SB711.DOC

SECTION 1. The legislature finds that transfer of development rights would provide the Hawaii community development authority with a very effective and flexible technique for land use control. Transfer of development rights is a legal procedure designed to preserve or protect natural or man-made property resources for the public's benefit. Transfer of development rights results from a recognition that land ownership has two distinct components, in that the right to develop land is an independent aspect of land ownership.

Transfer of development rights can be used to ensure that the open space requirements of the county's planning goals are met without causing a financial burden to landowners or restricting needed development. A well thought out and administered transfer of development rights program ultimately generates development that is more cost-effective and efficient. The use of transfer of development rights can reduce the prospect of litigation over preservation policies, avoid the use of state funds to purchase land while helping to ensure preservation goals, and allow a municipality to increase its tax base without accepting less land preservation than desired.

SECTION 2. Chapter 206E, Hawaii Revised Statutes, is amended by adding three new sections to part II to be appropriately designated and to read as follows:

"§206E-A Definitions. As used in this part:

"Development rights" shall have the same meaning as in section 46-162.

"Receiving district" means the Kakaako community development district.

"Sending district" shall have the same meaning as in section 46-162.

"Transfer of development rights" shall have the same meaning as in section 46-162.

§206E-B Zoning rules; established by transfer of development rights only. (a) Notwithstanding section 206E-7, the authority shall establish rules relating to the zoning of land within the Kakaako district only by the use of transfer of development rights in accordance with this section.

(b) Transfer of development rights to the Kakaako district shall be subject to the following conditions:

(1) Transfer of development rights shall be made in accordance with the purposes stated in section 206E‑31;

(2) A sending district shall contain natural, scenic, recreational, agricultural, forest, or open land or sites of special historical, cultural, aesthetic, or economic values sought to be protected;

(3) The authority shall evaluate the effects of potential increased development in the Kakaako district that may result from the transfer of development rights provisions and require:

(A) That the Kakaako district contains adequate resources; environmental quality; and public facilities, including transportation, water supply, waste disposal, and fire protection, to support the transfer of development rights;

(B) That there is approximate equivalence between potential low and moderate housing units lost in the sending district and gained in the Kakaako district or that reasonable action will be taken to compensate for any negative impact upon the availability or potential development of low or moderate income housing caused by the transfer of development rights;

(D) Increased development is compatible with the development currently existing in the Kakaako district;

(4) An environmental impact statement shall be prepared by the authority pursuant to section 343-6. The environmental impact statement shall be amended if there are material changes in circumstances;

(5) The agreement and procedure for transfer of development rights shall be specified in writing;

(6) The burden upon land within a sending district from which development rights have been transferred shall be documented by an instrument duly executed by the grantor in the form of a conservation easement which shall be enforceable by the Kakaako district in addition to any other person or entity granted enforcement rights by the terms of the instrument. All provisions of law applicable to such conservation easements shall apply with respect to conservation easements hereunder. Any development right that has been transferred by conservation easement shall be evidenced by a certificate of development right in a form suitable for recording; and

(7) Development rights shall be transferred reflecting the normal market in land, including but not limited to sales between owners of property in sending districts and the Kakaako district.

(c) Within one year after a development right is transferred, the assessed valuation placed on the affected properties for real property tax purposes shall be adjusted to reflect the transfer. A development right that is transferred shall be deemed to be an interest in real property and the rights evidenced thereby shall inure to the benefit of the Kakaako district.

(d) The authority may establish a development rights bank or such other account in which development rights may be retained and sold in the best interest of the Kakaako district. The authority shall be authorized to accept for deposit within the bank gifts, donations, bequests or other development rights.

(e) The authority shall adopt rules pursuant to chapter 91 for the amendment of transfer of development rights pursuant to this section.

§206E-C Transfer of development rights; authorization for sending district. In addition to existing powers and authority to regulate by planning or zoning, a town board is hereby empowered to provide for transfer of development rights to the Kakaako district subject to the conditions in section 206E-B and upon such other conditions as the town board deems necessary and appropriate that are consistent with the purposes of this section. The purpose of providing for transfer of development rights shall be to protect the natural, scenic, or agricultural qualities of open lands, to enhance sites and areas of special character or special historical, cultural, aesthetic, or economic interest or value, and to enable and encourage flexibility of design and careful management of land in recognition of land as a basic and valuable natural resource."

SECTION 3. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

SECTION 4. New statutory material is underscored.

SECTION 5. This Act shall take effect upon its approval.

INTRODUCED BY:	_____________________________

THE SENATE	S.B. NO.	711
TWENTY-SEVENTH LEGISLATURE, 2013
STATE OF HAWAII