Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committee on Commerce, Consumer Protection and Housing, to which was referred H.B. No. 2450, H.D. 1, entitled:

begs leave to report as follows:

The purpose of this measure is to encourage the development of affordable housing by waiving the Housing and Community Development Corporation of Hawaii's (HCDCH) three-year buyback provision until December 31, 2004.

Your Committee received testimony in support of this measure from the HCDCH.

Your Committee finds that when the original buyback provision was implemented, it was a tool that was used to prevent speculation and to preserve housing affordability. Our current housing market conditions and weakened economy reduces any opportunity for speculation. By waiving the three-year buyback provision until December 31, 2004, developers of affordable housing projects will be able to compete on a level playing field. By providing an equal market place, more jobs and affordable housing opportunities will emerge.

Your Committee has amended this measure by substituting the contents of S.B. No. 2708, S.D. 1, a substantively similar measure which contains a provision adding that the ten-year buyback requirement is reenacted on December 31, 2004, when the three-year buyback provision waiver ceases, as well as technical, nonsubstantive stylistic differences.

As affirmed by the record of votes of the members of your Committee on Commerce, Consumer Protection and Housing that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 2450, H.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 2450, H.D. 1, S.D. 1, and be referred to the Committee on Ways and Means.