Bill Text: HI SB707 | 2014 | Regular Session | Amended
Bill Title: Public Lands; Relinquishment of Lease; Capital Improvements ($)
Spectrum: Partisan Bill (Democrat 4-0)
Status: (Engrossed - Dead) 2014-04-02 - Recommitted to WAL with none voting no and Representative(s) Cachola, Hashem, Wooley excused. [SB707 Detail]
Download: Hawaii-2014-SB707-Amended.html
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THE SENATE |
S.B. NO. |
707 |
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TWENTY-SEVENTH LEGISLATURE, 2013 |
S.D. 2 |
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STATE OF HAWAII |
H.D. 1 |
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A BILL FOR AN ACT
RELATING TO ECONOMIC DEVELOPMENT.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. Chapter 171, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:
"§171- Right to relinquish a lease; appraisals; improvements. (a) Notwithstanding any other provision of law to the contrary, a lessee of public land that is subject to the management, administration, or control of the department may relinquish the lease at any time during the lease period as provided in this section.
(b) Prior to relinquishing the lease, the lessee shall contract with a real estate appraiser licensed or certified pursuant to chapter 466K to determine the current depreciated or residual value of any improvements to the land. Should the board fail to agree to the appraised current depreciated or residual value of the improvements, the department may contract with an appraiser licensed or certified pursuant to chapter 466K, who, together with the lessee's appraiser shall appoint a third appraiser, and the value shall be determined by arbitration as provided in chapter 658A. The lessee shall pay for all appraisal costs, except that the cost of the third appraiser shall be borne equally by the lessee and the board.
(c) Upon relinquishment of the lease, the board shall dispose of the land by public auction as provided in section 171-14; provided that the auction upset shall be the greater of the current ground rent or the appraised fair market rent, as if it were vacant and unimproved. The relinquishing lessee may bid on the new lease at the public auction; provided that if the relinquishing lessee does not bid or is not awarded the lease after the public auction, the relinquishing lessee shall vacate the land within one hundred twenty days and leave it in good condition.
(d) Lease terms for the new lease shall be determined by the board; provided that:
(1) The lease period shall be for a minimum of forty years;
(2) If the lease is awarded after public auction to any party other than the relinquishing lessee, the lease rent shall include a premium equal to the current depreciated or residual value of any improvements to the land as determined pursuant to subsection (b), which shall be paid to the relinquishing lessee prior to transfer of the land and improvements to the new lessee; and
(3) If the lessee's purpose in securing the lease includes substantial capital improvements to the land or partial or complete replacement of existing improvements, the terms of the new lease shall conform to the applicable financing requirements and shall include a minimum visible rent period of at least thirty years.
(e) If there are no bidders at public auction other than the relinquishing lessee, the existing lease contract shall be maintained unless both parties agree to terminate the lease. The board and the lessee may agree to modify the lease only by the lease period if extension is required for the lessee to secure financing for substantial capital improvements to the land or partial or complete replacement of existing improvements. If there are no bidders at public auction, including the relinquishing lessee, all improvements to the land shall revert to the board.
(f) This section shall not apply to:
(1) Any lessee who is in arrears in the payment of taxes, rents, or other obligations owing to the State or any county or who has had, during the five years preceding the anticipated disposition of the public land at a public auction, a previous sale, lease, license, permit, or easement covering other public lands canceled for failure to satisfy the terms and conditions thereof; or
(2) Any lease that is subject to cancellation for failure to satisfy the terms or conditions of a lease, license, permit, or easement covering the public lands."
SECTION 2. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.
SECTION 3. New statutory material is underscored.
SECTION 4. This Act shall take effect on July 1, 2030.
Report Title:
Public Lands; Relinquishment of Lease; Capital Improvements
Description:
Grants lessees of public land the right to relinquish a lease. Provides for the valuation of improvements to the land. Provides for disposition of the land at public auction after relinquishment. (SB707 HD1)
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.
