RELATING TO CONDOMINIUMS.

HB2041

HOUSE OF REPRESENTATIVES

H.B. NO.

2041

THIRTY-THIRD LEGISLATURE, 2026

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 legislature finds nearly forty per cent of
Hawaii's population lives in condominiums.
�

The legislature finds that while homeowner association self-governance
can be successful, there have been many cases of abuse of power and other acts
of malfeasance by certain association boards, association management, managing
agents, and association attorneys.
�
Local
news outlets have published articles dating nearly a decade ago, calling
attention to the need to strengthen regulations of associations and the need
for a condominium ombudsman.
�
Instead,
the only oversight offered is through the Regulated Industries Complaints
Office, which focuses on ensuring boards abide by legal requirements to provide
homeowners with certain financial documents, and the Real Estate Branch
emphasizes public outreach and education.
�
In addition, the state Department of Commerce
and Consumer Affairs has publicly noted the lack of any power to enforce
provisions of Hawaii's condominium statue.
�
Thus, time and time again these cries fall on
deaf ears as local residents continue to struggle.

����
Therefore,
the purpose of this Act is to:

����
(1)
�
Establish an ombudsman's office to receive and
investigate complaints by condominium unit owners against associations that are
subject to condominium laws;

����
(2)
�
Authorize the Real Estate Commission to
investigate complaints;

����
(3)
�
Amend the documents required for association
registration; and

����
(4)
�
Broadens the list of documents an association
must maintain and provide to unit owners.
�

PART I

����
SECTION 2.
�
Chapter 96, Hawaii Revised Statutes, is
amended by adding a new section to be appropriately designated and to read as
follows:

����
"
�96-
�
��
Condominium ombudsman; real estate
commission; certain matters.
�
(a)
�

There is established a condominium ombudsman to be administratively
attached to the real estate commission to receive and investigate complaints by
condominium unit owners against the real estate commission regarding the real
estate commission's duties under section 467-4(9).

����
(b)
�

With respect to any investigation under subsection (a), the condominium ombudsman's
findings shall be issued no later than thirty business days after the filing of
the complaint with the condominium ombudsman.

����
(c)
�

This section shall not be construed to e
stablish the
condominium
ombudsman as an authority
to which any party may file an appeal in any matter relating to the real estate
commission
.
"

����
SECTION
3
.
�
Section 467-4,
Hawaii Revised Statutes, is amended to read as follows:

����
"
�467-4
�
Powers

and

duties

of

commission.
�
In addition to any other powers and duties
authorized by law, the real estate commission shall:

����
(1)
�
Grant licenses,
registrations, and certificates pursuant to this chapter;

����
(2)
�
Adopt, amend, or
repeal rules as it may deem proper to effectuate this chapter and carry out its
purpose, which is the protection of the general public in its real estate
transactions.
�
All rules shall be
approved by the governor and director of commerce and consumer affairs, and
when adopted pursuant to chapter 91 shall have the force and effect of
law.
�
The rules may forbid acts or
practices deemed by the commission to be detrimental to the accomplishment of
the purpose of this chapter[
, and the rules may
]
;
require real
estate brokers and salespersons to complete educational courses or to make
reports to the commission containing items of information [
as
]
that

will better enable the commission to enforce this chapter and the rules, or [
as
]

that
will better enable the commission from time to time to amend the
rules to more fully effect the purpose of this chapter[
,
]
;
and[
,
further,
]

the rules may require real estate brokers and salespersons
to furnish reports to their clients containing matters of information [
as
]

that
the commission deems necessary to promote the purpose of this
chapter.
�
This enumeration of specific
matters that may properly be made the subject of rules shall not be construed
to limit the commission's broad general power to make all rules necessary to
fully effectuate the purpose of this chapter;

����
(3)
�
Enforce this
chapter and rules adopted pursuant thereto;

����
(4)
�
Suspend, fine,
terminate, or revoke any license, registration, or certificate for any cause
prescribed by this chapter, or for any violation of the rules, and may require
additional education or reexamination, and refuse to grant any license,
registration, or certificate for any cause that would be a ground for
suspension, fine, termination, or revocation of a license, registration, or
certificate;

����
(5)
�
Report to the
governor and legislature relevant information that shall include but not be
limited to a summary of the programs and financial information about the trust
funds, including balances and budgets, through the director of commerce and
consumer affairs annually, before the convening of each regular session, and at
other times and in other manners as the governor or [
the
] legislature
may require concerning its activities;

����
(6)
�
Publish and
distribute pamphlets and circulars, produce seminars and workshops, hold
meetings in all counties, and require other education regarding any information
as is proper to further [
the accomplishment of
]
accomplish
the
purpose of this chapter;

����
(7)
�
Enter into
a

contract or contracts with qualified persons to assist the commission in
effectuating the purpose of this chapter;

����
(8)
�
Develop a
curriculum for leadership training for condominium boards of directors,
including pertinent provisions of chapter 514B, association governing
documents, and the fi�duciary duties of board members; [
and
]

����
(9)
�
Receive and
investigate complaints by condominium unit owners against associations that are
subject to chapter 514B; and

�
[
(9)
]

(10)
�
Establish standing committees to
assist in effectuating this chapter and carry out its purpose, which shall meet
no less than ten times annually, and shall from time to time meet in each of
the counties."

