Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Third State Legislature

Regular Session of 2006

State of Hawaii

Sir:

Your Committees on Consumer Protection & Commerce and Judiciary, to which was referred H.B. No. 1935 entitled:

beg leave to report as follows:

The purpose of this bill is to protect potential purchasers of residences in planned communities by:

The Waikoloa Community Action Group and a concerned citizen supported this bill. A concerned citizen supported this measure with amendments. The Hawaii Association of Realtors and Mililani Town Association opposed this bill.

While in agreement with the intent of this bill to provide protection for prospective buyers of units within a planned community, your Committees believe that the association declaration and documents should be disclosed to prospective buyers at the same time as other material facts about the property. Accordingly, your Committees have included the planned community association declaration and documents in the disclosure statement required by Chapter 508D, Hawaii Revised Statutes (HRS), Mandatory Seller Disclosures in Real Estate Transactions.

Your Committee finds that as amended, the bill provides the prospective purchaser with a right to rescind the sales contract pursuant to section 508D-5, HRS, within 15 days of receiving the disclosure statement.

As affirmed by the records of votes of the members of your Committees on Consumer Protection & Commerce and Judiciary that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 1935, as amended herein, and recommend that it pass Second Reading in the form attached hereto as H.B. No. 1935, H.D. 1, and be placed on the calendar for Third Reading.