STAND. COM. REP. NO. 1431
Honolulu, Hawaii
, 2005
RE: H.B. No. 155
H.D. 1
S.D. 1
Honorable Robert Bunda
President of the Senate
Twenty-Third State Legislature
Regular Session of 2005
State of Hawaii
Sir:
Your Committees on Tourism and Commerce, Consumer Protection, and Housing, to which was referred H.B. No. 155, H.D. 1, entitled:
"A BILL FOR AN ACT RELATING TO TIME SHARING,"
beg leave to report as follows:
The purpose of this measure is to:
(1) Allow the Director of Commerce and Consumer Affairs to accept from a developer of time sharing plans a surety bond, escrow bond, irrevocable letter of credit, or other financial assurance in lieu of maintaining a purchaser's funds in escrow, and the amount thereof;
(2) Exempt from the time share law licensed real estate brokers or salespersons rendering services in the course of the person's practice as a real estate broker or salesperson in the sale of time share interests on behalf of a developer of a time share plan;
(3) Define "master development" and "person" and clarify the definitions of "blanket lien", "developer", and "project" under the time share law; and
(4) Clarify when the developer may release a purchaser's funds in escrow without a closing.
Your Committees received testimony in support of this measure from PMCI Hawaii, Pahio Resorts, Starwood Vacation Ownership, and Carlsmith Ball LLP. The Department of Commerce and Consumer Affairs and the Acting Time Share Administrator submitted comments.
This measure represents an ongoing and continuing effort of the time share industry and the State to improve the time share product. These matters include the accuracy of seller representations, deceptive trade practices, and the sale of time share interests. Your Committees find that time shares are becoming increasingly popular with tourists who prefer to own a vacation unit rather than stay in a hotel. An upright and honest time share industry is part of the quality visitor experience.
Your Committees have amended this measure by:
(1) Deleting the creation of a new section for release of a purchaser's funds pursuant to bond, letter of credit, or other financial assurance;
(2) Clarifying the definition of "person" to make the term more inclusive;
(3) Clarifying the exemption from the definition of "developer" for:
(a) A person who has acquired one or more time share interests, but less than twelve, for the person's own use and occupancy and then resells it;
(b) An association, that is not a developer, that offers for sale through a plan manager or a third party time share interests transferred to the association through specified means; and
(c) A licensed real estate broker who owns time share interests in a time share plan and resells the interests, under specified conditions;
(4) Changing the effective date to upon approval; and
(5) Making technical, nonsubstantive amendments.
As affirmed by the records of votes of the members of your Committees on Tourism and Commerce, Consumer Protection, and Housing that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 155, H.D. 1, as amended herein, and recommend that it pass Second Reading in the form attached hereto as H.B. No. 155, H.D. 1, S.D. 1, and be placed on the calendar for Third Reading.
Respectfully submitted on behalf of the members of the Committees on Tourism and Commerce, Consumer Protection, and Housing,
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____________________________ RON MENOR, Chair |
____________________________ DONNA MERCADO KIM, Chair |
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