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. (SB3098 HD1)

THE SENATE

S.B. NO.

3098

TWENTY-SECOND LEGISLATURE, 2004

H.D. 1

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. The legislature finds that in 1938 the United States Congress enacted Public Law 680, the Kalapana Extension Act, which authorized the addition of Kalapana lands to the Hawaii National Park. The law further authorized the granting of leases for home sites to native Hawaiian residents of the area and permitted fishing in the area only by native Hawaiian residents of the area or adjacent villages, or by visitors under their guidance.

The legislature further finds that pursuant to Public Law 86—3, Admission Act of 1959, the State assumed title to certain ceded lands adjacent to the Kalapana Extension in the Kikala-Keokea area. Section (f) of the Admission Act of 1959 provides that these lands may be used for the betterment of the conditions of native Hawaiians.

There is a further finding that a special trust obligation to native Hawaiians is established under sections 4 and 7 of article XII of the Constitution of the State of Hawaii, and that by virtue of these provisions, the State has an affirmative obligation to reaffirm and protect the cultural rights of native Hawaiians and their descendants, including fishing and subsistence rights.

The legislature also finds that through the years, the residents of Kalapana maintained traditional Hawaiian cultural practices, including speaking the Hawaiian language, raising small animals, planting sustenance crops, growing medicinal herbs, and gathering additional food resources from the nearby ocean and uplands.

There is a further finding that 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 disrupted the traditional Hawaiian lifestyle practiced by Kalapana residents.

The legislature further finds that in response to this tragedy, Act 314, Session Laws of Hawaii 1991, as amended (Act 314), authorized 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. Act 314 also authorized the department of land and natural resources to subdivide and create a residential subdivision in the Kikala-Keokea homestead area for lessees. Pursuant to Act 314, the department entered into lease arrangements with forty-eight of the fifty-eight eligible families.

The legislature also finds that Act 144, Session Laws of Hawaii 2001, as amended, 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 legislature further finds that there is a need to capitalize the Kikala—Keokea housing revolving fund to finance the construction of homes in the Kikala—Keokea subdivision, and further, to clarify the qualifications for low-interest loans from the fund. Therefore, the purposes of this Act are 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.

Finally, it is a finding of this legislature that, in establishing a funding mechanism for the construction of homes in the Kikala-Keokea residential subdivision, this Act serves a public purpose by facilitating the practice, protection, and perpetuation of native Hawaiian culture and traditions.

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] 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 $1 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.

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

SECTION 5. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

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