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HOUSE OF REPRESENTATIVES                H.B. NO.           
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                             
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                   A  BILL  FOR  AN  ACT

RELATING TO CONDOMINIUM PROPERTY REGIMES.



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

 1      SECTION 1.  The legislature finds that the function of
 
 2 county zoning and county land development ordinances and rules is
 
 3 to protect public health, safety, and welfare.  The purpose of
 
 4 this Act is to clarify that projects created and established as
 
 5 condominium property regimes are subject to county land use
 
 6 regulatory authority, and to ensure that projects created and
 
 7 established as condominium property regimes conform to the
 
 8 provisions of underlying county zoning ordinances and development
 
 9 requirements and are consistent with the intent of adopted county
 
10 land use policies and the state land use law.
 
11      SECTION 2.  Chapter 514A, Hawaii Revised Statutes, is
 
12 amended by adding to part I a new section to be appropriately
 
13 designated and to read as follows:
 
14      "514A-    Conformance with county zoning.  (a)  Any project
 
15 and all phases of any project established under this chapter
 
16 shall conform to the existing underlying county zoning for the
 
17 property and all development, building, and permitting
 
18 requirements adopted by the county by ordinance or rule.  The
 
19 total number of units or apartments established for residential
 

 
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 1 use for all phases of any project, inclusive of farm dwellings
 
 2 and all units or apartments to be conveyed with reservation
 
 3 rights to alter, improve, expand, convert, or replace a
 
 4 nonresidential apartment for residential use, shall not exceed
 
 5 the number of dwelling units allowed per zoned lot of record by
 
 6 the existing underlying county zoning."
 
 7      SECTION 3.  Section 514A-3, Hawaii Revised Statutes, is
 
 8 amended by amending the definition of "apartment" to read as
 
 9 follows:
 
10      ""Apartment" means a unit or part of the property intended
 
11 for any type of use or uses, and with an exit to a public street
 
12 or highway or to a common element or elements leading to a public
 
13 street or highway, and may include such appurtenances as garage
 
14 and other parking space, storage room, balcony, terrace, and
 
15 patio."
 
16      SECTION 4.  Section 514A-11, Hawaii Revised Statutes, is
 
17 amended to read as follows:
 
18      "514A-11  Recordation and contents of declaration.  The
 
19 bureau of conveyances and the land court shall immediately set up
 
20 the mechanics and method by which recordation of a master deed or
 
21 lease and the declaration may be made.  Provisions shall be made
 
22 for the recordation of instruments affecting the individual
 

 
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 1 apartments on subsequent resales, mortgages, and other
 
 2 encumbrances, as is done with all other real estate recordations;
 
 3 provided that land court certificates of title shall not be
 
 4 issued for apartments.  The declaration to which section 514A-20
 
 5 refers shall express the following particulars:
 
 6      (1)  Description of the land, whether leased or in fee
 
 7           simple, on which the building or buildings and
 
 8           improvements are or are to be located;
 
 9      (2)  Description of the building or buildings, stating the
 
10           number of stories and basements, the number of
 
11           apartments, and the principal materials of which it or
 
12           they is or are constructed or to be constructed;
 
13      (3)  The apartment number of each apartment, and a statement
 
14           of its location, approximate area, number of rooms, and
 
15           immediate common element to which it has access,
 
16           designated parking stall, if considered a limited
 
17           common element, and any other data necessary for its
 
18           proper identification;
 
19      (4)  Description of the common elements;
 
20      (5)  Description of the limited common elements, if any,
 
21           stating to which apartments their use is reserved;
 
22      (6)  The percentage of undivided interest in the common
 

 
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 1           elements appertaining to each apartment and its owner
 
 2           for all purposes, including voting;
 
 3      (7)  Statement of the purposes for which the building or
 
 4           buildings and each of the apartments are intended and
 
 5           restricted as to use;
 
 6      (8)  The name of a person to receive service of process in
 
 7           the cases hereinafter provided, together with the
 
 8           residence or place of business of the person which
 
 9           shall be within the county in which the property is
 
10           located;
 
