Bill Text: HI SB878 | 2020 | Regular Session | Amended

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Bill Title: Relating To Housing.

Spectrum: Partisan Bill (Democrat 6-0)

Status: (Engrossed - Dead) 2019-12-01 - Carried over to 2020 Regular Session. [SB878 Detail]

Download: Hawaii-2020-SB878-Amended.html

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THE SENATE	S.B. NO.	878
THIRTIETH LEGISLATURE, 2019		S.D. 1
STATE OF HAWAII

A BILL FOR AN ACT

 

 

RELATING TO HOUSING.

 

 

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

 

     SECTION 1.  The legislature finds that the self-help housing model is a cost-effective means of assisting low-income families who would otherwise not have a homeownership opportunity.  Self-help housing organizations leverage federal funds from the United States Department of Housing and Urban Development and the United States Department of Agriculture Rural Development and use low-income families' own contributions of labor to help them build their own communities.  However, an additional non-federal matching funding source is needed.

     The legislature further finds that homeownership is a national strategy for preserving affordable housing units financed through the federal low-income housing tax credit and section 8 programs.  Currently, there are 7,486 affordable housing units in Hawaii developed with low-income housing tax credits and section 8 program funding that are at or beyond their mandatory affordability period and will therefore be at risk of becoming market-rate units.  Action is needed to preserve the limited affordable housing opportunities for low- and moderate-income households in Hawaii.

     The legislature further finds that nonprofit community development financial institutions are intermediaries that provide financing and technical assistance to assist self-help housing organizations in the development of affordable homeownership units in underserved communities.  As private sector organizations, community development financial institutions establish and maintain revolving loan funds to attract capital from the United States Department of the Treasury and other public and private sources of capital in order to increase the collective impact of affordable housing development by self-help housing organizations.  According to Opportunity Finance Network, community development financial institutions leverage federal funding for affordable housing and community development activities at a ratio of 8:1.  Additional funding would help community development financial institutions attract private and public capital for affordable housing development.

     SECTION 2.  Chapter 201H, Hawaii Revised Statutes, is amended by adding a new subpart to part II to be appropriately designated and to read as follows:

"B.  Qualified Nonprofit Housing Trust Program

     §201H-A  Purpose and findings.  The legislature finds that qualified nonprofit housing trusts can help families by reducing housing costs significantly for income-qualified families up to one hundred forty per cent of the area median income.  Substantial cost savings are generated by retaining fee simple ownership of the home with the qualified nonprofit housing trust for the long term, subject to a long-term ground lease to the homeowner.  Qualified nonprofit housing trust homeowners have more financial stability because they no longer worry about rent increases or loss of their residence in the event the landlord decides to sell the unit.

     The purpose of this subpart is to promote permanent affordable homeownership opportunities by establishing an acquisition, rehabilitation, and development financing program for qualified nonprofit housing trusts and nonprofit community development financial institutions.

     §201H-B  Definitions.  As used in this subpart, unless a different meaning is clearly required by the context:

     "Develop" or "development" means the planning, financing, or acquisition of real and personal property; demolition of existing structures; clearance of real property; construction, reconstruction, alteration, or repairing of approaches, streets, sidewalks, utilities, and services, or other site improvements; construction, reconstruction, repair, remodeling, extension, equipment, or furnishing of buildings or other structures; or any combination of the foregoing, of any housing project, including any undertakings necessary therefor and the acquisition of any housing, in whole or in part.

     "Fund" means the qualified nonprofit housing trust revolving fund established pursuant to section 201H-C.

     §201H-C  Qualified nonprofit housing trust revolving fund.  (a)  There is established a qualified nonprofit housing trust revolving fund.  Funds appropriated for the purpose of the qualified nonprofit housing trust revolving fund and all moneys received or collected by the corporation for the purpose of the fund shall be deposited in the fund.  The proceeds in the revolving fund may be used for the necessary expenses incurred by the corporation in administering the fund; provided that fund moneys may not be used to finance day-to-day administrative expenses of projects allotted fund moneys.

     (b)  The fund shall be used to provide loans for the development, pre-development, construction, acquisition, preservation, and substantial rehabilitation of affordable housing units under the qualified nonprofit housing trust program.  Permitted uses of the fund may include but are not limited to planning, design, land acquisition, costs of options, agreements of sale, downpayments, equity financing, or other activities as provided in rules adopted by the corporation pursuant to chapter 91.  The rules may provide for a means of recapturing loans made from the fund if an affordable housing project financed under the fund is refinanced or sold by the qualified nonprofit housing trust at a later date.

     §201H-D  Qualified nonprofit housing trust program for affordable for-sale housing development.  (a)  The corporation may provide loans in amounts not to exceed $           under this section to qualified nonprofit housing trusts and nonprofit community development financial institutions for the development of affordable housing units.

     (b)  Affordable housing units developed under this section shall be sold to qualified residents earning not more than one hundred forty per cent of the area median income as determined by the United States Department of Housing and Urban Development under terms that ensure permanent housing affordability.

     (c)  Notwithstanding any other provision of law, the corporation, at its sole discretion, may waive or modify, as appropriate, the following restrictions for housing units developed under this section:

     (1)  The ten-year buyback restriction set forth in section 201H-47;

     (2)  The shared appreciation equity restriction set forth in section 201H-47;

     (3)  The buyback restriction set forth in section 201H-48;

     (4)  The restrictions on use of real property set forth in section 201H-49; and

     (5)  The restrictions on use, sale, and transfer of real property set forth in section 201H-50;

provided that the qualified nonprofit housing trust loan attributable to the housing units developed by the loan is repaid to the corporation upon closing of the sale or transfer of the housing units.

     (d)  Qualified nonprofit housing trusts shall establish and impose on qualified residents owner-occupancy and buyback restrictions, to be approved by the corporation, that require the purchased housing units to remain affordable in perpetuity.

     (e)  The corporation may establish, revise, charge, and collect fees, premiums, and charges as necessary, reasonable, or convenient, for its qualified nonprofit housing trust program.

     (f)  The corporation shall adopt rules pursuant to chapter 91 to effectuate the purpose of this program."

     SECTION 3.  Chapter 201H, Hawaii Revised Statutes, is amended by designating sections 201H-31 to 201H-70 as subpart A and inserting a title before section 201H-31 to read as follows:

"A.  General Provisions"

     SECTION 4.  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 2019-2020 to be deposited into the qualified nonprofit housing trust revolving fund established under section 201H-C, Hawaii Revised Statutes.

     SECTION 5.  There is appropriated out of the qualified nonprofit housing trust revolving fund the sum of $           or so much thereof as may be necessary for fiscal year 2019-2020 for the qualified nonprofit housing trust program.

     The sum appropriated shall be expended by the Hawaii housing finance and development corporation for the purposes of this Act.

     SECTION 6.  In codifying the new sections added by section 2 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

     SECTION 7.  New statutory material is underscored.

     SECTION 8.  This Act shall take effect on July 1, 2050.

 

 

 

Report Title:

Qualified Nonprofit Housing Trust Program; Appropriation

 

Description:

Establishes the qualified nonprofit housing trust program to authorize the Hawaii housing finance and development corporation to provide loans to qualified nonprofit housing trusts and nonprofit community development financial institutions to develop affordable housing units.  Makes an appropriation into and out of the qualified nonprofit housing trust revolving fund.  Effective 7/1/2050.  (SD1)

 

 

 

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