STAND. COM. REP. NO. 510________

                                 Honolulu, Hawaii
                                                   , 1999

                                 RE: H.B. No. 706
                                     H.D. 2




Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 1999
State of Hawaii

Sir:

     Your Committee on Judiciary and Hawaiian Affairs, to which
was referred H.B. No. 706, H.D. 1, entitled: 

     "A BILL FOR AN ACT RELATING TO HOMESTEAD LEASES,"

begs leave to report as follows:

     The purpose of this bill is to suspend the succession
provision of homestead leases under a mortgage, for the duration
of the loan.

     Testimony in support of this bill was received from the
Board of Land and Natural Resources.  Additional comments were
submitted by the Office of Hawaiian Affairs.

     Your Committee finds that many homestead lessees encounter
difficulty securing loans to fund improvements to their land.
Financial institutions are unwilling to lend lessees on homestead
land because the applicants do not own the land and the
succession provision prevents the land from being used as
security for the loan.

     Your Committee has amended this bill by making technical and
non-substantive changes for the purposes of style and clarity.

     As affirmed by the record of votes of the members of your
Committee on Judiciary and Hawaiian Affairs that is attached to
this report, your Committee is in accord with the intent and
purpose of H.B. No. 706, H.D. 1, as amended herein, and

 
 
 
                                 STAND. COM. REP. NO. 510________
                                 Page 2

 
recommends that it be referred to the Committee on Finance, in
the form attached hereto as H.B. No. 706, H.D. 2.

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



                                   ______________________________
                                   PAUL T. OSHIRO, Chair