11      (9)  Provision as to the percentage of votes by the
 
12           apartment owners which shall be determinative of
 
13           whether to rebuild, repair, or restore the property in
 
14           the event of damage or destruction of all or part of
 
15           the property;
 
16     (10)  Any further details in connection with the property
 
17           which the person executing the declaration may deem
 
18           desirable to set forth consistent with this chapter;
 
19     (11)  The method by which the declaration may be amended,
 
20           consistent with this chapter; provided that an
 
21           amendment to the declarations of all condominium
 
22           projects existing as of May 22, 1991, and all
 

 
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 1           condominium projects created thereafter shall require a
 
 2           vote or written consent of seventy-five per cent of all
 
 3           apartment owners, except as otherwise provided in this
 
 4           chapter; provided further that the declarations of
 
 5           condominium projects having five or fewer apartments
 
 6           may provide for the amendment thereof by a vote or
 
 7           written consent of more than seventy-five per cent of
 
 8           all apartment owners;
 
 9     (12)  Description as to any additions, deletions,
 
10           modifications, and reservations as to the property,
 
11           including without limitation provisions concerning the
 
12           merger or addition of later phases of the project.  To
 
13           the extent provided in the declaration, an amendment to
 
14           the declaration which is made to implement those
 
15           additions, deletions, modifications, reservations, or
 
16           merger provisions shall require the vote or written
 
17           consent of only the declarant or such percentage of
 
18           apartment owners as is provided in the declaration; and
 
19     (13)  [In the case of a project which includes one or more
 
20           existing structures being converted to condominium
 
21           status, a] Receipt of a written statement or other
 
22           administrative procedure evidencing the certification
 

 
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 1           by the county or city and county officer or officers
 
 2           having jurisdiction over county zoning ordinances and
 
 3           the issuance of building permits that the project is in
 
 4           compliance with all zoning and building ordinances and
 
 5           codes applicable to the project[,] pursuant to section
 
 6           514A-  , and specifying, if applicable:
 
 7           (A)  Any variances which have been granted to achieve
 
 8                such compliance; and
 
 9           (B)  Whether, as the result of the adoption or
 
10                amendment of any ordinances or codes, the project
 
11                presently contains any legal non-conforming uses
 
12                or structures[.];
 
13           except that a project that is registered pursuant to
 
14           section 514A-31 shall not include that statement in the
 
15           declaration and shall provide the statement pursuant to
 
16           514A-40."
 
17      SECTION 5.  Section 514A-12, Hawaii Revised Statutes, is
 
18 amended to read as follows:
 
19      "514A-12  Copy of the [floor] plans to be filed.  (a)
 
20 Simultaneously with the recording of the declaration, there shall
 
21 be filed in the office of the recording officer a set of plans to
 
22 include the floor plans and elevations of the building or
 

 
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 1 buildings, showing the layout, location, apartment numbers, and
 
 2 dimensions of the apartments, stating the name of the property or
 
 3 that it has no name, and [bearing the] a project site plan or map
 
 4 showing the boundaries of the project property and the boundaries
 
 5 of recorded lots, common elements, limited common elements for
 
 6 exclusive use of each apartment, easements and rights of way if
 
 7 any, the area measures for the preceding, location and uses of
 
 8 units or apartments and buildings, zoning of the recorded lots,
 
 9 and tax map key.
 
