2009 annual report - hawaiifiles.hawaii.gov/dcca/reb/reports/annual report_2009...i respectfully...

2009 Annual Report Real Estate Commission

Real Estate Branch Professional and Vocational Licensing Division

Department of Commerce and Consumer Affairs State of Hawaii

The 2009 Hawaii Real Estate Commission

Trudy I. Nishihara Chair

Oahu, Real Estate Broker

Stanley M. Kuriyama

Vice Chair Oahu, Real Estate Broker

Louis E. Abrams

Chair, Laws and Rules Review Committee Kauai, Real Estate Broker

Michele Sunahara Loudermilk

Vice Chair, Laws and Rules Review Committee Oahu, Public Member

Carol Mae A. Ball

Chair, Education Review Committee Maui, Real Estate Broker

Annette Aiona

Vice Chair, Education Review Committee Hawaii, Real Estate Broker

William Stanley Chee

Chair, Condominium Review Committee Oahu, Real Estate Broker

Mark Suiso

Vice Chair, Condominium Review Committee Oahu, Public Member

Frances Allison Torre Gendrano

Oahu, Real Estate Broker

The Purpose of the Commission:In summary, the purpose of the Commission: “...the protection of the general public in its real estate transactions.” “...promote the advancement of education and research in the field of real estate for the benefit of the public and those licensed under the provision of this chapter (467, HRS) and the improvement and more efficient administration of the real estate industry.” “...promoting education and research in the field of condominium management, condominium registra-tion, and real estate for the benefit of the public and those required to be registered under this chapter (514A and 514B, HRS).”

The Honorable Linda Lingle, Governor, State of Hawaii, Members of the Twenty-Fifth State Legislature and Lawrence Reifurth, Director, Department of Commerce and Consumer Affairs:

I respectfully present to you the annual report on the status of the Real Estate Commission (“Commission”) for fiscal year (“FY”) 2009. The Commission currently oversees approximately 18,707 licensees statewide, of which 13,142 hold active licenses. This is an 11.8% decrease from a year ago. We also oversee approximately 1,629 condominium associations and

19 condominium hotel operators. The number of condominium units being offered for sale in condominium projects continues to increase in FY09. There were 347 new and conversion project filings as compared to 417 filings in FY08. This represents an increase of 6,504 units in new and conversion condominium projects during the fiscal year. The Commission also provides information, advice, education and acts as resource for these unit owners throughout the year on all islands by way of the Commission’s Outreach Program.

The Real Estate Commission is a nine-member Governor-appointed body comprised of seven industry members, and two public members, who serve four-year terms. The Commission oversees the licensing of real estate salespersons and brokers, including brokerages, and the maintenance and renewal of these licenses every two years. The Commission certifies prelicense education schools and instructors, and is responsible for the development of the prelicensing curriculum for salespersons and brokers. The Commission also registers continuing education providers and certifies continuing education courses, and in the condominium area, registers condominium projects and condominium owner associations. Condominium managing agents are also monitored for compliance with the appropriate laws. The Commission publishes and disseminates reports and participates in court cases involving the real estate recovery fund. There were 17 cases filed for payment from the fund during FY 09. The Commission reviews and approves settlement agreements and disciplinary action cases against licensees who are investigated by the Regulated Industries Complaints Office (RICO).

The Commission has three standing committees; the Laws and Rules Review Committee, the Education Review Committee, and the Condominium Review Committee. All are working committees where Commissioners take on leadership roles to work towards accomplishing the Program of Work as described for the fiscal year. Funding for these programs is critical to the Commission in order to achieve the objectives and goals and to maintain the direction of the Commission as set forth by law.

Louis Abrams, Kauai Commissioner and Chair of the Laws and Rules Review Committee, and Vice Chair Michelle Loudermilk, Oahu Commissioner and Public Member, have diligently worked to address national and state issues that may impact Hawaii. Act 66, better known as the Mortgage Rescue Fraud Prevention Act, emerged from the 2009 Hawaii Legislative Session and resulted in the addition of a new paragraph in HRS Section 467-14, “Revocation, suspension, and fine.” The new cite is HRS, Section 467-14(21) and it defines a 365-day period where the licensee may not acquire an interest in a distressed property after that listing agreement for the distressed property has expired or is terminated.

The Education Review Committee under the leadership of Carol Ball, Maui Commissioner, and Vice Chair Frances Gendrano, Oahu Commissioner, worked with the Education Evaluation Task Force made up of industry volunteers, to produce the Commission’s 2009-2010 mandatory core course, part A. The mandatory 4-hour course is now offered over the course of two years, 2-hours each year. This was in response to the industry’s request that the course be split to bring licensees current with laws that passed during that year. Part A was released in June 2009. Part B is to be delivered in June 2010.

In August of 2008, a new, efficient Online Continuing Education System (“Online CE System”) was unveiled by the Real Estate Branch. The Online CE System has streamlined course offerings, roster information for classes, reporting course completions, and permits the electronic access to course completion certificates by licensees. The Commission’s CE providers have praised the initiation of the online system.

Condominium Review Committee Chair, William Chee, Oahu Commissioner, and Vice-Chair Mark Suiso, Oahu Commissioner and Public Member, took on the enormous task of compiling a library of brochures and books, totaling 320, to assist condominium homeowners and potential purchasers in understanding the rules and responsibilities of condominium living. Information provided includes the role of the board of directors, the management company, and the association of unit owners. These books may be found in public libraries on all islands.

Along with Commissioners Annette Aiona, Big island Commissioner and broker, and Vice Chair of the Commission, Stanley Kuriyama, Oahu Broker, the Commission is a hardworking and committed group, seeking to meet the challenges of an evolving real estate industry, as well as embracing current changes that impact today’s real estate licensee and consumer. The Commission is grateful to the members of the Education Evaluation Task Force, the Consumer Brokerage Ad Hoc Committee, and the Condominium Research and Education Task Force, who contribute unselfishly their time and effort, and are committed to improve the real estate industry to maintain professional standards.

With the help and support of the Director of the Department of Commerce and Consumer Affairs (DCCA), Lawrence Reifurth, Licensing Administrator Noe Noe Tom, the Regulated Industries Complaints Office (RICO), the Department of the Attorney General, and Supervising Executive Officer, Neil Fujitani, and his Real Estate Branch staff, the Commission will continue to take strides forward to improve the quality of its real estate licensees, and their ability to serve consumers.

Respectfully submitted,

Trudy I. Nishihara ® Chair

Real Estate Commission Real Estate Branch

Professional and Vocational Licensing Division Department of Commerce and Consumer Affairs

State of Hawaii

Lawrence M. Reifurth, Director Ronald Boyer, Deputy Director

Noe Noe Tom, Licensing Administrator

Real Estate Branch:

Neil K. Fujitani, Supervising Executive Officer Vacant, Executive Officer

Karyn Takahashi, Secretary Tania Nakano, Office Assistant

Diane Choy Fujimura, Senior Real Estate Specialist Amy Endo, Real Estate Specialist

David Grupen, Real Estate Specialist Vacant, Office Assistant

Toalua Lavatai, Office Assistant Cynthia Yee, Senior Condominium Specialist

Cheryl Leong, Condominium Specialist Benedyne Stone, Condominium Specialist

Tammy Norton, Secretary Jon Gasper, Office Assistant

Janelle Sarae, Office Assistant Louise Tadaki, Office Assistant

335 Merchant Street, Room 333

Honolulu, Hawaii 96813 Telephone: (808) 586-2643

Web: http://www.hawaii.gov/hirec Email: [email protected]

Copyright: Hawaii Real Estate Commission 2009. All rights reserved. Funded by the Real Estate Education Fund and the Condominium Education Trust Fund and provided as an educational service to real estate licensees and the condominium community. This publication is designed to provide general information on the subject matters covered and is not a substi-tute for professional services to address specific situations. If legal advice or other expert assistance is required, please seek the services of a competent professional. This material can be made available for individuals with special needs. Please call the Senior Real Estate Specialist at (808) 586-2643 to submit your request.

