SB1150

SECTION 1. The legislature finds that there is a pressing need to provide housing assistance for the recruitment and retention of teachers in the Hawaii public school system.

The purpose of this Act is to address the critical teacher shortage in Hawaii by creating an incentive program that provides housing for teachers at affordable prices and enables teachers to benefit from appreciation equal to investment in the purchase of a home.

SECTION 2. Chapter 302A, Hawaii Revised Statutes, is amended by adding three new sections to part III, subpart E, to be appropriately designated and to read as follows:

"§302A- Teachers' affordable housing program. (a) There is established an affordable housing program for qualified teachers under this subpart to be administered by the department of education.

(b) The department of education shall make available an interest in residential properties to qualified teachers for purchase at twenty per cent of the current fair market values of the properties. Fair market value shall equal that of comparable residential properties sold in the surrounding area as determined from tax assessed valuation.

(c) Under this program, the qualified teacher shall pay property taxes on the property's current full market value at the rate established by the county governments responsible for property tax assessments.

(d) The qualified teacher under this program shall be solely responsible for securing a mortgage, and paying principal and interest, mortgage insurance, maintenance, and other associated costs on the residential property.

(e) The department shall adopt rules pursuant to chapter 91 to carry out this section.

§302A- Qualifications for teachers' affordable housing program. (a) A qualified teacher shall be eligible to participate in the program if the teacher:

(1) Is an active, full-time teacher in the Hawaii public school system; and

(2) Resides on the property purchased under this subpart as the teacher's permanent and primary residence for at least nine months in a twelve-month period.

(b) No teacher who owns a residential property elsewhere shall be eligible to purchase a residential property under this subpart. A teacher shall be deemed to own a residential property if the teacher, the teacher's spouse, or both (unless separated and living apart under a decree of a court of competent jurisdiction) own a majority interest in a residential property.

§302A‑ Occupation of residential property by teacher and spouse upon termination of service, retirement, death, or divorce. (a) If the qualified teacher is terminated from service with ten years or less of service with the department, the teacher shall vacate the residential property. Twenty per cent of the fair market value of the property at the time of the purchase of the property by the teacher shall be returned to the teacher.

(b) If the qualified teacher is terminated from service with more than ten years of service with the department, the teacher shall vacate the residential property. Twenty per cent of the fair market value of the property at the time of termination shall be returned to the teacher.

(c) If the qualified teacher retires from the public school system and does not reside in the property for at least nine months in a twelve-month period, the property shall be sold back to the State at fair market value. Twenty per cent of the fair market value of the property at the time of the sale shall be returned to the teacher.

(d) The surviving spouse of a deceased qualified teacher may live in the home until the surviving spouse's death. Upon the death of both the qualified teacher and the spouse, twenty per cent of the fair market value of the property at the time of death of the teacher or spouse, whichever is later, shall be paid to the teacher's estate.

(e) If the qualified teacher is divorced from the teacher's spouse, the residential property shall be divided in accordance with section 580-47. If the qualified teacher has lived on the property for ten years or less, the teacher shall be entitled to twenty per cent of the fair market value of the property at the time of the purchase of the property by the teacher. If the qualified teacher has lived on the property for more than ten years, the teacher shall be entitled to twenty per cent of the fair market value of the property at the time of the divorce."

SECTION 3. Section 302A-831, Hawaii Revised Statutes, is amended to read as follows:

"[[]§302A-831[]] Purpose. The purpose of this subpart is to transfer the administration of the teachers' housing program from the housing and community development corporation of Hawaii to the department of education. This subpart [~~also~~] establishes a revolving fund for the accounting and control of receipts and disbursements in connection with the department of education's functions of planning, constructing, purchase, repairing, maintaining, and operating housing programs for teachers employed and assigned by the department of education. This subpart also establishes an affordable housing program for teachers to purchase an interest in residential property."

SECTION 4. Section 302A-833, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

"(b) The revolving fund may be used by the department of education for any and all of the purposes of teachers' housing, including the planning, construction, purchase, maintenance, and operation of teachers' housing, as well as for the salaries of the necessary personnel in charge thereof."

SECTION 5. Section 302A-834, Hawaii Revised Statutes, is amended to read as follows:

"[[]§302A-834[]] Annual statements. The department of education shall annually prepare for the director of human services and the director of finance a full, detailed description and financial statement of the planning, construction, purchasing, repair, maintenance, and operation of teachers' housing."

SECTION 6. 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 2007-2008, and the same sum, or so much thereof as may be necessary for fiscal year 2008-2009, to be deposited into the teachers' housing revolving fund for purchase of residential properties to be utilized as part of the teachers' affordable housing program pursuant to chapter 302A, Hawaii Revised Statutes.

SECTION 7. There is appropriated out of the teachers' housing revolving fund the sum of $ , or so much thereof as may be necessary for fiscal year 2007-2008, and the same sum, or so much thereof as may be necessary for fiscal year 2008-2009, for purchase of residential properties to be utilized as part of the teachers' affordable housing program pursuant to chapter 302A, Hawaii Revised Statutes.

SECTION 8. The sums appropriated shall be expended by the department of education for the purposes of this Act.

SECTION 9. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 10. This Act shall take effect on July 1, 2007.

INTRODUCED BY:	_____________________________

THE SENATE	S.B. NO.	1150
TWENTY-FOURTH LEGISLATURE, 2007
STATE OF HAWAII