REPORT TITLE:
Condos, reserve requirements


DESCRIPTION:
Extends the deadline to comply with the condominium reserve
requirement law until 7/1/2003 for any association of apartment
owners of which 75 per cent or more of the apartment owners vote
to extend the deadline no later than December 31, 1999. 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                            107         
HOUSE OF REPRESENTATIVES                H.B. NO.           
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                             
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                   A  BILL  FOR  AN  ACT

RELATING TO CONDOMINIUMS.



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

 1      SECTION 1.  Section 514A-83.6, Hawaii Revised Statutes, is
 
 2 amended by amending subsection (b) to read as follows:
 
 3      "(b)  The association shall assess the apartment owners to
 
 4 either fund a minimum of fifty per cent of the estimated
 
 5 replacement reserves or fund one hundred per cent of the
 
 6 estimated replacement reserves when using a cash flow plan;
 
 7 provided that a new association created after January 1, 1993,
 
 8 need not collect estimated replacement reserves until the fiscal
 
 9 year which begins after the association's first annual
 
10 meeting[.]; provided further that this requirement shall not
 
11 apply until July 1, 2003, for any association of which seventy-
 
12 five per cent or more of the apartment owners who are occupants
 
13 vote to extend the deadline no later than December 31, 1999.  For
 
14 each fiscal year, the association shall collect the amount
 
15 assessed to fund the estimated replacement for that fiscal year
 
16 reserves, as determined by the association's plan, except:
 
17      (1)  The commission shall adopt rules to permit an existing
 
18           association to fund its estimated replacement reserves
 
19           in increments after January 1, 1993 and prior to
 
20           January 1, 2000; and
 

 
Page 2                                         107         
                                     H.B. NO.           
                                                        
                                                        

 
 1      (2)  The commission shall adopt rules to permit an
 
 2           association to fund in increments, over three years,
 
 3           estimated replacement reserves that have been
 
 4           substantially depleted by an emergency.
 
 5 All assessments collected pursuant to this subsection shall
 
 6 become replacement reserves.  Nothwithstanding any other law to
 
 7 the contrary, any director who violates this subsection shall be
 
 8 held personally liable for breach of fiduciary duty."
 
 9      SECTION 2.  Statutory material to be repealed is bracketed.
 
10 New statutory material is underscored.
 
11      SECTION 3.  This Act shall take effect upon its approval.
 
12 
 
13                           INTRODUCED BY:  _______________________