10      (b)  The project site plan for all projects filed under this
 
11 chapter shall bear a statement from the county or city and county
 
12 officers having jurisdiction over zoning and development
 
13 permitting certifying the project to be in compliance with county
 
14 zoning and development ordinances and rules.  The floor plans
 
15 shall bear a statement of a registered architect or professional
 
16 engineer certifying that it is an accurate copy of portions of
 
17 the plans of the building or buildings as filed with the county
 
18 or city and county officer having jurisdiction over the issuance
 
19 of permits for the construction of buildings and, if construction
 
20 of the building or buildings is completed, as approved by the
 
21 county or city and county officer.  If the floor plans do not
 
22 include a statement by the architect or engineer that the floor
 

 
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 1 plans fully and accurately depict the layout, location, apartment
 
 2 numbers, and dimensions of the apartments as approved by the
 
 3 county or city and county officer having jurisdiction over the
 
 4 issuance of permits for the construction of buildings and as
 
 5 built, there shall be recorded within thirty days from the date
 
 6 of completion of the building or buildings as "date of
 
 7 completion" is defined in section 507-43, or from the date of
 
 8 occupancy of the building or buildings, whichever shall first
 
 9 occur, an amendment to the declaration to which shall be attached
 
10 a statement of a registered architect or professional engineer
 
11 certifying that the final floor plans theretofore filed, or being
 
12 filed simultaneously with such amendment, fully and accurately
 
13 depict the project site plan, layout, location, apartment
 
14 numbers, and dimensions of the apartments as approved by the
 
15 county or city and county officer having jurisdiction over the
 
16 issuance of permits for the construction of buildings and as
 
17 built, which amendment shall require only the vote or written
 
18 consent of the declarant or such other person or persons as are
 
19 provided in the declaration.
 
20      (c)  The plans shall be kept by the recording officer as
 
21 provided by rules adopted by the department of land and natural
 
22 resources, pursuant to chapter 91, indexed in the same manner as
 

 
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 1 a conveyance entitled to record, numbered serially in the order
 
 2 of receipt, each designated "apartment ownership," with the name
 
 3 of the property, if any, and each containing an appropriate
 
 4 reference to the recording of the declaration.  Correspondingly,
 
 5 the record of the declaration shall contain a reference to the
 
 6 file number of the project site plan and floor plans of the
 
 7 building or buildings on the property affected thereby."
 
 8      SECTION 6.  Section 514A-36, Hawaii Revised Statutes, is
 
 9 amended by amending subsection (a) to read as follows:
 
10      "(a)  Concurrently with its filing with the commission of
 
11 the notification of intention pursuant to sections 514A-31 and
 
12 514A-32, the developer shall prepare and submit to the commission
 
13 a public report disclosing all material facts pertaining to the
 
14 project.  The public report shall be in such form and content as
 
15 prescribed by the commission.  Such public report may not be used
 
16 for the purpose of selling any apartments in the project unless
 
17 and until the commission issues an effective date for the public
 
18 report.  The commission's issuance of an effective date for a
 
19 public report shall not be construed to constitute the
 
20 commission's approval or disapproval of the project, or the
 
21 commission's representation that all material facts concerning
 
22 the project have been fully or adequately disclosed, or the
 

 
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 1 commission's judgment of the value or merits of the project.  No
 
 2 effective date for a final public report shall be issued until
 
 3 execution and recordation of the deed or master lease, the
 
 4 declaration, the bylaws, and plans including site and floor
 
 5 plans, as provided by sections 514A-11, 514A-12, 514A-20, 514A-
 
 6 40, and 514A-81."
 
 7      SECTION 7.  Section 514A-40, Hawaii Revised Statutes, is
 
 8 amended by amending subsections (a) and (b) to read as follows:
 
 9      "(a)  No effective date shall be issued by the commission
 
10 for a final public report prior to completion of construction of
 
11 the project, unless there is filed with the commission:
 
12      (1)  A statement showing all costs involved in completing
 
13           the project, including land payments or lease payments,
 
14           real property taxes, construction costs, architect,
 
15           engineering, and attorneys' fees, financing costs,
 
16           provisions for contingency, etc., which must be paid on
 
17           or before the completion of construction of the
 
18           project;
 
19      (2)  An estimate of the time of completion of construction
 
20           of the total project;
 
21      (3)  Satisfactory evidence of sufficient funds to cover the
 
22           total project cost from purchasers' funds, equity
 

 
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 1           funds, interim or permanent loan commitments, or other
 
