House Standing Committee on Housing

Good morning. I'd like to call to order our House Housing Committee hearing for Wednesday, March 25. We are on our 10AM agenda in Conference Room 430, and it's currently 10:02. We have a relatively short agenda today. If you're testifying, please

keep your testimony within a reasonable length. We won't set a strict time limit for today because we don't have the time. Those on Zoom, please, avoid using any copyrighted images. And, as always for everybody, please avoid using any profanity, and, we'll ensure that the hearing remains respectful. With that said, we'll dive right into the agenda.

First item on the Agenda is SB 2405 SD one HD one, related to agricultural workforce housing. Vice Chair for the testimony.

Department of Agriculture and Biosecurity with comments. Thank you. Thank you. HHFDC in support. Agribusiness Development Corporation in support.

Not present. County of Hawaii Department of Research and Development in support. Housing Hawaii's Future in support, Hawaii Food and Policy in support, Chamber of Commerce Hawaii in support, Hawaii Farm Bureau in support, Office of Hawaiian Affairs in support.

Aloha, The Office of Hawaiian Affairs. OHA stands on our written testimony in support. We just wanted to let the community know that we appreciate amendments that includes our agency and the working group's membership. OHA has long advocated for policies that expand opportunities for native Hawaiian farmers, ranchers, and food producers. So OHA's participation in the working group ensures that agricultural workforce housing strategies are responsive to the needs of the Hawaiians.

Thank you.

Maui Chamber of Commerce in support and one individual in support. Anyone else online or in person wishing to testify on SB 2405 HD one? Seeing none, chair.

Members, any questions? I have a question for the Department of Ag. Security. Hi. Good morning.

Thank you. Thanks for being here. In your folks' testimony, you said that the department recommends an early task of the task force once established is to gather data and information and survey farm operators to assess the realistic demand for farm workers. Are you guys asking for an amendment to clarify that in the statute, or do you think if the task force was convened, you would just internally establish that as an early goal?

No. No. We've I've heard that request before. I'm not really sure what is you know, just to be sure, maybe it would be necessary to include that.

Would it be mentioned in the language of the bill? Okay. If we can do that, I just wanna make sure that you actually wanted it in the statutes. Okay. Alright.

Thank you. Thank you, sir. Members, any further questions? Seeing none, next item on the Agenda is SB 2599 SD two HD one related development, rated, sorry, relating to development.

Vice Chair for the testimony.

DBEDS Stadium Authority and support.

Just real quick. Chair, Vice Chair, thank you for the opportunity. Member, thank you for the opportunity. We stand on our written testimony and support. I do wanna add that we deeply appreciate the efforts of HCDA and the efforts of the legislature to help us codify that relationship.

We feel that it could be an asset, particularly when dealing with infrastructure spending and infrastructure bonding in the development district itself. And we're here for any questions or or any concerns. Thank you.

Thank you. HCDA in support.

Good morning, Chair, Vice Chair, Members of the Committee. Craig Nakamoto, executive director. Stand on our written testimony in support and available for questions.

Thank you. Thank you. Stanford car development in opposition. Anyone else online or in person wishing to testify on SB 2599 HD one? Seeing none, Chair.

Members, any questions? I have a question for this stadium authority.

The three committee clerks, I apologize. Mike, you're down from the oice hearing.

Thanks, Mike. Apologize, sir. So we did get testimony from Stanford Carr opposing it. Yes.

Know, and I think the thrust of their opposition is that there's not explicit language that states that the measure will not affect agreements executed prior to its enactment. I you know, we don't have any anything we pass won't impact existing contracts. But I do sort of wanna hear you talk through how you see the possible impacts to any existing agreements out there.

Sure. Sure. So the the agreements that govern both the stadium and the district are right. There are multiple agreements. It's not a single contract for everything.

