Hawaii 2024 Regular Session

Hawaii House Bill HB988 Compare Versions

Only one version of the bill is available at this time.

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1	1	HOUSE OF REPRESENTATIVES H.B. NO. 988 THIRTY-SECOND LEGISLATURE, 2023 STATE OF HAWAII A BILL FOR AN ACT RELATING TO THE HAWAII COMMUNITY DEVELOPMENT AUTHORITY. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
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3	3	HOUSE OF REPRESENTATIVES H.B. NO. 988
4	4	THIRTY-SECOND LEGISLATURE, 2023
5	5	STATE OF HAWAII
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7	7	HOUSE OF REPRESENTATIVES
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9	9	H.B. NO.
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11	11	988
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13	13	THIRTY-SECOND LEGISLATURE, 2023
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17	17	STATE OF HAWAII
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31	31	A BILL FOR AN ACT
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37	37	RELATING TO THE HAWAII COMMUNITY DEVELOPMENT AUTHORITY.
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43	43	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
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47	47	SECTION 1. The United States Department of Housing and Urban Development encourages authorities undertaking redevelopment efforts to create financially viable and socially stable communities through mixed-income development. The Hawaii community development authority has strived to create a dynamic urban neighborhood in Kakaako, where a mix of people with a wide range of socio-economic status, live, work, and play in the mixed-income mixed-use neighborhood. The legislature has for several years acknowledged that there exists a need for housing statewide. Given the acute lack of housing, a multi-pronged approach is necessary to meet the current and future housing demands in the state. Development of housing units, affordable at all levels of income, as well as ownership types (rental, for sale leasehold, for sale fee simple) must be explored to meet the current and future demands. Leasehold housing units tend to be more affordable than fee simple housing units, if the land on which housing is developed is owned by the state and leased to a developer for housing development. Developing multi-family housing units on a lot lowers the cost of land for the development, which in turn will lower the sales price of the housing units. Because the cost of leasehold land is lower than fee simple land and paid over a longer period, it further reduces the land cost and makes the housing units even more affordable. Because the land will be in leasehold, the state will continue to be the fee owner of the land. Therefore, encouraging development of for sale leasehold housing units is a viable strategy in meeting housing demand. However, the term of the lease needs to be long enough to make for sale leasehold housing units attractive to buyers as well as lenders. Typically, a ninety-nine-year lease is considered to be adequate to attract both lenders and buyers. Given its experience and expertise in developing affordable housing in Kakaako, the Hawaii community development authority is ideally suited for developing for sale leasehold housing units in community development districts. Therefore, the purpose of this Act is to provide additional means to increase the supply of housing in Hawaii by allowing the Hawaii community development authority to lease real property for a term of ninety-nine years. SECTION 2. Section 206E-14, Hawaii Revised Statutes, is amended to read as follows: "§206E-14 Sale or lease of redevelopment projects. (a) The authority may, without recourse to public auction, sell, or lease for a term not exceeding [sixty-five] ninety-nine years, all or any portion of the real or personal property, except that leases of lands that were classed as crown lands previous to August 15, 1895, shall have a term not exceeding sixty-five years, constituting a redevelopment project to any person, upon such terms and conditions as may be approved by the authority, if the authority finds that the sale or lease is in conformity with the community development plan. For the stadium development district, leases shall not exceed a term of ninety-nine years. (b) In the case of residential projects or redevelopment projects, the terms of the sale shall provide for the repurchase of the property by the authority at its option, in the event that the purchaser, if other than a state agency, desires to sell the property within ten years, provided that this requirement may be waived by the authority if the authority determines that a waiver will not be contrary to the community development plan. The authority shall establish at the time of original sale a formula setting forth a basis for a repurchase price based on market considerations including but not being limited to interest rates, land values, construction costs, and federal tax laws. If the purchaser in a residential project is a state agency, the authority may include as a term of the sale a provision for the repurchase of the property in conformance with this section. (c) The Hawaii community development authority may promulgate rules under chapter 91 relating to sales by unit purchasers in a residential leasehold project." SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored. SECTION 4. This Act shall take effect upon its approval. INTRODUCED BY: _____________________________ BY REQUEST
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49	49	SECTION 1. The United States Department of Housing and Urban Development encourages authorities undertaking redevelopment efforts to create financially viable and socially stable communities through mixed-income development. The Hawaii community development authority has strived to create a dynamic urban neighborhood in Kakaako, where a mix of people with a wide range of socio-economic status, live, work, and play in the mixed-income mixed-use neighborhood.
