STAND. COM. REP. NO. 1522

Honolulu, Hawaii

RE: H.B. No. 599

H.D. 1

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-First State Legislature

Regular Session of 2021

State of Hawaii

Sir:

Your Committee on Commerce and Consumer Protection, to which was referred H.B. No. 599, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO ASSOCIATION GOVERNANCE,"

begs leave to report as follows:

The purpose and intent of this measure is to:

(1) Clarify that planned community associations may conduct meetings remotely consistent with the Hawaii Nonprofit Corporations Act; and

(2) Authorize condominium associations to conduct electronic meetings and electronic, machine, or mail voting in a state of emergency or local state of emergency, or any meeting noticed during such emergencies and for which the applicable emergency has since expired.

Your Committee received testimony in support of this measure from the Hawai‘i State Association of Parliamentarians Legislative Committee, Community Associations Institute Hawaii Legislative Action Committee, Palehua Townhouse Association, Associa, Honolulu Tower AOAO, Hawaii Council of Associations of Apartment Owners, and six individuals.

Your Committee finds that, due to coronavirus disease 2019 pandemic restrictions and social distancing requirements, it has been difficult, if not impossible, for many associations to hold annual meetings. Your Committee notes this measure reflects consensus language between stakeholders to clarify that planned community associations may hold meetings remotely; enable condominium associations to hold electronic meetings and use electronic, machine, and mail voting for annual and special association meetings during any period in which there is a state of emergency or local state of emergency; and allow condominium associations to hold electronic meetings when there is no state of emergency if otherwise authorized by the association's governing documents. This measure will therefore lend associations greater flexibility to continue to conduct their important business when face-to-face meetings are not possible or during other states of emergency.

Your Committee has amended this measure by:

(1) Clarifying the notice requirements for regular, annual, and special planned community association meetings;

(2) Inserting language clarifying certain conflicting provisions in section 541B-121, Hawaii Revised Statutes;

(3) Inserting an effective date of January 1, 2022; and

(4) Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

As affirmed by the record of votes of the members of your Committee on Commerce and Consumer Protection that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 599, H.D. 1, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 599, H.D. 1, S.D. 1, and be placed on the calendar for Third Reading.

Respectfully submitted on behalf of the members of the Committee on Commerce and Consumer Protection,

________________________________

ROSALYN H. BAKER, Chair