And so for the stadium itself so separating the stadium from the district. The stadium executed two contracts in September, one to begin the dismantlement process and the other to begin the stadium build. And that's in full force, and that's working, and that's moving forward. Then there are about two to three remaining contracts to be negotiated that govern the district itself.

We have a tentative on the master development agreement, which then dictates how many, you know, tells, rooms, and what the minimum rent payments would be and things that subleases and things of that nature.

We see HCDAs involvement as a support to them. So we're looking at signing those agreements sometime in April. The lawyers are still kind of batting around the language to make sure that we're okay. We see HCDA lending support particularly on infrastructure bonding and spending to be able to facilitate that kind of growth and development. We see their insight on master planning as being a boon to us.

We have no opposition to HCDA's participation. We do not feel that their participation validates the work that we've already done. We feel it only adds.

Okay. So as I hear it, you're saying, if HCA will be there to help support the development of the infrastructure, help with the financing for the infrastructure, existing contracts that you have, the Stanford car who has submitted opposition, and others won't be impacted.

Our understanding is that they won't be impacted. We do know that the Bill provides for HCDA to to create a master plan and to work with us moving forward. We think that there are enough there's enough room in those existing contracts and the kinds that are being negotiated to allow for HCA's participation in that realm.

Okay. Great. Thank you very much. HCA. Morning, Chair.

Good morning. Do you have anything to add to that as it relates to existing contracts out there, which I think is the only real concern lingering on this?

Yeah. I I think our role in addition to being the agency that's gonna kind of plan, design, and build infrastructure related to the district. We're also gonna we're also the gonna be the zoning authority for that district, just like Kakaako, Kailai Law. So we will be doing master planning for the district, and we will be putting in place plan and rules like in Kaka. And those plan and rules will supersede county entitlements and zoning.

That's the vision. As a result of that master planning, there could be additional community facilities and public facilities that the community wants in that district, and we'll have to figure out a way to implement those or execute on those, additional community facilities.

Okay.

But you don't see your folks' role as superseding or impacting any existing contracts? Or you know-

I haven't looked into it, Chair, specifically, but, I think we should try to work sort of around those things. Yep. But I I have to look at it.

Okay. I appreciate that.

Alright. Thank you.

Members, any further questions? Seeing none, like I said, I'm only gonna do the SB 3233 SD 1 HD one related agricultural workforce housing Vice Chair for testimony.

Department of Agriculture and Biosecurity with comments. Planning health department's agriculture.

Thank you.

Thank you. Office of Planning and Sustainable Development in support.

Chair, Vice Chair, Members, Leo Asuncion, administrator with the Office of Planning and Sustainable Development. We'll stand on our written testimony in support of the Bill. We think, this is, something that is needed. It's been talked about for a long time, and I think we have, this Bill that can, start to, make that happen for our our our farms and modified farmers.

Thank you. Agribusiness Development Corporation in support. Present, Hawaii Island Chamber of Commerce in support. Chamber of Commerce Hawaii in support. Hawaii Farm Bureau in support.

Maui Chamber of Commerce in support, and one individual in support. Anyone else online or in person wishing to testify on SB 3233 HD one?

Members, any questions?

Chair, can I get, mister Ascunsion? Since he's the only one here. Right? No one else test just you. Thank you for being here, sir.

Good morning.

We have Department of Ag and Biosecurity at this office.

Oh, they're on?

In per, In person.

Oh, sorry. They didn't okay. Stand on their written testimony. Okay. So I guess this is my overall question to a lot of people.

It's just what is the procurement procurement involving agricultural products? What is that? Do you have a a meaning for that?

So the Bill looks at state agencies are that are, right, administering leases, licenses, or procurement. Right.

We have couple of, I do know, like, in in food security. Right? DOA is supposed to be looking at purchasing more, right, local products from local farms. So they would give them preference if these farms are also providing workforce housing. Right.

Right.

So in the procurement process, right, they would be looking at giving them, you know, a few more points or extra points. And in that in that regards, I would probably defer to either state procurement or the agency actually doing the

review, doing the procurement on how they would actually do that.

