HB2904 HD1

SECTION 1. Chapter 201H, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§201H- Infrastructure development revolving fund. (a) There is established the infrastructure development revolving fund to be administered by the corporation.

(b) An amount from the fund, to be set by the corporation but which shall not exceed $ , may be used for administrative expenses incurred by the corporation in administering the fund; provided that fund moneys may not be used to finance day-to-day administrative expenses of projects allotted fund moneys.

(1) Appropriations made by the legislature;

(2) Private contributions;

(3) Repayment of loans;

(4) Other returns; and

(5) Moneys from other sources.

(d) The fund shall be used to provide no-interest loans for the development, pre-development, or construction of infrastructure projects to expedite the building of affordable housing. Permitted uses of the fund may include planning, design, land acquisition, costs of options, agreements of sale, downpayments, equity financing, or other infrastructure-related services or activities as provided in rules adopted by the corporation pursuant to chapter 91. The use of the fund shall not be limited to projects developed under section 201H-38; provided that at least thirty per cent of the units in the project shall be built as low-cost housing, as defined by the corporation.

The rules may also provide that moneys from the fund shall be leveraged with other financial resources to the extent possible.

(e) The corporation may provide loans under this section; provided that:

(1) The corporation shall establish loan-to-value ratios to protect the fund from inordinate risk and under no circumstances shall the loan-to-value ratio exceed one hundred per cent; and

(2) The underwriting guidelines shall include a debt-coverage ratio of not less than 1.0 to 1.

(f) The corporation shall submit an annual report to the legislature no later than twenty days prior to the convening of each regular session describing the projects funded and its efforts to develop infrastructure development projects."

SECTION 2. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2008-2009 to be deposited in the infrastructure development revolving fund established under section 1 of this Act.

The sum appropriated shall be expended by the Hawaii housing finance and development corporation for the purposes of this Act.

SECTION 3. New statutory material is underscored.

SECTION 4. This Act shall take effect upon its approval; provided that section 2 of the Act shall take effect on July 1, 2008.

HOUSE OF REPRESENTATIVES	H.B. NO.	2904
TWENTY-FOURTH LEGISLATURE, 2008		H.D. 1
STATE OF HAWAII