SB2560

SECTION 1. The Hawaii Revised Statutes is amended by adding a new chapter to be appropriately designated and to read as follows:

"Chapter

Office of affordable housing finance and development

PART I. GENERAL PROVISIONS

§ -1 Definitions. As used in this chapter:

"Affordable dwelling units" means housing dwelling units or rental dwelling units that are affordable to families earning eighty per cent or below of the applicable area median income.

"Director" means the director of the office of affordable housing finance and development.

"Office" means the office of affordable housing finance and development.

§ -2 Office of affordable housing finance and development; establishment; staff; responsibilities. (a) There is established within the department of business, economic development, and tourism an office of affordable housing finance and development. The purpose of the office shall be to facilitate the financing, planning, permitting, designing, and building of affordable housing, either directly or in partnership with other government agencies and the private sector.

(b) The head of the office shall be known as the director of the office of affordable housing finance and development. The director shall:

(1) Have work experience or training related to financing, planning, permitting, designing, and building affordable housing;

(2) Be nominated by the governor and, by and with the advice and consent of the senate, appointed by the governor without regard to chapter 76;

(3) Be compensated at a salary level set by the governor;

(4) Be included in any benefit program generally applicable to the officers and employees of the State;

(5) Retain such staff as may be necessary for the purposes of this chapter pursuant to section -3; and

(6) Report to the director of business, economic development, and tourism and shall not be required to report directly to any other principal executive department.

(c) The office shall retain a chief counsel and two deputy attorneys appointed by the director. The chief counsel and each deputy attorney shall have at least five years of work experience in real property transaction, including experience in financing, banking, grants, or related practice areas.

§ -3 Powers; generally. Except as otherwise limited by this chapter, the office may:

(1) Sue and be sued;

(2) Have a seal and alter the same at pleasure;

(3) Make and execute contracts and all other instruments necessary or convenient for the exercise of its powers and functions under this chapter;

(4) Make rules with respect to its projects, operations, properties, and facilities, which rules shall be in conformance with chapter 91;

(5) Through its director appoint officers, agents, and employees, prescribe their duties and qualifications, and fix their salaries, without regard to chapter 76;

(6) Acquire, reacquire, or contract to acquire or reacquire by grant or purchase real, personal, or mixed property or any interest therein; to own, hold, clear, improve, and rehabilitate; and to sell, assign, exchange, transfer, convey, lease, or otherwise dispose of or encumber the same, without regard to any other law to the contrary including chapter 171;

(7) Acquire or reacquire by condemnation real, personal, or mixed property or any interest therein for the purpose of developing or facilitating the development of affordable dwelling units, without regard to any other law to the contrary including chapter 171; and

(8) By itself, or in partnership with private developers or other qualified persons, acquire, reacquire, construct, reconstruct, rehabilitate, improve, alter, or repair or provide for the construction, improvement, alteration, or repair of affordable dwelling units, without regard to any other law to the contrary including chapter 171.

§ -4 Fair housing law to apply. Notwithstanding any law to the contrary, the provisions of chapter 515 shall apply in administering this chapter.

§ -5 Review of office actions or decisions. Notwithstanding any law to the contrary, no action or decision of the office shall give rise to a contested case or agency hearing. Any person aggrieved by an action or decision of the office is entitled to judicial review thereof.

§ -6 Coordination with other government agencies. The office shall coordinate with other government agencies, including but not limited to the Hawaii housing finance and development corporation and Hawaii community development authority to facilitate the financing, planning, permitting, designing, and construction of affordable dwelling units.

§ -7 Affordable housing leases. (a) The office may negotiate transactions to lease parcels of real property acquired by the office pursuant to section -3 and without regard to any other law to the contrary including chapter 171; provided that:

(1) Leases entered into by the office shall have a term of no more than sixty-five years; and

(2) Any lease entered into by the office with a term greater than one year shall include at least one dwelling unit.