1 LawsandRulesReviewCommitteeReport 7-11 Chart 1. Recovery Fund - Notices . . . . . . . . . . . . . . . . 9

Chart 2. Recovery Fund - Claims Paid . . . . . . . . . . . . . . 9 FY 2009 Program of Work . . . . . . . . . . . . . . . . . . . 10 FY 2010 Program of Work . . . . . . . . . . . . . . . . . . . 11

2 AdministrativeActions 12-13 Table 1. Administrative Actions . . . . . . . . . . . . . . . . 12

Chart 3. Disciplinary Actions . . . . . . . . . . . . . . . . . . 12 Chart 4. Administrative Actions - Sanctions . . . . . . . . . . . 13

Chart 5. Disciplinary Actions By Activity . . . . . . . . . . . . . 13

3 RegulatedIndustriesComplaintsOffice(RICO) 14-17 Chart 6. RICO Complaints . . . . . . . . . . . . . . . . . . . 14 Chart 7. Statutory Violations . . . . . . . . . . . . . . . . . . 15 Chart 8. Rules Violations . . . . . . . . . . . . . . . . . . . 15

4 EducationReviewCommitteeReport 18-26 FY 2009 Program of Work . . . . . . . . . . . . . . . . . . . 18 Table 2. Real Estate Licensing Examination . . . . . . . . . . . 18 Chart 9. Licensing Examination Candidates . . . . . . . . . . . 19 Chart 10. Inquiries and Applications . . . . . . . . . . . . . . . 20 Chart 11. Website Hits . . . . . . . . . . . . . . . . . . . . . 20 Chart 12. New Real Estate Licenses Issued . . . . . . . . . . . . 24 Table 3. Current Real Estate Licensees . . . . . . . . . . . . . . 25 Chart 13. Real Estate Licensees - By Island . . . . . . . . . . . . 25 Chart 14. Total Real Estate Licensees . . . . . . . . . . . . . . . 26 FY 2010 Program of Work . . . . . . . . . . . . . . . . . . . 26

5 CondominiumReviewCommitteeReport 27-45 FY 2009 Program of Work . . . . . . . . . . . . . . . . . . . 28 Chart 15. Condominium Advice, Education, and Referral . . . . . . 28 Chart 16. Condominium Governance Mediations . . . . . . . . . 30 Chart 17. Condominium Association Registration . . . . . . . . . 31 Chart 18. CMA and CHO Registration . . . . . . . . . . . . . . . 32 Chart 19. Developer’s Public Reports Effective Dates Issued . . . . . 35 Chart 20. Number of Condominium Apartments . . . . . . . . . . 35 Chart 21. New Residential Projects - By Size . . . . . . . . . . . . 36 Table 4. Condominium Project Filings . . . . . . . . . . . . . . 36 FY 2010 Program of Work . . . . . . . . . . . . . . . . . . . 39 Addendum Preliminary Strategic Plan For Considering Condominium Registration Filings Via Electronic Format . . . . . . . . . . . . . . 45

6 FundInformation 46-48 Real Estate Education Fund . . . . . . . . . . . . . . . . . . . . 46 Real Estate Recovery Fund . . . . . . . . . . . . . . . . . . . . 47 Condominium Education Trust Fund . . . . . . . . . . . . . . . . 48

TableofContents

LAWSANDRULESREVIEWCOMMITTEE(LRRC)REPORT TheLRRC,forfiscalyear2009,ledbyChairLouisAbramsandViceChairMicheleSunaharaLoudermilk,hadanactiveyearwithlegislation,reactiveissues,licensingprograms,andrecoveryfundadministration.

Act 4 (SLH 2009) HB No. 520 HD1 SD1–Amendstherequirementoftakingarchivalphotographsbeforeconductinganydemolition,construction,oralterationofanybuildingover50yearsoldoranybuildinglisted,oreligibleforlisting,ontheHawaiiorNationalRegisterofHistoricPlaces.Thepreviousrequirementwasfoundtobeoverlybroadandanobstacletotimelyalterations,repairs,anddemolition.

Act 5 (SLH 2009) SB No. 1130 SD2 –Requirestheredactionofthefirstfivedigitsofthesocialsecuritynumbersonjudgments,decrees,andcourtorderswhenfilingatthebureauofconveyancesandlandcourt.Act 57 (SLH 2009) SB No. 521 SD2 HD1 –RequirestheRegistraroftheBureauofConveyancestoprovide,within10daysaftereachweekandfreeofcharge,animageandindexofalldocumentsandinstrumentswhichhavebeenrecordedintheregistrar’sofficethatweekrelatingtoregularsystemlandinallthecounties,tothecountydesignatedinamemorandumofunderstandingagreeduponbythecountiestoactasacentralclearinghouse.

Act 59 (SLH 2009) HB No. 1741 HD1 SD1 CD1–ReducestheamountoftheconveyancetaxtransferredtotheRentalHousingTrustFundandtheNaturalAreaReserveFundandincreasestheconveyancetaxratefortransfersorconveyancesofpropertiesof$2,000,000ormoreandsecondhousepurchases.

Act 61 (SLH 2009) SB No. 1111 SD1 HD1 CD1–Increasestherateoftransientaccommodationstaxonoperatorsoftransientrentalfacilitiesbyonepercentagepoint(to8.25%)onJuly1,2009,andbytwopercentage

points(to9.25%)onJuly1,2010.Act 66 (SLH 2009) SB No. 34 SD1 HD1 CD1–ExcludeslicensedrealestatebrokersandsalespersonsfromthedefinitionofdistressedpropertyconsultantsintheMortgageForeclosureRescueFraudPreventionActunderspecifiedconditions.However,theActalsoprohibitscertainconductrelatingtotheacquisitionofanownershipinterestindistressedpropertybylicensedrealestatebrokersandsalespersons(e.g.,licenseesmustwaitatleastoneyearfromthedatetheirlistingexpiresoristerminatedbeforetheycanacquiresuchaninterest).

Act 102 (SLH 2009) HB No. 271 SD2 CD1–PermitstheRegistraroftheBureauofConveyancestoacceptelectronicdocumentswithelectronicsignaturesforrecording,provideelectronicdocumentsinresponsetoarequest,andconvertexistingrecordstoelectronicformat.

Act 106 (SLH 2009) HB No. 1071 HD3 SD2 CD1–ProvidesforanewformoflicensingandregulationofmortgageservicersthatserviceresidentialmortgageloanssecuredbyrealpropertylocatedintheStateofHawaii,specifiesprohibitedmortgageservicerpractices,andplacesadministrationandregulationofmortgageservicersunderthecommissioneroffinancialinstitutionsstartingJuly1,2010.Act 120 (SLH 2009) SB No. 1352 SD2 HD2 CD1–Transfersfeetimeshareinterestfromthelandcourtsystemtotheregularsystem,allowsownerto“optout”oflandcourtandderegisterlandtoregularsystem,establishesaworkinggrouptoresolveimplementationissues,establishesapilotprogramtoimplementelectronicrecordingoffeetimeshareinterests,allowsbureauofconveyancestochargeafeeforderegistrationofafeetimeshareinterest,andallowselectronicfilingoflandcourtandregularsystemdocumentsandinstruments.Themainpurposeofthisbillistoreducethebacklog

LawsandRulesReviewCommitteeReport�LawsandRulesReviewCommitteeReport�

8 LawsandRulesReviewCommitteeReport

inlandcourtrecordationsandregistrationsandpromotedepartmentalefficiencies.

