STAND. COM. REP. 610
Honolulu, Hawaii
, 2003
RE: H.B. No. 1339
H.D. 1
Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twenty-Second State Legislature
Regular Session of 2003
State of Hawaii
Sir:
Your Committee on Consumer Protection and Commerce, to which was referred H.B. No. 1339 entitled:
"A BILL FOR AN ACT RELATING TO CONDOMINIUM PROPERTY REGIMES,"
begs leave to report as follows:
The purpose of this bill is to:
(1) Extend from December 31, 2003, to December 31, 2004, the sunset date of Act 39, Session Laws of Hawaii 2000 (Act 39), which allows a condominium association to, under certain circumstances, make a special assessment for delinquent common expenses against persons who purchase the delinquent apartment at foreclosure; and
(2) Allow a "subsequent purchaser" to receive, at no charge from the association, notice of the association’s intent to claim a lien for unpaid common expenses. This replaces the requirement that the association file a notice of lien against an apartment for delinquent common expenses before the apartment is purchased by a subsequent purchaser and before the association may charge those expenses to the subsequent purchaser, who is a person who acquires title from someone who purchased the delinquent apartment through foreclosure.
Mortgage Bankers Association of Hawaii testified in support of this bill. Testimony in support of this bill with a suggested amendment was submitted by Hawaii Council of Associations of Apartment Owners, Community Associations Institute, Hawaii Independent Condominium and Cooperative Owners, Yacht Harbor Towers, Hawaii Financial Services Association, Hawaii Bankers Association, and Makakilo Hale I.
Your Committee finds that the AOAO and mortgage lenders have made progress in resolving disputes regarding recovery of delinquent maintenance fees left outstanding due to foreclosure of the delinquent unit. Resolution began with the passing of Act 39, which allowed a condominium association to collect up to six months of maintenance fees up to a maximum of $1800, in the foreclosure of an apartment.
Your Committee believes that elimination of the requirement to record the notice of lien, which was contained in Act 39, and instead require only a notice of assessments owed, will save time and expense in the filing and releasing of a recorded lien.
Finally, your Committee has amended this bill to extend the sunset date of Act 39 to 2007. As received, this bill extended the date to December 31, 2004. However, the consensus of most of those who testified in support of this measure was that the sunset date should be extended, instead, to December 31, 2007. Given the current economy and the fact that attempts to collect delinquent maintenance fees under the Act have not been regularly resulting in the recovery of these fees, your Committee believes extension of the date to the year 2007 is reasonable.
As affirmed by the record of votes of the members of your Committee on Consumer Protection and Commerce that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1339, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1339, H.D. 1, and be placed on the calendar for Third Reading.
Respectfully submitted on behalf of the members of the Committee on Consumer Protection and Commerce,
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____________________________ KENNETH T. HIRAKI, Chair |
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