STAND. COM. REP. NO. 1750

Honolulu, Hawaii

RE: H.B. No. 1091

H.D. 2

S.D. 2

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Second State Legislature

Regular Session of 2023

State of Hawaii

Sir:

Your Committee on Commerce and Consumer Protection, to which was referred H.B. No. 1091, H.D. 2, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO REAL PROPERTY DISCLOSURES WITHIN SHORELINE AREAS,"

begs leave to report as follows:

The purpose and intent of this measure is to require disclosure of all existing permitted and unpermitted erosion control structures on the parcel and the annual coastal erosion rate for the zoning lot in real estate transactions when residential real property lies adjacent to the shoreline.

Your Committee received testimony in support of this measure from the Department of Land and Natural Resources, University of Hawai‘i System, Office of Planning and Sustainable Development, and one individual. Your Committee received comments on this measure from the Hawai‘i Association of REALTORS.

Your Committee finds that the vulnerability of coastal properties due to erosion and flooding from seasonal waves and storms is increasing with sea level rise. It is critical that buyers of coastal property in the State understand the hazards and risks they are assuming in purchasing oceanfront property. Therefore, this measure requires real estate disclosures to include certain erosion and erosion control information to support informed decision-making by buyers and government agencies.

Your Committee acknowledges the concerns raised in testimony that a seller may not have knowledge of or control over structures on state land and thus would be unable to disclose the existence of those structures. However, your Committee notes that erosion control structures are typically conspicuous and large in size, and it is unlikely that homeowners are unaware of their existence. Accordingly, the existence of these structures should be disclosed when a property is listed for sale. Amendments to this measure are therefore necessary to address these concerns.

Your Committee has amended this measure by clarifying that when residential real property lies adjacent to the shoreline, the seller shall disclose any notices of alleged violation associated with the parcel and any fines for expired permits or unpermitted structures associated with the parcel.

As affirmed by the record of votes of the members of your Committee on Commerce and Consumer Protection that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1091, H.D. 2, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 1091, H.D. 2, S.D. 2.

Respectfully submitted on behalf of the members of the Committee on Commerce and Consumer Protection,

________________________________

JARRETT KEOHOKALOLE, Chair