Okay. Alright. Thank thank you, mister Asuncion. Sorry. Department of Ag is here and ADC?

ADC

Is not here, but Department of Ag.

Department of Ag. Okay. Thank you. And so what how's this point system? I mean, like, all stars.

I mean, so so, like, how's this gonna work? Like, hey, you get more points.

But But honestly, we're not sure, which is why our initial testimony, stated our initial testimony was a request to exclude the monthly action of, pardon me, the monthly action of issuing long term thesis. Yeah.

Because it it seemed like and we didn't wanna assume, but it seemed like the intent of the Bill was created to create an incentive for farmworker housing on a large, like, a development, like, a subdivision type of level, not on an individual tweak or farm level because we really weren't sure how to give priority to a housing on a singular, yeah, on a singular lot. So that's why we asked for the the, changes that were thankfully put in.

But, quite honestly, I'm not sure how it would work. We would have to come, to some agreement, I guess, with all of the agencies involved that may, be faced with this situation so that whatever preferences are given are consistent across the agencies that are are are doing it. You I don't I don't think we would want to create one bunch of preferences for one agency and then skip it.

And I think, you also wanted clarification on, the definition of agriculture project.

Right.

Is that your you needed a large scale versus small scale, and, you know

Yeah. So I think the changes that we had, requested and that that were entered, which was essentially, subdivision and with a big emphasis on and CIP monies, would would encompass what we think and hope is the intent of the Bill while leaving the day to day tasks of, for instance, of the list issuing a singular lease without being trapped into this because that would really slow down, I think, the the issuance of a a farm lease or something like that.

Alright. Well, thank you for your clarification. Sure. Appreciate that.

I have another sorry. I have a question.

Yes, sir.

So, yeah, I appreciate Rep Cochran's questions because I had similar sort of confusion around how this would work. In other language, she is really broad. Any state agency administering leases, license development programs, or procurement. So I can sort of envision how this work for awarding a lease for procurement. Maybe talk through how this could work for procurement if, like, DOE is procuring food from agricultural vendors.

Are they giving preference then?

I don't know about the product side. My division does land and water leasing. Okay.

But the way I envision it, Lee, working on a land leasing side is if, for instance, if the the a department got a large tractable land, hundred, hundred fifty, 400 acres or something like that, And then, would more than likely, I think, have to join into some kind of joint venture with somebody, and then it would become a subdivision of this very large parcel into individual farm lots with a either attached or because it doesn't state that it has to be attached in that area.

But if it identified the possibility or the the potential for farmworker housing or any kind of farm dwelling, whether on-site or off-site, that they would get points or some kind of, priority on the awarding of the the the project.

But, again, it's not clear what the process is or how they want the process to to unfold. So I think it would require a bunch of people, agencies or whatever, getting together to come to some sort of agreement as to how it would would work. It's I'm not familiar with anything that's been done with this before.

And so is there you guys currently allow lessees to build for for housing non agricultural diesel vans?

For for individual lease land on the Department of Agriculture's parcels, yes, With the Board of Agriculture's approval. And it's very specific on that because we've actually rejected applications come forth that it was super obvious that it was like a gentleman house, you know, 4,500 square feet with grand staircase entrances and things like that.

So we do we appreciate the legislature's allowance to allow the board of ag to say yes or no to a farm dwelling because they're all calling it farm dwellings, whether it's, you know, a mansion or an actual, like, working, you know, farm where the garage is is some kind of processing thing, you know, which is totally legit.

And you allow a lessee to subdivide?

No. No. Because the department would do a subdivision. Okay. If because what we don't want is we don't wanna create lots that are so small that from a commercial perspective, it's, you know, not feasible.

So we will do the subdivision in most cases to a unit size that we think is measuring with supporting a even if it's a small but a small size commercial operation.