PART II

����
SECTION
4
.
�
Section
514B-154, Hawaii Revised Statutes, is amended by amending subsection (a)
through (i) to read as follows:

����
"
�514B-154
�

Association records; availability; disposal; prohibitions.
�
(
a)
�
[
The
association's most current financial statement shall be provided to any
interested unit owner at no cost or on
twenty-four-hour loan
, at a convenient location designated by the
board.
�
The meeting minutes of the
board of directors, once approved, for the current and prior year shall either:
]

Any unit owner of an association shall have the right to inspect, examine,
and make copies of the records required to be maintained in section 514B-153
, in person or by authorized agent, at any reasonable
time, at the association's principal office or with the board or managing
agent.
�
To exercise this right, a unit
owner shall submit a written request to the board or managing agent, stating
the records sought to be inspected, examined, or copied.
�
Failure of a board or managing agent to make
available all records requested within ten business days of receipt of the unit
owner's written request shall be deemed a denial.
�
Any unit owner who prevails in an enforcement
action to compel inspection, examination, or copying
the records
required to be maintained in section 514B-153
shall be entitled to recover reasonable attorneys' fees and costs from
the association.
�
These documents shall
either:

����
(1)
�
Be available for
examination by apartment owners at no cost or on twenty-four-hour loan at a
convenient location at the project, to be determined by the board of directors;
or

����
(2)
�
Be transmitted to
any apartment owner making a request [
for the minutes
], by the board of
directors, the managing agent, or the association's representative[
, within
fifteen days of receipt of the request
]; provided that the [
minutes
]

documents
shall be transmitted by mail, electronic mail transmission, or
facsimile, by the means indicated by the owner, if the owner indicated a
preference at the time of the request; and provided further that the owner
shall pay a reasonable fee for administrative costs associated with handling
the request.

Costs incurred
by apartment owners pursuant to this subsection shall be subject to section
514B‑105(d).

����
(b)
�

Financial statements, general ledgers, the accounts receivable ledger,
accounts payable ledgers, check ledgers, insurance policies, contracts, and
invoices of the association for the duration those records are kept by the
association and delinquencies of ninety days or more shall be available for
examination by unit owners at convenient hours at a place designated by the
board; provided that:

����
(1)
�
The
board may require owners to furnish to the
association
a [
duly executed and acknowledged affidavit
]

written certification
stating that the information is requested in good
faith [
for the protection of the interests of the association, its members,
or both;
]
and will not be used by the unit owner for any commercial
purpose or any purpose that does not relate to the association;
and

����
(2)
�
Owners shall pay for
reasonable
administrative costs in excess of
eight hours per year.

����
Copies of these items shall be provided to
any owner upon the owner's request; provided that the owner pays a reasonable
fee for duplication, postage, stationery, and other administrative costs
associated with handling the request.

����
(c)
�
After any association meeting,
and not earlier, unit owners shall be permitted to examine proxies, tally
sheets, ballots, owners' check-in lists, and the certificate of election;
provided that:

����
(1)
�
Owners
shall make a request to examine the documents within thirty days after the
association meeting;

����
(2)
�
The board may require owners to furnish to the association a [
duly
executed and acknowledged affidavit
]
written certification
stating
that the information is requested in good faith for the protection of the
interest of the association or its members or both; and

����
(3)
�
Owners shall pay for administrative costs in excess of eight hours per
year.

����
The documents may be destroyed ninety days
after the association meeting; provided that in the event of a contested
election, the documents shall be retained until the contested election is
resolved.
�
Copies of tally sheets,
owners' check-in lists, and the certificates of election from the most recent
association meeting shall be provided to any owner upon the owner's request;
provided that the owner pays a reasonable fee for duplicating, postage,
stationery, and other administrative costs associated with handling the
request.

����
(d)
�
The
managing agent shall provide copies of association records maintained pursuant
to this section and sections
514B-103,
514B‑152
,
and 514B‑153
to owners, prospective purchasers and their prospective agents during normal
business hours, upon payment to the managing agent of a reasonable charge to
defray any administrative or duplicating costs.
�

If the project is not managed by a managing agent, the foregoing
requirements shall be undertaken by a person or entity, if any, employed by the
association, to whom this function is delegated.

