HB 807: Hawaii Green Infrastructure Authority; Condominiums; Condominium Loan Program; Condominium Loan Loss Reserves Program; Reports; Appropriations
- Session Year: 2025-2026
- House: House
- Latest Version Date: 2025-03-20
Current Status:
Failed
(2025-12-08: Carried over to 2026 Regular Session.)
Introduced
In Committee
First Chamber
In Committee
Second Chamber
Final Decking
Enacted
Establishes the Condominium Loan Program to provide condominium associations with low-cost financing, or refinancing for previously obtained loans, for maintenance or repair projects. Establishes the Condominium Loan Loss Reserves Program to incentivize lenders to provide loans at competitive rates and terms to condominium associations for the purpose of allowing condominium associations to make necessary maintenance or repairs. Requires annual reports to the Legislature. Appropriates funds. Effective 7/1/3000. (SD1)
Establishes the Condominium Loan Program to provide condominium associations with low-cost financing, or refinancing for previously obtained loans, for maintenance or repair projects. Establishes the Condominium Loan Loss Reserves Program to incentivize lenders to provide loans at competitive rates and terms to condominium associations for the purpose of allowing condominium associations to make necessary maintenance or repairs. Appropriates funds. Effective 7/1/3000. (HD2)
Establishes the Condominium Loan Program to provide condominium associations with low-cost financing, or refinance previously obtained loans, for maintenance or repair projects. Establishes the Condominium Loan Loss Reserves Program to incentivize lenders into providing loans at competitive rates and terms to condominium associations for the purpose of allowing condominium associations to make necessary maintenance or repairs. Appropriates funds. (HD1)
Establishes the Condominium Loan Program to provide condominium associations with low-cost financing, or refinance previously obtained loans, for maintenance or repair projects. Establishes the Condominium Loan Loss Reserves Program to incentivize lenders into providing loans at competitive rates and terms to condominium associations for the purpose of allowing condominium associations to make necessary maintenance or repairs. Appropriates funds.
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HOUSE OF REPRESENTATIVES |
H.B. NO. |
807 |
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THIRTY-THIRD LEGISLATURE, 2025 |
H.D. 2 |
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STATE OF HAWAII |
S.D. 1 |
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A BILL FOR AN ACT
RELATING TO CONDOMINIUMS.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The Hawaii Revised Statutes is amended by adding a new chapter to be appropriately designated and to read as follows:
"Chapter
financing for condominiums
Part I. DIRECT FINANCING
§ -1 Definitions. As used in this chapter, unless the context clearly requires otherwise:
"Authority" means the Hawaii green infrastructure authority as established under section 196-63.
"Community development financial institution" means an entity certified as a community development financial institution by the United States Department of the Treasury's Community Development Financial Institutions Fund.
"Condominium association" has the same meaning as association as defined in section 514B-3.
"Condominium project" has the same meaning as project as defined in section 514B-3.
"Financial institution" includes a bank, trust company, banking association, savings and loan association, mortgage company, investment bank, credit union, or nontraditional financial institution.
"Loan" includes a line of credit.
"Participating community development financial institution" means a community development financial institution participating in the condominium loan loss reserves program.
"Qualified condominium association" means a condominium association that meets the eligibility requirements under section -6 and rules adopted by the authority.
"Reserve account" means an account established in a participating community development financial institution on approval of the authority in which money is deposited to serve as a reserve to reimburse a participating community development financial institution for losses on loans enrolled in the condominium loan loss reserves program.
§ -2 Powers; rulemaking. In addition to any other powers authorized by law, the authority may:
(1) Contract with any community development financial institution for services, including servicing or administering loans pursuant to this part; and
(2) Adopt rules pursuant to chapter 91 to effectuate this chapter, including but not limited to rules relating to:
(A) Determinations of any other maintenance or repairs that qualify for financing or refinancing under this chapter;
(B) The establishment of interest rates chargeable by the authority for direct loans under this part and by the participating community development financial institutions for loans under part II;
(C) The establishment of restrictions on the terms, maturities, collateral, and other requirements not inconsistent with this part;
(D) Procedures for validating a qualified condominium association's compliance with the obligation to increase its replacement reserves balance;
(E) Determinations of eligibility of a community development financial institution to participate in the condominium loan loss reserves program;
(F) Eligibility participation criteria for loans issued by an eligible community development financial institution to a qualified condominium association; and
(G) The authorization of a single community development financial institution or a consortium of community development financial institutions to participate in the condominium loan loss reserves program subject to condominium loan loss reserves program guidelines.
§ -3 Condominium loan program. There is established within the authority the condominium loan program to provide qualified condominium associations with low-cost financing, or refinancing for loans previously obtained, for maintenance or repair projects in accordance with this part.
§ -4 Condominium loan revolving fund. (a) There is established in the state treasury the condominium loan revolving fund, into which shall be deposited:
(1) Moneys received as repayment of loans and interest payments as provided in this chapter;
(2) Appropriations made by the legislature to the condominium loan revolving fund; and
(3) All interest and investment earnings credited to the assets of the fund.
(b) Moneys in the condominium loan revolving fund shall be expended by the authority for:
(1) The purposes of providing loans and credit enhancements in accordance with this chapter; and
(2) Paying administrative costs of the condominium loan program.
§ -5 Loans; limitations and conditions. (a) Loans under this chapter shall be for financing, or refinancing previous loans that were used for, the following maintenance or repairs in a condominium project:
(1) Installing, repairing, or replacing fire sprinklers or other fire safety measures;
(2) Repairing or replacing the pipes;
(3) Repairing or replacing the roof; or
(4) Any other maintenance or repairs the authority deems qualified for the loans.
(b) The loan agreement shall require that the qualified condominium association increase its replacement reserves fund balance over the term of the loan.
§ -6 Loans; eligibility. The authority may make loans directly to a condominium association that has:
(1) Received at least one letter from a financial institution declining its eligibility for a loan to address maintenance or insurance coverage issues; and
(2) Obtained full replacement property and hurricane insurance coverage or intends to do so as a condition of any financing received.
§ -7 Annual reports. The authority shall submit a report to the legislature no later than twenty days prior to the convening of each regular session that details the progress of the condominium loan program, aggregate data on the loans issued under this part, and the balance of the condominium loan revolving fund.
§ -8 Gifts and grants. The authority may accept gifts, grants, and donations from any source for the purposes of this chapter.
PART II. CREDIT ENHANCEMENT THROUGH LOAN LOSS RESERVES
§ -11 Condominium loan loss reserves program. (a) There is established within the authority the condominium loan loss reserves program to incentivize community development financial institutions, in accordance with this part, to provide loans at competitive rates and terms to condominium associations for the purpose of allowing condominium associations to make necessary maintenance or repairs.
(b) The authority shall use moneys in the condominium loan revolving fund to make deposits into a participating community development financial institution's reserve account in an amount specified by this part to be a source of moneys the participating community development financial institution may receive as reimbursement for losses attributable to loans in the condominium loan loss reserves program.
