There is a hearing on Wednesday, April 26, 2006 at 3:30 p.m. in room 016 on some bills of interest to community associations before two Conference Committee. The hearing notice discusses the following bills of interest to community associations:

House Conferees: Representatives Herkes, Chair; Schatz, Marumoto
Senate Conferees: Senators Menor, Chair; Ige, Whalen

SB2193 HD1 This bill would add a number of requirements in planned community associations, including:

  • Prohibiting associations from charging a member for the cost of providing documents unless the association within 10 days of receiving the request provides written notice to the member that it intends to charge the member for the cost of providing the information and of the amount to be charged (documents on delinquent assessments or in connection with proceedings to enforce the law or the association’s governing documents are excluded);
  • Allowing a member to withdraw a request for documents within 10 days of receiving the notice of costs;
  • Obtaining an annual audit and unannounced cash verification (associations with fewer than 20 units can vote to waive the audit and verification);
  • Providing the audit to every member that checks a box on the proxy;
  • Providing that if the audit is not made available at the annual meeting, the unaudited financial statements must be made available and the audited financial statement be made available as soon as they’re prepared;
  • Providing that the Department of Commerce and Consumer Affairs may conduct hearings on controversies and complaints regarding members in planned communities and recommend changes in the law;
  • Providing the Department of Commerce and Consumer Affairs the authority to take any other actions that promote and ensure the rights of members;
  • Eliminating the provision to all Board meetings to be held in closed session when it is not practicable;
  • Prohibiting directors from voting on issues in which they have a conflict of interest;
  • Requiring that the minutes of any meetings in which a Board appoints, alters or eliminates a committee shall identify the action taken, the members of the committee, and describe the matter that the committee is to consider and review; and
  • Requiring a complex method of providing minutes to board meetings to members.

Unfortunately, certain proponents are trying to make the planned community law as complicated and difficult to understand as the condominium law. While it is possible to identify problems with the proposed changes (i.e. why should all the members have to pay for the cost of providing documents to a member who requests them?), the bigger question is why is it necessary to change the law. When asked, proponents were unable to identify planned community problems other than an ongoing dispute between a legislative aid and his condominium (not a planned community) and a situation that turned out to be factually different from what was represented. Passing these types of laws just means that associations have to spend more money trying to figure out what they can and cannot do.

House Conferees: Representatives Herkes/Wakai, Co-Chairs; Cabanilla, Marumoto
Senate Conferees: Senators Menor, Chair; Taniguchi, Co-Chair; Espero, Tsutsui, Trimble

SB2545 HD2 This bill would extend the “condo court” pilot project. During the first two years of the pilot project, a total of 3 matters have been submitted to condo court. It appears that those individuals alleging widespread improper activity in Hawaii’s condominium associations may have exaggerated the problem.

AS THIS IS A DECISION MAKING MEETING ONLY, NO PUBLIC TESTIMONY WILL BE ACCEPTED. You can of course contact any of the conferees.