Terms Used In Hawaii Revised Statutes > Chapter 516 > Part VI - Sustainable Affordable Developments or Leases

• Affidavit: A written statement of facts confirmed by the oath of the party making it, before a notary or officer having authority to administer oaths.
• county: includes the city and county of Honolulu. See Hawaii Revised Statutes 1-22
• Development tract: means a single contiguous area of real property not less than five acres in size which has been developed and subdivided into residential lots, including residential lots which may have been converted to fee simple and streets and roadways developed as an integral part of the development tract. See Hawaii Revised Statutes 516-1
• Lease: means a conveyance of land or an interest in land, by a fee simple owner as lessor, or by a lessee or sublessee as sublessor, to any person, in consideration of a return of rent or other recompense, for a term, measured from the initial date of the conveyance, twenty years or more (including any periods for which the lease may be extended or renewed at the option of the lessee). See Hawaii Revised Statutes 516-1
• Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). ^{Source: OCC}
• Lessee: means any person to whom land is leased or subleased, and the lessee's heirs, successors, legal representatives, and assigns. See Hawaii Revised Statutes 516-1
• Lessor: means any person who leases or subleases land to another, and the lessor's heirs, successors, legal representatives, and assigns. See Hawaii Revised Statutes 516-1
• Sustainable affordable development: means a development tract that satisfies all of the following requirements:

  (1) The sales price at the time of initial sale of at least thirty per cent of all the residential lots in the development tract shall be limited in accordance with directly applicable state or county law, regulation, policy, or agreement, such that households earning not more than the required percentages of the median income for the applicable county (according to the directly applicable law, regulation, policy or agreement) will be required to spend no more than the allowable percentage of their gross incomes for housing costs as determined by secondary mortgage market standards or as otherwise agreed, all as determined as of the time of the initial sale of the residential lots;

  (2) The sales price at the time of the initial sale of at least fifty-one per cent of the residential lots in the development tract, including the lots subject to the requirements of paragraph (1), and the sales price at the time of a resale of at least fifty-one per cent of all the residential lots in the development tract, shall be no higher than eighty per cent of the fair market value of the residential lots in fee at the time of initial sale or resale, as appropriate, including all buildings and improvements, unencumbered by the restrictions of the lease;

  (3) All residential lots sold in satisfaction of paragraph (1) or (2) shall be leased under sustainable affordable leases;

  (4) The state or county agency that approves the sustainable affordable development may reduce the minimum percentage of residential lots to be sold in satisfaction of paragraph (1) or (2) upon a showing that the sustainable affordable development comprises a portion of a housing project that includes other housing, which together with the residential lots comprising the sustainable affordable development, satisfies the state or county agency's affordable housing requirements as set forth in the applicable state or county law, regulation, policy, or agreement; and

  (5) For the purposes of this chapter, the residential lots in a development tract comprising a sustainable affordable development are not required to be in a single contiguous area as long as all non-contiguous lots are:

  (A) Within a ten-mile radius of each other; and

  (B) Leased by the same fee owner under a sustainable affordable lease. See Hawaii Revised Statutes 516-1

• Sustainable affordable lease: means a residential lot lease in a sustainable affordable development that satisfies all of the following requirements:

  (1) The lease provides for a consideration to the fee owner below a fair market return on the fair market value of the land; provided that compensation to the fee owner for land, including lease rent, shall be either:

  (A) Totally capitalized into the initial sales price for the residential lot, including all buildings and improvements; or

  (B) Partially capitalized with a share of appreciation paid to the lessor upon resale of the residential lot;

  (2) In order to maintain the continued affordability of the residential lot, the lease limits the lessee's maximum sales price on the residential lot upon resale, including all buildings and improvements, to the lesser of:

  (A) The fair market value of the residential lot, including all buildings and improvements, encumbered by the restrictions of the lease; or

  (B) The sum of:

  (i) The lessee's purchase price for the residential lot, including all buildings and improvements;

  (ii) Any appreciation on the residential lot, including all buildings and improvements as measured by multiplying the amount in clause (i) by the increase in the consumer price index for all urban consumers as determined by the United States Department of Labor for the applicable county (or if not published for the county, then for the State), from the date of the purchase to the date of the contract for resale; and

  (iii) The fair market value of all lessor-approved capital improvements made by the lessee; and

  (3) The lease may allow the lessor to receive a share of the appreciation in accordance with paragraph (2), as agreed to by the lessor and lessee, and as set forth in the sustainable affordable lease. See Hawaii Revised Statutes 516-1