HB3409

PART I

SECTION 1. The legislature finds that many rural areas of the state such as Waianae lack enough workers of various professions. Physicians, teachers, and emergency services personnel are some of the positions that are frequently cited as shortage professions in rural areas. There is a critical need to provide incentives to attract such shortage professions into rural areas to create a balanced community.

The purpose of this part is to establish incentives for public employees, including teachers, to live in rural areas.

SECTION 2. Chapter 201H, Hawaii Revised Statutes, is amended by adding a new part to be appropriately designated and to read as follows:

“Part . PUBLIC EMPLOYEE HOUSING IN RURAL AREAS

§201H-A Definitions. As used in this part:

"Employee" or "public employee" shall have the same meaning as in section 76-11, except that for purposes of this part, "employee" or "public employee" shall include teachers.

"Qualified public employee" means a public employee working at least forty hours per week in a qualified rural area in their capacity as a public employee who fulfills any other eligibility requirements established under this part.

"Qualified rural area" means an area that is characterized by a low population density and the absence of city-like concentration of structures, streets, and urban services; provided that the corporation may establish more specific criteria and standards to further define "qualified rural area".

§201H-B Loans to public employees; rural area loan fund. (a) The corporation shall establish and administer a loan program to provide interest-free home purchase loans to qualified public employees.

(b) Loans made under this section shall be interest-free and shall be used by the qualified public employee exclusively for the purchase of a home, including an apartment, a townhouse, and a condominium in a qualified rural area. In addition, loans made under this section shall be:

(1) Repaid with a payment plan specified by the corporation; provided that additional payments in any sums, or the payment of the entire principal, may be made at any date within the time period of the loan;

(2) Secured in a manner to be determined by the corporation; and

(3) Subject to penalties for delinquency or late payments as specified by the corporation and including subsection (c).

The corporation shall negotiate the terms and conditions of each loan to ensure that each loan complies with the provisions of this section.

(c) During the time period of the loan, if at any time a person receiving the loan fails to comply with the requirements established in the definition of "qualified public employee" under this part, the loan shall be considered forfeit and all principal amounts outstanding, plus penalties, shall become due and payable. If the principal amounts outstanding and penalties are not remitted, the corporation may initiate foreclosure proceedings on the home purchased through the proceeds from the loan. This section shall not apply in cases where the qualified public employee fails to comply with the requirements because of circumstances beyond the qualified public employee's control, as determined by the corporation.

(d) Loans provided under this part shall not exceed $ per qualified public employee. Each qualified employee shall receive no more than one loan under this section. A qualified employee participating in the loan program under this section shall not be eligible for the allowance program under section 201H-C.

(e) There is established in the state treasury a special fund to be known as the rural area public employees loan special fund. Moneys in this fund shall be loaned by the corporation pursuant to this section. The rural area public employees loan special fund shall be funded by:

(1) Legislative appropriations;

(2) Federal funds, if available; and

(3) All principal payments, fees, interest, penalties, and any other proceeds derived by the corporation pursuant to this section.

(f) The corporation may adopt rules pursuant to chapter 91 to establish eligibility requirements for public employees applying for a loan under this section.

§201H-C Public employee housing allowance program; rural areas. (a) The corporation shall establish and administer a rural area public employee housing allowance program to provide housing allowances to qualified public employees who live in qualified rural areas of the state.

(b) The amount of the housing allowance shall be determined by the corporation and shall be no more than $ .

(c) The corporation may adopt rules pursuant to chapter 91 to establish eligibility requirements for public employees applying for a housing allowance under this section."

SECTION 3. 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 into the rural area public employees loan special fund.

SECTION 4. There is appropriated out of the rural area public employees loan special fund the sum of $ or so much thereof as may be necessary for fiscal year 2008-2009 to be used for the purposes of the fund.

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

SECTION 5. 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 for the rural area public employee housing allowance program established under this part.

