STAND. COM. REP. 1187

Honolulu, Hawaii

, 2003

RE: S.B. No. 1630

H.D. 1

 

 

 

Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committee on Consumer Protection and Commerce, to which was referred S.B. No. 1630 entitled:

"A BILL FOR AN ACT RELATING TO NONPROFIT CORPORATIONS,"

begs leave to report as follows:

The purpose of this bill is to clarify that where a nonprofit corporation's officers or board of directors are to be elected by its members, the election may be conducted by mail in accordance with the corporation's bylaws or as provided by the board.

Testimony in support of this bill was submitted by Mililani Town Association and Neeley & Anderson LLP. The Hawaii Council of Associations of Apartment Owners expressed concerns with this measure. A professional registered parliamentarian and another concerned citizen testified in opposition to this bill.

Your Committee notes that the Hawaii Nonprofit Corporations Act, chapter 414D, Hawaii Revised Statutes, does not allow for election by mail unless a corporation's bylaws specifically permit mail balloting. Your Committee is aware of concerns raised by this bill, which would enable directors to act contrary to their corporation's bylaws. However, your Committee finds that for certain large corporations, such as the Mililani Town Association, members are excluded from direct participation in elections because they are unable to vote by mail ballot.

Accordingly, your Committee has amended this bill by clarifying that for planned community associations with more than 2,500 members, elections may be conducted by mail if so determined by the board of directors.

As affirmed by the record of votes of the members of your Committee on Consumer Protection and Commerce that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 1630, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 1630, H.D. 1, and be placed on the calendar for Third Reading.

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

 

____________________________

KENNETH T. HIRAKI, Chair