CONFERENCE COMMITTEE REP

CONFERENCE COMMITTEE REP. NO. 28

Honolulu, Hawaii

, 2005

RE: S.B. No. 1798

H.D. 1

C.D. 1

Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Third State Legislature

Regular Session of 2005

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. 1798, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO NONPROFIT CORPORATIONS,"

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 exempt associations of apartment owners (AOAOs) from the nonprofit corporation laws governing cumulative voting to elect board directors and voting to remove a director.

This measure clarifies the scope of the Hawaii Nonprofit Corporations Act (Act), codified in chapter 414D, Hawaii Revised Statutes (HRS), by providing that the Act's provisions relating to cumulative voting to elect board directors and voting to remove a director do not apply to AOAOs organized under the laws governing condominium property regimes.

Your Committee on Conference has amended this measure by replacing its contents with language that amends chapter 514A, HRS, and corresponding provisions in Act 164, Session Laws of Hawaii 2004. As amended, this measure:

(1) Clarifies that the removal and replacement of a member of an AOAO's board of directors require a vote of a majority of apartment or unit owners;

(2) Authorizes cumulative voting if permitted under the bylaws and if an owner gives notice of the owner's intent to so vote before voting commences; and

(3) Takes effect upon its approval and upon the effective date of section 2 of Act 164, Session Laws of Hawaii 2004, rather than on July 1, 2099.

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. 1798, H.D. 1, as amended herein, and recommends that it pass Final Reading in the form attached hereto as S.B. No. 1798, 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

____________________________ Kenneth Hiraki, Chair		____________________________ Ron Menor, Chair