Act 192 (SLH 2009) SB No. 1338 SD2 HD2 CD1–Allowstheuseofclotheslinesonanyprivatelyownedsinglefamilyresidentialdwellingortownhouse.

Act 195 (SLH 2009) SB No. 203 SD2 HD1 CD1–IncreasespenaltiesforunlicensedcontractingviolationsofHRSChapter444,thecontractorslicensinglaw.

Act 196 (SLH 2009) SB No. 1461 SD2 HD1 CD2–Advancesdateoffilingofmonthly,quarterly,andsemi-annualgeneralexcisetaxreturnsfromthelastdayofthecalendar,quarterly,orsemi-annualmonthtothe20thday,requiresanypersonrequiredtoelectronicallyfileorremitafederalreturnortaxestoalsoelectronicallyfileandremitastatereturnofallstatetaxestothedepartmentoftaxation,andrequiresanyemployerrequiredtoremitanywithheldtaxestothefederalgovernmentonasemi-weeklyschedule,toalsoremitthecompleteamountoftaxwithheldtothedepartmentoftaxationonasemiweeklyschedule.

First Special Session Act 32 (SLH 2009) SB No. 1218 SD2 HD2 CD1–Authorizesthecommissioneroffinancialinstitutionstoregulate,license,examine,andenforcelawsregulatingmortgageloanoriginatorseffectiveJuly1,2010.Consequently,mortgageloanoriginatorscurrentlylicensedasmortgagesolicitorsunderChapter454,HRS,relatingtomortgagebrokersandsolicitors,willbesubjecttolicensurebytheDivisionofFinancialInstitutions.HR No. 128 HD1 (SLH 2009)–AskstheRealEstateCommissiontoconsiderallowingdevelopersandattorneystosubmitcondominiumregistrationfilingsinanallowabletypeofelectronicformat.

SCR No. 53 SD1 (SLH 2009)–Requeststheauditortoconductasunrisereviewanalysisoftheregulationofrealestateappraisalmanagementcompanies.

SR No. 113 SD1 (SLH 2009)–UrgestheRealEstateCommissiontoadoptandsubmitastrategicplantoallowdevelopersandattorneystosubmitcondominiumregistrationfilingsinanallowableelectronicformat.

Special Subcommittees

Forfiscalyear2009,thetwosubcommitteesandadhoccommitteeswereasfollows:

SubcommitteeonApplicantswithCriminalandOtherLegalBackgroundIssues-TheCommission’ssubcommitteeresearchedanddiscussedinformationreceivedfromotherStateswhohaveimplementedacriminalbackgroundreviewprogramofallrealestatelicensingapplicants.Thesubcommitteedesirestodiscussandworkwiththeumbrellaorganizationonthisissue.

AdHocCommitteeonConsumer-BrokerRelationships–Aftercompletingthecomprehensiveworkloadofextensiveresearch,meetingswithvariousorganizationsandCommissionsfromotherStates,anditsownmeetings,theAdHocCommitteeiscurrentlyfinalizinganddraftingproposedlanguageforrulemakingwhich,ifapprovedbytheCommission,willgothroughtheformalruleadoptionprocessandbeimplementedinthefuture.

Licensing

ForFY2009,thetotalnumberoflicenseesdroppedto18,�0�ascomparedto21,868inFY2008.Thisrepresentsa14.5%decreaseoverthepreviousfiscalyear.The

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Fiscal YearClaims Paid ($) 25,000 25,000 25,000 0 105,411 0 0 0 0 11,065 31,555

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LawsandRulesReviewCommitteeReport9

numberofrealestatelicenseeshasalwaysbeencyclical,withtheall-timehighof26,090licenseesin1990andthelowestcountinthepast20yearsof13,033licenseesin1999.

TheLawsandRulesReviewCommittee,throughtheProfessionalandVocationalLicensingDivision,developedaplanforincreasingthenumberof2008onlinerenewalsforrealestatelicensees.Ofthe1�,325licenseesthatrenewedbytheDecember31,2008renewaldeadline,16,633licensesor96%,renewedonline.

Real Estate Recovery Fund

TheCommissionisthetrusteeoftheRealEstateRecoveryFund,which

isintendedtoprovideameasureofcompensationtoconsumersinjuredbythefraud,misrepresentation,ordeceitofrealestatelicensees.OneoftheprimarystatutoryrequirementsforobtainingpaymentfromthefundisnotifyingtheCommissionofthefilingofacourtactionthatmayresultinpaymentfromthefund.

DuringFY2009,theCommissionreceivednotificationforaclaimonthefundin1�cases.Thiswasa54.5%increasefromtheFY2008noticesreceived.SeeChart1.

InFY2009,therewerethreepaymentspaidoutoftherecoveryfund.Sinceitsinceptionin196�,therecoveryfundhaspaidoutovertwomilliondollars.SeeChart2.

CHART1.RecoveryFund-Notices

CHART2.RecoveryFund-ClaimsPaid

10 LawsandRulesReviewCommitteeReport

FY2009PROGRAMOFWORKLaws and Rules Review Committee

Real Estate Recovery Fund – TheCommissionadministeredthestatutoryrequirements,contractswithconsultantattorneys,noticeofclaims,courtordersforpayouts,disseminationofinformation,financialresponsibilitiesofthefund,recordsmanagement,andthedevelopmentofreports.

Real Estate Licensing, Registration & Certification Administration – TheCommissionadministeredthelicensing,registration,andcertificationrequirements,includingapplicationsreviewandupdates,policies,procedures,appeals,subpoenas,andrequestsforrecordsundertheOfficeofInformationPractices,laws,rules,andprocedures.

Advice, Education, and Referral – Staffrespondedandprovidedinformationtoinquiriesreceivedviatelephone,walk-ins,faxes,written,emails,andthroughtheCommission’swebsite;printedanddistributedCommission-developedinformation;andrespondedtoinquiriesfromgovernmentofficialsandmedia.

Rule Making, Chapter 99 – TheCommissionstudied,evaluated,researched,anddevelopedruleamendmentsforsubmissiontotheformalrulemakingprocess.

Meetings – TheCommission,withsupportfromstaff,administeredthemonthlycommitteemeetings,aswellassubcommitteeandadhoccommitteemeetings.

Licensing Renewals – Staffimplementedaplanforpaperlessrenewalsystem.

Legislative and Government Participation – TheCommissionparticipatedinthelegislativesessions;providedbriefingsandactedasaresourcetoLegislators,governmentofficials,andstaff;researchedandsubmitted

testimonyonbillsandresolutions,includingoraltestimony;andassistedLegislatorsandgovernmentofficialsinrespondingtothecommunity.

Interactive Participation with Organizations – TheCommission,aswellasstaff,continuedactiveparticipationwiththeARELLO(AssociationofRealEstateLicenseLawOfficials),local,PacificRim,national,andinternationalorganizationsandgovernmentagenciesfortheexchangeofinformationandconcerns,sharingofeducationalandresearchefforts,jointprojectsofmutualconcern,training,etc.

Legislative Acts and Resolutions – TheCommissionreviewed,reported,anddevelopedsummariesonallrelatedActsandresolutions;implementedrequirementsofdirectly-relatedActsandresolutions.

Neighbor Island Outreach – TheCommissionheldthreecommitteemeetingsatneighborislandsites(KauaiinAugust2008,andHawaiiinNovember2008,andMauiinJanuary2009).

