Archive for January, 2007

January 30, 2007: 10:15 am: Richard S. EkimotoLegislation

Hearing on Bill for Construction Defect Litigation

There is a hearing on Wednesday, February 1, 2007 at 8:31 a.m. in room 329 on a bill of interest to community associations before the House Human Services & Housing Committee before Chair, Rep. Maile S. L. Shimabukuro. The hearing notice discusses the following bills of interest to community associations:

HB1846 would establish statutory provisions relating to construction defect litigation. The bill establish the rights and responsibilities of owners of residential dwellings and community associations for construction defects, including establishing standards for home construction, establishing a procedure for contractors to elect to repair the defects and limiting damages to: (1) cost of repair; (2) cost of repair of damages resulting from the failure of the home to meet the statutory standards; (3) cost of removing and replacing any improper repair by the builder; (4) relocation and storage expenses; (5) lost business income if appropriate; (6) investigative costs for each established violation; and (7) all other costs or fees recoverable by contract or statute.

PERSONS WHISHING TO TESTIFY ARE REQUESTED TO SUBMIT 40 COPIES OF THEIR TESTIMONY AT LEAST 24 HOURS PRIOR TO THE HEARING TO: (1) THE HSH COMMITTEE’S VICE CHAIR IN ROOM 326, STATE CAPITOL, OR (2) THE HOUSE SGT.-AT-ARMS TESTIMONY DROP OFF BOX IN THE TURNAROUND AREA OF THE CAPITOL BASEMENT PARKING LOT. TESTIMONY MAY ALSO BE FAXED IF LESS THAN 5 PAGES IN LENGTH TO THE HOUSE SGT.-AT-ARMS OFFICE AT: 586-6501 (OAHU) OR 1-800-535-3859 (NEIGHBOR ISLANDS). WHEN FAXING, PLEASE INDICATE THAT TESTIMONY IS BEING SUBMITTED TO THE HSH COMMITTEE VICE CHAIR, THE DATE AND TIME OF THE HEARING, AND THE REQUIRED NUMBER OF COPIES THAT IS NEEDED FOR SUBMITTAL.

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: 10:01 am: Richard S. EkimotoLegislation

Hearing on Bill for Leasehold Conversion Tax Credit

There is a hearing on Wednesday, February 1, 2007 at 8:30 a.m. in room 329 on a bill of interest to community associations before the House Human Services & Housing Committee before Chair, Rep. Maile S. L. Shimabukuro. The hearing notice discusses the following bills of interest to community associations:

HB734 will exclude from income taxation 100% of capital gains realized from the sale of leased fee interest in residential house lot or multi-family residential leasehold property to a lessee, association of apartment owners, or cooperative, subject to an aggregate cap of $800,000 per year.

AS THIS IS A DECISION MAKING MEETING ONLY, NO PUBLIC TESTIMONY WILL BE ACCEPTED.

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January 29, 2007: 7:36 pm: Richard S. EkimotoEkimoto & Morris

New Offices, New Logo

As many of you know from our postcards and emails, Ekimoto & Morris moved this weekend to:

American Savings Bank Tower
1001 Bishop Street, Suite 780
Honolulu, Hawaii 96813-3410

Our phone numbers, fax numbers and email addresses remain the same. While we only moved about one block, it took a lot of time and effort. My wife said that there’s a reason that people stay in their offices for at least 10 years — it takes that long for us to forget how much work it is! Even with freight elevators breaking down and construction of our new offices not fully completed on move day, we were able to get some work done today. We appreciate your understanding if you were not able to reach us on Friday during the move.

As you may have notice, the last update on legislation was a week ago. Unfortunately, the move meant that I did not get a chance to update you on legislation affecting community associations. That should get back on schedule shortly.

In conjunction with our move, we also adopted a new logo for the firm. We hope you like it.

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January 17, 2007: 6:38 pm: Richard S. EkimotoLegislation

2007 Community Association Related Bills

The following bills have been introduced that affect community associations. The table will be updated periodically to provide readily accessible information about the legislation introduced this year.