And is there any examples of something similar to this where you coordinate with a lessee or a group of lessees to subdivide and put in capital improvement projects for housing? Like, has anything like this ever happened before?

Sort of. We have what's in our inventory, a partial, and we may we have called it Royal Killeen Agricultural Park. And we obtained a 150 acres, I wanna say, about twenty years ago as part of a upzoning request in the Kunia Corridor. And a part of that was for us to develop a agricultural park with associated farmworker housing. So what we've done is we've gone through the design process, and we have created interior roads on paper.

We haven't been able to put shovel in the ground yet. We've been requesting funds for that. So we've we've on paper, we've designed 24 lots with an associated 24 farmhouses on the border between our, subdivision and the, neighboring housing subdivision. So that was the intent was to provide some kind of, break, there. And, so, yeah, we're still requesting, funds to do a break ground on that.

But that's something that we have done in the past that's very close to what this is.

But that's you folks doing the work, not necessarily unless you come in and then.

Yeah. Yeah. Right. So the the difference is that, I guess, if under the provisions of this Bill, for instance, what would have what would happen, I I'm I'm assuming, is say, Castle and Coke or something came up to us and said, hey, we wanna do a partnership with you folks. We'll do everything if you lease us the land.

And, as part of this, we'll we propose to have a housing element attached to it. Now, of course, at that point though, we would have to go out through procurement, and anybody would get the chance. So it would be Castle, it would be Horita, it would be, you know, whomever, a separate car. And, they would all submit their proposals to us, and then the ones with a proposed housing element would get this priority, so to speak.

Okay. Yeah. That last example, I think, I'll just clarify. And I know you said you specialize in leasehold land and not procurement. Any idea though on how the procurement part of this would work?

It says priority for also procurement involving agricultural products.

I I'm not yeah. I don't know. I think we'd have to play it out.

Okay. And I guess the concern with that, Farm Bureau said in their testimony that they have concerns that this could sort of squeeze the little guys out, which, you know, this is, say, DOE procuring food or something for school lunches and, like, if you provide housing, you're getting a boost and the small farmers aren't gonna have housing on their leasehold land.

Yeah. I think the Farm Bureau one of their primary arguments is, especially at the smaller farm level, like two to five acres or even up to say seven or eight or nine or ten, some of these guys have ancillary operations and they just want more land. They're an established farming legitimate operation that does really good work, but they don't want to necessarily put farmworker housing on that particular lot.

If they were to apply for that lot and be up against somebody else who says, oh, but I'm gonna go put farmworker housing on it, then they are already at a disadvantage. And I think that was one of their primary arguments.

Yeah.

I mean, just from my island of Kauai, we have a lot of farmers on ADC land. As far as I know, ADC doesn't allow housing on their land. These farmers would be at a disadvantage just by the nature of the land that they have. They don't have housing on their land. Okay.

Yeah. I would just sort of note that as a barrier concern then. That's all the questions I had. Members, any further questions?

I have a question more of a clarification.

You used your Royal Kurnia example.

I'm super confused about this whole Bill. And the intent the intent of it as you read it, it's a great idea. But the more I read the Bill, listen to testimonies, and just get into it deeper, it's super confusing. You use Royal Konea, 24 lots, 24 houses. Maybe it's just me, but that makes zero sense.

If we're trying to create ag housing, we're building one house per lot. It's one work one family per lot. Chances are one person in that family is gonna be working on a lot. Each lot, we all know, needs more than one. So is the intent or is the what your guys' plan is to help with housing?

Because it seems like you see where I'm confused. Right? One house per lot, which you're using your Royal Cochran example, and that makes, again, maybe it's just me, but it makes just zero sense in the force of agriculture workforce housing.

So I don't know if I I don't know if my answer is going to answer your particular question. Please forgive me if it doesn't.

No worries. Let's try this.