Review of Services and Organization – Staffanalyzedandinitiatedstepstoimprovetheservicesprovided,tostreamlineforeffectivenessandefficiency,amendmentstolaws,amendmentstorules,amendmentstoforms,amendmentstothesystem,staffing,equipment,reorganization,etc.ItconductedmeetingsandexchangeswithLicensingBranchpersonnel.

Application Processing and Forms – Staffstudiedandevaluatedtheprocessingofapplicationforms,evaluatedandamendedformsandinstructions;assistedinmainframecomputerprogrammingissues.Staffalsostudied,reportedon,andcontinuedresearchingotherelectronic/computerizedmethodstoimproveapplicationprocessing.

LawsandRulesReviewCommitteeReport11

ARELLO National Disciplinary Action Data Bank – StaffcontinuedparticipationintheARELLONationalDisciplinaryActionDataBanktoassistinthebackgroundreviewofapplicantsandconsumerprotectioneffortsinotherjurisdictions.

Case Law Review Program – TheCommissionmonitored,collected,andreportedoncaselaw,disciplinaryactions,judgmentsanddecisionsonHawaiicourtcases,federalcourtcases,andotherStates’courtcases;materialcasestobeconsideredfortheRealEstateBulletinandthewebsite.

Rule Making, Chapter 53, Fees – TheCommissionmonitored,reviewed,researched,andmaderecommendationsonruleamendmentsforfeesthroughcoordinationwiththeLicensingAdministrator.

Commissioners Education Program – StaffresearchedandprovidedreferencematerialstoCommissionersandconductedperiodicworkshopsforallCommissioners.CommissionerGendranoparticipatedinARELLO’sCommissionerCollege.

Division and Department Programs – TheCommissioncoordinatedandworkedwithPVLD,DCCA,andothersonprogramsofmutualconcern,jointprogramwithERCandCRC.

HUD/ARELLO Fair Housing Agreement – TheCommissionadministeredthetermsoftheagreementandcoordinatedanyreviewbyHUDofficials,participatedwithARELLO’sFairHousingCommittee,andworkedwithARELLOonthetermsoftheagreement.

FY2010PROGRAMOFWORKLaws and Rules Review Committee

RealEstateRecoveryFundRealEstateLicensing,Registration,&CertificationAdministrationCondominiumHotelOperatorRegistrationAdvice,Education,andReferralRuleMaking,Chapter99SubcommitteesMeetingsLicensingRenewalLegislativeandGovernmentParticipationInteractiveParticipationwithOrganizationsLegislativeActsandResolutionsNeighborIslandOutreachReviewofServicesandOrganizationApplicationProcessingandFormsARELLONationalDisciplinaryActionDataBankCaseLawReviewProgramRuleMaking,Chapter53,FeesCommissionersEducationProgramDivisionandDepartmentProgramsHUD/ARELLOFairHousingAgreement

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No. of Licensees 27 38 27 38 23 12 25 35 36 37 22

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No. of Licensees Disciplined - By CategoryGeneral Brokerage 10Property Management 3DUI Conviction 1Other 4Failure to Adhere to Law 1Taxes 3

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Licenses Revoked 9Licenses Suspended 6Licenses Fined 18

Total fines $65,500Licenses Subject to Other Sanctions 5

FY 2009 Administrative Actions

12 AdministrativeActions

ADMINISTRATIVEACTIONSTable1.AdministrativeActions Disciplinary Actions

TheCommissiontookdisciplinaryactionagainst22licenseesinFY2009.Thiswasa40.5%decreaseoverthe3�licenseesdisciplinedinFY2008.Chart3provideshistoricalinformationonthenumberoflicenseesdisciplined.

Finestotaling$65,500wereassessedagainst18ofthelicensees.Ninelicenseeshadtheirlicensesrevoked.Table1andChart4providedetailsondisciplinaryactionsandChart5showsthedistributionbythetypeofrealestateactivityinvolvedinthecase.Ofnote,thenumberoflicenseesfinedin2009,totalling18,decreased4�.1%comparedtolastyear’stotalof34.

CHART3.DisciplinaryActions(FY1999-2009)

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Licenses Revoked 8 8 4 7 6 4 6 4 7 7 9

Licenses Suspended 2 0 1 3 0 1 0 1 2 0 6

Licenses Fined 19 29 26 23 20 6 21 33 42 34 18

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Other18%

DUI Conviction5%

Property Management14%

General Brokerage44%

Failure to Adhere to Law5%

Taxes14%

AdministrativeActions13

CHART4.AdministrativeActions-Sanctions(FY1999-2009)

CHART5.DisciplinaryActionsByActivity(FY2009)

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14 RegulatedIndustriesComplaintsOffice(RICO)

REGULATEDINDUSTRIESCOMPLAINTSOFFICE(RICO)

CHART6.RICOComplaints(RealEstateFY1999-2009)

RICOreceives,investigatesandprosecutescomplaintsagainstrealestatelicenseesforviolationsoflawsandrules.Complaintshavefluctuatedoverthepasttenyearswitha5�%increasein2009.RICOreceived168realestatecomplaintsinFY2009,comparedto10�inFY2008.RefertoChart6.

Onehundredandfiftyoneofthecomplaintsarepending,while1�havebeenclosed.Oftheclosedcomplaints,therewasinsufficientevidenceintwocases,warningletterswereissuedinsixcases,fourcaseswereresolved,intwocaseslegalactionwastaken,inonecasethecomplaintwaswithdrawn,inonecasetherewasnoviolationfound,andinonecasetheywereunabletoproceed.

Charts�and8showthenumberofcasesinwhichspecificprovisionofthelaworrulewereviolatedorallegedtobeviolated.TheallegationsarebasedonRICOcomplaints.

Theviolationsfoundoradmittedshowthenumberofdisciplinaryactioncasesinwhichthelicensee(s)admittedorthehearingsofficerfoundaviolationofaspecificruleorlaw.Indisciplinaryactionsthatareconcludedbysettlementagreement,thereoftenisnoadmissionofviolations.§16-99-3(i) Thebrokeragefirmshallnotsubmitoradver-

tisepropertywithoutwrittenauthorization,and

RegulatedIndustriesComplaintsOffice(RICO)15

Chart7.StatutoryViolations(HRSCh.467and436B)

Chart8.RulesViolations(Chapter99,HAR)

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StatutoryViolations(HRSCh.467and436B)

RulesViolations(Chapter99,HAR)

§46�-1.6Principalbrokershallhavedirectmanagementandsupervisionofthefirmanditslicensees.

§46�-� Licensesrequiredtoactasarealestatebrokerorsalesperson.

§46�-8 Prerequisitesforlicense,registration,orcertifi-cate.

§46�-11.5(c) Nolicenseshallberenewedifthelicensetradename,partnership,orcorporationisnotcurrentlyregisteredwiththedepartmentofcommerceandconsumeraffairs.

§46�-12 Placeofbusinessandpostingoflicense.§46�-13 Licenseeshalldeliveracopyoftheagreementor

contracttothepartiessigningitatthetimethesignatureisobtained.

§46�-14(1) Makinganymisrepresentationconcerninganyrealestatetransaction.

§46�-14(2) Makinganyfalsepromisesconcerninganyrealestatetransactionofacharacterlikelytomisleadanother.

§46�-14(3) Pursuingacontinuedandflagrantcourseofmis-representation.

§46�-14(4) Withoutfirsthavingobtainedthewrittenconsenttodosoofbothpartiesinvolvedinanyrealestatetransaction,actingforboththepartiesinconnec-tionwiththetransaction,orcollectingorattempt-ingtocollectcommissionsorothercompensationforthelicenseesservicesfrombothoftheparties.

