THE SENATE

S.B. NO.

2943

TWENTY-NINTH LEGISLATURE, 2018

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

relating to transit-oriented development zones.

 

 

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

 


     SECTION 1.  The legislature finds that the construction and installation of certain public facilities is necessary and desirable to facilitate the renewal and redevelopment of areas proximate to proposed fixed rail transit stations.  Transit-oriented development is a powerful tool that can ultimately deliver a wide range of social, environmental, and economic benefits.  Transit-oriented development promotes development patterns that support quality of life, preserves the natural environment, provides a range of housing choices for residents, and encourages walking, biking, and mass transit.

     The State plays an important role in overcoming barriers to transit-oriented development, including encouraging needed investments in regional public facilities, such as roads, sewers, and drainage systems.  This Act is intended to move current transit-oriented development planning efforts forward into structures that benefit the community.

     The purpose of this Act is to establish a transit-oriented development zone improvement program to foster community development by strategically investing in public facilities under the Hawaii community development authority.

     SECTION 2.  Chapter 201H, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§201H-    Transit-oriented development zone infrastructure subaccounts.  (a)  At the request of the Hawaii community development authority, the corporation may establish and operate a transit-oriented development zone infrastructure subaccount within the dwelling unit revolving fund established pursuant to section 201H-191 for the benefit of transit-oriented development zone improvement projects within a transit-oriented development zone.

     (b)  Each transit-oriented development zone infrastructure subaccount shall consist of the following sources of revenue:

     (1)  Moneys received by the corporation from counties for the repayment of the loan principal and the payment of simple interest from various assessments or fees from special improvement districts, improvement districts, tax increment financing districts, community facilities districts, and other areas where property value increases are captured over periods of time for the purposes of transit-oriented development zone infrastructure financing;

     (2)  Appropriations from the legislature;

     (3)  Federal grants and subsidies to the State or counties;

     (4)  Private investments; and

     (5)  Voluntary contributions.

     (c)  The corporation shall expend revenues in the subaccounts to make grants and loans to state agencies, and loans to counties or private developers for the costs, in whole or in part, of transit-oriented development zone infrastructure improvements that would increase the capacity of the infrastructure facilities, including regional sewer systems, water systems, drainage systems, roads, and telecommunications and broadband.

     Grants and loans may be made only for capital improvement projects approved by the Hawaii community development authority and the respective county council and mayor, or state agency, as applicable, with a view toward the development or renewal and redevelopment of areas proximate to proposed fixed rail transit stations.

     (d)  Eligible costs shall include those for planning, design, feasibility studies, construction, and materials.  No grant or loan shall be made:

     (1)  For maintenance or repair costs unless the construction would simultaneously increase the carrying capacity of the infrastructure facility; or

     (2)  Solely for mass transit or electrical utilities.

     The corporation may also expend revenues in the subaccounts to repay private investors for their investment plus any interest accrued on their investments made into the subaccounts to finance, in whole or in part, transit-oriented development zone infrastructure improvements that would facilitate the renewal and redevelopment of areas proximate to proposed fixed rail transit stations.

     (e)  The corporation may accept improved land from the Hawaii community development authority, counties, or private developers in repayment of their loans.

     (f)  The corporation shall adopt rules in accordance with chapter 91 for the purposes of this section.

     (g)  For purposes of this section, "transit-oriented development zone" shall have the same meaning as in section 201H-191."

     SECTION 3.  Section 201H-191, Hawaii Revised Statutes, is amended to read as follows:

     "§201H-191  Dwelling unit revolving fund.  (a)  There is created a dwelling unit revolving fund.  The funds appropriated for the purpose of the dwelling unit revolving fund and all moneys received or collected by the corporation for the purpose of the revolving fund shall be deposited in the revolving fund.  The proceeds in the revolving fund shall be used [to]:

     (1)  To reimburse the general fund to pay the interest on general obligation bonds issued for the purposes of the revolving fund, [for] as applicable;

     (2)  For the necessary expenses in administering housing development programs [and], regional state infrastructure programs, and [for] the transit-oriented development zone improvement program under section 206E-6;

     (3)  For carrying out the purposes of housing development programs [and regional state infrastructure programs, including but not limited to the expansion of community facilities and regional state infrastructure constructed in conjunction with housing and mixed-use transit-oriented development projects], including but not limited to permanent primary or secondary financing, and supplementing building costs, federal guarantees required for operational losses, and all things required by any federal agency in the construction and receipt of federal funds or lowincome housing tax credits for housing projects[.];

     (4)  For carrying out the purposes of regional state infrastructure programs, including but not limited to the expansion of community facilities and regional state infrastructure constructed in conjunction with housing and mixed-use transit-oriented development projects; and

     (5)  For carrying out the purposes of transit-oriented development zone improvement program projects in a transit-oriented development zone.