(b) If a parcel of property obtained by the office cannot be used for housing within thirty years, the office shall transfer that parcel of property to another state or county agency to be used for a public purpose. If no state or county agency agrees to receive the parcel of property within one hundred eighty days, the parcel of property shall be sold at public auction to the highest bidder, without regard to any other law to the contrary including chapter 171.

(c) The office may allow tenants to sublease parcels of property for residential purposes at the discretion of the office.

PART II. AFFORDABLE HOUSING DEVELOPMENT LOANS

§ -11 Affordable housing development loan program. (a) There is established an affordable housing development loan program, which shall be a loan program as defined under section 39-51. The program shall be administered by the office in a manner consistent with chapter 39, part III. The loan program may include loans made, on terms approved by the office, to private entities, whether corporations, partnerships, limited liability companies, or other persons, that are capable, authorized, and in good standing with the State to develop, construct, or manage affordable dwelling units for lease or sale to the public.

(b) The office shall adopt rules in accordance with chapter 91 to establish pass/fail criteria for loan and financing qualification.

§ -12 Affordable housing development loans; fees. The office may establish, revise, charge, and collect fees, premiums, and charges as necessary, reasonable, or convenient for the affordable housing development loan program. The fees, premiums, and charges shall be deposited into the affordable housing development loan revolving fund.

§ -13 Affordable housing development; exemption from statutes, ordinances, charter provisions, and rules. (a) Projects approved by the office for participation in the affordable housing development loan program shall be exempt from all statutes, ordinances, charter provisions, and rules of any government agency relating to planning, zoning, construction standards for subdivisions, development and improvement of land, and the construction of dwelling units thereon; provided that:

(1) At least fifty per cent of the dwelling units in the housing project are affordable dwelling units;

(2) The office finds that the housing project is consistent with the purpose and intent of this chapter and meets minimum requirements of health and safety;

(3) The development of the proposed housing project does not contravene any safety standards, tariffs, or rates and fees approved by the public utilities commission for public utilities or of the various boards of water supply authorized under chapter 54;

(4) Unless the project is located in a community development district created by the legislature under chapter 206E, the legislative body of the county in which the housing project is to be situated shall have approved the project with or without modifications:

(A) The legislative body shall approve, approve with modifications, or disapprove the project by resolution within forty-five days after the developer has submitted the preliminary plans and specifications for the project to the legislative body. If on the forty-sixth day a project is not disapproved, it shall be deemed approved by the legislative body;

(B) No action shall be prosecuted or maintained against any county, its officials, or employees on account of actions taken by them in reviewing, approving, modifying, or disapproving the plans and specifications; and

(C) The final plans and specifications for the project shall be deemed approved by the legislative body if the final plans and specifications do not substantially deviate from the preliminary plans and specifications. The final plans and specifications for the project shall constitute the zoning, building, construction, and subdivision standards for that project. For purposes of sections 501-85 and 502-17, the director of the office or the responsible county official may certify maps and plans of land connected with the project as having complied with applicable laws and ordinances relating to consolidation and subdivision of lands, and the maps and plans shall be accepted for registration or recordation by the land court and registrar;

(5) The land use commission shall approve, approve with modifications, or disapprove a boundary change within forty-five days after the developer has submitted a petition to the commission as provided in section 205-4. If, on the forty-sixth day, the petition is not disapproved, it shall be deemed approved by the commission; and

(6) The Hawaii community development authority shall approve, approve with modifications, or disapprove a developer's proposal to develop lands under the authority's control within forty-five days after the developer has submitted a proposal to the authority as provided in section 206E-5.6; provided that only one hearing shall be required by the authority for proposals submitted to the authority under this section. If, on the forty-sixth day, the petition is not disapproved, it shall be deemed approved by the authority.

(b) For the purposes of this section, "developer" means an entity that is developing, constructing, or managing a project proposed for participation in the affordable housing development loan program.