The what our vision of the wave would work is the the the farmer who takes on a farm lot and also would potentially have the associated housing lot can use that lot for either, as as a farm dwelling for themselves and their family or farmworker housing. It it it doesn't have to be only for, people who are going to work the land.

So if it's their family, then mom and dad maybe work the farm, but the kids don't you know, they might be go to go to school or something. It's the our perspective is from the agricultural, viewpoint primarily. But we also are aware that there is a desire for housing not far away for security purposes as well as being able to be close enough to their their land to, save time and all these other types of things.

So that's the perspective that the Department of Ag has has taken, and I'm not sure if that answers your question.

No. I thank you for that. That's very that's exactly what I heard. That's exactly what I heard you say about that thing.

But if if our goal here is to help overall agricultural quantity in Hawaii, we wanna boost it, we wanna start doing our own, Then as I understand, we should we we we're wanting to build affordable housing for the workforce, the agricultural workforce. And that's why, I guess, I'm getting lost when we do one house per lot kinda deal because that's not a workforce. That's a that that could be me. Yeah. That could be me farming a one acre lot, and I'm now gonna get a house.

But as I as I and, again, it could just be me. I'm not that smart. But when we do one per one house, one lot, it is

I I

I don't I don't get the workforce. I'm trying to paint trying to see the picture, but I don't see workforce when we do one dwelling per

Yeah. I I get you. I think well, first of all, we're commenting on this building. It wasn't a No. And and I So we we we right in the middle, we said we're not sure what the intent was.

But

No. Just like Craig, I don't mean nothing towards you. I just asking for clarification.

No. I'm

Even laughing.

But our What our comments were initially kind of sort of addresses what I think I'm hearing from you, and that is that the build seems designed for large scale subdivision. And what that's why we tried to carve out the day to day issuances of single leases. If you're gonna develop, 150 acres and maybe the whole thing is gonna go to one particular entity like a large farmer, then put yeah. It might make sense to develop a singular, multi density workforce housing unit or something like that.

It might be, it it might be feasible to do something like that.

But but as it applies to us, that's the only that's the only angle that we're asking for here or pointing out here is is that as it applies to us.

Thank you. Thank you.

Sure. Sorry. Sorry. I hate you. I can't

I can't.

So a follow-up. So is this, as you read it, intended strictly for New Ag Park projects. New, not per se existing, but new.

We actually kinda had a very brief unofficial conversation about that with the, attorney general's office. And their kinda read on it was it could only apply to new projects. Okay.

So So this is my read also. I just wanted to reconfirm.

Yeah. I I'm I'm on a this much surprise that they didn't actually submit testimony on that because but I know they were thinking about it.

And also, I know sorry, Chair. I wasn't here for the first item, but I felt like this and this is, like, another lining up a question for you. Don't you see that agricultural working group to be created within your department sort of to address these

Oh, it's right.

These points in the Bill that is intended to be, you know, move through today. So as in this, I'm like, this kind of pertains to the first fill in this working group to discuss these things.

Yeah. And I I think the the working group would also be able to look at it from a broader perspective. Right? Because, as far as the authority that I have, pardon me, it it's restricted to agricultural lands within the Department of Agriculture's control. Whereas, this could potentially be, a broader issue of other state lands or potentially even going to the rising lands.

Sure.

Okay. Alright. Well, thank you. Thanks.

Thank you very much. You helped clarify it. Members, any further questions? Seeing none, next item on the Agenda is SB 3333 SD water related taxation, Vice Chair for testimony.

City and county of Honolulu, Department of Budget and Fiscal Services with comments. Hawaii Realtors in support.

Thank you, Chair. In support.

Thank you. Anyone else in person or online wishing to testify on SB 3333 SD one?

Hang on, Chair. Members, any questions.

Sorry. On Honolulu. You weren't Honolulu. Oh, you're a realtor. Hi, Lindsay.

No.

I don't want anybody to ask questions.

Okay. Alright. Seeing none, we are gonna recess briefly to get quorum.