     (b)  Subject to the requirements of subsection (a), proceeds in the revolving fund may be used to establish and operate regional state infrastructure subaccounts pursuant to section 201H-191.5[.] and transit-oriented development zone infrastructure subaccounts pursuant to section 201H-  .

     (c)  For purposes of this section, "transit-oriented development zone" shall have the same meaning as in section 206E-2."

     SECTION 4.  Section 206E-2, Hawaii Revised Statutes, is amended by adding a new definition to be appropriately inserted and to read as follows:

     ""Transit-oriented development zone" means the parcels of land within a one-half mile radius around a proposed or existing fixed transit station as determined by the authority, taking into account proximity, walkability, adopted county plans, and other relevant factors."

     SECTION 5.  Section 206E-3, Hawaii Revised Statutes, is amended to read as follows:

     "§206E-3  Hawaii community development authority; established.  (a)  There is established the Hawaii community development authority, which shall be a body corporate and a public instrumentality of the State, for the purpose of implementing this chapter.  The authority shall be placed within the department of business, economic development, and tourism for administrative purposes.

     (b)  The authority shall consist of the following members:

     (1)  The director of finance or the director's designee; [the]

     (2)  The director of transportation or the director's designee; [a]

     (3)  The director of the office of planning or the director's designee;

     (4)  The executive director of the Hawaii housing finance and development corporation or the executive director's designee;

     (5)  A cultural specialist; [an]

     (6)  An at-large member; [an]

     (7)  An at-large member nominated by the senate president; [an]

     (8)  An at-large member nominated by the speaker of the house; [three]

     (9)  Three representatives of the Heeia community development district, [comprising two] which shall consist of the following:

          (A)  Two residents of that district or the Koolaupoko district, which consists of sections 1 through 9 of zone 4 of the first tax map key division[,]; and [one]

          (B)  One owner of a small business or one officer or director of a nonprofit organization in the Heeia community development district or Koolaupoko district,

          nominated by the county council of the county in which the Heeia community development district is located; [three]

    (10)  Three representatives of the Kalaeloa community development district, [comprising two] which shall consist of the following:

          (A)  Two residents of the Ewa zone (zone 9, sections 1 through 2) or the Waianae zone (zone 8, sections 1 through 9) of the first tax map key division[,]; and [one]

          (B)  One owner of a small business or one officer or director of a nonprofit organization in the Ewa or Waianae zone,

          nominated by the county council of the county in which the Kalaeloa community development district is located; [three]

    (11)  Three representatives of the Kakaako community development district, [comprising two] which shall consist of the following:

          (A)  Two residents of the district; and [one]

          (B)  One owner of a small business or one officer or director of a nonprofit organization in the district,

          nominated by the county council of the county in which the Kakaako community development district is located; [the]

    (12)  The director of planning and permitting of each county in which a community development district is located or the director's designee, who shall serve in an ex officio, nonvoting capacity; and [the]

    (13)  The chairperson of the Hawaiian homes commission or the chairperson's designee, who shall serve in an ex officio, nonvoting capacity.

     All members, except the director of finance, director of transportation, county directors of planning and permitting, and chairperson of the Hawaiian homes commission or their designees, shall be appointed by the governor pursuant to section 26-34.  The two at-large members nominated by the senate president and speaker of the house and the nine representatives of the respective community development districts shall each be appointed by the governor from a list of three nominees submitted for each position by the nominating authority specified in this subsection.

