Honolulu, Hawaii



RE:    S.B. No. 1244

       S.D. 1




Honorable Ronald D. Kouchi

President of the Senate

Twenty-Ninth State Legislature

Regular Session of 2017

State of Hawaii




     Your Committees on Housing and Government Operations, to which was referred S.B. No. 1244 entitled:




beg leave to report as follows:


     The purpose and intent of this measure is to authorize qualified nonprofit housing trusts to repurchase affordable units developed with government assistance when a government entity waives its first right of refusal to repurchase the unit.


     Your Committees received testimony in support of this measure from the Hawaii HomeOwnership Center; Hawaii HomeOwnership Center on behalf of more than fifty-five residents; Hawaii Association of REALTORS; Gentry Homes, LTD; Honolulu Board of REALTORS; and two individuals.  Your Committees received comments on this measure from the Department of Commerce and Consumer Affairs, Hawaii Housing Finance and Development Corporation, and Hawaii Community Development Authority.


     Your Committees find that the shortage of safe, decent, and sanitary housing has been a persistent problem in Hawaii for decades.  Your Committees further find that the median price for single family homes on Oahu has risen to approximately $750,000.  Your Committees additionally find that it is necessary to take steps to ensure that existing affordable housing is preserved as affordable for as long as possible.  Your Committees also find that this measure has generated a significant amount of testimony by state agencies and other bodies deeply involved in the development and management of affordable residential units in Hawaii.


     Accordingly, your Committees have amended this measure by:


     (1)  Adding language requiring perpetual buyback restrictions by qualified nonprofit housing trusts;


     (2)  Clarifying the definition of "qualified nonprofit housing trust" and allowing HCDA, each county, and the Hawaii Housing and Finance Development Corporation (HHFDC) to make their own determinations of whether a qualified nonprofit housing trust has the capacity, resources, and mission to ensure long-term affordability of housing;


     (3)  Adding language including the Hawaii Housing Finance and Development Corporation's share of net appreciation in the real property for the purposes of calculating the maximum price of the Corporation's first option to purchase;


     (4)  Adding language clarifying that the Hawaii Housing Finance and Development Corporation may select the nonprofit housing trust which shall have the option to purchase an affordable housing unit if the Corporation waives its first option to repurchase;


     (5)  Adding language clarifying that the Hawaii Community Development Authority may adopt rules to specify the cutoff income levels for low- and moderate-income ranges for the purpose of determining workforce housing; and


     (6)  Making technical, nonsubstantive amendments for the purposes of clarity and consistency.


     As affirmed by the records of votes of the members of your Committees on Housing and Government Operations that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 1244, as amended herein, and recommend that it pass Second Reading in the form attached hereto as S.B. No. 1244, S.D. 1, and be referred to your Committee on Ways and Means.


Respectfully submitted on behalf of the members of the Committees on Housing and Government Operations,