Ensures that condominium property regimes are subject to county
zoning and county subdivision and development ordinances and

THE SENATE                              S.B. NO.           790
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            

                   A  BILL  FOR  AN  ACT



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

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 1 appurtenance for residential use, shall not exceed the number of
 2 dwelling units allowed without further governmental action under
 3 the county land use ordinance applicable to the lot of record at
 4 the time the declarations or condominium plans are recorded.
 5      (b)  For any project with individual detached apartments
 6 intended for residential use, including farm dwellings, or
 7 intended to be converted to residential use, the area of the
 8 limited common element designated for exclusive use by each
 9 detached apartment shall conform to minimum lot size
10 requirements, use restrictions, and development standards of the
11 underlying county zoning existing at the time the declaration."
12      SECTION 3.  Section 514A-3, Hawaii Revised Statutes, is
13 amended by amending the definition of "apartment" to read as
14 follows:
15      ""Apartment" means a unit or a part of the property intended
16 for any type of use or uses, and with an exit to a public street
17 or highway or to a common element or elements leading to a public
18 street or highway, and may include such appurtenances as garage
19 and other parking space, storage room, balcony, terrace, and
20 patio."
21      SECTION 4.  Section 514A-11, Hawaii Revised Statutes, is
22 amended to read as follows:
23      "514A-11  Recordation and contents of declaration.  The

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

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

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 1           amendment to the declarations of all condominium
 2           projects existing as of May 22, 1991, and all
 3           condominium projects created thereafter shall require a
 4           vote or written consent of seventy-five per cent of all
 5           apartment owners, except as otherwise provided in this
 6           chapter; provided further that the declarations of
 7           condominium projects having five or fewer apartments
 8           may provide for the amendment thereof by a vote or
 9           written consent of more than seventy-five per cent of
10           all apartment owners;
11     (12)  Description as to any additions, deletions,
12           modifications, and reservations as to the property,
13           including without limitation provisions concerning the
14           merger or addition of later phases of the project.  To
15           the extent provided in the declaration, an amendment to
16           the declaration which is made to implement those
17           additions, deletions, modifications, reservations or
18           merger provisions shall require the vote or written
19           consent of only the declarant or such percentage of
20           apartment owners as is provided in the declaration; and
21     (13)  [In the case of a project which includes one or more
22           existing structures being converted to condominium
23           status, a] Receipt of a written statement or other

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 1           administrative procedure evidencing the certification
 2           by the county officer or officers having jurisdiction
 3           over county zoning ordinances and rules and the
 4           issuance of building permits that the project is in
 5           compliance with all zoning and building ordinances and
 6           codes applicable to the project[,] pursuant to section
 7           514A, and specifying, if applicable:
 8           (A)  Any variances which have been granted to achieve
 9                such compliance; and
10           (B)  Whether, as the result of the adoption or
11                amendment of any ordinances or codes, the project
12                presently contains any legal non-conforming uses
13                or structures[.];
14           except that a project that is registered pursuant to
15           section 514A-31 shall not include that statement in the
16           declaration and shall provide the statement pursuant to
17           section 514A-40."
18      SECTION 5.  Section 514A-12, Hawaii Revised Statutes, is
19 amended to read as follows:
20      "514A-12  Copy of the [floor] plans to be filed.  (a)
21 Simultaneously with the recording of the declaration, there shall
22 be filed in the office of the recording officer a set of plans to
23 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 property or boundaries of recorded lots, common
 5 elements, limited common elements for exclusive use of each
 6 apartment, easements and rights of way if any, the area measures
 7 for the preceding, location, and uses of apartments and
 8 buildings, zoning, and tax map key.
 9      (b)  The project site plan for all projects filed under this
10 chapter shall bear a statement from the county officers having
11 jurisdiction over zoning and development permitting certifying
12 the project to be in compliance with county zoning, subdivision,
13 and development ordinance and rules.  The floor plans shall bear
14 a statement of a registered architect or professional engineer
15 certifying that it is an accurate copy of portions of the plans
16 of the building or buildings as filed with the county or city and
17 county officer having jurisdiction over the issuance of permits
18 for the construction of buildings and, if construction of the
19 building or buildings is completed, as approved by the county or
20 city and county officer.  If the floor plans do not include a
21 statement by the architect or engineer that the floor plans fully
22 and accurately depict the layout, location, apartment numbers,
23 and dimensions of the apartments as approved by the county or

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

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 1 the record of the declaration shall contain a reference to the
 2 file number of the project site plan and floor plans of the
 3 building or buildings on the property affected thereby."
 4      SECTION 6.  Section 514A-36, Hawaii Revised Statutes, is
 5 amended by amending subsection (a) to read as follows:
 6      "(a)  Concurrently with its filing with the commission of
 7 the notification of intention pursuant to sections 514A-31 and
 8 514A-32, the developer shall prepare and submit to the commission
 9 a public report disclosing all material facts pertaining to the
10 project.  The public report shall be in such form and content as
11 prescribed by the commission.  Such public report may not be used
12 for the purpose of selling any apartments in the project unless
13 and until the commission issues an effective date for the public
14 report.  The commission's issuance of an effective date for a
15 public report shall not be construed to constitute the
16 commission's approval or disapproval of the project, or the
17 commission's representation that all material facts concerning
18 the project have been fully or adequately disclosed, or the
19 commission's judgment of the value or merits of the project.  No
20 effective date for a final public report shall be issued until
21 execution and recordation of the deed or master lease, the
22 declaration, the bylaws, and plans including site and floor
23 plans, as provided by sections 514A-11, 514A-12, 514A-20,