§ -12 Participating community development financial institutions; reserve account. (a) To participate in the condominium loan loss reserves program, an eligible community development financial institution shall enter into a participation agreement with the authority that sets out the terms and conditions under which the authority will make contributions to the community development financial institution's reserve account and specifies the criteria for a loan to qualify as a loan under this part.
(b) On approval by the authority and after a community development financial institution enters into a participation agreement with the authority, the authority shall establish a reserve account at a participating community development financial institution making a loan under this part and deposit an amount equal to five per cent of the original loan amount. The reserve account shall be used by the authority to cover any losses arising from a default of the loan made by the participating community development financial institution under this part or as otherwise provided by this part.
(c) When a participating community development financial institution makes a loan enrolled in the condominium loan loss reserves program, the participating community development financial institution shall pay to the authority a fee equal to fifty basis points of the amount deposited into the condominium loan revolving fund to support the loan, which the authority shall deposit into the reserve account, and annually thereafter. The participating community development financial institution may recover from the borrower all or part of the amount the participating community development financial institution is required to pay under this subsection in any manner agreed to by the financial institution and borrower.
(d) For each loan under this part, the participating community development financial institution shall provide executed loan documents to the authority, within the period prescribed by the authority, including the amount of fees received from the borrower.
§ -13 Loans. (a) Except as otherwise provided by this chapter, the authority shall determine the recipient, amount, or interest rate of a loan under this part or the fees or other requirements related to the loan.
(b) To qualify as a loan under this part, a loan shall:
(1) Be made to a condominium association that has:
(A) Received at least one letter from a financial institution declining the condominium association's eligibility for a loan to address maintenance or insurance coverage issues; and
(B) Obtained full replacement property and hurricane insurance coverage or intends to do so as a condition of any financing received;
(2) Meet the limitations and conditions under section ‑5; and
(3) Meet other criteria established by the authority by rules adopted pursuant to chapter 91.
(c) For a line of credit to qualify for participation in the condominium loan loss reserves program, a line of credit shall:
(1) Be an account at a participating community development financial institution under which the community development financial institution agrees to lend money to a qualified condominium association from time to time to finance one or more projects that are authorized by this chapter; and
(2) Contain the same restrictions, to the extent possible, that are placed on a loan that is not a line of credit.
(d) A loan under this part may be sold on the secondary market under conditions as may be determined by the participating community development financial institution with the consent of the authority.
(e) When enrolling a loan in the condominium loan loss reserves program, a participating community development financial institution may specify an amount to be covered under the condominium loan loss reserves program that is less than the amount allowed under section -12(b).
§ -14 Limitations on amounts retained in reserve accounts. The maximum aggregate amount the authority may retain on deposit in a reserve account shall not exceed five per cent of the aggregate outstanding principal balance of enrolled loans. On a regular basis, no less than annually, the authority shall withdraw from a reserve account the amounts in excess of the limit and deposit that amount into the condominium loan revolving fund. A withdrawal of money authorized under this section shall not reduce an active reserve account to an amount that is less than the aggregate amount allowed under this section.
§ -15 State's rights with respect to reserve account. (a) All of the money in a reserve account established under this part shall be the property of the State.
(b) The State shall be entitled to earn interest on the amount of contributions made by the authority, borrower, and participating community development financial institution to a reserve account under this part. On a regular basis, no less than annually, the authority shall withdraw from a reserve account the amount of the interest earned by the State. The authority shall deposit the amount withdrawn under this section into the condominium loan revolving fund.
(c) The authority shall withdraw from the participating community development financial institution's reserve account the total amount in the account and any interest earned on the account and deposit the amount into the condominium loan revolving fund when:
(1) A participating community development financial institution is no longer eligible to participate in the condominium loan loss reserves program or a participation agreement entered into under this part expires without renewal by the authority or institution; and
(2) The participating community development financial institution has no outstanding loans under this part.
§ -16 Participating community development financial institution's annual reports. A participating community development financial institution shall submit an annual report to the authority. The report shall:
(1) Provide information regarding outstanding principal balances of the loans under this part, loan losses, and any other information on loans under this part the authority considers appropriate;
(2) Include a copy of the participating community development financial institution's most recent financial statement; and
(3) Include information regarding the condominium associations with loans under this part.
§ -17 Authority's annual report; audits. (a) The authority shall submit to the legislature an annual status report on the condominium loan loss reserves program's activities.
(b) The condominium loan revolving fund shall be audited at least annually by a firm of independent certified public accountants selected by the authority and provide the results of the audit to the department of business, economic development, and tourism and the legislature.
§ -18 State liability prohibited. The State shall not be liable to a participating community development financial institution for payment of the principal, interest, or any late charges on a loan made by a participating community development financial institution to a qualified condominium association under this part."
SECTION 2. 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 2025-2026 and the same sum or so much thereof as may be necessary for fiscal year 2026-2027 to be deposited into the condominium loan revolving fund.
SECTION 3. There is appropriated out of the condominium loan revolving fund the sum of $ or so much thereof as may be necessary for fiscal year 2025-2026 and the same sum or so much thereof as may be necessary for fiscal year 2026-2027 to implement the condominium loan program.
The sums appropriated shall be expended by the Hawaii green infrastructure authority for the purposes of this Act.
SECTION 4. This Act shall take effect on July 1, 3000.
Report Title:
Hawaii Green Infrastructure Authority; Condominiums; Condominium Loan Program; Condominium Loan Loss Reserves Program; Reports; Appropriations
Description:
Establishes the Condominium Loan Program to provide condominium associations with low-cost financing, or refinancing for previously obtained loans, for maintenance or repair projects. Establishes the Condominium Loan Loss Reserves Program to incentivize lenders to provide loans at competitive rates and terms to condominium associations for the purpose of allowing condominium associations to make necessary maintenance or repairs. Requires annual reports to the Legislature. Appropriates funds. Effective 7/1/3000. (SD1)
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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HOUSE OF REPRESENTATIVES |
H.B. NO. |
807 |
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THIRTY-THIRD LEGISLATURE, 2025 |
H.D. 2 |
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STATE OF HAWAII |
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|
|
|
||
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A BILL FOR AN ACT
RELATING TO CONDOMINIUMS.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The Hawaii Revised Statutes is amended by adding a new chapter to be appropriately designated and to read as follows:
"Chapter
financing for condominiums
Part I. DIRECT FINANCING
§ -1 Definitions. As used in this chapter, unless the context clearly requires otherwise:
"Authority" means the Hawaii green infrastructure authority as established under section 196-63.
"Community development financial institution" means an entity certified as a community development financial institution by the federal Community Development Financial Institution Fund.
"Condominium association" has the same meaning as association as defined under section 514B-3.
"Condominium project" has the same meaning as project as defined under section 514B-3.
"Financial institution" includes a bank, trust company, banking association, savings and loan association, mortgage company, investment bank, credit union, or nontraditional financial institution.
"Loan" includes a line of credit.
"Qualified condominium association" means a condominium association that meets the eligibility requirements under section -6 and the rules adopted by the authority.
"Participating community development financial institution" means a community development financial institution participating in the condominium loan loss reserves program.
"Reserve account" means an account established in a participating community development financial institution on approval of the authority in which money is deposited to serve as a reserve to reimburse a participating community development financial institution for losses on loans enrolled in the condominium loan loss reserves program.