House Bills
Measure Title Status Comment
HB65 Relating to Planned Community Associations Status Adds a Section to the Planned Community Act requiring associations to notify members of the cost of providing information
HB66 Relating to Planned Community Associations Status Requires the Department of Commerce and Consumer Affairs to report on planned community associations in the state
HB67 Relating Planned Community Associations Status Amends HRS §421J-5 to add a requirement that the minutes of planned community association board meetings (other than executive session) include the vote of each director
HB68 Relating to Meetings of Board of Directors Status Amends HRS §421J-5 and §514B-125 to require that notices and agendas for board meetings be posted on the project and mailed, delivered or electronically delivered to members on request
HB450 Relating to the Residential Landlord-Tenant Code Status Requires landlords of condominium units to provide tenants with at least thirty days notice of construction (does not include an exception for emergency construction).
HB469 Relating to Real Property Transactions Status Prohibits discrimination in housing on the basis of domestic violence.
HB656 Relating to Planned Community Associations Status Holds grantee of a unit jointly and severally liable with the grantor for delinquent assessments against the grantor
HB723 Relating to Condominiums Status Limits any late fee for delinquent common expenses to twenty per cent of the monthly maintenance fee. Requires an association to give a unit owner 10 business days notice of any delinquent assessments before taking any action for which attorney’s fees may be assessed.
HB726 Relating to Association Records Status Prevents the managing agent from providing a list of current members to anyone but a member.
HB734 Relating to Leasehold Conversion Status Excludes from income taxation 100% of capital gains realized from the sale of leased fee interest in residential house lot or multi-family residential leasehold property to a lessee, association of apartment owners, or cooperative, subject to an aggregate cap of $800,000 per year.
House Resolutions
HCR3 Requesting the Legislative Reference Bureau to Identify All Planned Community Associations in Hawaii, Their Size, and the Laws under Which They Are Regulated Status Requests a study about planned community associations.
Senate Bills
Measure Title Status Comment
SB73 Relating to Nonprofit Corporations Status Amends the Nonprofit Corporation Act to require nonprofit corporations with annual gross revenues of $1,000,000.00 or more to implement Sarbanes-Oxley Act-type provisions, use GAAP. It also would provide whistleblower protections. It would also require all nonprofit corporations regardless of size to have financials on an accural basis which is not the norm in Hawaii. May impact community associations.
SB234 Relating to Condominiums Status Amends HRS §514B-39 to require that condominium associations regulate the use, maintenance, repair, replacement, and modification of the limited common element and HRS §514B-104 to eliminate the ability of the associations to regulate the use, maintenance, repair, replacement of the common elements.
SB265 Relating to Business Regulation Status Short form bill
SB419 Relating to Condominium Property Regimes Status Short form bill
SB420 Relating to Condominium Property Regimes Status Short form bill
SB600 Relating to Leasehold Conversion Status Exempts from taxation 100% of capital gains realized during taxable years 2008-2012 from sale of leased fee interest in condominium units to association of apartment owners or residential cooperative corporations
SB726 Relating to Time Share Plans Status Requires online advertising of transient vacation rentals to include local contact information.
SB728 Relating to Planned Community Associations Status Holds grantee of a unit jointly and severally liable with the grantor for delinquent assessments against the grantor.
SB748 Relating to Planned Community Associations Status Prohibits associations from imposing any restriction on use of outdoor clothes lines.
SB915 Relating to Meetings of Boards of Directors Status Amends HRS §421J-5 and §514B-125 to require that notices and agendas for board meetings be posted on the project and mailed, delivered or electronically delivered to members on request
SB920 Relating to Condominiums Status Limits the use of the condominium association member lists by the managing agent.
SB921 Relating to Condominium Association Records Status Amends HRS §514B-154 to add a provision that limits costs charged to members for association records to reasonable administrative and duplication costs not to exceed 50 cents a page.
SB922 Relating to Condominiums Status Amends HRS §514B-162 to provide that arbitration may not be commenced until 30 days after the final day of mediation or after the final decision of the administrative hearings officer
SB923 Relating to Condominiums Status Eliminates the December 31, 2007 sunset date for the limited priority lien for condominium associations.
SB1230 Relating to Condominiums Status Amends HRS §§514B-104 & 106 to provide that Boards may renew contracts without approval of the owners. However, it is unclear what impact this bill will have because HRS §§514B-104 & 106 are subject to the Declaration and By-Laws. Therefore, if the Boards have authority to renew contracts under the governing documents, the bill would do nothing and if the governing documents prohibit it, the bill would do nothing.
SB1257 Relating to Discrimination Complaints Status Amends HRS §368-4 to permit the Executive Director of the Hawaii Civil Rights Commission to disclose certain information from the Commission’s investigation to the parties during the conciliation phase in order to attempt settlement. Strangely, much of this information is required to be released by the Department of Housing and Urban Development in fair housing investigations brought under both the State and Federal Fair Housing Acts.

1/18/2007: Added SB234, SB265, SB419 & SB420 to the table.

1/20/2007: Added HB450, HB469, HB656, HB723, HB726, HB734, HCR3, SB600, SB726, SB728, SB748, SB915, SB920, SB921, SB922 & SB923

1/22/2007: Added SB1230 & SB1257. Added second to last sentence and struck-out last sentence in comment for SB73.

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January 16, 2007: 5:37 pm: Richard S. EkimotoLegislation

Hawaii State Legislature Opens Tomorrow

The Hawaii State Legislature opens tomorrow at 10:00 a.m. for the first year of the two year legislative session.  The deadline for introduction of bills is January 24, 2007.  Until that time, we will not have a complete listing of the bills that affect community associations.  However, we anticipate that bills relating to the new Condominium Property Act, the limited priority lien and proxies to be introduced this year.  We’ll provide a more detailed listing once all the bills have been introduced and reviewed. 

Most of the bills affecting community associations will be heard in the House of Representatives before the Consumer Protection & Commerce Committee before Chair, Rep. Robert N. Herkes and in the Senate before the Commerce, Consumer Protection, and Affordable Housing Committee before Chair, Sen. Brian Taniguchi. Due to a reorganization of the Senate, there has been a change in the Chair of the Senate Committee that primarily handles community association legislation. 

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