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 1 514A-40, and 514A-81."
 2      SECTION 7.  Section 514A-40, Hawaii Revised Statutes, is
 3 amended by amending subsections (a) and (b) to read as follows:
 4      "(a)  No effective date shall be issued by the commission
 5 for a final public report prior to completion of construction of
 6 the project, unless there is filed with the commission:
 7      (1)  A statement showing all costs involved in completing
 8           the project, including land payments or lease payments,
 9           real property taxes, construction costs, architect,
10           engineering, and attorneys' fees, financing costs,
11           provisions for contingency, etc., which [must] shall be
12           paid on or before the completion of construction of the
13           project;
14      (2)  An estimate of the time of completion of construction
15           of the total project;
16      (3)  Satisfactory evidence of sufficient funds to cover the
17           total project cost from purchasers' funds, equity
18           funds, interim or permanent loan commitments, or other
19           sources;
20      (4)  A copy of the executed construction contract;
21      (5)  Satisfactory evidence of a performance bond issued by a
22           surety licensed in the State of not less than one
23           hundred per cent of the cost of construction, or such

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 1           other substantially equivalent or similar instrument or
 2           security approved by the commission; 
 3      (6)  If purchasers' funds are to be used for construction,
 4           an executed copy of the escrow agreement for the trust
 5           fund required under section 514A-67 for financing
 6           construction, which expressly shall provide for:
 7           (A)  No disbursements by the escrow agent for payment
 8                of construction costs, unless bills are submitted
 9                with the request for disbursements that have been
10                approved or certified for payment by the project
11                lender or an otherwise qualified financially
12                disinterested person; and
13           (B)  No disbursements from the balance of the trust
14                fund after payment of construction costs pursuant
15                to the preceding paragraph until construction of
16                the project has been completed and the escrow
17                agent receives satisfactory evidence that all
18                mechanics' and materialmen's liens have been
19                cleared, unless sufficient funds are set aside for
20                any bona fide dispute;
21      (7)  A parking plan to include designated residence parking
22           stalls and guest parking, if any, exclusive of
23           assignment to individual apartments, if parking stalls

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 1           are to be considered limited common elements; [and]
 2      (8)  A copy of the disclosure statement required by section
 3           514A-62(f)(3) if an effective date for a contingent
 4           final public report has been issued by the commission
 5           and the report has not expired[.]; and
 6      (9)  A signed statement or other administrative evidence
 7           issued by the appropriate county officer or officers
 8           having jurisdiction over county zoning, subdivision
 9           ordinances and rules, and the issuance of building
10           permits, certifying that the project is in compliance
11           with all zoning and building ordinances and codes
12           applicable to the project, pursuant to section 514A-  .
13      (b)  No effective date shall be issued by the commission for
14 a final public report for a project that includes one or more
15 existing structures being converted to condominium status unless
16 there is filed with the commission all items required under
17 subsection (a) and:
18      (1)  A statement signed by [an] appropriate county
19           [official] officers that the project is in compliance
20           with all zoning and building ordinances and codes
21           applicable to the project, pursuant to section 514A-  ,
22           and specifying, if applicable:
23           (A)  Any variances which have been granted to achieve

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 1                such compliance; and
 2           (B)  Whether the project contains any legal
 3                nonconforming uses or structures as a result of
 4                the adoption or amendment of any ordinances or
 5                codes;
 6      (2)  A statement by the declarant, based upon a report
 7           prepared by an independent Hawaii registered architect
 8           or engineer, describing the present condition of all
 9           structural components and mechanical and electrical
10           installations material to the use and enjoyment of the
11           project; and
12      (3)  A statement by the declarant of the expected useful
13           life of each item reported on in paragraph (2) or a
14           statement that no representations are made in that
15           regard; provided that this paragraph and paragraph (2)
16           apply only to apartments that may be occupied for
17           residential use and have been in existence for five
18           years or more."
19      SECTION 8.  This Act shall apply to:
20      (1)  Condominium property regimes established and recorded
21           pursuant to chapter 514A, Hawaii Revised Statutes, made
22           on or after the effective date of this Act;
23      (2)  Amendments made on or after the effective date of this

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 1           Act to condominium property regimes recorded before the
 2           introduction date of this Act.
 3      SECTION 9.  Statutory material to be repealed is bracketed.
 4 New statutory material is underscored.
 5      SECTION 10.  This Act shall take effect upon its approval.
 7                           INTRODUCED BY:  _______________________