 412, H.D. 1, S.D. 2.

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

STAND. COM. REP. NO. 1269

Honolulu, Hawaii

RE:    H.B. No. 412

       H.D. 1

       S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Sir:

     Your Committee on Government Operations, to which was referred H.B. No. 412, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO LOBBYING,"

begs leave to report as follows:

     The purpose and intent of this measure is to:

     (1)  Establish certain presumptions regarding lobbying on behalf of private clients;

     (2)  Make certain contracts voidable when entered into in violation of the state lobbying law under certain conditions; and

     (3)  Expand the definition of "lobbying" in the state lobbying law to include certain communications with certain government officials regarding procurement decisions.

     Your Committee received testimony in support of this measure from the Hawaiʻi State Ethics Commission and State Procurement Office.

     Your Committee received testimony in opposition to this measure from the Hawaiʻi Primary Care Association.

     Your Committee finds that there is a growing national trend to regulate procurement lobbying to ensure fair and ethical conduct.  State procurement practices are strictly regulated due to the large monetary sums and critical infrastructure involved in their execution.  However, the state lobbying law does not currently apply to procurement lobbying, creating a gap in oversight.  This lobbying often occurs in pre-procurement communications and includes efforts to influence procurement decisions through interactions with high-level government officials.  This measure will reduce corruption, waste, and fraud in state procurements by addressing procurement lobbying in the state lobbying law.

     Your Committee has amended this measure by:

     (1)  Inserting language specifying that the Attorney General shall consult with the head of the purchasing agency impacted when enforcing this measure; and

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

     Your Committee notes the concerns expressed by the Hawaii Primary Care Association that this measure is likely to fundamentally change the way social service nonprofit organizations operate and unduly increase their administrative burdens by subjecting communications between their employees and certain government officials to the state lobbying law; necessitating the registration of all employees as lobbyists; and putting the organization's contracts at risk of being voided should the organization be found to be in violation of the newly applicable state lobbying law.  Your Committee finds that these issues raise concerns that merit further consideration and respectfully requests that subsequent Committees to which this measure is referred consider this matter.

     As affirmed by the record of votes of the members of your Committee on Government Operations that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 412, H.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 412, H.D. 1, S.D. 1, and be referred to your Committee on Judiciary.

Respectfully submitted on behalf of the members of the Committee on Government Operations,

STAND. COM. REP. NO.  815

Honolulu, Hawaii

                , 2025

RE:   H.B. No. 412

      H.D. 1

Honorable Nadine K. Nakamura

Speaker, House of Representatives

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Madame:

     Your Committee on Judiciary & Hawaiian Affairs, to which was referred H.B. No. 412 entitled:

"A BILL FOR AN ACT RELATING TO LOBBYING,"

begs leave to report as follows:

     The purpose of this measure is to enhance government transparency by:

     (1)  Establishing certain presumptions regarding lobbying on behalf of private clients;

     (2)  Making certain contracts voidable when entered into in violation of the state lobbying law; and

     (3)  Expanding the definition of "lobbying" in section 97‑1, Hawaii Revised Statutes, to include certain communications with high-level government officials regarding procurement decisions.

     Your Committee received testimony in support of this measure from the Hawaiʻi State Ethics Commission.  Your Committee received comments on this measure from the State Procurement Office and one individual.

     Your Committee finds that the State's definition of "lobbying" is limited and could be expanded to capture certain activities that are not currently covered.  This measure addresses this need and updates regulations on lobbying by establishing certain presumptions regarding lobbying on behalf of clients, making contracts voidable when entered into in violation of lobbying law, and expanding the definition of "lobbying" to include communications with government officials regarding procurement decisions.

     Your Committee has amended this measure by 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 Judiciary & Hawaiian Affairs that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 412, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 412, H.D. 1, and be placed on the calendar for Third Reading.

Respectfully submitted on behalf of the members of the Committee on Judiciary & Hawaiian Affairs,