§46�-14(5) Acceptanceofanycommissionorothercom-pensationfortheperformanceofanyoftheactsenumeratedinthedefinitionsetforthinsection46�-1ofrealestatesalespersonfromanypersonotherthantherealestatesalesperson’semployerortherealestatebrokerwithwhomtherealestatesalespersonassociatesor,beingarealestatebro-kerorsalesperson,compensatesonenotlicensedunderChapter46�toperformanysuchact.

§46�-14(6) Salespersonactingorattemptstoactasarealestatebrokerorrepresentsorattemptstorep-resentanyrealestatebrokerotherthantheoneemployedorassociatedwith.

§46�-14(�) Failingtoaccountformoneysbelongingtooth-ers.

§46�-14(8) Conductconstitutingfraudulentordishonestdealings.

§46�-14(10) Permittingacorporateofficeroremployeewhodoesnotholdarealestatebroker’slicensetohavedirectmanagementofthebrokeragebusi-ness.

§46�-14(12) Failingtoobtainonthecontractbetweenthepar-tiestotherealestatetransactionconfirmationofwhotherealestatebrokerrepresents.

§46�-14(13) Violatingthischapter,chapters484,514A,514B,514E,or515,orsection516-�1,ortherulesadoptedpursuantthereto.

§46�-14(15) Comminglingthemoneyorotherpropertyofthelicensee’sprincipalwiththelicensee’sown.

§46�-14(16) Convertingotherpeople’smoneystothelicens-eesownuse.

§46�-14(20) Failuretomaintainareputationfororrecordofcompetency,honesty,truthfulness,financialintegrity,andfairdealing.

§46�-1� Additionalpaymentstofunds.§46�-20 Falsestatement.

§46�-30(b) Allcondominiumhoteloperatorsshallregisterwiththecommissionasasoleproprietor,partner-ship,limitedliabilitycompany,orcorporationandshall...

§436B-12 CriminalConviction.§436B-13 RenewalofLicense.§436B-16 Noticeofjudgments,penalties.§436B-18 Disciplinaryaction.§436B-19 Groundsforrefusaltorenew,reinstateorrestore

andforrevocation,suspension,denial,orcondi-tionoflicenses.

§436B-19(1) Failuretomeetormaintaintheconditionsandrequirementsnecessarytoqualifyforthegrantingofalicense.

§436B-19(2) Engaginginfalse,fraudulent,ordeceptiveadvertising,ormakinguntruthfulorimprobablestatements.

§436B-19(5) Procuringalicensethroughfraud,misrepresenta-tion,ordeceit.

§436B-19(6) Aidingandabettinganunlicensedpersontodirectlyorindirectlyperformactivitiesrequiringalicense.

§436B-19(�) Professionalmisconduct,incompetence,grossnegligence,ormanifestincapacityinthepracticeofthelicensedprofessionorvocation.

§436B-19(8) Failuretomaintainarecordorhistoryofcompe-tency,trustworthiness,fairdealing,andfinancialintegrity.

§436B-19(9) Conductorpracticecontrarytorecognizedstandardsofethicsforthelicensedprofessionorvocation.

§436B-19(12)Failuretocomply,observe,oradheretoanylawinamannersuchthatthelicensingauthoritydeemstheapplicantorholdertobeanunfitorimproperpersontoholdalicense.

§436B-19(14)Criminalconviction.§436B-19(15)Failuretoreportdisciplinaryactionwithinthirty

daysofthedisciplinarydecision.§436B-19(16)Employing,utilizing,orattemptingtoemployor

utilizeatanytimeanypersonnotlicensedunderthelicensinglawswherelicensureisrequired.

§436B-19(1�)ViolationsofChapter46�,HRS,oranyotherruleororderofthelicensingauthority.

§436B-2� Civilandcriminalsanctionsforunlicensedactiv-ity;fines;injunctiverelief;damages;forfeiture.

§16-99-2Definitions.§16-99-3 Conduct.§16-99-3(a) Licenseeshallfullyprotectthegeneralpublicin

itsrealestatetransactions.§16-99-3(b) Licenseeshallprotectthepublicagainstfraud,

misrepresentation,orunethicalpracticesintherealestatefield.

§16-99-3(f) Licenseeshallseethatfinancialobligationsandcommitmentsareinwriting.

§16-99-3(g) Licenseeshallnotacquirepropertywithoutmakingthetruepositionknowninwritingtotheowner.

RegulatedIndustriesComplaintsOffice(RICO)1�

inanyofferingthepricequotedshallnotbeotherthanthatagreeduponwiththeownerastheoffer-ingprice.

§16-99-3(l) Alicenseeshallnotplaceanysignoradvertise-mentindicatingapropertyisforsale,rent,lease,orexchangewithoutthewrittenauthorizationoftheownerorsellerandapprovaloftheprincipalbrokerorbrokerincharge.

§16-99-3(m) Aprincipalbrokerorbrokerinchargeshallbeimmediatelyresponsiblefortherealestateopera-tionsconductedattheplaceofbusiness.

§16-99-3(n) AbrokeragefirmshallmaintainaprincipalplaceofbusinesslocatedinthisStateatabusinessaddressregisteredwiththecommissionfromwhichthebrokeragefirmconductsbusinessandwherethebrokeragefirm’sbooksandrecordsaremaintained.

§16-99-3(o) Priortothetimetheprincipalbrokerorthebrokerinchargeisabsentfromtheprincipalplaceofbusinessformorethanthirtycalendardays,andnootherbrokerinchargeisregisteredwiththeprincipalplaceofbusiness,theprincipalbrokershallsubmittothecommissionasigned,writtennotificationoftheabsencedesignatingatemporaryprincipalbrokerortemporarybrokerincharge,whoshallacknowledgethetemporarydesignationbysigningthenotification.Prolongedillnessordeathwheretheprincipalbrokerorbro-kerinchargeisunabletoact,anotherbrokershallbedesignatedasthetemporaryprincipalbrokerorbrokerinchargewithin30daysoftheillnessordeathwithappropriatenotificationtothecom-mission.Atemporaryprincipalbrokerorbrokerinchargearrangementshallnotexceedaperiodofsixmonths,withtherighttoextendpriortoexpirationforanothersixmonthsforgoodcauseandwiththeapprovalofthecommission.

§16-99-3(p) Licenseeshallnotactasabroker,broker-sales-person,orsalespersonformorethanonebroker-agefirmexceptthatthissubsectionshallnotapplytothosesituationsasdescribedinsubsec-tion(o).

§16-99-3(u) Thelicenseeshallnotaddormodifythetermsofapartytoatransactionwithoutwrittenconsentof

alltheparties.§16-99-3(v) Thelicenseeshallnotconvertotherpeople’s

moneytothelicensee’sownuse.§16-99-3.1(c)(1)Ifthelicenseeactingasthelistingbrokerage

firmisactingaloneandprovidingservicestothebuyer,thelicenseeshalldisclosewhothelicenseerepresentsinthetransaction.

§16-99-3.1(e) Anydisclosurerequired...shallbeconfirmedinwritinginaseparateparagraphtitled“AGENCYDISCLOSURE”....

§16-99-4(g) Receivedpropertytobeheldintrustforthebenefitofthedepositor,andorforthebenefitofthirdpersons,shallbereceivedonbehalfofthesalesperson’sorbroker-salesperson’sprincipalbrokerorbrokerincharge,andshallbedeliveredimmediatelybythenextbusinessdayafterre-ceipttothesalesperson’sorbroker-salesperson’s

principalbrokerorbrokerincharge,unlessthesalespersonandbroker-salespersonisinstructedastoanothertimeinwritingbythedepositor.

§16-99-4(i) Asalesperson,broker-salesperson,oremployeeshallnothandletrustpropertiesinanywaywithouttheexpresswrittenauthorizationoftheperson’sprincipalbrokerorbrokerincharge.