§ -2 Powers; rulemaking. In addition to any other powers authorized by law, the authority may:
(1) Contract with any community development financial institution for services, including servicing or administering loans pursuant to this part; and
(2) Adopt rules pursuant to chapter 91 to effectuate this chapter, including but not limited to rules relating to:
(A) Determinations of any other maintenance or repairs that qualify for financing or refinancing under this chapter;
(B) The establishment of interest rates chargeable by the authority for direct loans under this part and by the participating community development financial institutions for loans under part II;
(C) The establishment of restrictions on the terms, maturities, collateral, and other requirements not inconsistent with this part;
(D) Procedures for validating a qualified condominium association's compliance with the obligation to increase its replacement reserves balance;
(E) Determinations of eligibility of a community development financial institution to participate in the condominium loan loss reserves program;
(F) Eligibility participation criteria for loans issued by an eligible community development financial institution to a qualified condominium association; and
(G) The authorization of a consortium of community development financial institutions to participate in the condominium loan loss reserves program subject to condominium loan loss reserves program guidelines.
§ -3 Condominium loan program. There is established within the authority the condominium loan program to provide qualified condominium associations with low-cost financing, or refinancing for loans previously obtained, for maintenance or repair projects in accordance with this part.
§ -4 Condominium loan revolving fund. (a) There is established in the state treasury the condominium loan revolving fund, into which shall be deposited:
(1) Moneys received as repayment of loans and interest payments as provided in this chapter;
(2) Appropriations made by the legislature to the condominium loan revolving fund; and
(3) All interest and investment earnings credited to the assets of the fund.
(b) Moneys in the condominium loan revolving fund shall be expended by the authority for:
(1) The purposes of providing loans and credit enhancements in accordance with this chapter; and
(2) Paying administrative costs of the condominium loan program.
§ -5 Loans; limitations and conditions. (a) Loans under this chapter shall be for financing, or refinancing previous loans that were used for, the following maintenance or repairs in a condominium project:
(1) Installing, repairing, or replacing fire sprinklers or other fire safety measures;
(2) Repairing or replacing the pipes;
(3) Repairing or replacing the roof; or
(4) Any other maintenance or repairs the authority deems qualified for the loans.
(b) The loan agreement shall require that the qualified condominium association increase its replacement reserves fund balance over the term of the loan.
§ -6 Loans; eligibility. The authority may make loans directly to a condominium association that:
(1) Has received at least one letter from a financial institution declining its eligibility for a loan to address maintenance or insurance coverage issues; and
(2) Has obtained full replacement insurance coverage or intends to do so as a condition of any financing received.
§ -7 Annual reports. The authority shall submit a report to the legislature no later than twenty days prior to the convening of each regular session that details the progress of the condominium loan program, aggregate data on the loans issued under this part, and the balance of the condominium loan revolving fund.
§ -8 Gifts and grants. The authority may accept gifts, grants, and donations from any source for the purposes of this chapter.
PART II. CREDIT ENHANCEMENT THROUGH LOAN LOSS RESERVES
§ -11 Condominium loan loss reserves program. (a) There is established within the authority the condominium loan loss reserves program to incentivize community development financial institutions, in accordance with this part, to provide loans at competitive rates and terms to condominium associations for the purpose of allowing condominium associations to make necessary maintenance or repairs.
(b) The authority shall use moneys in the condominium loan revolving fund to make deposits into a participating community development financial institution's reserve account in an amount specified by this part to be a source of moneys the participating community development financial institution may receive as reimbursement for losses attributable to loans in the condominium loan loss reserves program.
§ -12 Participating community development financial institutions; reserve account. (a) To participate in the condominium loan loss reserves program, an eligible community development financial institution shall enter into a participation agreement with the authority that sets out the terms and conditions under which the authority will make contributions to the community development financial institution's reserve account and specifies the criteria for a loan to qualify as a loan under this part.
(b) On approval by the authority and after a community development financial institution enters into a participation agreement with the authority, the authority shall establish a reserve account at a participating community development financial institution making a loan under this part and deposit an amount equal to five per cent of the original loan amount. The reserve account shall be used by the authority to cover any losses arising from a default of the loan made by the participating community development financial institution under this part or as otherwise provided by this part.
(c) When a participating community development financial institution makes a loan enrolled in the condominium loan loss reserves program, the participating community development financial institution shall pay to the authority a fee equal to fifty basis points of the amount deposited into the reserve account to support the loan, which the authority shall deposit into the reserve account, and annually thereafter. The participating community development financial institution may recover from the borrower all or part of the amount the participating community development financial institution is required to pay under this subsection in any manner agreed to by the financial institution and borrower.
(d) For each loan under this part, the participating community development financial institution shall provide executed loan documents to the authority, within the period prescribed by the authority, including the amount of fees received from the borrower.
§ -13 Loans. (a) Except as otherwise provided by this chapter, the authority shall not determine the recipient, amount, or interest rate of a loan under this part or the fees or other requirements related to the loan.
(b) To qualify as a loan under this part, a loan shall:
(1) Be made to a condominium association;
(2) Meet the limitations and conditions under section ‑5; and
(3) Meet other criteria established by the authority by rules adopted pursuant to chapter 91.
(c) For a line of credit to qualify for participation in the condominium loan loss reserves program, a line of credit shall:
(1) Be an account at a participating community development financial institution under which the community development financial institution agrees to lend money to a qualified condominium association from time to time to finance one or more projects that are authorized by this chapter; and
(2) Contain the same restrictions, to the extent possible, that are placed on a loan that is not a line of credit.
(d) A loan under this part may be sold on the secondary market under conditions as may be determined by the participating community development financial institution with the consent of the authority.
(e) When enrolling a loan in the condominium loan loss reserves program, a participating community development financial institution may specify an amount to be covered under the condominium loan loss reserves program that is less than the amount allowed under section -12(b).
§ -14 Limitations on state contribution to reserve account. The maximum aggregate amount the authority may retain on deposit in a reserve account shall not exceed per cent of the aggregate outstanding principal balance of enrolled loans. On a regular basis, no less than annually, the authority shall withdraw from a reserve account the amounts in excess of the limit and deposit that amount into the condominium loan revolving fund. A withdrawal of money authorized under this section shall not reduce an active reserve account to an amount that is less than the aggregate amount allowed under this section.
§ -15 State's rights with respect to reserve account. (a) All of the money in a reserve account established under this part is property of the State.
(b) The State is entitled to earn interest on the amount of contributions made by the authority, borrower, and participating community development financial institution to a reserve account under this part. On a regular basis, no less than annually, the authority shall withdraw from a reserve account the amount of the interest earned by the State. The authority shall deposit the amount withdrawn under this section into the condominium loan revolving fund.
(c) The authority shall withdraw from the participating community development financial institution's reserve account the total amount in the account and any interest earned on the account and deposit the amount into the condominium loan revolving fund when:
(1) A participating community development financial institution is no longer eligible to participate in the condominium loan loss reserves program or a participation agreement entered into under this part expires without renewal by the authority or institution; and
(2) The participating community development financial institution has no outstanding loans under this part.
