THE SENATE

S.B. NO.

2128

THIRTY-SECOND LEGISLATURE, 2024

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

relating to deannexation of real property.

 

 

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

 

     SECTION 1.  Chapter 421I, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§421I-    Deannexation.  (a)  A tenant shareholder may deannex the dwelling unit that the tenant shareholder occupies from the cooperative housing corporation under the terms specified in the bylaws.

     (b)  If the bylaws do not contain terms of deannexation or if the tenant shareholder declares that the terms of deannexation in the bylaws are unjust, the tenant shareholder and the cooperative housing corporation shall negotiate for deannexation under separate terms.

     (c)  If the tenant shareholder and the cooperative housing corporation are unable to agree upon terms for deannexation, the terms shall be that the tenant shareholder shall not be a shareholder of the cooperative housing corporation and shall not be required to pay any fees to the cooperative housing corporation."

     SECTION 2.  Chapter 421J, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§421J-    Deannexation.  (a)  The unit owner of any unit may deannex that unit from the planned community under the terms specified in the bylaws.

     (b)  If the bylaws do not contain terms of deannexation or if the unit owner declares that the terms of deannexation in the bylaws are unjust, the unit owner and the association shall negotiate for deannexation under separate terms.

     (c)  If the unit owner and the association are unable to agree upon terms for deannexation, the terms shall be that the unit shall not be part of the planned community and the unit owner shall not be required to pay any fees to the association."

     SECTION 3.  Chapter 514B, Hawaii Revised Statutes, is amended by adding a new section to part III to be appropriately designated and to read as follows:

     "§514B-    Deannexation.  (a)  The unit owner of any unit may deannex that unit from the condominium pursuant to the terms specified in the bylaws under section 514B-108(b)(9).

     (b)  If the bylaws do not contain terms of deannexation or if the unit owner declares that the terms of deannexation in the bylaws are unjust, the unit owner and the association shall negotiate for deannexation under separate terms.

     (c)  If the unit owner and the association are unable to agree upon terms for deannexation, the terms shall be that the unit shall not be a part of the condominium and the unit owner shall not be required to pay any fees to the association."

     SECTION 4.  Section 514B-108, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:

     (b)  The bylaws shall provide for at least the following:

     (1)  The number of members of the board and the titles of the officers of the association;

     (2)  Election by the board of a president, treasurer, secretary, and any other officers of the association the bylaws specify;

     (3)  The qualifications, powers and duties, terms of office, and manner of electing and removing directors and officers and the filling of vacancies;

     (4)  Designation of the powers the board or officers may delegate to other persons or to a managing agent;

     (5)  Designation of the officers who may prepare, execute, certify, and record amendments to the declaration on behalf of the association;

     (6)  The compensation, if any, of the directors;

     (7)  Subject to subsection (e), a method for amending the bylaws; [and]

     (8)  The percentage, consistent with this chapter, that is required to adopt decisions binding on all unit owners; provided that votes allocated to lobby areas, swimming pools, recreation areas, saunas, storage areas, hallways, trash chutes, laundry chutes, and other similar common areas not located inside units shall not be cast at any association meeting, regardless of their designation in the declaration[.]; and

     (9)  The terms of deannexation of any unit, including a calculation:

          (A)  For future maintenance fees arising from common elements that cannot be separated from the unit, including fees directly arising from elevators, roads, and the roof above the unit; and

          (B)  That excludes future maintenance fees arising from common elements that can be separated from the unit, including fees directly arising from a condominium swimming pool or recreational area."

     SECTION 5.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

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

 

INTRODUCED BY:

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Report Title:

Condominiums; Planned Community Associations; Cooperative Housing Corporations; Deannexation; Unit Owner; Association

 

Description:

Requires condominium homeowner associations to include in their bylaws an option for a unit owner to opt-out of a condominium.  Establishes a procedure for a unit owner of a condominium, planned community association, or cooperative housing corporation to opt-out of their respective private community.

 

 

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