     (c)  The authority shall be organized and shall exercise jurisdiction as follows:

     (1)  For matters affecting the Heeia community development district, the following members shall be considered in determining quorum and majority and shall be eligible to vote:

          (A)  The director of finance or the director's designee;

          (B)  The director of transportation or the director's designee;

          (C)  The cultural specialist;

          (D)  The three at-large members; and

          (E)  The three representatives of the Heeia community development district;

          provided that the director of planning and permitting of the relevant county or the director's designee shall participate in these matters as an ex officio, nonvoting member and shall not be considered in determining quorum and majority;

     (2)  For matters affecting the Kalaeloa community development district, the following members shall be considered in determining quorum and majority and shall be eligible to vote:

          (A)  The director of finance or the director's designee;

          (B)  The director of transportation or the director's designee;

          (C)  The cultural specialist;

          (D)  The three at-large members; and

          (E)  The three representatives of the Kalaeloa community development district;

          provided that the director of planning and permitting of the relevant county and the chairperson of the Hawaiian homes commission, or their respective designees, shall participate in these matters as ex officio, nonvoting members and shall not be considered in determining quorum and majority;

     (3)  For matters affecting the Kakaako community development district, the following members shall be considered in determining quorum and majority and shall be eligible to vote:

          (A)  The director of finance or the director's designee;

          (B)  The director of transportation or the director's designee;

          (C)  The cultural specialist;

          (D)  The three at-large members; and

          (E)  The three representatives of the Kakaako community development district;

          provided that the director of planning and permitting of the relevant county or the director's designee shall participate in these matters as an ex officio, nonvoting member and shall not be considered in determining quorum and majority[.]; and

     (4)  For matters affecting transit-oriented development zones, including the creation of transit-oriented development zones, the following members shall be considered in determining quorum and majority and shall be eligible to vote:

          (A)  The director of finance or the director's designee;

          (B)  The director of transportation or the director's designee;

          (C)  The director of the office of planning or the director's designee;

          (D)  The executive director of the Hawaii housing finance and development corporation or the executive director's designee;

          (E)  The cultural specialist; and

          (F)  The three at-large members;

          provided that the director of planning and permitting of the relevant county or the director's designee shall participate in these matters as an ex officio, nonvoting member and shall not be considered in determining quorum and majority.

     (d)  In the event of a vacancy, a member shall be appointed to fill the vacancy in the same manner as the original appointment within thirty days of the vacancy or within ten days of the senate's rejection of a previous appointment, as applicable.

     The terms of the director of finance, director of transportation, director of the office of planning, executive director of the Hawaii housing finance and development corporation, county directors of planning and permitting, and chairperson of the Hawaiian homes commission or their respective designees shall run concurrently with each official's term of office.  The terms of the appointed voting members shall be for four years, commencing on July 1 and expiring on June 30; provided that the initial terms of all voting members initially appointed pursuant to Act 61, Session Laws of Hawaii 2014, shall commence on March 1, 2015.  The governor shall provide for staggered terms of the initially appointed voting members so that the initial terms of four members selected by lot shall be for two years, the initial terms of four members selected by lot shall be for three years, and the initial terms of the remaining five members shall be for four years.

     The governor may remove or suspend for cause any member after due notice and public hearing.

     (e)  Notwithstanding section 92-15, a majority of all eligible voting members as specified in this subsection shall constitute a quorum to do business, and the concurrence of a majority of all eligible voting members as specified in this subsection shall be necessary to make any action of the authority valid.  All members shall continue in office until their respective successors have been appointed and qualified.  Except as herein provided, no member appointed under this subsection shall be an officer or employee of the State or its political subdivisions.

     (f)  For purposes of this section, "small business" means a business [which] that is independently owned and [which] is not dominant in its field of operation.

     [(c)] (g)  The authority shall appoint the executive director who shall be the chief executive officer.  The authority shall set the salary of the executive director, who shall serve at the pleasure of the authority and shall be exempt from chapter 76.

     [(d)] (h)  The authority shall annually elect the chairperson and vice chairperson from among its members.

     [(e)] (i)  The members of the authority appointed under subsection (b) shall serve without compensation, but each shall be reimbursed for expenses, including travel expenses, incurred in the performance of their duties."

     SECTION 6.  Section 206E-6, Hawaii Revised Statutes, is amended as follows:

     1.  By amending its title and subsections (a) and (b) to read:

     "§206E-6  District-wide and transit-oriented development zone improvement [program.] programs.  (a)  The authority shall develop a district-wide improvement program and a transit-oriented development zone improvement program to identify necessary district-wide and transit-oriented development zone public facilities within a community development district[.] or transit-oriented development zone.