§ -16 Participating community development financial institution's annual reports. A participating community development financial institution shall submit an annual report to the authority. The report shall:
(1) Provide information regarding outstanding principal balance of the loans under this part, loan losses, and any other information on loans under this part the authority considers appropriate;
(2) Include a copy of the participating community development financial institution's most recent financial statement; and
(3) Include information regarding the condominium associations with loans under this part.
§ -17 Authority's annual report; audits. (a) The authority shall submit to the legislature an annual status report on the condominium loan loss reserves program's activities.
(b) The condominium loan revolving fund shall be audited at least annually by a firm of independent certified public accountants selected by the authority and provide the results of the audit to the department of business, economic development, and tourism and the legislature.
§ -18 State liability prohibited. The State shall not be liable to a participating community development financial institution for payment of the principal, the interest, or any late charges on a loan made by a participating community development financial institution to a qualified condominium association under this part."
SECTION 2. 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 2025-2026 and the same sum or so much thereof as may be necessary for fiscal year 2026-2027 to be deposited into the condominium loan revolving fund.
SECTION 3. There is appropriated out of the condominium loan revolving fund the sum of $ or so much thereof as may be necessary for fiscal year 2025-2026 and the same sum or so much thereof as may be necessary for fiscal year 2026-2027 to implement the condominium loan program.
The sums appropriated shall be expended by the Hawaii green infrastructure authority for the purposes of this Act.
SECTION 4. This Act shall take effect on July 1, 3000.
Report Title:
Hawaii Green Infrastructure Authority; Condominiums; Condominium Loan Program; Condominium Loan Loss Reserves Program; Appropriation
Description:
Establishes the Condominium Loan Program to provide condominium associations with low-cost financing, or refinancing for previously obtained loans, for maintenance or repair projects. Establishes the Condominium Loan Loss Reserves Program to incentivize lenders to provide loans at competitive rates and terms to condominium associations for the purpose of allowing condominium associations to make necessary maintenance or repairs. Appropriates funds. Effective 7/1/3000. (HD2)
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
|
HOUSE OF REPRESENTATIVES |
H.B. NO. |
807 |
|
THIRTY-THIRD LEGISLATURE, 2025 |
H.D. 1 |
|
|
STATE OF HAWAII |
|
|
|
|
|
|
|
|
||
|
|
||
A BILL FOR AN ACT
RELATING TO CONDOMINIUMS.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The Hawaii Revised Statutes is amended by adding a new chapter to be appropriately designated and to read as follows:
"Chapter
financing for condominiums
Part I. DIRECT FINANCING
§ -1 Definitions. As used in this chapter, unless the context clearly requires otherwise:
"Authority" means the Hawaii green infrastructure authority as established under section 196-63.
"Condominium association" has the same meaning as association as defined under section 514B-3.
"Condominium project" has the same meaning as project as defined under section 514B-3.
"Financial institution" includes a bank, trust company, banking association, savings and loan association, mortgage company, investment bank, credit union, or nontraditional financial institution.
"Loan" includes a line of credit.
"Qualified condominium association" means a condominium association that meets the eligibility requirements under section -6 and the rules adopted by the authority.
"Participating community development financial institution" means a community development financial institution participating in the condominium loan loss reserves program.
"Reserve account" means an account established in a participating community development financial institution on approval of the authority in which money is deposited to serve as a reserve to reimburse a participating community development financial institution for losses on loans enrolled in the condominium loan loss reserves program.
§ -2 Powers; rulemaking. In addition to any other powers authorized by law, the authority may:
(1) Contract with any community development financial institution for services, including servicing or administering loans pursuant to this part;
(2) Adopt rules pursuant to chapter 91 to effectuate this chapter, including but not limited to rules relating to:
(A) Determinations of any other maintenance or repairs that qualify for financing or refinancing under this chapter;
(B) The establishment of interest rates chargeable by the authority for direct loans under this part and by the participating community development financial institutions for loans under part II;
(C) The establishment of restrictions on the terms, maturities, collateral, and other requirements not inconsistent with this part;
(D) Procedures for validating a qualified condominium association's compliance with the obligation to increase its replacement reserves balance;
(E) Determinations of eligibility of a community development financial institution to participate in the condominium loan loss reserves program;
(F) Eligibility participation criteria for loans issued by an eligible community development financial institution to a qualified condominium association; and
(G) The authorization of a consortium of community development financial institutions to participate in the condominium loan loss reserves program subject to condominium loan loss reserves program guidelines.
§ -3 Condominium loan program. There is established within the authority the condominium loan program to provide qualified condominium associations with low-cost financing, or refinancing for loans previously obtained, for maintenance or repair projects in accordance with this part.
§ -4 Condominium loan revolving fund. (a) There is established in the state treasury the condominium loan revolving fund, into which shall be deposited:
(1) Moneys received as repayment of loans and interest payments as provided in this chapter;
(2) Appropriations made by the legislature to the condominium loan revolving fund; and
(3) All interest and investment earnings credited to the assets of the fund.
(b) Moneys in the condominium loan revolving fund shall be expended by the authority for:
(1) The purposes of providing loans and credit enhancements in accordance with this chapter; and
(2) Paying administrative costs of the condominium loan program.
§ -5 Loans; limitations and conditions. (a) Loans under this chapter shall be for financing, or refinancing previous loans that were used for, the following maintenance or repairs in a condominium project:
(1) Installing, repairing, or replacing fire sprinklers or other fire safety measures;
(2) Repairing or replacing the pipes;
(3) Repairing or replacing the roof; or
(4) Any other maintenance or repairs the authority deems qualified for the loans.
(b) The loan agreement shall require that the qualified condominium association increase its replacement reserves fund balance over the term of the loan and terms.
§ -6 Loans; eligibility. The authority may make loans directly to condominium associations that:
(1) Has received at least one letter from a financial institution declining its eligibility for a loan to address maintenance or insurance coverage issues; and
(2) Has obtained full replacement insurance coverage or intends to do so as a condition of any financing received.
§ -7 Annual reports. The authority shall submit a report to the legislature no later than twenty days prior to the convening of each regular session that details the progress of the condominium loan program, aggregate data on the loans issued under this part, and the balance of the condominium loan revolving fund.
§ -8 Gifts and grants. The authority may accept gifts, grants, and donations from any source for the purposes of this chapter.
PART II. CREDIT ENHANCEMENT THROUGH LOAN LOSS RESERVES
§ -11 Condominium loan loss reserves program. (a) There is established within the authority the condominium loan loss reserves program to incentivize community development financial institutions, in accordance with this part, to provide loans at competitive rates and terms to condominium associations for the purpose of allowing condominium associations to make necessary maintenance or repairs.
(b) The authority shall use moneys in the condominium loan revolving fund to make deposits into a participating community development financial institution's reserve account in an amount specified by this part to be a source of moneys the participating community development financial institution may receive as reimbursement for losses attributable to loans in the condominium loan loss reserves program.
§ -12 Participating community development financial institutions; reserve account. (a) To participate in the condominium loan loss reserves program, an eligible community development financial institution shall enter into a participation agreement with the authority that sets out the terms and conditions under which the authority will make contributions to the community development financial institution's reserve account and specifies the criteria for a loan to qualify as a loan under this part.
