Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2001

State of Hawaii

Sir:

Your Committee on Economic Development and Technology to which was referred S.B. No. 845 entitled:

begs leave to report as follows:

The purpose of this measure is to establish a fair market value standard (FMVS) for appraising the leased fee interest of condominium and co-operative housing corporations for leases that do not specify an appraisal standard and for leases on or after the effective date of this measure.

Your Committee received testimony opposing this measure from the Hawaii Chapter of the Appraisal Institute and an individual.

Your Committee finds that there is no standardized system for evaluating the fair market value of lease-to-fee property which can be a deterrent to potential lessee-buyers and lessor-sellers.

Your Committee amended this measure to require that sellers disclose county tax assessments of the property to the buyer. The purpose of this amendment is to provide potential buyers of lease-to-fee property a complete financial picture of the property.

As affirmed by the record of votes of the members of your Committee on Economic Development and Technology that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 845, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 845, S.D. 1, and be referred to the Committee on Commerce, Consumer Protection and Housing.