THE SENATE	S.B. NO.	2059
TWENTY-EIGHTH LEGISLATURE, 2016
STATE OF HAWAII

A BILL FOR AN ACT

relating to the condominium education trust fund.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  Section 514B-71, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

     "(a)  The commission shall establish a condominium education trust fund that the commission shall use for educational purposes.  Educational purposes shall include financing or promoting:

     (1)  Education and research in the field of condominium management, condominium project registration, and real estate, for the benefit of the public and those required to be registered under this chapter;

     (2)  The improvement and more efficient administration of associations;

     (3)  Expeditious and inexpensive procedures for resolving association disputes; [and]

(4) Education for unit owners, board members, potential board members, and employees of managing agents on the rights and responsibilities of unit owners and board members; and

    [(4)] (5)  Support for mediation of condominium related disputes."

     SECTION 2.  Section 514B-72, Hawaii Revised Statutes, is amended to read as follows:

     "§514B-72  Condominium education trust fund; payments by associations [and], developers[.], and managing agents. (a)  Each project or association with more than five units, including any project or association with more than five units subject to chapter 514A, shall pay to the department of commerce and consumer affairs:

     (1)  A condominium education trust fund fee within one year after the recordation of the purchase of the first unit or within thirty days of the association's first meeting, and thereafter, on or before June 30 of every odd-numbered year, as prescribed by rules adopted pursuant to chapter 91; [and]

     (2)  Beginning with the July 1, 2015, biennium registration, an additional annual condominium education trust fund fee in an amount equal to the product of $1.50 times the number of condominium units included in the registered project or association to be dedicated to supporting mediation of condominium related disputes.  The additional condominium education trust fund fee shall total $3 per unit until the commission adopts rules pursuant to chapter 91.  On June 30 of every odd-numbered year, any unexpended additional amounts paid into the condominium education trust fund and initially dedicated to supporting mediation of condominium related disputes, as required by this paragraph, shall be used for educational purposes as provided in section 514B-71(a)(1), (2), and (3)[.]; and

(3) Beginning with the July 1, 2017, biennium registration, an additional annual condominium education trust fund fee in an amount equal to the product of $       times the number of condominium units included in the registered project or association to be dedicated to supporting educational purposes as provided in section 514B-71(a)(4).

     (b) Each developer shall pay to the department of commerce and consumer affairs the condominium education trust fund fee for each unit in the project, as prescribed by rules adopted by the director of commerce and consumer affairs pursuant to chapter 91.  The project shall not be registered and no effective date for a developer's public report shall be issued until the payment has been made.

(c)  In addition to the requirements under sections 514A-95 and 514B-132, each managing agent shall pay a condominium education trust fund fee for each unit included in the registered project or association, as prescribed by rules adopted by the director of commerce and consumer affairs pursuant to chapter 91.  The fee shall be used for educational purposes as provided in section 514B-71(a)(4).

     [(c)] (d)  Payments of any fees required under this section shall be due on or before the registration due date and shall be nonrefundable.  Failure to pay the required fee by the due date shall result in a penalty assessment of ten per cent of the amount due and the association shall not have standing to bring any action to collect or to foreclose any lien for common expenses or other assessments in any court of this State until the amount due, including any penalty, is paid.  Failure of an association to pay a fee required under this section shall not impair the validity of any claim of the association for common expenses or other assessments, or prevent the association from defending any action in any court of this State.

     [(d)] (e)  The department of commerce and consumer affairs shall allocate the fees collected under this section, section 514A-40, and section 514A-95.1 to the condominium education trust fund established pursuant to section 514B-71.  The fees collected pursuant to this section shall be administratively and fiscally managed together as one condominium education trust fund established by section 514B-71."

     SECTION 3.  Section 514B-73, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

     "(b)  The commission and the director of commerce and consumer affairs may use moneys in the condominium education trust fund collected pursuant to sections 514A-40, 514A-95.1, and 514B-72, and the rules of the commission to employ necessary personnel not subject to chapter 76 for additional staff support, to provide office space, and to purchase equipment, furniture, and supplies required by the commission to carry out its responsibilities under this part.  The director of commerce and consumer affairs may use moneys in the condominium education trust fund collected pursuant to sections 514A-40, 514A-95.1, and 514B-72, and the rules of the commission to employ additional personnel as needed to enforce this chapter or the rules of the commission."

     SECTION 4.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

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

INTRODUCED BY:

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Report Title:

Condominiums; Condominium Education Trust Fund; Assessment; Managing Agents; Associations; Real Estate Commission; Enforcement

Description:

Adds education for condominium unit owners, board members, potential board members, and employees of managing agents on the rights and responsibilities of condominium unit owners and condominium board members as one of the education purposes supported by the condominium education trust fund.  Beginning with the July 1, 2017, biennium registration, imposes an additional annual condominium education trust fund fee dedicated to supporting education for condominium unit owners, board members, potential board members, and employees of managing agents.  Imposes a condominium education trust fund fee on managing agents.  Permits the department of commerce and consumer affairs to use moneys in the condominium education trust fund to employ additional personnel as needed to enforce condominium laws and rules of the real estate commission.

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.