(b) On approval by the authority and after a community development financial institution enters into a participation agreement with the authority, the authority shall establish a reserve account at a participating community development financial institution making a loan under this part and deposit an amount equal to five per cent of the original loan amount. The reserve account shall be used by the authority to cover any losses arising from a default of the loan made by the participating community development financial institution under this part or as otherwise provided by this part.
(c) When a participating community development financial institution makes a loan enrolled in the condominium loan loss reserves program, the participating community development financial institution shall pay to the authority a fee equal to fifty basis points of the amount deposited into the reserve account to support the loan, which the authority shall deposit into the reserve account, and annually thereafter. The participating community development financial institution may recover from the borrower all or part of the amount the participating community development financial institution is required to pay under this subsection in any manner agreed to by the financial institution and borrower.
(d) For each loan under this part made by a participating community development financial institution, the financial institution shall provide executed loan documents to the authority, within the period prescribed by the authority, including the amount of fees received from the borrower.
§ -13 Loans. (a) Except as otherwise provided by this chapter, the authority shall not determine the recipient, amount, or interest rate of a loan under this part or the fees or other requirements related to the loan.
(b) To qualify as a loan under this part, a loan shall:
(1) Be made to a condominium association;
(2) Meet the limitations and conditions under section ‑5; and
(3) Meet other criteria established by the authority by rules adopted pursuant to chapter 91.
(c) For a line of credit to qualify for participation in the condominium loan loss reserves program, a line of credit shall:
(1) Be an account at a participating community development financial institution under which the community development financial institution agrees to lend money to a qualified condominium association from time to time to finance one or more projects that are authorized by this chapter; and
(2) Contain the same restrictions, to the extent possible, that are placed on a loan that is not a line of credit.
(d) A loan under this part may be sold on the secondary market under conditions as may be determined by the participating community development financial institution with the consent of the authority.
(e) When enrolling a loan in the condominium loan loss reserves program, a participating community development financial institution may specify an amount to be covered under the condominium loan loss reserves program that is less than the amount allowed under section -12(b).
§ -14 Limitations on state contribution to reserve account. The maximum aggregate amount the authority may retain on deposit in a reserve account shall not exceed per cent of the aggregate outstanding principal balance of enrolled loans. On a regular basis, no less than annually, the authority shall withdraw from a reserve account the amounts in excess and deposit that amount into the condominium loan revolving fund. A withdrawal of money authorized under this section shall not reduce an active reserve account to an amount that is less than the aggregate amount allowed under this section.
§ -15 State's rights with respect to reserve account. (a) All of the money in a reserve account established under this part is property of the State.
(b) The State is entitled to earn interest on the amount of contributions made by the authority, borrower, and participating community development financial institution to a reserve account under this part. On a regular basis, no less than annually, the authority shall withdraw from a reserve account the amount of the interest earned by the State. The authority shall deposit the amount withdrawn under this section into the condominium loan revolving fund.
(c) The authority shall withdraw from the participating community development financial institution's reserve account the total amount in the account and any interest earned on the account and deposit the amount into the condominium loan revolving fund when:
(1) A participating community development financial institution is no longer eligible to participate in the condominium loan loss reserves program or a participation agreement entered into under this part expires without renewal by the authority or institution; and
(2) The participating community development financial institution has no outstanding loans under this part.
§ -16 Participating community development financial institution's annual reports. A participating community development financial institution shall submit an annual report to the authority. The report shall:
(1) Provide information regarding outstanding principal balance of the loans under this part, loan losses, and any other information on loans under this part the authority considers appropriate;
(2) Include a copy of the participating community development financial institution's most recent financial statement; and
(3) Include information regarding the condominium associations with loans under this part.
§ -17 Authority's annual report; audits. (a) The authority shall submit to the legislature an annual status report on the condominium loan loss reserves program's activities.
(b) The condominium loan revolving fund shall be audited at least annually by a firm of independent certified public accountants selected by the authority and provide the results of the audit to the department and legislature.
§ -18 State liability prohibited. The State shall not be liable to a participating community development financial institution for payment of the principal, the interest, or any late charges on a loan made by a participating community development financial institution to a qualified condominium association under this part."
SECTION 2. 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 2025-2026 and the same sum or so much thereof as may be necessary for fiscal year 2026-2027 to be deposited into the condominium loan revolving fund.
SECTION 3. There is appropriated out of the condominium loan revolving fund the sum of $ or so much thereof as may be necessary for fiscal year 2025-2026 and the same sum or so much thereof as may be necessary for fiscal year 2026-2027 to implement the condominium loan program.
The sums appropriated shall be expended by the Hawaii green infrastructure authority for the purposes of this Act.
SECTION 4. This Act shall take effect on July 1, 2025.
Report Title:
Hawaii Green Infrastructure Authority; Condominiums; Condominium Loan Program; Condominium Loan Loss Reserves Program; Appropriation
Description:
Establishes the Condominium Loan Program to provide condominium associations with low-cost financing, or refinance previously obtained loans, for maintenance or repair projects. Establishes the Condominium Loan Loss Reserves Program to incentivize lenders into providing loans at competitive rates and terms to condominium associations for the purpose of allowing condominium associations to make necessary maintenance or repairs. Appropriates funds. (HD1)
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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HOUSE OF REPRESENTATIVES |
H.B. NO. |
807 |
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THIRTY-THIRD LEGISLATURE, 2025 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
relating to condominiums.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The Hawaii Revised Statutes is amended by adding a new chapter to be appropriately designated and to read as follows:
"Chapter
financing for condominiums
Part I. DIRECT FINANCING
§ -1 Definitions. As used in this chapter, unless the context clearly requires otherwise:
"Authority" means the Hawaii green infrastructure authority as established under section 196-63.
"Condominium association" has the same meaning as association as defined under section 514B-3.
"Condominium project" has the same meaning as project as defined under section 514B-3.
"Financial institution" includes a bank, trust company, banking association, savings and loan association, mortgage company, investment bank, credit union, or nontraditional financial institution.
"Loan" includes a line of credit.
"Qualified condominium association" means a condominium association that meets the eligibility requirements under section -6 and the rules adopted by the authority.
"Participating financial institution" means a financial institution participating in the condominium loan loss reserves program.
"Reserve account" means an account established in a participating financial institution on approval of the authority in which money is deposited to serve as a reserve to reimburse the financial institution for losses on loans enrolled in the condominium loan loss reserves program.
§ -2 Powers; rulemaking. In addition to any other powers authorized by law, the authority may:
(1) Contract with any financial institution for services, including servicing or administering loans pursuant to this part;
(2) Adopt rules pursuant to chapter 91 to effectuate this chapter, including but not limited to rules relating to:
(A) Determinations of any other maintenance or repairs that qualify for financing or refinancing under this chapter;
(B) The establishment of interest rates chargeable by the authority for direct loans under this part and by the participating financial institutions for loans under part II;
(C) The establishment of restrictions on the terms, maturities, collateral, and other requirements not inconsistent with this part;
(D) Procedures for validating a qualified condominium association's compliance with the obligation to increase its replacement reserves balance;
(E) Determinations of eligibility of a financial institution to participate in the condominium loan loss reserves program;
(F) Eligibility participation criteria for loans issued by an eligible financial institution to a qualified condominium association; and
(G) The authorization of a consortium of financial institutions to participate in the condominium loan loss reserves program subject to condominium loan loss reserves program guidelines.