Okay. Alright. Seeing none, we are gonna recess briefly to get quorum.

Reconvening our House House Committee hearing for decision making for our Wednesday, March 25 10am agenda first item on the agendas before I begin. I actually want to Rep, congratulate Rep Muraoka for for her birthday today.

Wish him a happy birthday. Happy birthday. You have permission to vote no one every Bill you need.

My yes day.

First item is SB 2405 SD one HD one, doing agricultural workforce housing. I recommend that we move out at HD two. I did get prior concurrence on these proposed amendments. I recommend that we add the mayor of each county to the working group, as was proposing the testimony.

I recommend that we adopt the proposed amendment from the Maui Chamber of Commerce to explicitly include on Page three paragraph three consideration of changes to zoning, building and land use policies that include innovative housing models such as modular homes, tiny homes and container homes.

I recommend that we, based on the amendment provided by the Department of Agriculture and Biosecurity and testimony in their testimony. That we clarify in the Bill that an early task of the working group is to gather data and information and survey farm operators to assess the realistic demand for farm workers to ensure targeted assessment of agricultural workers' housing needs and tech amendments as needed. Members, any questions, comments, or concerns? Rep Cochran?

The g, the wait. Was it OHA? OHA had or wait. Hold on.

No. I'm so sorry. And OHA, but

OHA is included in the work group already. Okay. That amendment I mean, we made

Oh they're an addition into the group. Yes.

Their testimony was expressing support.

Super.

Yeah. Already being included. Are there.

I think I think my my overall thing just seeing another working group, another pilot, another task force, another another another. I just rather see some real time efforts. You know, I mean, that's just my thing of all these collective talking in a circle group thing, which is needed. I get it. But, I mean, you know, I just wanna see yeah.

Okay.

Point. Just a second.

There's further questions, comments or concerns. I see none Vice Chair for the vote.

Voting on SD 2405 SD one HD one. The recommendation is to pass with amendments. Chair and Vice Chair votes aye. Representative Grandinetti. Aye.

Representative Kila. Aye. Representative Kitagawa. Aye. Representative La Chica. Aye. Representative Cochran. I have, with reservations.

Reservations. Representative Muraoka. Aye. Representative Pierick. No. No vote. The recommendation is adopted.

Thank you. Next on the agenda is SB 2599 SD2 HD1 related to development. Just a comment, guys. And please keep your voices down, especially because the mics can pick up everything else.

So it can be distracting. SB 2599 SD2 HD1 related development. I recommend that we move on HD2 for this bill. I also got prior concurrence for these proposed amendments. On page 47 lines one to nine on the language around parking is I don't mean to always talk about parking this committee, but the language on parking is confusing.

So we're just clarifying that to, I believe, restate what, clarify with the intent of that parking languages. So just for clarifying that the authority shall include public parking hubs of meaningful capacity, including charging infrastructure for electric vehicles, provided that 25% of all parking stalls developed as part of the public parking hubs pursuant to this paragraph shall be electric vehicle ready.

No minimum parking requirements shall apply to any development within the district except for parking spaces reserved for persons with disabilities as defined in section 291-51. And the tech amendments as necessary. I do want to note that the only testimony we got in opposition was concerned that this would impact existing contracts, for the Stadium District.

So I do wanna clarify in the community report that, that the bill won't affect agreements executed prior to its enactment as, you know, it's already sort of constitutionally prohibited for us to interfere with existing contracts. Though I do think that as this continues to move forward, we do need to ensure, that this isn't potentially disrupting work that's already, you know, been in process for the stadium. Members, questions, comments, or concerns?

Yes. Representative Cochran.

Chair?

This is, I feel like a superseding of zoning and entitlement power of the counties. And as you former council member know too, you know, we kinda like to have our home rule in decision making and not have state entity overstepping and superseding such points. So that's one of my concerns. And, again, my first comment for the other bill was yet another special fund, special group, special everything. I just, you know?

