CONFERENCE COMMITTEE REPORT NO. 89

                            Honolulu, Hawaii
                                            , 2000

                            RE:   S.B. No. 2021
                                  S.D. 2
                                  H.D. 1
                                  C.D. 1




Honorable Norman Mizuguchi
President of the Senate
Twentieth State Legislature
Regular Session of 2000
State of Hawaii

Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 2000
State of Hawaii

Sir:

     Your Committee on Conference on the disagreeing vote of the
Senate to the amendments proposed by the House of Representatives
in S.B. No. 2021, S.D. 2, H.D. 1, entitled:  

     "A BILL FOR AN ACT RELATING TO HOUSING," 

having met, and after full and free discussion, has agreed to
recommend and does recommend to the respective Houses the final
passage of this bill in an amended form.

     The purpose of this measure is to provide low-income tenants
who live in housing projects subsidized under the United States
Department of Housing and Urban Development (HUD) Section 8
program (Section 8) with some assurance that affordable housing
will continue to be available.

     This measure:

     (1)  Requires Section 8 housing owners to provide the
          Housing and Community Development Corporation of Hawaii
          (HCDCH) with all HUD documents relating to the owner's

 
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          intention to opt out of the Section 8 contract, as well
          as pertinent project and market information;

     (2)  Requires the HCDCH to collaborate with HUD to preserve
          the affordability of the project by:

          (A)  Providing the owner and interested entities with
               information on government-assisted financing
               programs;

          (B)  Providing the owner with a list of local,
               regional, or national organizations interested in
               purchasing the project; and

          (C)  Encouraging the owner to provide the tenant
               association with an opportunity to purchase the
               project;

     (3)  Requires that entities receiving state assistance be
          capable of managing the project by itself or through a
          management agent and agree to obligate itself and any
          successors in interest to maintain the affordability of
          the project for low, very low, or moderate income level
          persons; and

     (4)  Prohibits entities receiving state assistance from
          having any officer with a financial interest in
          assisted housing projects that have terminated a
          subsidy contract or prepaid mortgage on the
          development.

     Upon further consideration, your Committee notes that the
purpose of this measure is to also encourage the HCDCH to devote
its efforts primarily to the preservation of existing government
subsidized rental housing and secondarily to the funding of
rental housing projects by nonprofit organizations and has
amended this measure by:

     (1)  Limiting the definition of "owner" to one who holds
          title to an assisted housing development;

     (2)  Authorizing or requiring the HCDCH to:

          (A)  Issue a "threat of condemnation";

          (B)  Communicate with HUD to maintain Section 8
               subsidies;


 
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          (C)  Use its staff and resources to form a tenant
               association and assist the association in applying
               for non-profit status;

          (D)  Conduct appraisals on properties targeted for
               purchase; and

          (E)  Issue multi-family housing bonds and make a
               corresponding appropriation to purchase target
               properties and perform necessary renovations;

     (3)  Providing that tenant associations and local nonprofit
          organizations, and public agencies should first be
          considered as potential project purchasers; and

     (4)  Providing that purchasing entities or successors in
          interest shall be obligated to maintain the
          affordability of the project for a minimum of thirty
          years from the date of possession.

     As affirmed by the record of votes of the managers of your
Committee on Conference that is attached to this report, your
Committee on Conference is in accord with the intent and purpose
of S.B. No. 2021, S.D. 2, H.D. 1, as amended herein, and
recommends that it pass Final Reading in the form attached hereto
as S.B. No. 2021, S.D. 2, H.D. 1, C.D. 1.

                                   Respectfully submitted on
                                   behalf of the managers:

  ON THE PART OF THE HOUSE           ON THE PART OF THE SENATE




_____________________________     _______________________________
Rep. DENNIS A. ARAKAKI            Sen. ROD TAM
Co-Chair                          Co-Chair



_____________________________     _______________________________
Rep. MICHAEL PUAMAMO KAHIKINA     Sen. JONATHAN CHUN
Co-Chair                          Co-Chair

 
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