§16-99-4(l) Informationaboutescrowaccountsandrecordsforrealestatetransactionsundertherealestatebrokeragefirmshallberetainedforatleastthreeyears,subjecttoinspectionbythecommissionoritsrepresentativeattheplaceofbusiness.

§16-99-5 Notificationandfilingofnames,addresses,andchanges.

§16-99-5.1 Involuntaryinactivelicensestatus.§16-99-5.2 Statewidelicense.§16-99-11(a) Advertisements.§16-99-11(c) Disclosureoflicensee’sstatus(active/inactive)in

alladvertisingandpromotionalmaterial.§16-99-11(e) Licensee’sname-advertisingandpromotions.§16-99-11(f) Iftheaddressofanyunregisteredplaceofbusi-

nessisincludedinadvertisingmaterials,thenthestreetaddressoftheprincipalplaceofbusinessorthebranchoffice,asthecasemaybe,shallbeincludedandrespectivelyidentifiedassuch.

§16-99-19(a)(2)Allapplicationsforarealestatesalespersonorbrokerlicenseshallbeaccompaniedbysupport-ingdocumentstosatisfytheapplicableeducationandexperiencerequirements.Applicationsnotaccompaniedbysupportingdocumentsshallberejected.Intheeventanapplicanthasnotsatisfiedtheapplicableeducationandexperiencerequirements,theapplicant’sexaminationscoreshallbedeclaredvoidandlicenseapplicationrejected.

§16-99-25 Thecommissionmaydenyanapplicantadmis-siontotheexamination,orissuanceoflicense,voidapplicant’sexaminationscore,orrevokealicenseonthegroundoffalsificationofanyinformationsuppliedintheapplicationforex-amination,applicationforexperiencecertificate,applicationforlicense,orsupportingdocuments.

§16-99-8� Definitions.§16-99-112(a)(2)Eachstudentshallincludeproofofactual

courseattendanceincludingaverifiedsign-inandsign-outattendancesheetorastudentcertifica-tionstatementinthecaseofacontinuingeduca-tioncourseofferedbyalternativedeliverymeth-odswithinteractiveinstructionaltechniques.Thesign-inandsign-outsheetmaybekeptinanotherlocationotherthanthestudent’srecord,providedthatreferencetosuchlocationshallbemadeineachstudent’srecord.Thename,address,andphonenumberoftheindividualwhoverifiedthestudent’sattendanceshallalsobenotedinthestudent’srecord.

18 EducationReviewCommitteeReport

EDUCATIONREVIEWCOMMITTEE(ERC)REPORT

Table2.RealEstateLicensingExamination

Specialists’ Office for the Day – TheSpecial-ists’OfficefortheDayprovidesstaffwithanopportunitytomeetinpersonwithlicensees,applicants,prospectivelicensees,andmembersofthepublic.AnadditionalbenefitwhenthesessionsareheldatthelocalBoardofREAL-TORS®’officesistheopportunitytoexchangeinformationwiththestaffandmembershipofthelocalBoards.Infiscalyear2009,realestatespecialistsvisitedKauaionAugust13,2008;HiloonNovember12,2008;andMauionJanu-ary�,2009.

Neighbor Island Outreach – TheCommis-sionconvenesitsstandingcommitteemeetingsonaneighborislandtwotothreetimesayear.ThecommitteesmetonKauaionAugust13,2008;HiloonNovember12,2008;andMauionJanuary�,2009.Themeetingsaffordedneigh-borislandlicensees,governmentofficials,andinterestedpartiesanopportunitytoattendandparticipateinthecommitteemeetings.

Instructor’s Development Workshop – TheCommissioncontractedwiththeHawaiiAssociationofREALTORS®toco-sponsoranInstructor’sDevelopmentWorkshop(IDW)dur-ingthe200�-2008biennium.InAugust2008,Mr.DouglasDeVitrepresentedanIDWontechnologyandhowitenhancesliveclassroompresentations,entitled“MakingMagicwithMicrosoftPowerPoint200�.”

Continuing Education (CE) – Duringthefiscalyear,therewere193approvedCEcourses,anincreasefromthe39approvedCEcoursesinthepreviousfiscalyear.Sixteenofthecourseswerenationalcourses.Therewere39CEproviders.CEprovidersoffered1,098classesto35,501participants,ascomparedtothepreviousfiscalyearof1,151classesofferedto14,223partici-pants.

Real Estate Licensing Examination –Pear-sonVUEcontinuedofferingtestingfivedaysaweekinHonolulu,twiceamonthinKahuluiandonKauai,andonaspaceavailablebasisatParkerSchoolinKamuelaontheBigIsland.AsshowninTable2andChart9,thenumberofexaminationcandidatesdecreased38.6%overthelastfiscalyear.StaffperiodicallymonitorstheexaminationadministrationoneachislandtoassurefacilitiesandprocedurescomplywithPearsonVUEandCommissionpolicies.

Therewere2�3applicationsapprovedforequivalencytotheuniformsectionoftheexami-nation,tocandidateslicensedinanotherstatewhopassedthatstate’suniformsectionoftheexamination.Thisrepresentsa32.�6%decreasefromthelastfiscalyear’stotalof406approvals.

Interactive Participation with Other Organi-zations – TheCommissioncontinueditspartici-pationineventssponsoredbylocalandnationalorganizations.Commissionersandstaffpar-ticipatedinanumberofeventswiththeHawaiiAssociationofREALTORS®,theKauaiBoardofREALTORS®,theREALTORS®Associa-

TheERC,forfiscalyear2009,undertheleadershipofChairCarolMaeBallandViceChairAnnetteAiona,continuedtoaddressimportantandvariededucationissues.

FY2009PROGRAMOFWORK

FY 2008 FY 2009 % ChangeBrokers Tested 735 583 -20.7%Salespersons Tested 2884 1638 -43.2% Total Tested 3619 2221 -38.6%

Brokers Passed 242 186 -23.1%Salespersons Passed 1545 910 -41.1% Total Passed 1787 1096 -38.7%

% Brokers Pass 32.9% 31.9%% Salespersons Pass 53.6% 55.6%

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

0

1,000

2,000

3,000

4,000

5,000

6,000

No

. of

Can

did

ates

Fiscal Year

Brokers Salespersons Total

Brokers 187 224 304 269 409 516 1,022 714 957 735 583

Salespersons 1,082 1,504 1,744 2,158 3,012 3,458 4,283 4,838 3,306 2,884 1,638

Total 1,269 1,728 2,048 2,427 3,421 3,974 5,305 5,552 4,263 3,619 2221

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

EducationReviewCommitteeReport19

CHART9.LicensingExaminationCandidates(FY1999-2009)

tionofMaui,theHawaiiIslandBoardofREAL-TORS®,andtheKonaBoardofREALTORS®.Onanationallevel,theCommissioncontinueditsactiveparticipationwiththeAssociationofRealEstateLicenseLawOfficials(ARELLO),theRealEstateEducatorsAssociation(REEA),andtheNationalAssociationofREALTORS®(NAR).Participationinnationalorganizationsoffersanopportunitytolearnaboutthelatestissues,trends,andsolutionsintheindustry,andinotherjurisdictions.

