Report Title:

Kikala-Keokea; Home Loans; Self-help; GO Bonds

Description:

Clarifies loan limits and borrower qualifications for the Kikala-Keokea housing revolving fund. Authorizes the issuance of general obligation bonds to fund low-interest home construction loans for Kikala-Keokea lessees and self-help housing project.

THE SENATE

S.B. NO.

3098

TWENTY-SECOND LEGISLATURE, 2004

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

relating to Kikala-keokea.

 

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

SECTION 1. Beginning in 1983 and continuing into the following decade, lava erupted by Kilauea Volcano repeatedly invaded communities along the southern coast of the island of Hawaii, destroying more than one hundred eighty homes. Flows entered Kalapana briefly in November, 1986, then moved through the entire community in 1990 and 1991.

The lava flows destroyed one of the last native Hawaiian settlements on the island of Hawaii and a tightly-knit community, whose rights to occupy the land under homestead leases and to fish in surrounding waters have been recognized by the federal government since 1938 under the Kalapana Extension Act.

In recognition of this tragedy, the legislature enacted Act 314, Session Laws of Hawaii 1991, as amended (Act 314), authorizing the department of land and natural resources to negotiate long term leases with qualified, displaced Kalapana families to allow them to maintain their heritage on ceded lands in the Kikala-Keokea homestead area adjacent to the Kalapana-Kapoho Beach road. This site allows the Kalapana families to maintain their traditional cultural practices, including speaking the Hawaiian language, raising small animals, planting sustenance crops, growing herbal medicines, and gathering additional food resources from the nearby ocean and uplands.

Act 314 also stipulated that the department of land and natural resources subdivide and create a residential subdivision in the Kikala-Keokea homestead area. Pursuant thereto, the department entered into lease arrangements with forty-eight of the fifty-eight eligible families.

In 2001, the legislature enacted Act 144, Session Laws of Hawaii 2001, as amended. The law established the infrastructure development fund to fund the construction of roads, water lines, and other infrastructure, and the Kikala-Keokea housing revolving fund to provide low-interest loans to Kikala-Keokea leaseholders for home construction. The development of infrastructure in the Kikala-Keokea area will be completed in 2004, allowing for the commencement of home construction by leaseholders. Some of the homes to be constructed will be built by the homeowners themselves through a self-help housing project.

The purpose of this Act is to:

(1) Clarify the purposes of the Kikala-Keokea housing revolving fund; and

(2) Authorize the issuance of general obligation bonds and appropriate moneys to fund the Kikala-Keokea housing revolving fund.

SECTION 2. Section 201G-170.5, Hawaii Revised Statutes, is amended by amending subsections (a) and (b) to read as follows:

"(a) There is established in the state treasury the Kikala-Keokea housing revolving fund to provide low interest loans in an amount up to $60,000 for home construction for Kikala-Keokea leaseholders who have been denied loans from traditional financial institutions[.] and who meet the following requirements:

(1) The lessee is domiciled in the State and shall physically reside in the dwelling unit purchased;

(2) The lessee:

(A) Is a person who, individually or together with a spouse or household member, does not own a majority interest in fee simple or leasehold lands suitable for dwelling purposes or a majority interest in land under any trust agreement or other fiduciary arrangement in which another person holds the legal title to the land; or

(B) Is a person whose spouse or household member does not own a majority interest in fee simple or leasehold lands suitable for dwelling purposes or more than a majority interest in lands under any trust agreement or other fiduciary arrangement in which another person holds the legal title to the land, except when husband and wife are living apart under a decree of separation from bed and board issued by the family court pursuant to section 580-71; and

(3) The lessee's household income does not exceed eighty per cent of the area median income.

The revolving fund shall be administered by the housing and community development corporation of Hawaii.

(b) The rate of interest on loans executed pursuant to this section shall not exceed three per cent per year [and interest earnings on loans made pursuant to this section]. Moneys in the revolving fund may be used for administrative and other expenses necessary for administering the loan program. Guidelines shall be established by the housing and community development corporation of Hawaii with respect to loan terms and loan qualification criteria. Moneys appropriated for the purposes of this section shall be deposited into the Kikala-Keokea housing revolving fund; provided that upon fulfillment of the purposes of this section, all unencumbered moneys shall lapse into the state general fund."

SECTION 3. The director of finance is authorized to issue general obligation bonds in the sum of $2,000,000, or so much thereof as may be necessary, and the same sum, or so much thereof as may be necessary, is appropriated for fiscal year 2004-2005, for the Kikala-Keokea housing revolving fund to provide low-interest home construction loans for Kikala-Keokea leaseholders and to fund related activities, including administration of a self-help housing project.

SECTION 4. The appropriation made for the capital improvement project authorized by this Act shall not lapse at the end of the fiscal biennium for which the appropriation is made; provided that all moneys from the appropriation unencumbered as of June 30, 2006, shall lapse as of that date.

SECTION 5. The sum appropriated shall be expended by the department of human services for the purposes of this Act.

SECTION 6. This Act shall take effect on July 1, 2004.

INTRODUCED BY:

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