§ -14 Affordable housing development loan revolving fund. (a) There is established the affordable housing development loan revolving fund to be administered by the office, into which shall be deposited:

(1) Legislative appropriations;

(2) Revenues from rental payments under leases entered into pursuant to section -7;

(3) Revenues from repayment of loans made under the affordable housing development loan program; and

(4) All moneys received and collected by the office not otherwise pledged or obliged nor required by law to be placed in any other special or revolving fund.

(b) Notwithstanding any law to the contrary, moneys in the affordable housing development loan revolving fund shall be used for affordable housing development loans pursuant to section -11."

SECTION 2. Section 28-8.3, Hawaii Revised Statutes, is amended as follows:

1. By amending subsection (a) to read:

"(a) No department of the State other than the attorney general may employ or retain any attorney, by contract or otherwise, for the purpose of representing the State or the department in any litigation, rendering legal counsel to the department, or drafting legal documents for the department; provided that the foregoing provision shall not apply to the employment or retention of attorneys:

(1) By the public utilities commission, the labor and industrial relations appeals board, and the Hawaii labor relations board;

(2) By any court or judicial or legislative office of the State; provided that if the attorney general is requested to provide representation to a court or judicial office by the chief justice or the chief justice's designee, or to a legislative office by the speaker of the house of representatives and the president of the senate jointly, and the attorney general declines to provide such representation on the grounds of conflict of interest, the attorney general shall retain an attorney for the court, judicial, or legislative office, subject to approval by the court, judicial, or legislative office;

(3) By the legislative reference bureau;

(4) By any compilation commission that may be constituted from time to time;

(5) By the real estate commission for any action involving the real estate recovery fund;

(6) By the contractors license board for any action involving the contractors recovery fund;

(7) By the office of Hawaiian affairs;

(8) By the department of commerce and consumer affairs for the enforcement of violations of chapters 480 and 485A;

(9) As grand jury counsel;

(10) By the Hawaii health systems corporation, or its regional system boards, or any of their facilities;

(11) By the auditor;

(12) By the office of ombudsman;

(13) By the insurance division;

(14) By the University of Hawaii;

(15) By the Kahoolawe island reserve commission;

(16) By the division of consumer advocacy;

(17) By the office of elections;

(18) By the campaign spending commission;

(19) By the Hawaii tourism authority, as provided in section 201B-2.5;

(20) By the division of financial institutions;

(21) By the office of information practices; [or]

(22) By the office of affordable housing finance and development; or

[~~(22)~~] (23) By a department, if the attorney general, for reasons deemed by the attorney general to be good and sufficient, declines to employ or retain an attorney for a department; provided that the governor waives the provision of this section."

2. By amending subsection (c) to read:

"(c) Every attorney employed by any department on a full-time basis, except an attorney employed by the public utilities commission, the labor and industrial relations appeals board, the Hawaii labor relations board, the office of Hawaiian affairs, the Hawaii health systems corporation or its regional system boards, the department of commerce and consumer affairs in prosecution of consumer complaints, insurance division, the division of consumer advocacy, the University of Hawaii, the Hawaii tourism authority as provided in section 201B-2.5, the office of information practices, the office of affordable housing finance and development, or as grand jury counsel, shall be a deputy attorney general."

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 2018-2019 for personnel and operating costs of the office of affordable housing finance and development.

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

SECTION 4. 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 2018-2019 to be deposited into the affordable housing development loan revolving fund.

SECTION 5. There is appropriated out of the affordable housing development loan revolving fund the sum of $ or so much thereof as may be necessary for fiscal year 2018-2019 for the purpose of providing affordable housing development loans.

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

SECTION 6. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 7. This Act shall take effect on July 1, 2018.

INTRODUCED BY:	_____________________________

THE SENATE	S.B. NO.	2560
TWENTY-NINTH LEGISLATURE, 2018
STATE OF HAWAII