Advice, Education, and Referral – Staffcontinuedtofieldanenormousnumberoftelephone,walk-in,writteninquiries,faxes,andemails.Forrealestate,thefiscalyearproduced14,5�9telephoneinquiries,436walk-ininqui-ries,12,910writteninquiries/writtenrequests/faxes,and14,950emails.SeeChart10.Website Hits – TheCommission’swebsite,

www.hawaii.gov/hirec,isavailablesevendaysaweek24hourseachdayforinformation,forms,andapplications.Thewebsitehasprovidedwellover2�0,220realestateandcondominiumrelatedhits.DuetoachangeintheprogramadoptedbytheStateInformationSystemsandCommunicationsOffice,somepreviouslycol-lectedwebstatsarenolongeravailable.SeeChart11

Publications – TheCommissioncontinuedtopublishtheHawaiiRealEstateBulletininatraditionalnewsletterformatthatwasmailedtoallcurrentlicensees,legislators,governmentof-ficials,ARELLOjurisdictions,andotherinter-estedparties.ItwasalsoavailableinelectronicformatontheCommission’swebsiteatwww.hawaii.gov/hirec.

(continued on page 21)

0

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

900,000

No. o

f Hits

Hits 774,640 679,159 296,279 319,232 108,704 270,220

FY 04 FY 05 FY 06 FY 07 FY 08* FY 09

*WebstatsavailablefortheperiodofJanuary11throughJune30,2008only


CHART10.InquiriesandApplications(FY2001-2009)

2001 2002 2003 2004 2005 2006 2007 2008 2009

0

10,000

20,000

30,000

40,000

50,000

60,000

No.

of R

eque

sts

Fiscal Year

E-mail 1,052 3,889 4,695 7,499 8,886 13,193 12,648 14,950

Walk-ins 2,241 2,185 1,417 768 904 807 996 594 436

Applications / written requests 12,068 11,343 14,753 15,137 17,574 17,439 18,985 17,037 12,910

Telephone calls 26,295 20,184 18,864 15,050 19,738 16,478 20,995 14,999 14,576

Total 40,604 34,764 38,923 35,650 45,715 43,610 54,169 45,278 42,872

2001 2002 2003 2004 2005 2006 2007 2008 2009

CHART11.WebsiteHits


TheCommissionalsopublishedaquarterlynewsletter,SchoolFiles,exclusivelyfortherealestateeducationcommunity.Itprovidedschools,instructors,andcontinuingeducationprovidersinformationonadministrativepro-cedures,changesinlicensinglaws,andotherarticlesrelevanttothedeliveryofrealestateeducation.AswiththeBulletin,SchoolFileswaspublishedinprintandinelectronicformat.

IncontrasttotheBulletinandSchoolFiles,theCommission’sAnnualReportisprimarilyanelectronicpublication.AlimitednumberofprintedcopiesweredistributedtotheLegisla-tureandtotheGovernor.InterestedlicenseesandmembersofthepubliccoulddownloadandprintthereportfromtheCommission’swebsite.

Continuing Education Core Course – TheCommissionresearchedanddevelopeditscorecourseonlawupdate,rulesupdate,andagencyanddisclosuresforthelicensingbienniumandprovidedrecommendationsonthefutureofthecorecourse.Thenewformatforthecorecoursewascarriedforwardfromthepriorfiscalyear,offeringthecorecourseintwo,2-hourpartsforthebiennium.Thistwo-partformatprovidedatimelyupdateofthatyear’slegislationrelevanttorealestatelicensees.

Salesperson Curriculum and Resources – Thesalesperson’scurriculumcontinuedtobeofferedinbothaliveclassroomandonlineformat.

Broker Curriculum and Resources – Thebroker’scurriculumcontinuedtobeofferedinbothaliveclassroomandonlineformat.

Advice, Education, and Referral – Staffcon-tinuedtoprovideadvice,education,andreferraltoapplicants,licensees,governmentofficials,consumers,public,organizations,includingtheresearch,reproductionofmaterialsandmail-ings.Itdevelopedadistributionsystemofeducationalandinformationalproductsforeachprincipalbrokerandbroker-in-charge.Staffalsopublishedanddistributededucationaland

informationalmaterialsandprovidededucation-almaterialthroughtheCommission’swebsite.

Administration of Prelicense EducationProgram, Schools and Instructors –TheCom-missionprovidedadministrativereviewandanapprovalprocessforapplications,disseminatedinformationregardingrenewalsandcertifica-tion,andprovidedappropriaterecordsmanage-ment.Itcoordinatedtheinstructor’sexamina-tionprogramwithitstestadministrator,PearsonVUE,andadministeredanevaluationsystemofschoolsandinstructors.Staffresearched,developed,printed,anddistributedthequarterlySchoolFiles,abulletinforeducators.ThiswasajointprogramwiththeContinuingEducationProgram.

Administration of Examinations – TheCom-missionadministeredtherealestatelicensingexaminationprogram,includingcontractad-ministrationwithitstestadministratorPearsonVUE,providedinformationregardingtheexamprocess,reviewedamendmentstotestcandidatebooklets,evaluatedperiodicexaminationreportsandkeptabreastofdailyexams.TheCommis-sion,alongwithPearsonVUE,conductedaTestDevelopmentWorkshopandanEducatorsForuminSeptember2008.InMay2009,theCommissionenteredintoacontractwithanewtestadministrator,PSI.PSI,basedinCalifornia,conductedaTestDevelopmentWorkshopandEducatorsForuminJune2009.

Administration of Continuing Education Pro-gram, Providers, and Instructors – TheCommissionadministeredthecontinuingeduca-tionprogramincludingtheregistrationofpro-viders,certificationofcoursesandinstructors,andprovidedtimelyinformationandrecordsmanagement,asappropriate.Itresearched,developed,printed,anddistributedthequar-terlySchoolFiles,abulletinforeducators.Staffdeveloped,printed,anddistributedcontinuingeducationcourseschedules.


Administration of Continuing Education Elective Courses – TheCommissionprovidedadministrativeinformationtoelectivecourseprovidersandlicensees,assistedprovidersinsubmissions,reviewedsubmittedapplications,reviewedsubmittedcurriculum,maderecom-mendations,andassistedwithrecordsmanage-ment.InAugust2008,staffimplementedanOnlineContinuingEducation(CE)SystemwhichprovidedrealestatelicenseeswiththeabilitytoviewthenumberofCEhoursrequiredandearnedforthecurrentlicensingperiod,theirCEhistory,andtheabilitytosearchforfutureCEcoursesbeingofferedbyapprovedCEpro-viders.Realestatelicenseeswerealsoabletoaccessandreprinttheirowncoursecompletioncertificatesforthecurrentandpreviousbienni-ums,whereas,formerlythiswasdonebytheCEproviders.Additionally,realestateprincipalbro-kersandbrokers-in-chargewereabletomonitorandviewthecurrentCEhours,CEhistory,andlicensestatusofalllicenseesassociatedwiththebrokerage.Thesystemwasupdateddaily.

Education Evaluation Task Force (EETF) – TheCommission’sEETFreviewed,recommended,assistedindevelopment,updates,andadministrationofeducation-relatedprojectsandcontinuingeducation.TheEETFconductedfourmeetingsduringthefiscalyear:Septem-ber2008,February,April,andMay,2009.TheEETFassistedinthedevelopmentoftheCom-mission’s2009-2010CoreCourse,PartA.

Meetings and Symposium – TheCommission,withstaffsupport,planned,coordinated,andconductedmonthlyEducationReviewCommit-teemeetings.

Annual Report and Quarterly Bulletin – Staffresearched,developedanddistributedtheCommission’sAnnualReport.Staffresearched,edited,printed,anddistributedthequarterlyRealEstateBulletin;andcontinuedcontractadministrationwithconsultantandprocurementcodemanagement.

Real Estate Education Fund (REEF) – TheCommissionmaintainedandreviewedthebudget,finance,andrecordsforREEF;preparedquarterlyandannualfinancialstatements;pre-paredannualandbiennialbudgets;andadmin-isteredfundinvestmentprograms,includingcontractadministrationandprocurementcodemanagement.

