RELATING TO COMMON INTEREST COMMUNITIES.

HB630

HOUSE OF REPRESENTATIVES

H.B. NO.

630

THIRTY-THIRD LEGISLATURE, 2025

STATE OF HAWAII

A BILL FOR AN ACT

RELATING
TO COMMON INTEREST COMMUNITIES
.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

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SECTION
1.
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The purpose of this Act is to:

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(1)
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Provide for the administrative dissolution of
any planned community association or condominium association in existence as of
July 1, 2027;

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(2)
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Provide to the department of commerce and
consumer affairs the powers and responsibilities currently given to planned
community associations and condominium associations under chapters 421J and
514B, Hawaii Revised Statutes, and each planned community's or condominium's
bylaws and other governing documents; and

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(3)
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Require the department of commerce and
consumer affairs to submit to the legislature a report and proposed legislation
addressing the department's future governance of planned communities and
condominiums.

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SECTION 2.
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As used in this Act:

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"Condominium"
has the same meaning as in section 514B-3, Hawaii Revised Statutes.

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"Condominium
association" has the same meaning as "association" under section
514B-3, Hawaii Revised Statutes.

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"Department"
means the department of commerce and consumer affairs.

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"Director"
means the director of commerce and consumer affairs.

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"Planned
community" has the same meaning as in section 421J-2, Hawaii Revised
Statutes.

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"Planned
community association" has the same meaning as "association"
under section 421J-2, Hawaii Revised Statutes.

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SECTION 3.
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(a)
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A
planned community association under chapter 421J, Hawaii Revised Statutes, or a
condominium association under chapter 514B, Hawaii Revised Statutes, that
exists as of July 1, 2027, shall be deemed to be administratively dissolved by
the director of commerce and consumer affairs as of that date.

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(b)
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No new planned community association or condominium
association shall be incorporated or otherwise formed after June 30, 2027.
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Any articles of incorporation or other
document purporting to establish a new planned community association or new
condominium association after June 30, 2027, shall be void.

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(c)
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Beginning January 1, 2027, the department
shall administer each planned community and condominium under the bylaws,
covenants, association documents, rules, or other documents governing the use
of common areas, architectural controls, maintenance of units, restrictions on
the use of units, and payments of money as a regular assessment or otherwise in
connection with the provisions, maintenance, or services for the benefit of
some or all of the units, the owners, or occupants of the units or the common
areas, as well as any amendments made to the foregoing documents.
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To perform these functions, the department
shall have all powers and responsibilities provided to planned community
associations and condominium associations under chapters 421J and 514B, Hawaii
Revised Statutes, respectively, and under the bylaws and covenants, association
documents, rules, or other documents governing the planned community or
condominium.

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(d)
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Beginning July 1, 2027, all rights, powers,
and functions of each existing planned community association or condominium
association shall be transferred to the department.
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Any employee of a planned community or
condominium association may be transferred and may continue in the employee's
position, except as determined by the department; provided that the employee
shall not be subject to chapters 76 and 89, Hawaii Revised Statutes, and the director
of commerce and consumer affairs may prescribe the duties and qualifications of
these employees and fix their salaries without regard to chapter 76, Hawaii
Revised Statutes.
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The powers provided to
the department under this subsection shall continue until the enactment of laws
that provide for the long-term administration of planned communities and
condominiums by the department.

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(e)
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All records, equipment, machines, files,
supplies, contracts, books, papers, documents, maps, and other personal
property heretofore made, used, acquired, or held by an planned community
association or condominium association relating to the planned community or
condominium shall be transferred to the department.

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(f)
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A planned community association or
condominium association that is administratively dissolved pursuant to
subsection (a) shall continue its corporate existence but shall not carry on
any business except that necessary to wind up and liquidate its affairs under part
XIII of chapter 414D, Hawaii Revised Statutes, or other applicable law.

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SECTION 4.
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(a)
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No
later than twenty days prior to the convening of the regular session of 2026,
the department shall submit a report to the legislature that makes
recommendations for the department's governance of planned communities and
condominiums, including:

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(1)
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A plan for the governance of existing planned
communities and condominiums;

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(2)
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The department's estimated budget requirements
to administer planned communities and condominiums under the paragraph (1);

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(3)
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Recommendations to address any potential legal
issues, including claims under the takings clauses of the United States Constitution
and Hawaii state constitution; and

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(4)
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Any other findings and recommendations.

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(b)
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The report shall include proposed legislation
that:

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(1)
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Creates a statutory
framework for the department's governance of existing planned communities and
condominium
s and the creation of new planned communities and condominiums;

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(2)
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Appropriates funds necessary to fund the
department's operations under paragraph (1); and

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(3)
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Addresses potential legal issues, including claims
under the takings clauses of the United States Constitution or Hawaii state
constitution.

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SECTION
5.
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If any provision of this Act, or the
application thereof to any person or circumstance, is held invalid, the
invalidity does not affect other provisions or applications of the Act that can
be given effect without the invalid provision or application, and to this end
the provisions of this Act are severable.

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SECTION 6.
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This Act shall take effect upon its approval.

INTRODUCED BY:

_____________________________

Report Title:

DCCA;
Condominiums; Planned Communities; Dissolution; Governance; Report to
Legislature

Description:

Provides
for the administrative dissolution of any planned community association or
condominium association in existence as of 7/1/2027.
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Provides the Department of Commerce
and Consumer Affairs the powers currently provided to planned community
associations and condominium associations under chapters 421J and 514B, HRS,
and each planned community's or condominium's bylaws and other governing
documents.
�
Requires the Department of Commerce and Consumer Affairs to
submit
a report and proposed legislation to the Legislature with recommendations to
administer planned communities and condominiums.

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