����
(e)
�

[
Prior
to the
organization of the association, any
]
Any
unit owner shall be
entitled to inspect as well as receive a copy of the management contract from
the entity that manages the operation of the property.

����
(f)
�
Owners
may file a written request with the board to examine other documents.
�
The board shall give written authorization or
written refusal with an explanation of the refusal within [
thirty
]
ten

calendar days of receipt of the request.

����
(h)
�
A
managing agent retained by one or more associations may dispose of the records
of any association which are more than [
five
]
ten
years old, except
for tax records, which [
shall
]
may
be [
kept for
]
disposed
of after
seven years, without liability if the managing agent first
provides the board of the association affected with written notice of the
managing agent's intent to dispose of the records if not retrieved by the board
within sixty days, which notice shall include an itemized list of the records
proposed to be disposed.

����
(i)
�
No
person shall knowingly make any false certificate, entry, or memorandum upon
any of the books or records of any managing agent or association.
�
No person shall knowingly alter, destroy,
mutilate, or conceal any books or records of a managing agent or
association.
�
Any violation of this
subsection shall constitute forgery in the third degree under section 708-853.
"

����
SECTION
6
.
�
Section
514B-154.5, Hawaii Revised Statutes, is amended to read as follows:

����
"
�
514B-154.5
�
Association documents to be provided.
�
(a)
�

Notwithstanding any other provision in the declaration, bylaws, or house
rules, if any, the following documents, records, and information, whether
maintained, kept, or required to be provided pursuant to this section or
section
514B-103,
514B-152, 514B-153, or 514B-154, shall be made
available to any unit owner and the owner's authorized agents by the managing
agent, resident manager, board through a board member, or the association's
representative:

����
(1)
�
All financial and
other records sufficiently detailed in order to comply with requests for
information and disclosures related to the resale of units;

����
(2)
�
[
An accurate
copy of the declaration, bylaws, house rules, if any, master lease, if any, a
sample original conveyance document, and all public reports and any amendments
thereto;
]
All records required to be maintained pursuant to section
514B-153(a);

����
(3)
�
Detailed, accurate
records in chronological order of the receipts and expenditures affecting the
common elements, specifying and itemizing the maintenance and repair expenses
of the common elements and any other expenses incurred and monthly statements indicating
the total current delinquent dollar amount of any unpaid assessments for common
expenses;

����
(4)
�
All records and
the vouchers authorizing the payments and statements kept and maintained at the
address of the project, or elsewhere within the State as determined by the
board, subject to section 514B-152;

����
(5)
�
All signed and
executed agreements for managing the operation of the property, expressing the
agreement of all parties, including but not limited to financial and accounting
obligations, services provided, and any compensation arrangements, including
any subsequent amendments;

����
(6)
�
An accurate and
current list of members of the condominium association and the members' current
addresses and the names and addresses of the vendees under an agreement of
sale, if any.
�
A copy of the list shall
be available, at cost, to any unit owner or owner's authorized agent who
furnishes to the managing agent, resident manager, or the board a [
duly
executed and acknowledged affidavit
]
written certification
stating
that the list:

���������
(A)
�
Shall be used by
the unit owner or owner's authorized agent personally and only for the purpose
of soliciting votes or proxies or for providing information to other unit
owners with respect to association matters; and

���������
(B)
�
Shall not be used
by the unit owner or owner's authorized agent or furnished to anyone else for
any other purpose;

����
(7)
�
The association's
most current financial statement, at no cost or on twenty-four-hour loan, at a
convenient location designated by the board;

���
[
(8)
�
Meeting minutes of the association,
pursuant to section 514B-122;

����
(9)
�
Meeting minutes of the board,
pursuant to section 514B-126, which shall be:

���������
(A)
�
Available for examination by unit
owners or owners' authorized agents at no cost or on twenty-four-hour loan at a
convenient location at the project, to be determined by the board; or

���������
(B)
�
Transmitted to any unit owner or
owner's authorized agent making a request for the minutes within fifteen days
of receipt of the request by the owner or owner's authorized agent; provided
that:

�������������
(i)
�
The minutes shall be transmitted by
mail, electronic mail transmission, or facsimile, by the means indicated by the
owner or owner's authorized agent, if the owner or owner's authorized agent
indicated a preference at the time of the request; and

������������
(ii)
�
The owner or owner's authorized
agent shall pay a reasonable fee for administrative costs associated with
handling the request, subject to section 514B-105(d);

���
(10)
]

(8)
�
Financial statements, general ledgers,
the accounts receivable ledger, accounts payable ledgers, check ledgers,
insurance policies, contracts, and invoices of the association for the duration
those records are kept by the association, and any documents regarding
delinquencies of ninety days or more shall be available for examination by unit
owners or owners' authorized agents at convenient hours at a place designated
by the board; provided that:

���������
(A)
�
The board may
require unit owners or owners' authorized agents to furnish to the association
a [
duly executed and acknowledged affidavit
]
written certification

stating that the information is requested in good faith for the protection of
the interests of the association, its members, or both; and

���������
(B)
�
Unit owners or
owners' authorized agents shall pay for administrative costs in excess of eight
hours per year;

��
[
(11)
]

(9)
�
Proxies, tally sheets, ballots, unit
owners' check-in lists, and the certificate of election subject to section
514B-154(c);

��
[
(12)
]

(10)
�
Copies of an association's documents,
records, and information, whether maintained, kept, or required to be provided
pursuant to this section or section 514B‑152, 514B-153, or 514B-154;

��
[
(13)
]

(11)
�
A copy of the management contract from
the entity that manages the operation of the property before the organization
of an association;

��
[
(14)
]

(12)
�
Other documents requested by a unit
owner or owner's authorized agent in writing; provided that the board shall
give written authorization or written refusal with an explanation of the
refusal within [
thirty
]
ten
calendar days of receipt of a request
for documents pursuant to this paragraph; and

��
[
(15)
]

(13)
�
A copy of any contract, written job
description, and compensation between the association and any person or entity
retained by the association to manage the operation of the property on-site,
including but not limited to the general manager, operations manager, resident
manager, or site manager; provided that personal information may be redacted
from the contract copy, including but not limited to the manager's date of
birth, age, signature, social security number, residence address, telephone
number, non-business electronic mail address, driver's license number, Hawaii
identification card number, bank account number, credit or debit card number,
access code or password that would permit access to the manager's financial
accounts, or any other information that may be withheld under state or federal
law.

����
(b)
�

Subject to section 514B-105(d), copies of the items in subsection (a)
shall be provided to any unit owner or owner's authorized agent upon the
owner's or owner's authorized agent's request; provided that the owner or
owner's authorized agent pays a reasonable fee for duplication, postage,
stationery, and other administrative costs associated with handling the
request.

����
(c)
�

Notwithstanding any provision in the declaration, bylaws, or house rules
providing for another period of time, all documents, records, and information
listed under subsection (a), whether maintained, kept, or required to be
provided pursuant to this section or section 514B-152, 514B-153, or 514B-154,
shall be provided no later than [
thirty
]
ten calendar
days after
receipt of a unit owner's or owner's authorized agent's written request, unless
a lesser time is provided pursuant to this section or section 514B-152,
514B-153, or 514B‑154, and except as provided in subsection (a)(14).

����
(d)
�

Any documents, records, and information, whether maintained, kept, or
required to be provided pursuant to this section or section 514B-152, 514B-153,
or 514B-154, may be made available electronically to the unit owner or owner's
authorized agent if the owner or owner's authorized agent requests such in
writing.

����
(e)
�

An association may comply with this section or section 514B-152,
514B-153, or 514B-154 by making the required documents, records, and
information available to unit owners or owners' authorized agents for download
through an internet site, at the option of each unit owner or owner's
authorized agent and at no cost to the unit owner or owner's authorized agent.

����
(f)
�

Any fee charged to a unit owner or owner's authorized agent to obtain
copies of the association's documents, records, and information, whether
maintained, kept, or required to be provided pursuant to this section or
section 514B-152, 514B-153, or 514B-154, shall be reasonable; provided that a
reasonable fee shall include administrative and duplicating costs and shall not
exceed $1 per page, or portion thereof, except that the fee for pages exceeding
eight and one-half inches by fourteen inches may exceed $1 per page.

����
(g)
�

This section shall apply to all condominiums organized under this
chapter or any predecessor thereto.

����
(h)
�
If the board fails to provide records
properly requested under this section, the owner may seek appropriate relief
and shall be entitled to an award of reasonable attorneys' fees and costs if
the unit owner prevails.

����
[
(h)
]
(i)
�
Nothing in this section shall be construed to
create any new requirements for the release of documents, records, or
information."

PART III

����
SECTION 7.
�
This Act does not affect rights and duties
that matured, penalties that were incurred, and proceedings that were begun
before its effective date.

����
SECTION 8.
�
Statutory material to be repealed is
bracketed and stricken.
�
New statutory
material is underscored.

����
SECTION 9.
�
This Act shall take effect upon its approval.

INTRODUCED BY:

_____________________________

Report Title:

Condominium
Regulation; Ombudsman; Documents, Records; Transparency

Description:

Part I: Establishes
an Ombudsman's Office and gives the Real Estate Commission the authority to
investigate complaints.
�
Part II: Broadens
the list of documents an association must maintain and provide to unit owners.
�

The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.