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

PART II

SECTION 6. The legislature finds that many rural areas of the state such as Waianae lack enough workers of various professions. Physicians, teachers, and emergency services personnel are some of the positions that are frequently cited as shortage professions in rural areas. There is a critical need to provide incentives to attract such shortage professions into rural areas to create a balanced community.

The purpose of this part is to establish incentives for emergency workers to live in rural areas.

SECTION 7. Chapter 201H, Hawaii Revised Statutes, is amended by adding a new part to be appropriately designated and to read as follows:

“Part . EMERGENCY WORKER HOUSING IN RURAL AREAS

§201H-A Definitions. As used in this part:

"Emergency worker" means a lifeguard, firefighter, police officer, or any other emergency response personnel as determined by the corporation, employed by any of the counties or the state.

"Qualified emergency worker" means an emergency worker working at least forty hours per week in a qualified rural area in their capacity as a public employee who fulfills any other eligibility requirements established under this part.

§201H-B Loans to emergency workers; rural area loan fund. (a) The corporation shall establish and administer a loan program to provide interest-free home purchase loans to qualified emergency workers.

(b) Loans made under this section shall be interest-free and shall be used by the qualified emergency worker exclusively for the purchase of a home, including an apartment, a townhouse, and a condominium in a qualified rural area. In addition, loans made under this section shall be:

(2) Secured in a manner to be determined by the corporation; and

(3) Subject to penalties for delinquency or late payments as specified by the corporation and including subsection (c).

The corporation shall negotiate the terms and conditions of each loan to ensure that each loan complies with the provisions of this section.

(c) During the time period of the loan, if at any time a person receiving the loan fails to comply with the requirements established in the definition of "qualified emergency worker" under this part, the loan shall be considered forfeit and all principal amounts outstanding, plus penalties, shall become due and payable. If the principal amounts outstanding and penalties are not remitted, the corporation may initiate foreclosure proceedings on the home purchased through the proceeds from the loan. This section shall not apply in cases where the qualified emergency worker fails to comply with the requirements because of circumstances beyond the qualified emergency worker's control, as determined by the corporation.

(d) Loans provided under this part shall not exceed $ per qualified emergency worker. Each qualified emergency worker shall receive no more than one loan under this section. A qualified emergency worker participating in the loan program under this section shall not be eligible for the allowance program under section 201H-C.

(e) There is established in the state treasury a special fund to be known as the rural area emergency workers loan special fund. Moneys in this fund shall be loaned by the corporation pursuant to this section. The rural area emergency workers loan special fund shall be funded by:

(1) Legislative appropriations;

(2) Federal funds, if available; and

(3) All principal payments, fees, interest, penalties, and any other proceeds derived by the corporation pursuant to this section.

(f) The corporation may adopt rules pursuant to chapter 91 to establish eligibility requirements for emergency workers applying for a loan under this section.

§201H-C Emergency worker housing allowance program; rural areas. (a) The corporation shall establish and administer a rural area emergency worker housing allowance program to provide housing allowances to qualified emergency workers who live in qualified rural areas of the state.

(b) The amount of the housing allowance shall be determined by the corporation and shall be no more than $ .

(c) The corporation may adopt rules pursuant to chapter 91 to establish eligibility requirements for emergency workers applying for a housing allowance under this section."

SECTION 8. 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 into the rural area emergency workers loan special fund.

SECTION 9. There is appropriated out of the rural area emergency workers loan special fund the sum of $ or so much thereof as may be necessary for fiscal year 2008-2009 to be used for the purposes of the fund.

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

SECTION 10. 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 for the rural area emergency worker housing allowance program established under this part.

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

PART III

SECTION 11. In codifying the new sections added to chapter 201H, Hawaii Revised Statutes, by sections 2 and 7 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

SECTION 12. This Act shall take effect on July 1, 2008.

INTRODUCED BY:	_____________________________

HOUSE OF REPRESENTATIVES	H.B. NO.	3409
TWENTY-FOURTH LEGISLATURE, 2008
STATE OF HAWAII