HB1467 HD2

SECTION 1. The purpose of this Act is to establish the strengthen Hawaii homes program, which will be dedicated to retrofitting residential properties to:

(1) Enhance those properties' resilience against disaster impacts; and

(2) Reduce potential insurance liabilities.

SECTION 2. The Hawaii Revised Statutes is amended by adding a new chapter to title 13 to be appropriately designated and to read as follows:

"Chapter

strengthen hawaii homes act

§ -1 Short title. This Act shall be known and may be cited as the Strengthen Hawaii Homes Act.

§ -2 Definitions. As used in this chapter:

"Department" means the department of business, economic development, and tourism.

"Disaster" includes earthquakes, floods, high water, hurricanes, Kona low storms, landslide, mudslide, tidal wave, tornadoes, tsunami, wildfire, wind-driven water, windstorms, and other causes as determined by the department.

"Nonprofit organization" means an entity that is recognized as a tax-exempt organization under the Internal Revenue Code and is registered to do business in the State.

"Program" means the strengthen Hawaii homes program.

"Residential property" means an owner-occupied, single‑family, primary residence in the State. "Residential property" does not include a condominium or mobile home.

§ -3 Strengthen Hawaii homes program; established. (a) There is established within the department the strengthen Hawaii homes program, under which the department shall provide grants to modify and strengthen existing residential properties to improve their resilience to disasters and reduce potential insurance liabilities.

(b) Implementation of the program shall be subject to the availability of funds. The department shall use its best efforts to obtain grants or other funding from the federal government or other funding sources to supplement any moneys appropriated by the legislature to the department for the program.

(c) Nothing in this chapter shall be construed as creating an entitlement for residential property owners or obligating the State in any way to fund the inspection, construction, or retrofitting of residential properties.

§ -4 Strengthen Hawaii homes program administrator and requirements. (a) The department may delegate the powers and responsibilities incurred under this chapter to a third party as necessary.

(b) The department, without regard to chapter 103D, may contract with a third party to operate and manage the program.

(c) A third party contracted pursuant to this section shall be subject to oversight by the department and shall report to the department twice a year and upon request of the department.

(d) A third party contracted pursuant to this section shall satisfy the qualification requirements established by the department, including having experience and expertise in:

(1) Residential resilience technologies and methods; and

(2) Identifying, developing, administering, and implementing residential resilience management and community-based infrastructure programs.

(e) The duties and responsibilities of a third party contracted under this section shall be established by the department.

§ -5 Grants; applications; eligibility. (a) Applications for grants shall be filed electronically in the form and manner prescribed by the department and shall contain such information required by the department. At minimum, an application shall show:

(1) The name of the requesting individual applicant;

(2) The purpose for the grant;

(3) The address of the single-family home requesting to receive the grant;

(4) The tax map key number of the single-family home;

(5) The proposed plan to comply with the program if the applicant receives a grant pursuant to this section;

(6) Receipt of the licenses and permits necessary to carry out activities performed pursuant to the proposed plan;

(7) A proposed timeline for compliance with the program;

(8) A declaration that the grant shall only be used for activities that are consistent with the purpose of the program and this chapter; and

(9) The applicant's household income does not exceed one hundred forty per cent of the area median income.

(b) To be eligible for a grant under the program, a person shall:

(1) Establish that the property is a residential property and not a condominium or mobile home;

(2) Establish that the residential property is in good repair; provided that this paragraph shall not disqualify residential property that has been damaged by a disaster;

(3) Consult with an evaluator to conduct the property evaluation required by section -7, and submit the results of the evaluation to the department;

(4) Agree to allow the department to inspect or reinspect the residential property, including by conducting random inspections or reinspections; and

(5) Meet any other requirements set forth by the department for the specific grant the applicant is seeking; provided that the department shall not establish requirements relating to a residential property's insurance coverage.

(c) The department may require a person to submit documentation or a written affirmation to verify that the person meets the requirements of subsection (b).

(d) Grant applications shall be accepted on a first-come, first-served basis within each income tier as established by the department.

(e) Priority for the award of grants shall be given to applicants:

(1) Whose households have an income of no more than one hundred forty per cent of the area median income as determined by the United States Department of Housing and Urban Development; and

(2) Who meet any other criteria that the department determines is appropriate to meet the purposes of the program.

(f) Any entity that provides moneys to the program may establish additional rules and guidelines under which those moneys may be used; provided that the rules and guidelines do not violate any federal or state law.

(g) The department shall clearly explain the terms of each grant offered under the program for the purpose of ensuring transparency and equity in the allocation of funds.

§ -6 Availability of funds for nonprofit organizations. (a) If the department obtains grants or other funds under rules that authorize the funds to be issued to nonprofit organizations, then the department, by contract, may make moneys available to nonprofit organizations that retrofit residential properties to resist loss due to disasters.

(b) Any contract with a nonprofit organization under this section shall require the nonprofit organization to agree to:

(1) Administer the moneys under the same terms that would be applicable if the moneys were administered by the department under this chapter; and

(2) Allow the department, legislative committees and their staff, and auditor full access to the nonprofit organization's records, reports, files, and other related documents and information for the purposes of monitoring, measuring the effectiveness of, and ensuring the proper expenditure of funds.

§ -7 Evaluation of residential property by evaluator. (a) A person who owns residential property and who seeks to retrofit that residential property under this chapter shall select an evaluator from a list of evaluators published by the department pursuant to section -8 to conduct the evaluation required by subsection (b).