§ -3 Condominium loan program. There is established within the authority the condominium loan program to provide qualified condominium associations with low-cost financing, or refinancing for loans previously obtained, for maintenance or repair projects in accordance with this part.
§ -4 Condominium loan revolving fund. (a) There is established in the state treasury the condominium loan revolving fund, into which shall be deposited:
(1) Moneys received as repayment of loans and interest payments as provided in this chapter;
(2) Appropriations made by the legislature to the condominium loan revolving fund; and
(3) All interest and investment earnings credited to the assets of the fund.
(b) Moneys in the condominium loan revolving fund shall be expended by the authority for:
(1) The purposes of providing loans and credit enhancements in accordance with this part; and
(2) Paying administrative costs of the condominium loan program.
§ -5 Loans; limitations and conditions. (a) Loans under this chapter shall be for financing, or refinancing previous loans that were used for, the following maintenance or repairs in a condominium project:
(1) Installing, repairing, or replacing fire sprinklers or other fire safety measures;
(2) Repairing or replacing the pipes;
(3) Repairing or replacing the roof; or
(4) Any other maintenance or repairs the authority deems qualified for the loans.
(b) The loan agreement shall require that the qualified condominium association increase its replacement reserves fund balance over the term of the loan and terms.
§ -6 Loans; eligibility. The authority may make loans directly to condominium associations that:
(1) Are unable to secure full replacement value insurance at reasonable rates; or
(2) Cannot obtain sufficient funds at reasonable rates from private lenders independently.
§ -7 Annual reports. The authority shall submit a report to the legislature no later than twenty days prior to the convening of each regular session that details the progress of the condominium loan program, aggregate data on the loans issued under this part, and the balance of the condominium loan revolving fund.
§ -8 Gifts and grants. The authority may accept gifts, grants, and donations from any source for the purposes of this chapter.
PART II. CREDIT ENHANCEMENT THROUGH LOAN LOSS RESERVES
§ -11 Condominium loan loss reserves program. (a) There is established within the authority the condominium loan loss reserves program to incentivize lenders, in accordance with this part, to provide loans at competitive rates and terms to condominium associations for the purpose of allowing condominium associations to make necessary maintenance or repairs.
(b) The authority shall use moneys in the condominium loan revolving fund to make deposits into a participating financial institution's reserve account in an amount specified by this part to be a source of moneys the participating financial institution may receive as reimbursement for losses attributable to loans in the condominium loan loss reserves program.
§ -12 Participating financial institutions; reserve account. (a) To participate in the condominium loan loss reserves program, an eligible financial institution shall enter into a participation agreement with the authority that sets out the terms and conditions under which the authority will make contributions to the institution's reserve account and specifies the criteria for a loan to qualify as a loan under this part.
(b) On approval by the authority and after a financial institution enters into a participation agreement with the authority, the authority shall establish a reserve account at a participating financial institution making a loan under this part and deposit an amount equal to five per cent of the original loan amount. The reserve account shall be used by the authority to cover any losses arising from a default of the loan made by the institution under this part or as otherwise provided by this part.
(c) When a participating financial institution makes a loan enrolled in the condominium loan loss reserves program, the institution shall pay to the authority a fee equal to fifty basis points of the amount deposited into the reserve account to support the loan, which the authority shall deposit into the reserve account, and annually thereafter. The participating financial may recover from the borrower all or part of the amount the institution is required to pay under this subsection in any manner agreed to by the institution and borrower.
(d) For each loan under this part made by a participating financial institution, the institution shall provide executed loan documents to the authority, within the period prescribed by the authority, including the amount of fees received from the borrower.
§ -13 Loans. (a) Except as otherwise provided by this chapter, the authority shall not determine the recipient, amount, or interest rate of a loan under this part or the fees or other requirements related to the loan.
(b) To qualify as a loan under this part, a loan shall:
(1) Be made to a condominium association;
(2) Meet the limitations and conditions under section ‑5; and
(3) Meet other criteria established by the authority by rules adopted pursuant to chapter 91.
(c) For a line of credit to qualify for participation in the condominium loan loss reserves program, a line of credit shall:
(1) Be an account at a financial institution under which the financial institution agrees to lend money to a qualified condominium association from time to time to finance one or more projects that are authorized by this chapter; and
(2) Contain the same restrictions, to the extent possible, that are placed on a loan that is not a line of credit.
(d) A loan under this part may be sold on the secondary market under conditions as may be determined by the participating financial institution with the consent of the authority.
(e) When enrolling a loan in the condominium loan loss reserves program, a participating financial institution may specify an amount to be covered under the condominium loan loss reserves program that is less than the amount allowed under section -12(b).
§ -14 Limitations on state contribution to reserve account. The maximum aggregate amount the authority may retain on deposit in a reserve account shall not exceed per cent of the aggregate outstanding principal balance of enrolled loans. On a regular basis, no less than annually, the authority shall withdraw from a reserve account the amounts in excess and deposit that amount into the condominium loan revolving fund. A withdrawal of money authorized under this section shall not reduce an active reserve account to an amount that is less than the aggregate amount allowed under this section.
§ -15 State's rights with respect to reserve account. (a) All of the money in a reserve account established under this part is property of the State.
(b) The State is entitled to earn interest on the amount of contributions made by the authority, borrower, and participating financial institution to a reserve account under this part. On a regular basis, no less than annually, the authority shall withdraw from a reserve account the amount of the interest earned by the State. The authority shall deposit the amount withdrawn under this section into the condominium loan revolving fund.
(c) The authority shall withdraw from the participating financial institution's reserve account the total amount in the account and any interest earned on the account and deposit the amount into the condominium loan revolving fund when:
(1) A financial institution is no longer eligible to participate in the condominium loan loss reserves program or a participation agreement entered into under this part expires without renewal by the authority or institution; and
(2) The financial institution has no outstanding loans under this part.
§ -16 Participating financial institution's annual reports. A participating financial institution shall submit an annual report to the authority. The report shall:
(1) Provide information regarding outstanding principal balance of the loans under this part, loan losses, and any other information on loans under this part the authority considers appropriate;
(2) Include a copy of the institution's most recent financial statement; and
(3) Include information regarding the condominium associations with loans under this part.
§ -17 Authority's annual report; audits. (a) The authority shall submit to the legislature an annual status report on the condominium loan loss reserves program's activities.
(b) The condominium loan revolving fund shall be audited at least annually by a firm of independent certified public accountants selected by the authority and provide the results of the audit to the department and legislature.
§ -18 State liability prohibited. The State shall not be liable to a participating financial institution for payment of the principal, the interest, or any late charges on a loan made under this part."
SECTION 2. 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 2025-2026 and the same sum or so much thereof as may be necessary for fiscal year 2026-2027 to be deposited into the condominium loan revolving fund.
