HOUSE OF REPRESENTATIVES

H.B. NO.

1373

THIRTY-FIRST LEGISLATURE, 2021

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

relating to coastal zone management.

 

 

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

 


PART I

SECTION 1. The legislature finds that beaches in the State are critically important to the local economy, ecosystems, and way of life. The coastal zone management program, established pursuant to Act 188, Session Laws of Hawaii 1977, declared that it is state policy to:

(1) Protect, preserve, and where desirable, restore or improve the quality of coastal scenic and open space resources;

(2) Protect valuable coastal ecosystems from disruption and minimize adverse impacts on all coastal ecosystems;

(3) Reduce hazards to life and property from tsunami, storm waves, stream flooding, erosion, and subsidence; and

(4) Improve the development review process, communication, and public participation in the management of coastal resources and hazards.

The legislature also finds that sea level rise and shoreline erosion have accelerated in recent decades, threatening private property, public infrastructure, cultural practices, and public trust resources such as beaches and wetlands. As coastlines erode and the mean high water line moves mauka, formerly dry lands, if unimpeded, will naturally pass into the public trust. Article XI, section 1 of the state constitution clearly states that "[a]ll public natural resources are held in trust by the State for the benefit of the people"; this includes marine resources.

Facing loss of their property, however, owners of land that abuts the shoreline have responded to coastal erosion by erecting shoreline hardening structures, including seawalls and revetments, which accelerate coastal erosion in adjacent areas, restrict the natural landward movement of the shoreline, stem the natural increase of public trust land, impede the State's ability to protect the coastal zone, and deprive residents of Hawaii of the benefits of increased public trust lands.

The legislature further finds that the Hawaii Sea Level Rise Vulnerability and Adaptation Report predicts that 3.2 feet of sea level rise will compromise or destroy six thousand five hundred structures across the State, leaving twenty thousand displaced residents in need of new homes. The legislature also finds that the State must acquire private, shoreline-adjacent lands to ensure that space exists for the survival of the beaches and dune systems in the State. Further, the acquisition of shoreline-adjacent land will enable the State to allow continued public access to Hawaii's beaches, a right protected under the state constitution. Acquiring shoreline-adjacent property will also create a buffer between the shoreline and developed areas, protecting the State from any potential future natural disasters. Doing this before permanent inundation or chronic flooding will be easier and cheaper for the State.

The purpose of this Act is to ensure the preservation of Hawaii's beaches for future generations by:

(1) Establishing the Hawaii beach preservation revolving fund within the state treasury;

(2) Creating a low-interest contingent mortgage financing pilot program to encourage certain shoreline property owners to relocate mauka of expected sea level rise and erosion hazard zones;

(3) Appropriating moneys for the Hawaii beach preservation revolving fund, to be used for the contingent mortgage financing pilot program;

(4) Increasing the conveyance tax rate for oceanfront properties having a value of $10,000,000 or higher and for which the purchaser is ineligible for a county homeowner's exemption on property tax, and further allocating one hundred per cent of taxes collected on those properties for deposit into the Hawaii beach preservation revolving fund; and

(5) Prohibiting, without exception, the construction or repair of any shoreline hardening structures, including seawalls and revetments, that would impede the natural landward movement of public trust lands.

PART II

SECTION 2. Chapter 171, Hawaii Revised Statutes, is amended by adding two new sections to be appropriately designated and to read as follows:

"171-A Hawaii beach preservation revolving fund; established; uses. (a) There is established within the state treasury the Hawaii beach preservation revolving fund, to be administered by the department, into which shall be deposited:

(1) Legislative appropriations to the fund;

(2) Moneys received as repayment of loan and interest payments;

(3) Fees collected by the department pursuant to this section or section 171-B;

(4) Gifts, donations, and grants from any public or private entities;

(5) All interest earned or accrued on moneys deposited into the fund; and

(6) Moneys paid to or allotted to the fund from other sources.

(b) Moneys from the fund shall be expended by the department to provide a low-interest mortgage loan to any owner of a qualifying private residential shoreline property in an expected sea level rise hazard zone or erosion hazard zone who:

(1) Relinquishes the shoreline property to the State; and

(2) Uses the mortgage loan offered pursuant to section 171-B to acquire or build a residential property mauka of expected sea level rise and erosion hazard zones;

provided that any mortgage loan offered shall be equal to the property's current value as appraised in accordance with rules adopted by the department pursuant to chapter 91.