     (b)  Whenever the authority shall determine to undertake, or cause to be undertaken, any public facility as part of the district-wide or transit-oriented development zone improvement program, the cost of providing the public facilities shall be assessed against the real property in the community development district specially benefiting from [such] these public facilities.  The authority shall determine the areas of the community development district or transit-oriented development zone, which will benefit from the public facilities to be undertaken and, if less than the entire community development district or transit-oriented development zone benefits, the authority may establish assessment areas within the community development district[.] or transit-oriented development zone.  The authority may issue and sell bonds in [such] amounts as may be authorized by the legislature to provide funds to finance [such] these public facilities.  The authority shall fix the assessments against real property specially benefited.  All assessments made pursuant to this section shall be a statutory lien against each lot or parcel of land assessed from the date of the notice declaring the assessment until paid and [such] the lien shall have priority over all other liens except the lien of property taxes.  As between liens of assessments, the earlier lien shall be superior to the later lien."

     2.  By amending subsection (i) to read:

     "(i)  Notwithstanding any law to the contrary, whenever as part of a district-wide or transit-oriented development zone improvement program it becomes necessary to remove, relocate, replace, or reconstruct public utility facilities, the authority shall establish by rule the allocation of cost between the authority, the affected public utilities, and properties that may specially benefit from [such] the improvement, if any.  In determining the allocation of cost, the authority shall consider the cost allocation policies for improvement districts established by the county in which the removal, relocation, replacement, or reconstruction is to take place."

     SECTION 7.  (a)  The executive director of the Hawaii housing finance and development corporation, in collaboration with the executive director of the Hawaii community development authority, shall initially establish two transit-oriented development zones:  one zone to include the Leeward Community College and Pearl Highlands transit stations, and a second zone to include the Aloha Stadium transit station, and shall conduct a study examining the current infrastructure of the zones and the requirements necessary to upgrade the infrastructure to facilitate future transit-oriented development.  The study shall include recommendations and a general implementation plan for improving the infrastructure in the transit-oriented development zones.

     (b)  The executive director of the Hawaii housing finance and development corporation, in collaboration with the executive director of the Hawaii community development authority, shall submit a report of the findings and recommendations of the infrastructure study, including any proposed legislation, to the legislature no later than twenty days prior to the convening of the regular session of 2019.

     SECTION 8.  There is appropriated out of the dwelling unit revolving fund established under section 201H-191, Hawaii Revised Statutes, the sum of $500,000 or so much thereof as may be necessary for fiscal year 2018-2019 to conduct the infrastructure study pursuant to section 7.

     The sum appropriated shall be expended by the Hawaii housing finance and development corporation for the purposes of this Act.

     SECTION 9.  There is appropriated out of the general revenues of the State of Hawaii the sum of $60,000 or so much thereof as may be necessary for fiscal year 2018-2019 for the hiring of one temporary full-time equivalent (1.0 FTE) position in the Hawaii community development authority to maintain the staff necessary to develop and manage the transit-oriented development zone improvement program.

     The sum appropriated shall be expended by the Hawaii community development authority for the purposes of this Act.

     SECTION 10.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 11.  This Act shall take effect on July 1, 2018.

 

INTRODUCED BY:

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Report Title:

Transit-Oriented Development; Zones; Public Facilities; Hawaii Community Development Authority; Dwelling Unit Revolving Fund; Hawaii Housing Finance and Development Corporation; Study; Appropriation

 

Description:

Authorizes the Hawaii housing finance and development corporation, at the request of the Hawaii community development authority, to establish and operate transit-oriented development zone infrastructure subaccounts within the dwelling unit revolving fund for the benefit of transit-oriented development zone improvement projects within a transit-oriented development zone.  Requires HCDA to develop a transit-oriented development zone improvement program to foster infrastructure development by strategically investing in public facilities.  Requires the executive director of HHFDC in collaboration with the executive director of HCDA to conduct a study examining the current infrastructure of the transit-oriented development zones and the requirements necessary to upgrade the infrastructure to facilitate future transit-oriented development.  Appropriates funds out of the dwelling unit revolving fund for HHFDC and HCDA to conduct an infrastructure study.  Appropriates funds to HCDA for staff necessary to develop and manage the transit-oriented development zone improvement program.

 

 

 

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