SECTION 3. There is appropriated out of the condominium loan revolving fund the sum of $ or so much thereof as may be necessary for fiscal year 2025-2026 and the same sum or so much thereof as may be necessary for fiscal year 2026-2027 to implement the condominium loan program.
The sums appropriated shall be expended by the Hawaii green infrastructure authority for the purposes of this Act.
SECTION 4. This Act shall take effect on July 1, 2025.
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INTRODUCED BY: |
_____________________________ |
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Report Title:
Hawaii Green Infrastructure Authority; Condominiums; Condominium Loan Program; Condominium Loan Loss Reserves Program; Appropriation
Description:
Establishes the Condominium Loan Program to provide condominium associations with low-cost financing, or refinance previously obtained loans, for maintenance or repair projects. Establishes the Condominium Loan Loss Reserves Program to incentivize lenders into providing loans at competitive rates and terms to condominium associations for the purpose of allowing condominium associations to make necessary maintenance or repairs. Appropriates funds.
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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Date
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Status
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| Dec 8, 2025 | Carried over to 2026 Regular Session. |
| Apr 1, 2025 | The committee on WAM deferred the measure. |
| Mar 27, 2025 | The committee(s) on WAM will hold a public decision making on 04-01-25 10:01AM; Conference Room 211 & Videoconference. |
| Mar 21, 2025 | Report adopted; Passed Second Reading, as amended (SD 1) and referred to WAM. |
| Mar 21, 2025 | Reported from CPN (Stand. Com. Rep. No. 1337) with recommendation of passage on Second Reading, as amended (SD 1) and referral to WAM. |
| Mar 19, 2025 | The committee(s) on CPN recommend(s) that the measure be PASSED, WITH AMENDMENTS. The votes in CPN were as follows: 4 Aye(s): Senator(s) Keohokalole, Fukunaga, McKelvey, Awa; Aye(s) with reservations: none ; 0 No(es): none; and 1 Excused: Senator(s) Richards. |
| Mar 14, 2025 | The committee(s) on CPN deferred the measure until 03-19-25 10:00AM; Conference Room 229 & Videoconference. |
| Mar 7, 2025 | The committee(s) on CPN has scheduled a public hearing on 03-14-25 9:30AM; Conference Room 229 & Videoconference. |
| Mar 6, 2025 | Referred to CPN, WAM. |
| Mar 6, 2025 | Passed First Reading. |
| Mar 6, 2025 | Received from House (Hse. Com. No. 288). |
| Mar 4, 2025 | Passed Third Reading as amended in HD 2 with none voting aye with reservations; none voting no (0) and Representative(s) Pierick, Ward excused (2). Transmitted to Senate. |
| Feb 28, 2025 | Forty-eight (48) hours notice Tuesday, 03-04-25. |
| Feb 28, 2025 | Reported from FIN (Stand. Com. Rep. No. 1008) as amended in HD 2, recommending passage on Third Reading. |
| Feb 21, 2025 | The committee on FIN recommend that the measure be PASSED, WITH AMENDMENTS. The votes were as follows: 13 Ayes: Representative(s) Yamashita, Takenouchi, Grandinetti, Holt, Hussey, Keohokapu-Lee Loy, Kitagawa, Kusch, Lamosao, Miyake, Morikawa, Templo, Reyes Oda; Ayes with reservations: none; Noes: none; and 3 Excused: Representative(s) Lee, M., Alcos, Ward. |
| Feb 19, 2025 | Bill scheduled to be heard by FIN on Friday, 02-21-25 12:00PM in House conference room 308 VIA VIDEOCONFERENCE. |
| Feb 14, 2025 | Passed Second Reading as amended in HD 1 and referred to the committee(s) on FIN with Representative(s) Garcia voting aye with reservations; none voting no (0) and Representative(s) Cochran, Matayoshi, Poepoe, Ward excused (4). |
| Feb 14, 2025 | Reported from CPC (Stand. Com. Rep. No. 675) as amended in HD 1, recommending passage on Second Reading and referral to FIN. |
| Feb 11, 2025 | The committee on CPC recommend that the measure be PASSED, WITH AMENDMENTS. The votes were as follows: 10 Ayes: Representative(s) Matayoshi, Chun, Ilagan, Ichiyama, Iwamoto, Kong, Lowen, Marten, Tam, Pierick; Ayes with reservations: none; Noes: none; and Excused: none. |
| Feb 7, 2025 | Bill scheduled for decision making on Tuesday, 02-11-25 2:00PM in conference room 329 VIA VIDEOCONFERENCE. |
| Feb 5, 2025 | The committee(s) on CPC recommend(s) that the measure be deferred. |
| Feb 3, 2025 | Bill scheduled to be heard by CPC on Wednesday, 02-05-25 2:00PM in House conference room 329 VIA VIDEOCONFERENCE. |
| Jan 21, 2025 | Referred to CPC, FIN, referral sheet 2 |
| Jan 21, 2025 | Introduced and Pass First Reading. |
| Jan 17, 2025 | Pending introduction. |
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Date
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Description
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Location
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Votes
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| Mar 19, 2025 | The committee(s) on CPN recommend(s) that the measure be PASSED, WITH AMENDMENTS | Senate Standing Committee on Commerce and Consumer Protection |
Passed |
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| Mar 4, 2025 | Third Reading | House Floor |
Passed |
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| Feb 21, 2025 | The committee on FIN recommend that the measure be PASSED, WITH AMENDMENTS | House Standing Committee on Finance |
Passed |
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| Feb 11, 2025 | The committee on CPC recommend that the measure be PASSED, WITH AMENDMENTS | House Standing Committee on Consumer Protection & Commerce |
Passed |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
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Organization
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Position
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Date
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| Hawaii Alliance for Retired Americans | *** Against | Mar 14, 2025 |
| Hawaii Bankers Association | *** Support | Mar 31, 2025 |
| Hawaii Council of Community Associations | ** Support | |
| Hawai‘i Green Infrastructure Authority | *** Support | Mar 31, 2025 |
| Kokua Council | *** Against | Mar 14, 2025 |
| Palehua Townhouse Association | *** Support | Mar 31, 2025 |
| Waikiki Neighborhood Board | *** Against | Mar 14, 2025 |
STAND. COM. REP. NO. 1337
Honolulu, Hawaii
RE: H.B. No. 807
H.D. 2
S.D. 1
Honorable Ronald D. Kouchi
President of the Senate
Thirty-Third State Legislature
Regular Session of 2025
State of Hawaii
Sir:
Your Committee on Commerce and Consumer Protection, to which was referred H.B. No. 807, H.D. 2, entitled:
"A BILL FOR AN ACT RELATING TO CONDOMINIUMS,"
begs leave to report as follows:
The purpose and intent of this measure is to:
(1) Establish within the Hawaii Green Infrastructure Authority the Condominium Loan Program to provide condominium associations with low-cost financing, or refinancing for previously obtained loans, for maintenance or repair projects;
(2) Establish the Condominium Loan Loss Reserves Program to incentivize lenders to provide loans at competitive rates and terms to condominium associations to allow them to make necessary maintenance and repairs; and
(3) Appropriate funds.