 2           sources;
 
 3      (4)  A copy of the executed construction contract;
 
 4      (5)  Satisfactory evidence of a performance bond issued by a
 
 5           surety licensed in the State of not less than one
 
 6           hundred per cent of the cost of construction, or such
 
 7           other substantially equivalent or similar instrument or
 
 8           security approved by the commission;
 
 9      (6)  If purchasers' funds are to be used for construction,
 
10           an executed copy of the escrow agreement for the trust
 
11           fund required under section 514A-67 for financing
 
12           construction, which expressly shall provide for:
 
13           (A)  No disbursements by the escrow agent for payment
 
14                of construction costs, unless bills are submitted
 
15                with the request for disbursements that have been
 
16                approved or certified for payment by the project
 
17                lender or an otherwise qualified financially
 
18                disinterested person; and
 
19           (B)  No disbursements from the balance of the trust
 
20                fund after payment of construction costs pursuant
 
21                to the preceding paragraph until construction of
 
22                the project has been completed and the escrow
 

 
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 1                agent receives satisfactory evidence that all
 
 2                mechanics' and materialmen's liens have been
 
 3                cleared, unless sufficient funds are set aside for
 
 4                any bona fide dispute;
 
 5      (7)  A parking plan to include designated residence parking
 
 6           stalls and guest parking, if any, exclusive of
 
 7           assignment to individual apartments, if parking stalls
 
 8           are to be considered limited common elements; [and]
 
 9      (8)  A copy of the disclosure statement required by section
 
10           514A-62(f)(3) if an effective date for a contingent
 
11           final public report has been issued by the commission
 
12           and the report has not expired[.]; and
 
13      (9)  A signed statement or other administrative evidence
 
14           issued by the appropriate county or city and county
 
15           officer or officers having jurisdiction over county
 
16           zoning ordinances and the issuance of building permits,
 
17           certifying that the project is in compliance with all
 
18           zoning and building ordinances and codes applicable to
 
19           the project, pursuant to section 514A- .
 
20      (b)  No effective date shall be issued by the commission for
 
21 a final public report for a project that includes one or more
 
22 existing structures being converted to condominium status unless
 

 
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 1 there is filed with the commission all items required under
 
 2 subsection (a) and:
 
 3      (1)  A statement signed by [an] appropriate county
 
 4           [official] or city and county officers that the project
 
 5           is in compliance with all zoning and building
 
 6           ordinances and codes applicable to the project[,]
 
 7           pursuant to section 514A- , and specifying, if
 
 8           applicable:
 
 9           (A)  Any variances which have been granted to achieve
 
10                such compliance; and
 
11           (B)  Whether the project contains any legal
 
12                nonconforming uses or structures as a result of
 
13                the adoption or amendment of any ordinances or
 
14                codes;
 
15      (2)  A statement by the declarant, based upon a report
 
16           prepared by an independent Hawaii registered architect
 
17           or engineer, describing the present condition of all
 
18           structural components and mechanical and electrical
 
19           installations material to the use and enjoyment of the
 
20           project; and
 
21       (3) A statement by the declarant of the expected useful
 
22           life of each item reported on in paragraph (2) or a
 

 
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 1           statement that no representations are made in that
 
 2           regard; provided that this paragraph and paragraph (2)
 
 3           apply only to apartments that may be occupied for
 
 4           residential use and have been in existence for five
 
 5           years or more."
 
 6      SECTION 8.  If any provision of this Act, or the application
 
 7 thereof to any person or circumstance is held invalid, the
 
 8 invalidity does not affect other provisions or applications of
 
 9 the Act which can be given effect without the invalid provision
 
10 or application, and to this end the provisions of this Act are
 
11 severable.
 
12      SECTION 9.  Statutory material to be repealed is bracketed.
 
13 New statutory material is underscored.
 
14      SECTION 10.  This Act shall take effect upon its approval.
 
15 
 
16                           INTRODUCED BY: ________________________
 

 
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