STAND. COM. REP. NO. 1263

Honolulu, Hawaii

, 2005

RE: H.B. No. 1303

H.D. 2

S.D. 1

 

 

Honorable Robert Bunda

President of the Senate

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Commerce, Consumer Protection, and Housing, to which was referred H.B. No. 1303, H.D. 2, entitled:

"A BILL FOR AN ACT RELATING TO HOUSING,"

begs leave to report as follows:

The purpose of this measure is to implement recommendations proposed by the Affordable Housing Task Force and other strategies to improve the affordable housing situation in the State.

Testimony in support of this measure was received from the following: Senior Policy Advisor to the Governor, Housing and Community Development Corporation of Hawaii (HCDCH), Department of Community Services and Department of Planning and Permitting of the City and County of Honolulu, Vice Chair of the Maui County Council, Land Use Research Foundation, Institute for Human Services, Maui Land and Pineapple Company, Inc., Hawaii Catholic Conference, Catholic Charities Hawaii, Affordable Housing and Homeless Alliance, Hawaii Coalition of Christian Churches, The Nature Conservancy of Hawaii, Partners in Care, Kaanapali Development Corp., Blueprint for Change, Hawaii Community Reinvestment Corporation, and two individuals.

The Office of Housing and Community Development of the County of Hawaii, Cendant Timeshare Resort Group, Inc., Fairfield Resorts, Inc., and Hawaii Association of Realtors opposed the measure. Comments were presented by UniDev, LLC, Life of the Land, Pier Management Hawaii, LLC, and two individuals.

This measure incorporates and implements various strategies to provide more affordable housing in the State, including those developed by the Affordable Housing Task Force established under S.C.R. No. 135, S.D. 1 (2004). Among other things, this measure establishes tax incentives, provides the counties with greater flexibility with respect to land use restrictions, provides additional funding for rental housing development, establishes a moratorium on the demolition of decommissioned housing projects, and requires annual audits of housing provider agencies.

Your Committee has amended this measure by replacing its language with the contents of a modified version of S.B. No. 798, S.D. 1, S.B. No. 1844, S.D. 1, S.B. 1852, S.D. 2, and S.B. 1805, S.D. 1. As amended, this measure:

(1) Prohibits the raiding of housing special funds;

(2) Establishes a general excise tax exemption for proceeds received in connection with the development of affordable housing projects;

(3) Dedicates twenty-five per cent of general excise taxes imposed on residential rentals to the Rental Housing Trust Fund (RHTF) and establishes a conveyance tax rate schedule;

(4) Requires the membership of the HCDCH Board of Directors to include a representative of the continuum of care systems;

(5) Establishes deadlines for the repair of vacant public housing and the construction of new public housing;

(6) Exempts from Land Use Commission approval affordable housing projects of fifty acres or less;

(7) Changes the standard for an affordable housing project from one that requires the project to be primarily designed for lower income persons to one that requires the project to provide a certain percentage of lower income housing units;

(8) Permits the Dwelling Unit Revolving Fund to be used for permanent financing, in addition to interim financing;

(9) Repeals specific numerical requirements for RHTF projects relating to the minimum amount of units that must be provided for households within certain income groups;

    (10) Permits nonprofit entities to qualify for RHTF loans;

    (11) Allows use of RHTF financing for mixed finance public housing developments;

    (12) Increases the RHTF's share of conveyance taxes from twenty-five per cent to fifty per cent;

    (13) Abolishes the RHTF Advisory Commission to avoid duplication in the review process for housing development applications;

    (14) Authorizes the issuance of general obligation bonds for the renovation, repair, and construction of low-income housing units;

    (15) Requires HCDCH to convene a committee to consider the bifurcation of the agency into separate public housing and housing finance and development entities, and appropriates funds for the committee; and

    (16) Takes effect on July 1, 2050 to facilitate the continued discussion of affordable housing issues.

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. 1303, H.D. 2, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1303, H.D. 2, S.D. 1, and be referred to the Committee on Ways and Means.

 

Respectfully submitted on behalf of the members of the Committee on Commerce, Consumer Protection, and Housing,

____________________________

RON MENOR, Chair