Your Committee received testimony in support of this measure from the Hawaii Green Infrastructure Authority, Hawaii Bankers Association, Hawaii Council of Community Associations, and seven individuals.
Your Committee received testimony in opposition to this measure from two individuals.
Your Committee received comments on this measure from the Department of Budget and Finance and one individual.
Your Committee finds that the rising cost of insurance premiums in Hawaii has made it harder for condominium associations to obtain full property insurance coverage in the State, causing many of these associations to instead elect to reduce the amount of insurance coverage to less than one hundred percent of the replacement cost value, or seek considerably more expensive secondary insurance policies to fill the gaps, if they can qualify. This has had the unintended consequence of impacting mortgage loans for condominium units because the federal requirements under the Fannie Mae and Freddie Mac guidelines prohibit these entities from purchasing mortgages on condominium units that have less than full replacement property insurance coverage. This measure will enable the Hawaii Green Infrastructure Authority to provide much needed financing for condominium associations to fund essential repairs and address deferred maintenance and structural issues to enhance their insurability, thereby enabling buyers of individual units to access secondary mortgage financing. Additionally, this measure allows the Hawaii Green Infrastructure Authority, in collaboration with the banking industry, to provide credit enhancements to community development financial institutions, mitigating their risks and enabling them to provide loans at competitive rates and terms for condominium associations.
Your Committee notes, however, that to offset the administrative costs for the Hawaii Green Infrastructure Authority to administer the Condominium Loan Loss Reserves Program, amendments to this measure are necessary to ensure there is adequate funding to properly administer these programs.
Accordingly, your Committee has amended this measure by:
(1) Clarifying that the Hawaii Green Infrastructure Authority may authorize a single community development financial institution or a consortium of community development financial institutions to participate in the Condominium Loan Loss Reserves Program;
(2) Amending the criteria for determining a condominium association's eligibility for loans under the programs to be a condominium association that has:
(A) Received at least one letter from a financial institution declining its eligibility for a loan to address maintenance or insurance coverage issues; and
(B) Obtained full replacement property and hurricane insurance coverage or intends to do so as a condition of any financing received;
(3) Requiring the fees paid by a participating community development financial institution when it makes a loan enrolled in the Condominium Loan Program to be deposited into the Condominium Loan Revolving Fund, rather than into the reserve account;
(4) Specifying that the maximum aggregate amount the Hawaii Green Infrastructure Authority may retain on deposit in a reserve account shall not exceed five percent of the aggregate outstanding principal balance of enrolled loans; and
(5) Making technical, nonsubstantive amendments for the purposes of clarity and consistency.
As affirmed by the record of votes of the members of your Committee on Commerce and Consumer Protection that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 807, H.D. 2, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 807, H.D. 2, S.D. 1, and be referred to your Committee on Ways and Means.
Respectfully submitted on behalf of the members of the Committee on Commerce and Consumer Protection,
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________________________________ JARRETT KEOHOKALOLE, Chair |
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STAND. COM. REP. NO. 1008
Honolulu, Hawaii
, 2025
RE: H.B. No. 807
H.D. 2
Honorable Nadine K. Nakamura
Speaker, House of Representatives
Thirty-Third State Legislature
Regular Session of 2025
State of Hawaii
Madame:
Your Committee on Finance, to which was referred H.B. No. 807, H.D. 1, entitled:
"A BILL FOR AN ACT RELATING TO CONDOMINIUMS,"
begs leave to report as follows:
The purpose of this measure is to provide condominium associations with financing options by:
(1) Establishing and appropriating funds for the Condominium Loan Program to provide condominium associations with low-cost financing, or refinancing for previously obtained loans, for maintenance or repair projects; and
(2) Establishing the Condominium Loan Loss Reserves Program to incentivize private lenders to provide loans at competitive rates and terms.
Your Committee received testimony in support of this measure from three individuals. Your Committee received comments on this measure from the Department of Budget and Finance; Hawaiʻi Green Infrastructure Authority; and Hawaii Bankers Association.
Your Committee has amended this measure by:
(1) Changing the effective date to July 1, 3000, to encourage further discussion; and
(2) Making technical, nonsubstantive amendments for the purposes of clarity, consistency, and style.
As affirmed by the record of votes of the members of your Committee on Finance that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 807, H.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 807, H.D. 2.
Respectfully submitted on behalf of the members of the Committee on Finance,
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____________________________ KYLE T. YAMASHITA, Chair |
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STAND. COM. REP. NO. 675
Honolulu, Hawaii
, 2025
RE: H.B. No. 807
H.D. 1
Honorable Nadine K. Nakamura
Speaker, House of Representatives
Thirty-Third State Legislature
Regular Session of 2025
State of Hawaii
Madame:
Your Committee on Consumer Protection & Commerce, to which was referred H.B. No. 807 entitled:
"A BILL FOR AN ACT RELATING TO CONDOMINIUMS,"
begs leave to report as follows:
The purpose of this measure is to provide condominium associations with financing options by:
(1) Establishing the Condominium Loan Program to provide low-cost financing, or refinance previously obtained loans, for maintenance or repair projects; and
(2) Establishing the Condominium Loan Loss Reserves Program to incentivize private lenders into providing loans at competitive rates and terms.
Your Committee finds that, due to issues in the global insurance industry and recent increases in catastrophic weather events around the world, there have been unprecedented insurance premium rate increases for condominium associations. Many of these condominium associations are also seeing the increased insurance premiums due to the aging buildings that make up the condominium projects and the associated repairs and maintenance issues, which are often significant. This measure provides two avenues for condominium associations to receive funding for much needed insurance and repairs.
Your Committee has amended this measure by:
(1) Clarify that the financial institutions that may participate in the Condominium Loan Loss Reserves Program are community development financial institutions;
(2) Amending the criteria for determining a condominium association's eligibility for the programs to be a condominium association that:
(A) Has received at least one letter from a financial institution declining its eligibility for a loan to address maintenance or insurance coverage issues; and
(B) Has obtained full replacement insurance coverage or intends to do so as a condition of any financing received; and
(3) Making technical, nonsubstantive amendments for the purposes of clarity, consistency, and style.
As affirmed by the record of votes of the members of your Committee on Consumer Protection & Commerce that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 807, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 807, H.D. 1, and be referred to your Committee on Finance.
Respectfully submitted on behalf of the members of the Committee on Consumer Protection & Commerce,
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____________________________ SCOT Z. MATAYOSHI, Chair |
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Date
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Testimony PDF
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| Mar 31, 2025 | HB807_SD1_TESTIMONY_WAM_04-01-25_.PDF |
| Mar 14, 2025 | HB807_HD2_TESTIMONY_CPN_03-14-25_.PDF |
| Feb 21, 2025 | HB807_HD1_TESTIMONY_FIN_02-21-25_.PDF |
| Feb 5, 2025 | HB807_TESTIMONY_CPC_02-05-25_.PDF |
Discussed in Hearing
1MIN
House Standing Committee on Finance
5MIN
House Standing Committee on Consumer Protection & Commerce
Bill Author
