STAND. COM. REP. NO. 2709

Honolulu, Hawaii

RE: S.B. No. 2060

S.D. 2

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2026

State of Hawaii

Sir:

Your Committee on Ways and Means, to which was referred S.B. No. 2060, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO THE RENTAL HOUSING REVOLVING FUND,"

begs leave to report as follows:

The purpose and intent of this measure is to facilitate the development of rental housing units in the State.

Specifically, this measure:

(1) Authorizes the Hawaii Housing Finance and Development Corporation to transfer moneys between the rental housing revolving fund and its subaccounts without legislative authorization;

(2) Allows rental housing revolving fund moneys to be used to provide any and all forms of financing for the development, pre-development, construction, acquisition, preservation, and substantial rehabilitation of rental housing units;

(3) Requires the Hawaii Housing Finance and Development Corporation to give preference to certain projects having perpetual affordability commitments and to applicants having a demonstrated history of early repayment to the rental housing revolving fund;

(4) Requires rental housing revolving fund loans applied for or awarded after December 31, 2026, to be subject to review and renegotiation when any mortgage debt to which the loan is subordinate is refinanced or retired;

(5) Authorizes the Director of Finance to transfer moneys from the rental housing revolving fund to its mixed‑income subaccount for fiscal year 2026-2027;

(6) Makes the mixed-income subaccount of the rental housing revolving fund permanent by repealing the sunset date contained in Act 159, Session Laws of Hawaii 2025; and

(7) Appropriates moneys into and out of the mixed income subaccount of the rental housing revolving fund.

Your Committee received written comments in support of this measure from the Hawaii Housing Finance and Development Corporation, Hawaii Public Housing Authority, Holomua Collaborative, and Hawai`i YIMBY.

Your Committee received written comments on this measure from Catholic Charities Hawai`i.

Your Committee finds that the mixed-income subaccount of the rental housing revolving fund provides a dedicated funding source for workforce housing projects. Your Committee further finds that creating a mechanism for the transfer of funds between the rental housing revolving fund and its subaccounts will reduce administrative delays that can stall projects and increase costs.

Your Committee has amended this measure by:

(1) Requiring that transfers of moneys between the rental housing revolving fund and its subaccounts be subject to approval of the Legislature by concurrent resolution;

(2) Requiring the Hawaii Housing Finance and Development Corporation to publish on its website a list of projects for which funds transferred between the rental housing revolving fund and its subaccounts will be expended;

(3) Authorizing the Hawaii Housing Finance and Development Corporation, with the approval of the Legislature by concurrent resolution, to use moneys in the rental housing revolving fund that have been reserved or awarded by the Corporation for specific projects but have not yet been encumbered to fund other rental housing projects or for other authorized purposes of the fund, subject to certain conditions; and

(4) Deleting the appropriation of moneys into and out of the mixed-income subaccount of the rental housing revolving fund.

As affirmed by the record of votes of the members of your Committee on Ways and Means that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2060, S.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as S.B. No. 2060, S.D. 2.

Respectfully submitted on behalf of the members of the Committee on Ways and Means,

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DONOVAN M. DELA CRUZ, Chair