STAND. COM. REP. NO. 3670

Honolulu, Hawaii

RE: H.B. No. 1633

H.D. 1

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Second State Legislature

Regular Session of 2024

State of Hawaii

Sir:

Your Committee on Commerce and Consumer Protection, to which was referred H.B. No. 1633, H.D. 1, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO CONTRACTORS,"

begs leave to report as follows:

The purpose and intent of this measure is to amend the law that exempts owner-builders from state law governing contractors by:

(1) Repealing language that allows lessees of the property to be eligible for the exemption; and

(2) Repealing language that requires the buildings or structures to be built or improved for the property owner's own use or for use by the owner's grandparents, parents, siblings, or children.

Your Committee received testimony in support of this measure from the Hawaiʻi Association of REALTORS and Grassroot Institute of Hawaii.

Your Committee received testimony in opposition to this measure from the Regulated Industries Complaints Office of the Department of Commerce and Consumer Affairs and Contractors License Board.

Your Committee finds that property owners that construct or improve certain buildings or structures on their own property can do so without a construction license by obtaining an owner-builder exemption permit. However, under the existing law governing owner-builder exemptions, any newly constructed or improved building or structure must ultimately be for the owner's or their family's use and occupancy. Your Committee finds that this requirement has made it difficult and more expensive for homeowners who seek to self-convert their single-family residences into leasable multi-family dwellings. Therefore, this measure removes certain restrictions on the use of a property built or improved pursuant to the owner-builder exemption to help stimulate the construction of rental housing and increase the housing supply in Hawaii.

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. 1633, H.D. 1, S.D. 1, and recommends that it pass Third Reading.

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

________________________________

JARRETT KEOHOKALOLE, Chair