171-B Contingent mortgage financing pilot program; established. (a) There is established the contingent mortgage financing pilot program, to be administered by the department, to provide a low-interest mortgage loan to any owner of a qualifying private residential shoreline property in an expected sea level rise hazard zone or erosion hazard zone who:

(1) Relinquishes the shoreline property to the State; and

(2) Uses the mortgage loan offered to acquire or build a residential property mauka of expected sea level rise and erosion hazard zones.

(b) Mortgage loans offered pursuant to this section shall be offered:

(1) To any owner of a private single-family residence; provided that the private single-family residence is a qualifying private residential shoreline property in an expected sea level rise hazard zone or erosion hazard zone in accordance with rules adopted by the department pursuant to chapter 91; provided further that the contingent mortgage financing pilot program shall be available for up to one hundred qualified single-family residences;

(2) To any owner of a private condominium property regime established pursuant to chapter 514B; provided that the private condominium property regime is a qualifying private residential shoreline property in an expected sea level rise hazard zone or erosion hazard zone in accordance with rules adopted by the department pursuant to chapter 91; provided further that the contingent mortgage financing pilot program shall be available for up to ten qualified condominium property regimes; and

(3) Using funds from the Hawaii beach preservation revolving fund.

(c) The department, or another agency as determined by the governor, shall manage all lands and property acquired pursuant to this section. Lands acquired pursuant to this section shall remain public in perpetuity or until natural processes transform the land into public trust lands.

(d) The department shall submit an annual report to the legislature regarding the contingent mortgage financing pilot program, including the number of mortgage loans issued pursuant to the program, recommendations, and any proposed legislation, no later than twenty days prior to the convening of the regular session of 2023 and each regular session thereafter.

(e) The department shall adopt rules pursuant to chapter 91 to effectuate the purposes of this section; provided that the rules required by this subsection shall be adopted no later than December 31, 2021."

SECTION 3. There is appropriated out of the general revenues of the State of Hawaii the sum of $ or so much thereof as may be necessary for fiscal year 2021-2022 and the same sum or so much thereof as may be necessary for fiscal year 2022-2023 to be deposited into the Hawaii beach preservation revolving fund and expended for the contingent mortgage financing pilot program.

The sums appropriated shall be expended by the department of land and natural resources for the purposes of this Act.

PART III

SECTION 4. Section 247-2, Hawaii Revised Statutes, is amended to read as follows:

"247-2 Basis and rate of tax. The tax imposed by section 247-1 shall be based on the actual and full consideration [(], whether cash or otherwise, including any promise, act, forbearance, property interest, value, gain, advantage, benefit, or profit[)], paid or to be paid for all transfers or conveyance of realty or any interest therein, that shall include any liens or encumbrances thereon at the time of sale, lease, sublease, assignment, transfer, or conveyance, and shall be at the following rates:

(1) Except as provided in paragraph (2):

(A) Ten cents per $100 for properties with a value of less than $600,000;

(B) Twenty cents per $100 for properties with a value of at least $600,000, but less than $1,000,000;

(C) Thirty cents per $100 for properties with a value of at least $1,000,000, but less than $2,000,000;

(D) Fifty cents per $100 for properties with a value of at least $2,000,000, but less than $4,000,000;

(E) Seventy cents per $100 for properties with a value of at least $4,000,000, but less than $6,000,000;

(F) Ninety cents per $100 for properties with a value of at least $6,000,000, but less than $10,000,000; and

(G) One dollar per $100 for properties with a value of $10,000,000 or greater; and

(2) For the sale of a condominium or single family residence for which the purchaser is ineligible for a county homeowner's exemption on property tax:

(A) Fifteen cents per $100 for properties with a value of less than $600,000;

(B) Twenty-five cents per $100 for properties with a value of at least $600,000, but less than $1,000,000;

(C) Forty cents per $100 for properties with a value of at least $1,000,000, but less than $2,000,000;

(D) Sixty cents per $100 for properties with a value of at least $2,000,000, but less than $4,000,000;

(E) Eighty-five cents per $100 for properties with a value of at least $4,000,000, but less than $6,000,000;

(F) One dollar and ten cents per $100 for properties with a value of at least $6,000,000, but less than $10,000,000; and

