STAND. COM. REP. NO. 137

Honolulu, Hawaii

, 2005

RE: H.B. No. 155

H.D. 1

 

 

 

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 and Commerce, to which was referred H.B. No. 155 entitled:

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

begs leave to report as follows:

The purpose of this bill is to allow an escrow agent to release purchasers' funds to a time share developer prior to closing if the developer secures the funds with a bond or letter of credit.

Testimony supporting this bill was received from Hilton Grand Vacations Club, American Resort Development Association-Hawaii, Cendant Timeshare Resort Group, Inc., Fairfield Resorts, Inc., Starwood Vacation Ownership, and Old Republic Title & Escrow Company. The Department of Commerce and Consumer Affairs (DCCA) supported the bill in part, and opposed the bill in part.

Your Committee finds that this bill was heard along with the following three measures related to Hawaii's time share industry:

(1) H.B. No. 156, which adds definitions of "master development" and "person" to, and amends the definitions of, "blanket lien" and "project" in the time share law;

(2) H.B. No. 391, which amends the definition of "developer" in the time share law; and

(3) H.B. No. 157, which exempts a sales agent of a time share developer licensed as a mortgage broker from mortgage broker and solicitor licensing laws.

Testimony received on these bills showed some general support for their intent. Concerns were also voiced that will take some time to resolve, such as those of DCCA regarding this bill and its lack of specifications for the bonds or letter of credit, notice to purchasers, enforcement resources, and other similar consumer protection concerns. However, your Committee also noted a willingness among the testifiers to discuss and resolve the various concerns raised regarding these bills.

Accordingly, your Committee has amended this bill to eoncourage discussion and resolution of related issues by:

(1) Including the substance of H.B. Nos. 156, 157, and 391, into this bill, thereby consolidating the bills into a single omnibus time share bill;

(2) Changing the effective date to July 1, 2050; and

(3) Making technical, nonsubstantive amendments for consistency and style.

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 H.B. No. 155, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 155, 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 HIRAKI, Chair