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51	51	The legislature has for several years acknowledged that there exists a need for housing statewide. Given the acute lack of housing, a multi-pronged approach is necessary to meet the current and future housing demands in the state. Development of housing units, affordable at all levels of income, as well as ownership types (rental, for sale leasehold, for sale fee simple) must be explored to meet the current and future demands.
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53	53	Leasehold housing units tend to be more affordable than fee simple housing units, if the land on which housing is developed is owned by the state and leased to a developer for housing development. Developing multi-family housing units on a lot lowers the cost of land for the development, which in turn will lower the sales price of the housing units. Because the cost of leasehold land is lower than fee simple land and paid over a longer period, it further reduces the land cost and makes the housing units even more affordable. Because the land will be in leasehold, the state will continue to be the fee owner of the land. Therefore, encouraging development of for sale leasehold housing units is a viable strategy in meeting housing demand. However, the term of the lease needs to be long enough to make for sale leasehold housing units attractive to buyers as well as lenders. Typically, a ninety-nine-year lease is considered to be adequate to attract both lenders and buyers.
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55	55	Given its experience and expertise in developing affordable housing in Kakaako, the Hawaii community development authority is ideally suited for developing for sale leasehold housing units in community development districts. Therefore, the purpose of this Act is to provide additional means to increase the supply of housing in Hawaii by allowing the Hawaii community development authority to lease real property for a term of ninety-nine years.
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57	57	SECTION 2. Section 206E-14, Hawaii Revised Statutes, is amended to read as follows:
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59	59	"§206E-14 Sale or lease of redevelopment projects. (a) The authority may, without recourse to public auction, sell, or lease for a term not exceeding [sixty-five] ninety-nine years, all or any portion of the real or personal property, except that leases of lands that were classed as crown lands previous to August 15, 1895, shall have a term not exceeding sixty-five years, constituting a redevelopment project to any person, upon such terms and conditions as may be approved by the authority, if the authority finds that the sale or lease is in conformity with the community development plan.
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61	61	For the stadium development district, leases shall not exceed a term of ninety-nine years.
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63	63	(b) In the case of residential projects or redevelopment projects, the terms of the sale shall provide for the repurchase of the property by the authority at its option, in the event that the purchaser, if other than a state agency, desires to sell the property within ten years, provided that this requirement may be waived by the authority if the authority determines that a waiver will not be contrary to the community development plan. The authority shall establish at the time of original sale a formula setting forth a basis for a repurchase price based on market considerations including but not being limited to interest rates, land values, construction costs, and federal tax laws.
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65	65	If the purchaser in a residential project is a state agency, the authority may include as a term of the sale a provision for the repurchase of the property in conformance with this section.
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67	67	(c) The Hawaii community development authority may promulgate rules under chapter 91 relating to sales by unit purchasers in a residential leasehold project."
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69	69	SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
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71	71	SECTION 4. This Act shall take effect upon its approval.
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75	75	INTRODUCED BY: _____________________________
76	76	BY REQUEST
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78	78	INTRODUCED BY:
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86	86	BY REQUEST
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88	88	Report Title: Affordable Housing; Hawaii Community Development Authority; Lease of State Land Description: Increases options to build affordable housing in Hawaii Community Development Authority districts by increasing the permissible lease term to ninety-nine years. Prohibits the Hawaii Community Development Authority from encumbering lands that were classed as crown lands previous to August 15, 1895, in leases longer than sixty-five years. The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
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92	92	Report Title:
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94	94	Affordable Housing; Hawaii Community Development Authority; Lease of State Land
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98	98	Description:
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100	100	Increases options to build affordable housing in Hawaii Community Development Authority districts by increasing the permissible lease term to ninety-nine years. Prohibits the Hawaii Community Development Authority from encumbering lands that were classed as crown lands previous to August 15, 1895, in leases longer than sixty-five years.
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108	108	The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.