(G) One dollar and twenty-five cents per $100 for properties with a value of $10,000,000 or greater[,]; provided that for oceanfront properties under this subsection with a value of $10,000,000 or more, the rate shall be one dollar and fifty cents per $100,

of [such] the actual and full consideration; provided that in the case of a lease or sublease, this chapter shall apply only to a lease or sublease whose full unexpired term is for a period of five years or more, and in those cases, including [(], where appropriate[)], those cases where the lease has been extended or amended, the tax in this chapter shall be based on the cash value of the lease rentals discounted to present day value and capitalized at the rate of six per cent, plus the actual and full consideration paid or to be paid for any and all improvements, if any, that shall include on-site as well as off-site improvements, applicable to the leased premises; and provided further that the tax imposed for each transaction shall be not less than $1."

SECTION 5. Section 247-7, Hawaii Revised Statutes, is amended to read as follows:

"247-7 Disposition of taxes. All taxes collected under this chapter shall be paid into the state treasury to the credit of the general fund of the State, to be used and expended for the purposes for which the general fund was created and exists by law; provided that of the taxes collected each fiscal year:

(1) Ten per cent or $5,100,000, whichever is less, shall be paid into the land conservation fund established pursuant to section 173A-5; [and]

(2) Fifty per cent or $38,000,000, whichever is less, shall be paid into the rental housing revolving fund established by section 201H-202[.]; and

(3) One hundred per cent of the taxes collected on the sale of oceanfront property pursuant to section 247‑2(2)(G) shall be paid into the Hawaii beach preservation revolving fund established by section 171-A."

PART IV

SECTION 6. Section 205A-43.5, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) Prior to action on a variance application, the authority shall hold a public hearing under chapter 91. By adoption of rules under chapter 91, the authority may delegate responsibility to the department. Public and private notice, including reasonable notice to abutting property owners and persons who have requested this notice, shall be provided, but a public hearing may be waived prior to action on a variance application for:

(1) Stabilization of shoreline erosion by the moving of sand entirely on public lands;

(2) [Protection] Temporary protection of a legal structure or public facility, including any facility owned by a public utility that is regulated pursuant to chapter 269[,] and excluding shore protection structures, that does not fix the shoreline, under an emergency authorization issued by the authority; provided that the structure or public facility is at risk of immediate damage from shoreline erosion, the proposed construction shall not artificially fix the shoreline, and the authorization does not exceed three years;

(3) Other structures or activities; provided that no person or agency has requested a public hearing within twenty-five calendar days after public notice of the application; or

(4) Maintenance, repair, reconstruction, and minor additions or alterations of legal boating, maritime, or watersports recreational facilities, that result in little or no interference with natural shoreline processes."

SECTION 7. Section 205A-44, Hawaii Revised Statutes, is amended to read as follows:

"205A-44 Prohibitions. (a) The mining or taking of sand, dead coral or coral rubble, rocks, soil, or other beach or marine deposits from the shoreline area is prohibited with the following exceptions:

(1) [The inadvertent taking from the shoreline area of the materials, such as those inadvertently carried away on the body, and on clothes, toys, recreational equipment, and bags;

(2)] Where the mining or taking is authorized by a variance pursuant to this part;

[(3)] (2) The clearing of these materials from existing drainage pipes and canals and from the mouths of streams including clearing for the purposes under section 46-11.5; provided that the sand removed shall be placed on adjacent areas unless the placement would result in significant turbidity;

[(4)] (3) The cleaning of the shoreline area for state or county maintenance purposes, including the clearing for purposes under section 46-12; provided that the sand removed shall be placed on adjacent areas unless the placement would result in significant turbidity;

[(5)] (4) The taking of driftwood, shells, beach glass, glass floats, or seaweed;

[(6)] (5) The exercise of traditional cultural practices as authorized by law or as permitted by the department pursuant to article XII, section 7, of the Hawaii State Constitution; or

[(7)] (6) For the response to a public emergency or a state or local disaster.

