SB778

SECTION 1. The legislature finds that there is a critical shortage in the number of rental housing units in the State that are affordable for families with low to moderate incomes. The legislature also finds that many planned community and homeowners' associations have imposed restrictions that prohibit or limit their members from renting out their units.

The purpose of this Act is to ensure that more affordable rental housing units are made available in the State by prohibiting planned community and homeowners' associations from preventing their members from renting out their single-family detached dwelling units when the tenant is a family with a low to moderate income and the duration of the tenancy is for six months or longer.

SECTION 2. Chapter 421J, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§421J- Prohibition on use restrictions; affordable rental housing. (a) Notwithstanding any law to the contrary, no association shall prevent by any covenant, declaration, bylaws, restriction, deed, lease, term, provision, condition, codicil, contract, rule, or similar binding agreement, however worded, its members from renting their units; provided that:

(1) The unit is a single-family detached dwelling unit;

(2) The tenant is a family with an annual income of not more than one hundred forty per cent of the area median family income for a family of the same size;

(3) The tenancy is for a duration of six months or longer;

(4) There is a written rental agreement;

(5) The premises that is subject to the tenant's exclusive use and occupancy under the rental agreement includes the entire unit and the tenant is not a roomer or boarder; and

(6) The monthly rent for the unit excluding utility expenses does not exceed thirty per cent of the tenant's monthly income.

Any provision in any agreement, lease, instrument, or contract contrary to the intent of this section shall be void and unenforceable.

(b) Every association may adopt rules that place reasonable conditions under which its members may rent their units; provided that those conditions do not prohibit the renting of any member's unit under this section. No association shall assess or charge any member any fees for a member's renting of their units under this section.

"Area median family income" means the most current median family income for an area as estimated and adjusted for family size by the United States Department of Housing and Urban Development.

"Dwelling unit" means a structure or part of a structure that is used as a home, residence, or sleeping place by one person or by two or more persons maintaining a common household, to the exclusion of all others.

"Family" includes a family of one individual.

"Premises" means a dwelling unit, appurtenances thereto, grounds, and facilities held out for the use of tenants generally and any other area or facility whose use is promised to the tenant.

"Rental agreement" means all written agreements that establish or modify the terms, conditions, rules, regulations, or any other provisions concerning the use and occupancy of a dwelling unit and premises.

"Roomer" or "boarder" means a tenant occupying a dwelling unit:

(1) That lacks at least one major bathroom or kitchen facility, such as a toilet, refrigerator, or stove;

(2) In a building where one or more such major facilities are supplied to be used in common by the occupants of the tenant's dwelling unit and by the occupants of one or more other dwelling units; and

(3) In a building in which the landlord resides.

"Single-family detached dwelling unit" means an individual, freestanding, unattached dwelling unit, typically built on a lot larger than the structure itself, resulting in an area surrounding the dwelling.

"Tenant" means any person who occupies a dwelling unit for dwelling purposes under a rental agreement."

SECTION 3. If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of the Act that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

SECTION 4. New statutory material is underscored.

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

INTRODUCED BY:	_____________________________

THE SENATE	S.B. NO.	778
THIRTY-FIRST LEGISLATURE, 2021
STATE OF HAWAII