Honolulu, Hawaii
                                                   , 1999

                                 RE: S.B. No. 1519
                                     S.D. 3
                                     H.D. 1

Honorable Calvin K.Y. Say
Speaker, House of Representatives
Twentieth State Legislature
Regular Session of 1999
State of Hawaii


     Your Committee on Human Services and Housing, to which was
referred S.B. No. 1519, S.D. 3, entitled: 


begs leave to report as follows:

     The purpose of this bill is to prevent eviction and
homelessness by:

     (1)  Requiring assisted housing development owners to give a
          one-year notice to tenants if the owner is going to
          terminate a subsidy contract or mortgage prepayment;

     (2)  Giving tenants or nonprofit organizations opportunities
          to purchase the development if the owner of the
          development has not given notice to sell prior to July
          1, 1999; and

     (3)  Authorizing general obligation bonds to the Rental
          Housing Trust Fund (Trust Fund) to encourage the
          development and availability of low income rental

     The Legal Aid Society of Hawaii, Hawaii Investors for
Affordable Housing, the Affordable Housing and Homeless Alliance,
and the Hawaii Catholic Conference testified in support of this
measure.  The Housing and Community Development Corporation of
Hawaii and one individual commented on this measure.

                                 STAND. COM. REP. NO. 1331
                                 Page 2

     More than 3,000 Hawaii households now have affordable rent
through the U.S. Department of Housing and Urban Development
(HUD) project-based Section 8 program.  In this program, HUD
directly subsidizes buildings, which are owned by private
entities.  Originally subsidized for a term of twenty years,
every unit in these buildings are now at risk of converting to
market rate rent due to HUD's yearly contract renewals, shrinking
subsidies, and the Mark to Market program.

     Your Committee finds that since the twenty-year commitment
has expired, more and more owners are putting their units up for
sale or converting them to market rate rent.  This action is
displacing many elderly and low-income individuals into

     Your Committee acknowledges that extending a one year's
notice upon termination of a subsidy contract or mortgage
prepayment is not the answer to this problem, rather, more
affordable rental housing is needed.  However, this measure goes
a long way toward supporting tenants' efforts to preserve the
affordability of their homes.

     Your Committee has amended this measure by making technical,
nonsubstantive amendments for clarity and style.

     As affirmed by the record of votes of the members of your
Committee on Human Services and Housing that is attached to this
report, your Committee is in accord with the intent and purpose
of S.B. No. 1519, S.D. 3, as amended herein, and recommends that
it pass Second Reading in the form attached hereto as S.B. No.
1519, S.D. 3, H.D. 1, and be referred to the Committee on

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committee on Human Services
                                   and Housing,

                                   DENNIS A. ARAKAKI, Chair