REPORT TITLE:
Condominiums; Zoning; Land Use

DESCRIPTION:
Subjects condominium property regimes to county zoning and
development ordinances and rules. (SD2)

 
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THE SENATE                              S.B. NO.           S.D. 2
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 land use ordinances.  Any
 
15 condominium property regime established under this chapter shall
 
16 conform to the existing underlying county zoning for the property
 
17 and all applicable county permitting requirements adopted by the
 
18 county in which the property is located, including any
 
19 supplemental rules and regulations adopted by the county pursuant
 

 
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 1 to section 514A-45 to ensure the conformance of condominium
 
 2 property regimes to the intent and provisions of county zoning
 
 3 and development ordinances and chapter 205."
 
 4      SECTION 3.  Section 514A-3, Hawaii Revised Statutes, is
 
 5 amended by amending the definition of "apartment" to read as
 
 6 follows:
 
 7      ""Apartment" means a unit or part of the property intended
 
 8 for any type of use or uses, and with an exit to a public street
 
 9 or highway or to a common element or elements leading to a public
 
10 street or highway, and may include such appurtenances as garage
 
11 and other parking space, storage room, balcony, terrace, and
 
12 patio."
 
13      SECTION 4.  Section 514A-11, Hawaii Revised Statutes, is
 
14 amended to read as follows:
 
15      "514A-11  Recordation and contents of declaration.  The
 
16 bureau of conveyances and the land court shall immediately set up
 
17 the mechanics and method by which recordation of a master deed or
 
18 lease and the declaration may be made.  Provisions shall be made
 
19 for the recordation of instruments affecting the individual
 
20 apartments on subsequent resales, mortgages, and other
 
21 encumbrances, as is done with all other real estate recordations;
 
22 provided that land court certificates of title shall not be
 
23 issued for apartments.  The declaration to which section 514A-20
 

 
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 1 refers shall express the following particulars:
 
 2      (1)  Description of the land, whether leased or in fee
 
 3           simple, on which the building or buildings and
 
 4           improvements are or are to be located;
 
 5      (2)  Description of the building or buildings, stating the
 
 6           number of stories and basements, the number of
 
 7           apartments, and the principal materials of which it or
 
 8           they is or are constructed or to be constructed;
 
 9      (3)  The apartment number of each apartment, and a statement
 
10           of its location, approximate area, number of rooms, and
 
11           immediate common element to which it has access,
 
12           designated parking stall, if considered a limited
 
13           common element, and any other data necessary for its
 
14           proper identification;
 
15      (4)  Description of the common elements;
 
16      (5)  Description of the limited common elements, if any,
 
17           stating to which apartments their use is reserved;
 
18      (6)  The percentage of undivided interest in the common
 
19           elements appertaining to each apartment and its owner
 
20           for all purposes, including voting;
 
21      (7)  Statement of the purposes for which the building or
 
22           buildings and each of the apartments are intended and
 
23           restricted as to use;
 

 
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 1      (8)  The name of a person to receive service of process in
 
 2           the cases hereinafter provided, together with the
 
 3           residence or place of business of the person which
 
 4           shall be within the county in which the property is
 
 5           located;
 
 6      (9)  Provision as to the percentage of votes by the
 
 7           apartment owners which shall be determinative of
 
 8           whether to rebuild, repair, or restore the property in
 
 9           the event of damage or destruction of all or part of
 
10           the property;
 
11     (10)  Any further details in connection with the property
 
12           which the person executing the declaration may deem
 
13           desirable to set forth consistent with this chapter;
 
14     (11)  The method by which the declaration may be amended,
 
15           consistent with this chapter; provided that an
 
16           amendment to the declarations of all condominium
 
17           projects existing as of May 22, 1991, and all
 
18           condominium projects created thereafter shall require a
 
19           vote or written consent of seventy-five per cent of all
 
20           apartment owners, except as otherwise provided in this
 
21           chapter; provided further that the declarations of
 
22           condominium projects having five or fewer apartments
 
23           may provide for the amendment thereof by a vote or
 

 
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 1           written consent of more than seventy-five per cent of
 
 2           all apartment owners;
 
 3     (12)  Description as to any additions, deletions,
 
 4           modifications, and reservations as to the property,
 
 5           including without limitation provisions concerning the
 
 6           merger or addition of later phases of the project.  To
 
 7           the extent provided in the declaration, an amendment to
 
 8           the declaration which is made to implement those
 
 9           additions, deletions, modifications, reservations, or
 
10           merger provisions shall require the vote or written
 
11           consent of only the declarant or such percentage of
 
12           apartment owners as is provided in the declaration; and
 
13     (13)  [In the case of a project which includes one or more
 
14           existing structures being converted to condominium
 
15           status, a statement] A declaration under penalty of law
 
16           that the project is in compliance with all zoning and
 
17           building ordinances and codes, and all other permitting
 
18           requirements applicable to the project[,] pursuant to
 
19           section 514A-  , and specifying, if applicable:
 
20           (A)  Any variances which have been granted to achieve
 
21                such compliance; and
 
22           (B)  Whether, as the result of the adoption or
 
23                amendment of any ordinances or codes, the project
 

 
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 1                presently contains any legal non-conforming uses
 
 2                or structures[.];
 
 3           except that a project that is registered pursuant to
 
 4           section 514A-31 shall not include that statement in the
 
 5           declaration and shall provide the statement pursuant to
 
 6           514A-40."
 
 7      SECTION 5.  Section 514A-40, Hawaii Revised Statutes, is
 
 8 amended by amending subsection (a) 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
 
23           funds, interim or permanent loan commitments, or other
 

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

 
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 1                cleared, unless sufficient funds are set aside for
 
 2                any bona fide dispute;
 
 3      (7)  A parking plan to include designated residence parking
 
 4           stalls and guest parking, if any, exclusive of
 
 5           assignment to individual apartments, if parking stalls
 
 6           are to be considered limited common elements; [and]
 
 7      (8)  A copy of the disclosure statement required by section
 
 8           514A-62(f)(3) if an effective date for a contingent
 
 9           final public report has been issued by the commission
 
10           and the report has not expired[.]; and
 
11      (9)  A declaration under penalty of law that the project is
 
12           in compliance with all county zoning and building
 
13           ordinances and codes, and all other county permitting
 
14           requirements applicable to the project, pursuant to
 
15           section 514A-    ."
 
16      SECTION 6.  If any provision of this Act, or the application
 
17 thereof to any person or circumstance is held invalid, the
 
18 invalidity does not affect other provisions or applications of
 
19 the Act which can be given effect without the invalid provision
 
20 or application, and to this end the provisions of this Act are
 
21 severable.
 
22      SECTION 7.  Statutory material to be repealed is bracketed.
 
23 New statutory material is underscored.
 

 
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 1      SECTION 8.  This Act shall take effect upon its approval.
 

 
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