And my concerns, I, I hear Sanford Carr, my classmate. So I I know he's because he's been tapped, I believe, to to, do this. Not the entire thing, but, a lot of it. And he wasn't a his legal counsel wasn't aware of the measure, and they didn't have a, you know, ample chance to have a comprehensive review. So I hear his concerns. So I'm, not in support at this time.

Thanks for sharing your comments? Members, further questions, comments, or concerns? Seeing none, Vice Chair for the vote.

Voting on SB 2599 SD2 HD1. The recommendation is to pass with amendments. Are there any reservations? Any no votes? No votes for Rep. Cochran and Rep. Pierick. The recommendation is adopted.

Next item on the agenda.

Is SB 3233 SD1 HD1, related agriculture workforce housing. I recommend I move on h d two for this. I got prior concurrence on this amendment also. Just a small chain on page five, line one through three, delete "would help the need for additional statutory authority" and instead begin that clause by saying "notwithstanding any laws or rules to the contrary." Members questions, comments, or concerns?

Chair.

Yes.

I just feel that there's potential. I'm not, I can't work with, agriculture workforce housing to caveat with that. But, just think there could be some unintended consequences here. And as stated by DAB, they're sort of scratching their heads too as to how this is supposed to technically roll out with the scoring system, what have you. So I just yeah.

And making, making sure there's a a scale a fair scale and, you know, with Mister Miyamoto's concerns for small scale versus large scale and and things like that. So there's, again, unintended consequences. Maybe, had spiked with reservations.

Thank you, Rep. Cochran. Any other further concerns? Seeing none, Vice Chair for the vote.

Voting on SB 3233 SD1 HD1. The recommendation is to pass with amendments. Noting Representative Cochran's reservations, any other reservations? Any no votes?

Reservations.

Reservations for Rep. Muraoka as well. The recommendation is adopted.

Next item on the agenda is SB 3333 SD1, related taxation. I really respect the intention of this bill. This is something that, that I'm actually also passionate about. We, I tried to do this while I was on the Kuwait County Council to do something similar.

This is a major issue, in that, property tax, you know, the reassessments, it can take twelve or even eighteen months from the time you purchase a home depending on when the filing period is. And people can get stuck with higher property taxes for a long duration of time.

And so I've spent a considerable amount of time trying to work through this problem at a county level, and it's a very, very thorny issue. That said, one, we don't have the constitutional authority to require that the counties do this.

And so, as was clearly stated in testimony, even if we did pass this, the county's wouldn't do it because we cannot force them to do these reassessments. Because the constitution clearly gives taxation authority, probable taxation authority to the counties. And I also wanna say that I, I really don't think it would be workable for them to do an automatic, you know, reassessment of the time of purchase anyway, and that they're doing their budgeting based on property tax forecasts.

And if those forecasts are continually, you know, if the revenue is changing based on these readjustments, that's gonna wreak havoc in their budgeting and also the manpower necessary to do these readjustments at the time of every single sale makes this as written essentially impossible, I think, for them to implement.

So that said, while I respect the work of the introducer and the work put into this bill, we will be deferring this bill. And maybe you can come back in the form of a resolution at a later date or or more work at the county. You gotta wait. Get this done. The last item on the agenda is, was deferred for decision making in our previous agenda. This is SB 2061 SD2 relating to residential condominiums.

I recommend that we, pass an HD1, and I've distributed a proposed HD1 to the members. And really what this is doing is just cleaning up in the language and clarifying the underlying intent of the bill. I did work with HCDA to try and clarify this. So nothing is really changing as far as, like, the structure of the program. The amendment isn't changing the underlying, the 99 year leasehold program.

HCDA has right of first refusal. The resale restrictions on owner occupied units all remain basically the same. And what the bill is doing, and I think what there was some confusion on last time, 60% of the units will be income restricted, less than a 140% AMI. This specific project will be a 2oH project. They're gonna go for a G waiver, so 60% of units will have to be income restricted.