(b) Except as provided in this section, structures are prohibited in the shoreline area without a variance pursuant to this part. Structures in the shoreline area shall not need a variance if:

(1) They were completed prior to June 22, 1970;

(2) They received either a building permit, board approval, or shoreline setback variance prior to June 16, 1989;

(3) They are outside the shoreline area when they receive either a building permit or board approval;

(4) They are necessary for or ancillary to continuation of existing agriculture or aquaculture in the shoreline area on June 16, 1989;

(5) They are minor structures permitted under rules adopted by the department [which] that do not affect beach processes or artificially fix the shoreline and do not interfere with public access or public views to and along the shoreline; or

(6) Work being done consists of maintenance, repair, and minor additions or alterations of legal boating, maritime, or watersports recreational facilities, [which] that are publicly owned, and [which] that result in little or no interference with natural shoreline processes;

provided that permitted structures may be repaired, but shall not be enlarged, rebuilt, or replaced within the shoreline area without a variance.

(c) The construction of shoreline hardening structures within the shoreline setback area, including seawalls, groins, revetments, and geotextile shore protection projects, shall be prohibited; provided that when public infrastructure is imminently threatened by coastal erosion:

(1) Temporary non-structural erosion prevention measures shall be utilized;

(2) Shoreline hardening methods shall not be utilized; and

(3) Any public infrastructure temporarily protected pursuant to this subsection shall be moved mauka as soon as possible, after which all temporary non-structural erosion prevention measures shall be immediately removed.

(d) No existing shoreline hardening structure shall be altered, repaired, or replaced."

SECTION 8. Section 205A-46, Hawaii Revised Statutes, is amended by amending subsections (a) and (b) to read as follows:

"(a) [A] Except as provided in subsection 205A-44(d), variance may be granted for a structure or activity otherwise prohibited in this part if the authority finds in writing, based on the record presented, that the proposed structure or activity is necessary for or ancillary to:

(1) Cultivation of crops;

(2) Aquaculture;

(3) Landscaping; provided that the authority finds that the proposed structure or activity will not adversely affect beach processes and will not artificially fix the shoreline;

(4) Drainage;

(5) Boating, maritime, or watersports recreational facilities;

(6) Facilities or improvements by public agencies or public utilities regulated under chapter 269;

(7) Private facilities or improvements that are clearly in the public interest;

(8) Private facilities or improvements that will not adversely affect beach processes, result in flanking shoreline erosion, or [artificially fix the shoreline;] curtail public access; provided that the authority may consider any hardship that will result to the applicant if the facilities or improvements are not allowed within the shoreline area;

(9) Private facilities or improvements that may artificially fix the shoreline; provided that the authority may consider hardship to the applicant if the facilities or improvements are not allowed within the shoreline area; provided further that a variance to artificially fix the shoreline shall not be granted in areas with sand beaches or where artificially fixing the shoreline may interfere with existing recreational and waterline activities and other beach processes, result in flanking shoreline erosion, or curtail public access, unless the granting of the variance is clearly demonstrated to be in the interest of the general public[;], for example, in the case of an imminent threat of a road or highway failure, or to other critical public infrastructure; or

(10) Moving of sand from one location seaward of the shoreline to another location seaward of the shoreline; provided that the authority also finds that moving of sand will not adversely affect beach processes, will not diminish the size of a public beach, and will be necessary to stabilize an eroding shoreline.

(b) Hardship shall be defined in rules adopted by the authority under chapter 91. Hardship shall not be determined as a result of county zoning changes, planned development permits, cluster permits, or subdivision approvals after June 16, 1989, or as a result of any other permit or approval listed in rules adopted by the authority[.], or as a result of sea level rise."

PART V

SECTION 9. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

SECTION 10. In codifying the new sections added by section 2 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

SECTION 11. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 12. This Act shall take effect on July 1, 2021; provided that section 2 of this Act shall be repealed on June 30, 2026, and all unencumbered balances remaining in the Hawaii beach preservation revolving fund on that date shall lapse to the credit of the general fund.

 

INTRODUCED BY:

_____________________________

 

 


 


 

Report Title:

Coastal Zone Management; Sea Level Rise; Managed Retreat; Revolving Fund; Appropriation

 

Description:

Establishes the Hawaii beach preservation revolving fund within the state treasury. Establishes a low-interest contingent mortgage financing pilot program to encourage certain shoreline property owners to relocate mauka of expected sea level rise and erosion hazard zones. Amends coastal zone management laws to further protect against impacts of sea level rise and coastal erosion. Appropriates moneys.

 

 

 

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.