(b) The evaluator shall examine the person's residential property and shall identify all improvements necessary for the residential property to achieve the following standards:

(1) Insurance Institute for Business and Home Safety FORTIFIED Roof;

(2) Insurance Institute for Business and Home Safety FORTIFIED Silver;

(3) Insurance Institute for Business and Home Safety FORTIFIED Gold; or

(4) Any similar standard approved by the department;

provided that if the evaluator determines that the residential property is not able to be improved to meet any of the standards described in this subsection, then the evaluator shall make a determination that the residential property is not mitigable and the residential property owner shall not be eligible for a grant under this chapter.

§ -8 Evaluators; eligibility; listing. (a) To serve as an evaluator under this chapter, a person shall:

(1) Meet all program requirements established under this chapter or the rules adopted under this chapter;

(2) Be in good standing with:

(A) The Insurance Institute for Business and Home Safety and maintain an active Insurance Institute for Business and Home Safety certification as a FORTIFIED Home Evaluator; or

(B) Another organization approved by the department;

(3) Agree to follow program requirements established under this chapter or the rules adopted under this chapter;

(4) Maintain with the department proof that the evaluator:

(A) Is registered to do business in the State; and

(B) Has an active Insurance Institute for Business and Home Safety FORTIFIED Home Evaluator certification or other certification approved by the department;

(5) Maintain current and accurate contact information with the department;

(6) Pay all fees associated with any certifications required under this chapter, including any training fees;

(7) Not have a financial interest in any project which the person inspects for designation purposes pursuant to this chapter;

(8) Not be a contractor or supplier of any materials, products, or systems installed in any home that the person inspects for purposes of this chapter;

(9) Not be a sales agent for any home being designated under the program;

(10) Report to the department any conflicts of interest; and

(11) Meet any other eligibility requirements established by the department.

(b) The department shall publish and maintain on its website a list of evaluators who meet the eligibility requirements of this section.

§ -9 Use of grant moneys; conditions. (a) The residential property owner shall hire a contractor who meets the standards set forth in section -10 to perform the improvements necessary for the residential property to achieve one of the designations specified in section -7(b).

(b) A retrofit project for which a grant is issued shall be completed no later than six months after the date the residential property owner receives notice of the grant approval. Failure to complete a project within the required timeframe may result in the forfeiture of the grant. For good cause, the department may extend the timeframe for the completion of the retrofit project.

(c) Grant funds shall not be paid until a certificate has been issued for the FORTIFIED standard, pursuant to rules adopted by the department. Grant moneys shall be paid by the department, on behalf of the residential property owner, directly to the contractor who performed the retrofit work; provided that the department may delegate payment under this subsection to another agency.

(d) A residential property owner shall be responsible for any amount that is owed to a contractor that exceeds the amount of awarded grant moneys.

(e) Grant moneys shall not be used for maintenance or repairs, unless used in conjunction with repairs or reconstruction necessary to address damage from a disaster.

(f) All retrofit activities shall comply with applicable:

(1) Building codes;

(2) Permitting and inspection requirements; and

(3) Standards established by the Insurance Institute for Business and Home Safety FORTIFIED Homes Program or other applicable standards under section -7(b).

(g) The department may conduct random inspections of funds, records, and residential properties for the purposes of preventing or detecting fraud.

§ -10 Contractors; eligibility. (a) A person receiving a grant under this chapter shall hire a contractor who meets the eligibility requirements of subsection (b) to perform the retrofit work.

(b) To be eligible to perform retrofit work under this chapter, a contractor shall:

(1) Be certified by the Insurance Institute for Business and Home Safety or another organization approved by the department;

(2) Be capable of performing work that satisfies the standards prescribed by this chapter and any rules adopted under this chapter;

(3) Meet all program requirements established under this chapter and any rules adopted under this chapter;

(4) Maintain with the department proof that the contractor:

(A) Is licensed under chapter 444;

(B) Is registered to do business in the State;

(D) Maintains workers' compensation as required by law; and

(E) Has an active Insurance Institute for Business and Home Safety FORTIFIED roof contractor certification or FORTIFIED professional certification, or another certification approved by the department;

(5) Maintain current and accurate contact information with the department;

(6) Have no record of disciplinary action by the contractors license board;

(7) Pay all fees associated with any certifications required under this chapter, including any training fees;

(8) Agree to follow all policies and procedures required by the department;

(9) Not have a financial interest in any project funded by the program for which the contractor is performing work, other than receiving payment on behalf of the homeowner from the program;

(10) Report to the department any conflicts of interest before work commences;

(11) Not be the evaluator for any project funded under the program; and

(12) Meet any other eligibility requirements established by the department.

§ -11 Annual reports. No later than twenty days prior to the convening of each regular session, the department shall submit a report to the legislature that includes:

(1) The number of homes retrofitted under the program during the previous year;

(2) Changes in vulnerability and insurance accessibility observed by the department, including short-term and long-term trends; and

(3) Any other findings and recommendations, including any proposed legislation.

§ -12 Rules. The department shall adopt rules pursuant to chapter 91 necessary to implement this chapter, including rules that address eligibility requirements, application procedures, procedures for appeals, conditions on the use of funds, and fees."

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 2025-2026 for the strengthen Hawaii homes program.

The sum appropriated shall be expended by the department of business, economic development, and tourism for the purposes of this Act.

SECTION 4. This Act shall take effect on July 1, 3000.

HOUSE OF REPRESENTATIVES	H.B. NO.	1467
THIRTY-THIRD LEGISLATURE, 2025		H.D. 2
STATE OF HAWAII