That income restriction, that period will last ten years. At the initial time of offering when these units all come up for sale, 100% of them will be restricted to owner occupied fees. After sixty days, of the non income restricted units, those that haven't sold in that sixty day period, the unsold non income restricted units, can be sold without an owner occupied restriction.

So I think what was confusing people and honestly kind of broke my mind going through it was like the 60% of 40% and other remaining units, I think, was confusing. So we just trimmed all that language.

So, that said, you guys have you folks have the proposed HD1 in front of you. Does anybody have any questions, comments, concerns on this proposal? Yes, Rep. Cochran.

Yeah. I mean, I still have issues. I mean, with the bill. I know I have issues, with the bill. So second page, implement initial sales period. I mean, everything is with the authority of, you know, with the authority. With initial sales period, duration, eligible buyers, who are foregone occupied.

The additional terms, conditions, requirements as determined by authority, sold within, the one push third page. I'm not, not sold within sixty days. I've taken it that will flip into market rate, and which also sold to other buyers, which would be opening the door for offshore investor type people too. I mean, the list just kinda goes on and on for me.

There's a lot of, lack of clarity in my mind when I'm just glancing at this, very briefly. So, anyways, that's just the first three pages I glanced at real quickly right now.

And I think your comments are fair. What part of what we did was because this project is gonna go through the 201H process, rather than restate all of that again as far as the restrictions imposed on a project through 201H, we, we left a lot of it out. But because it's implied that it will have to go through the same, you know, 60% will be affordable.

The income restrictions as defined in 201H with the occupancy repair period as defined in 201H. But for future projects, yes, they could have some more flexibility, though they'd like to come back to us for, you know, further statutory authority to do another project.

And, really, we're looking at infill more so areas in the urban redevelopment sites. So that considered.

This is for a specific project, which is at the Jack in the Box location at in Kakaako, which is, yes, certainly an infill.

Okay. Okay. And then you changed the word "made" to "shall" require at least 60%.

Yep.

So that's definitely a lot more secure for the 60. So that's yay. Okay. I'm just, someone else can comment. I'm trying to sorry. I have a question. Quick question.

For the initial sales period, do you know if there'll be additional rules that will allow us to filter applications from those that are local versus from the Mainland seeking to purchase and be owner occupied?

Yeah.

So in the language, I believe well, certainly, qualified residents, as defined by 201H, it has to be up somebody domiciled in the state.

Oh, okay. And then can also set additional guidance.

It, it's already set up.

Yeah. Alright. Any further?

Sorry. Yeah. And lastly, Chair, page five at the bottom, where the underlined portion authority shall establish rules require buyback pricing similar to other states' agencies' existing pricing formulas. Can Mr. Nakamoto? Oh, sorry. Are we in there? We're not in that process. Sorry.

We're not thinking.

Or can you explain a little more? What that's?

So, yeah. So, there's a bill going through the legislature right now, which gives HHFDC sort of there's a limited equity appreciation program set on formula based on, like, real estate appreciation. So it's just saying, like, the authority could use other existing buyback formulas out there to come up with a buyback provision for these units and a first right of refusal. So HCDA would have the first right to purchase these projects based on existing formulas and statute.

Okay. And from your discussions, they have a particular format at this time?

So HHFDC has a formula, which they can reference that formula. I don't know if HCDA has other formulas.

Good. We'll look at each yep. HHFDC' formula too.

Okay. Alright. I was just yeah.

Alright. Members, if there's no further questions, we will, Vice Chair for the vote.

Voting on SB 2061 SD2, the recommendation is to pass with amendments. Are there any reservations? Any no votes? No votes for Representative Cochran and Representative Pierick. The recommendation is adopted.

Alright. Thank you, Members, very much. We'll see you on Friday. This hearing is now adjourned.