Bill Text: HI SB2373 | 2010 | Regular Session | Amended

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Bill Title: Real Property; Transfer Fees

Spectrum: Partisan Bill (Democrat 6-0)

Status: (Engrossed - Dead) 2010-03-04 - (H) Referred to WLO, CPC, JUD, referral sheet 37 [SB2373 Detail]

Download: Hawaii-2010-SB2373-Amended.html

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STAND. COM. REP. NO. 2615

 

Honolulu, Hawaii

                  

 

RE:    S.B. No. 2373

       S.D. 2

 

 

 

Honorable Colleen Hanabusa

President of the Senate

Twenty-Fifth State Legislature

Regular Session of 2010

State of Hawaii

 

Madam:

 

     Your Committee on Judiciary and Government Operations, to which was referred S.B. No. 2373, S.D. 1, entitled:

 

"A BILL FOR AN ACT RELATING TO PRIVATE TRANSFER FEES,"

 

begs leave to report as follows:

 

     The purpose of this measure is to prohibit in a deed or other covenant running with the land a provision that requires the transferee to pay a fee in connection with a future transfer of the property to a declarant, other person imposing the deed or restriction or covenant, or a third party designated by a transferor of the property.

 

     Your Committee received written comments in support of this measure from three nonprofit entities, two financial organizations, and one private entity.  Written testimony presented to the Committee may be reviewed on the Legislature's website.

 

     Your Committee finds that private transfer fees are created by a private party through a deed restriction or covenant on real property.  This restriction requires every transferee or buyer of the real property to pay a transfer fee to the private party which created that restriction.  Because this private transfer fee is paid every time that real property is transferred, the private party imposing this restriction may be deemed to be retaining a part of the fee simple interest in the real property that is being transferred.  This restriction could constitute an inappropriate restraint on the transfer of real property.  Your Committee notes that this measure provides exemptions to the general prohibition on transfer fees for legitimate changes required by a deed restriction or other covenant running with the land in connection with the transfer of real property.  Your Committee also notes its concern about the grandfathering of covenants that existed prior to this measure, particularly with respect to conservation easements or land trusts.

 

     Accordingly, your Committee has amended this measure by changing the effective date to July 1, 2050, to continue the discussions on this matter.  Your Committee has also made technical, nonsubstantive amendments for the purposes of clarity and style.

 

     As affirmed by the record of votes of the members of your Committee on Judiciary and Government Operations that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2373, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 2373, S.D. 2.

 

Respectfully submitted on behalf of the members of the Committee on Judiciary and Government Operations,

 

		____________________________ BRIAN T. TANIGUCHI, Chair