(1) Requires BLNR to accept applications for acquisitions of certain lands; (2) requires legislative approval of acquisition; and (3) provides for lump sum purchase or installment purchase agreement with landowner.

A BILL FOR AN ACT

SECTION 1. Chapter 173A, Hawaii Revised Statutes, is amended by adding a four new sections to be appropriately designated and to read as follows:

"§173A-A Acquisitions by applications to the board; application. (a) Any state agency, county, or nonprofit land conservation organization may submit an application to the board for the acquisition of specific parcels of land, conservation easements, or agricultural easements in land having value as a resource to the State.

(b) The board, from time to time, shall give notice of when applications will be accepted. Notice shall be published at least once in each of three successive weeks statewide, with the last public notice published not less than ten days before the first day that applications are to be accepted. The notice shall contain the following:

(c) The application shall contain:

(d) The board shall review the applications and shall determine those applications qualifying as interests in lands having value as a resource to the State. The board shall prepare a list of applications accepted and rank the applications based on its evaluation of the parcels. The board shall establish a priority for the acquisition of interest in land having value as a resource to the State. The board shall submit its recommendations to the legislature for the acquisition of interests in land having value as a resource to the State and the appropriation of moneys from the fund for the acquisitions.

§173A-B Acquisitions authorized by the legislature. (a) The board, pursuant to section 173A-A, or any other state agency, county, or nonprofit land conservation organization may submit a proposal to the legislature for the acquisition of specific parcels of land, conservation easements, or agricultural easements in land having value as a resource to the State.

(b) All proposals shall be made in the form of a bill and shall contain:

(c) The legislature shall:

§173A-C Acquisitions; payment, grants. (a) If the landowner agrees to the sale of the interest in land having value as a resource to the State and the legislature did not determine whether the purchase would be by lump sum payment or installment purchase agreement, the landowner and the board shall agree upon whether the landowner shall receive payment for the interests in a lump sum or through an installment purchase agreement pursuant to section 173A-D.

(b) The board may make grants to state agencies, counties, and nonprofit land conservation organizations from an appropriation of moneys from the fund as authorized by the legislature.

§173A-D Installment purchase agreements; interest payment. (a) The legislature may authorize the board to establish installment purchase agreements for the acquisition of specific parcels of land, conservation easements, or agricultural easements in land having value as a resource to the State. The agreements shall be structured pursuant to the requirements of the Internal Revenue Code of 1986, as amended, to defer recognition of capital gain until all of the purchase price is paid. The agreement shall include provisions for the periodic payment of a portion of the purchase price with the remainder of the purchase price paid at the end of the term of the agreement. The legislature shall authorize the purchase of United States Treasury zero coupon bonds for the installment purchase agreement with a maturity date equal to the term of the agreement.

(b) The interest rate paid on the installment purchase agreement shall be not less than the interest rate on the zero coupon bonds at the closing of the agreement or eight per cent, whichever is higher.

(c) The board shall make semi-annual interest payments on the outstanding balance of the installment purchase agreement purchase price from the land conservation fund."

SECTION 2. Section 173A-2, Hawaii Revised Statutes, is amended by adding four definitions to be appropriately inserted and to read as follows:

""Agricultural easement" means an interest in real property created by deed, restrictions, covenants, or conditions, the purpose of which is to preserve and protect agricultural lands classified pursuant to chapter 205.

"Matching funds" means:

SECTION 3. Section 173A-4, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) [Subject to the approval of the governor,] When authorized pursuant to section 173A-A, the board may acquire, by purchase, gift, or the exercise of the power of eminent domain, as authorized by chapter 101, any land having value as a resource to the State[.] or any agricultural easement or agricultural lands upon application of a landowner. Such acquisition is hereby declared to be for a public use."

SECTION 4. Section 173A-5, Hawaii Revised Statutes, is amended to read as follows:

"§173A-5 Land conservation fund. (a) A land conservation fund, hereinafter called "fund", is hereby established.

(b) The proceeds from the sale of any general obligation bonds, authorized and issued for purposes of this chapter, shall be deposited in or credited to the fund.

(c) Any net proceeds or revenue from the operation, management, sale, lease, or other disposition of land or the improvements on such land, acquired or constructed by the board under the provisions of this chapter, shall also be deposited in or credited to the fund.

(d) Ten per cent of all taxes imposed and collected by section 247-1 shall be deposited in or credited to the fund every year.

(e) The fund shall be administered and managed by the [department.] board.

(f) The acquisition of interests or rights in land having value as a resource to the State for the preservation of:

constitutes a public purpose for which public funds may be expended or advanced.

(g) The fund shall be used for:

[(h) Based on applications from state agencies, counties, and nonprofit land conservation organizations, the department shall recommend to the board specific parcels of land to be acquired, restricted with conservation easements, or preserved in similar fashion. The board shall review the selections and approve or reject the selections according to the availability of moneys in the fund. To be eligible for grants from the fund, state and county agencies and nonprofit land conservation organizations shall submit applications to the department that contain:

(i) For applications approved by the board, the board may acquire land having value as a resource to the State, pursuant to section 173A-4, or the board may award grants from the fund to the qualifying state or county agencies or nonprofit land conservation organizations for the preservation of the real property. Where the recipient of a grant is a county agency or nonprofit land conservation organization, the board shall require additional matching funds of at least twenty-five per cent of the total project costs. Matching funds may be in the form of:

(j)] (h) The board shall:

SECTION 5. Section 173A-9, Hawaii Revised Statutes, is amended to read as follows:

"§173A-9 Grants to state agencies, counties, and nonprofit land conservation organizations. [Subject to the approval of the governor,] As provided in section 173A-A, the board may make grants to state agencies, counties, and nonprofit land conservation organizations from available funds for the purchase or acquisition of interests or rights in land having value as a resource to the State, whether in fee title or through the purchase of permanent conservation easements under chapter 198, and approved for purchase or acquisition by the board. Any land so acquired by any state agency or county may be sold, leased, or otherwise disposed of, subject to chapter 171, with the prior written approval of the board. Any land acquired by any nonprofit land conservation organization under this chapter may be sold, leased, or otherwise disposed of with the prior written approval of the board. Any permanent conservation easement established under this section that includes partnership with a federal land conservation program may be transferred only as provided by rules of the federal program."

SECTION 6. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 7. This Act shall take effect upon its approval.