STAND. COM. REP. NO. 822

Honolulu, Hawaii

, 2005

RE: H.B. No. 835

H.D. 2

 

 

 

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Third State Legislature

Regular Session of 2005

State of Hawaii

Sir:

Your Committee on Consumer Protection & Commerce, to which was referred H.B. No. 835, H.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO TIME SHARING PLANS,"

begs leave to report as follows:

The purpose of this bill is to improve and clarify provisions of the law relating to time share industry sales. Specifically, this bill:

(1) Amends signage requirements for time share booths such that a permanent, conspicuous, clear, and unobstructed sign containing the words "time share" or "time sharing" is required to be displayed at all times, except for booths located within a project subject to a time share plan or within a hotel if:

(A) The project or hotel is owned or operated by the developer or an affiliate of the developer;

(B) The owner or operator of the project or hotel, or one of their affiliates, is the plan manager of the time share plan; or

(C) The owner or operator of the project or hotel, or one of their affiliates, is a subcontractor of the plan manager and provides check-in, check-out, day-to-day maintenance, and housekeeping services for the time share plan;

(2) Provides that the prohibition on receiving money, property, or other valuable consideration from a purchaser or prospective purchaser does not apply to money paid for a tourist activity, product, or service offered to induce attendance at a time share sales; and

(3) Clarifies that the requirement for including in promotional literature a disclosure that the product or activity involves a time share does not apply to a sign or banner, except as provided in the signage requirements of section 514E-11, Hawaii Revised Statutes.

Your Committee received testimony in support of this measure from Pahio Resorts, Starwood Vacation Ownership, Marriott International, Inc., American Resort Development Association-Hawaii Chapter, Cendant Timeshare Resort Group, Inc., and Fairfield Resorts, Inc. The Department of Commerce and Consumer Affairs (DCCA) supported the intent of this measure with amendments.

Your Committee finds that time share signage requirements will protect and inform consumers when promotional prizes or gifts are offered to them for the purpose of soliciting sales of time share units or interests. While your Committee believes that this measure will provide parity among time share competitors, it does recognize DCCA's concerns about excluding specific owners, operators, or developers from signage requirements. It is your Committee's understanding that DCCA is currently in discussions with time share industry representatives to draft language that is mutually agreeable.

In light of the ongoing discussions, your Committee has amended this bill by:

(1) Providing a defective date of July 1, 2099, to encourage further discussion; and

(2) Making technical, nonsubstantive amendments for purposes of clarity and style.

 

As affirmed by the record of votes of the members of your Committee on Consumer Protection & Commerce that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 835, H.D. 1, as amended herein, and recommends that it pass Third Reading in the form attached hereto as H.B. No. 835, H.D. 2.

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

 

____________________________

KENNETH HIRAKI, Chair