Neighbor Island Outreach – TheCommissionheldthreeERCmeetingsonneighborislandsitesonKauaiinAugust2008;HiloinNovem-ber2008;andonMauiinJanuary,2009.

Interactive Participation with Organizations – TheCommissionactivelyparticipatedwithlocal,PacificRim,nationalandinternationalorganizationsandgovernmentagenciesfortheexchangeofinformationandconcerns,sharingofeducationalandresearchefforts,jointprojectsofmutualconcern,andtraining.

Real Estate Seminars – TheCommissioncon-tractedwiththeHawaiiAssociationofREAL-TORS®toprovideastatewideseminarduringthe200�-2008bienniumforrealestatelicens-eesand/orconsumersthroughacontractor,viasubsidy,sponsoring,assisting,orco-sponsoring.MarcieRoggowwasthepresenterinastatewiderealestateseminaron“RiskManagementforResidentialSpecialists”whichtookplaceonOctober20-24,2008.Theseminarwaspre-sentedinWaikoloa,Honolulu,Kauai,Maui,andHilo.

Legislative Participation, Research, and Report – TheCommissionresearched,partici-pated,andreportedonrequestsbytheLegis-lature,includingresolutions,agreements,andissuesofmutualconcern.

Instructor’s Development Workshop – TheCommissiondeveloped,sponsored,coordinated,and/orproducedinstructordevelopmentwork-shopsforprelicensinginstructorstomeetrulerequirements.ItcontractedwiththeHawaii


AssociationofREALTORS®todevelopandpresentaninstructor’sdevelopmentworkshopinthe200�-2008biennium.InAugust2008,Mr.DouglasDeVitrepresented“MakingMagicwithMicrosoftPowerPoint200�”astheIDW.

Evaluation and Education System for CE and Prelicensing Instructors, Courses, Providers, and Schools – TheCommissionadministeredanevaluationsystemofprelicensingandcon-tinuingeducationinstructors.

Real Estate Specialist Office for the Day – Withadvancedpublicity,mail-outs,andappointments,RealEstateSpecialistssetupofficeatRICO neighborislandofficesandothermeetingsitestoprovideadvice,education,andreferrals.Uponrequest,SpecialistsprovidedtrainingtoRICOinvestigators.

Real Estate Speakership Program – SubjecttoStategovernmentapprovalsandpriorities,theCommission,alongwithstaff,honoredrequeststoprovideaspeaker,resourceperson,orbeanactiveparticipantinfunctionsrelatedtorealestateeducation.

Prelicensing Education Equivalency Adminis-tration – TheCommissionadministeredappli-cationsforprelicensingeducationequivalencies,includingconsultationwithARELLO.

Uniform Section Equivalency of Prelicensing Examination – TheCommissionadministeredapplicationsontheequivalencytotheuniformpartoftheexambasedonpassageoftheuni-formpartofanotherstate’sexam.

New Technology Program and Real Estate Commission Website – Staffadministeredanin-housenetworkcomputersystemincoordina-tionwithDCCA’sInformationSystemscoordi-nator.Staffalsoconductedin-housetraining,coordinatedthepurchaseofcomputerhardwareandsoftware,anddevelopeddatabaseprogram-ming.

Records Management – Staffevaluated,planned,reorganized,andimplementedacen-tralized,consistent,userfriendly,computerizedglossaryofexistingandfuturerecordsandfiles.

Information Distribution System – Staffre-searched,developed,andimplementedacentral-izedinformationdistributionsystemforalltheeducationproductsproducedbytheCommis-sion.Staffstandardizedpoliciesandproceduresfordistribution,purchasing,copyright,specificpermissioncopyingorgenericpermissioncopy-ingofbrochures,reports,andvideotapes.

New Salesperson and New Broker Start-up Kits – Staffpackagedanddistributedstart-upkitstonewlylicensedsalespersonsandbrokers.

Cooperative Education, Research, and Ad-ministration Program – TheCommissionactivelyparticipatedandsponsoredcooperativeeducation,research,andadministrativepro-gramsforthoseindividuals,branches,divi-sions,departmentpersonnel,andtheAttorneyGeneral’sOfficethatprovideddirectorindirectservicestotheCommissionorwerepartofarealestate-relatedprogram.

Division and Department Programs – TheCommissioncoordinatedactivitiesandpro-gramsofmutualconcernwithPVLDandDCCA.

Staff and Commissioners Development – StaffdevelopedandtrainedstaffandCommissionersforbetteradministrationoftherealestatepro-grams.Commissioners,aswellasstaff,partici-patedintrainingandeducationalopportunitiesprovidedbyREEA,ARELLO,CAI,CLEAR,andotherorganizations.

Real Estate Reference Library – TheCom-missionsubscribedandpurchasedrealestatereferencematerialsforpublicreview.

0

500

1000

1500

2000

2500

Broker (Corp, Part, LLC)Broker (Individual)Salesperson

Broker (Corp, Part, LLC) 58 61 81 88 126 106 130 131 132 119 116

Broker (Individual) 92 78 107 138 128 201 344 214 294 232 211

Salesperson 651 971 968 1111 1278 1887 2148 2244 1672 1559 863

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009


Licensees

New Licenses

ThenumberofnewlicensesissuedinFY2009decreased3�.�%overthepriorfiscalyear.DuringFY2009,1,190newlicenseswereissued.Individualbrokerlicensesdecreasedby9%,newsalespersonlicensesdecreasedby44.6%,andnewentitylicensesdecreasedby2.5%.RefertoChart12.

Current Licenses

Theoverallnumberofcurrentrealestatelicensesdecreased14.5%bytheendofFY2009.InFY2009,activelicensesdecreased11.8%overlastyear,whileinactivelicensesdecreased20.1%.Therewasa1�.5%decreaseofactivelicensesonMaui,a15.4%decreaseonKauai,a13.8%decreaseonHawaii,a9.3%decreaseonOahu,anda6.1%decreaseonMolokai.TherewasnochangeontheislandofLanai.RefertoTable3,Charts13and14.

CHART12.NewRealEstateLicensesIssued

Maui15.74%

Hawaii13.28%

Oahu58.10%

Kauai7.26%

Mainland/Foreign5.30%

Molokai0.24%

Lanai0.08%

Oahu Hawaii Maui Kauai Molokai Lanai Other TotalActive

Broker 1,856 471 459 206 12 3 54 3,061Salesperson 4,638 964 1,211 548 23 5 122 7,511Sole Proprietor 736 150 101 66 5 1 2 1,061Corporation, Partnership, LLC 937 225 238 99 6 3 1 1,509

Total Active 8,167 1,810 2,009 919 46 12 179 13,142

Inactive

Broker 269 54 44 24 0 0 183 574Salesperson 2,628 551 746 385 5 5 605 4,925Corporation, Partnership, LLC 32 11 12 4 0 0 7 66

Total Inactive 2,929 616 802 413 5 5 795 5,565

Active and Inactive

Broker 2,125 525 503 230 12 3 237 3,635Salesperson 7,266 1,515 1,957 933 28 10 727 12,436Sole Proprietor 736 150 101 66 5 1 2 1,061Corporation, Partnership, LLC 969 236 250 103 6 3 8 1,575

Total 11,096 2,426 2,811 1,332 51 17 974 18,707


CHART13.RealEstateLicensees-ByIsland

Table3.CurrentRealEstateLicensees-ByLicenseTypeandIsland(July2009)

0

5,000

10,000

15,000

20,000

25,000

30,000

1978 1981 1984 1987 1990 1993 1996 1999 2002 2005 2008

End of Fiscal Year

No.

of L

icen

sees

Corp/Part/LLCBrokersSalespersons


FY2010PROGRAMOFWORKEducation Review Committee

ContinuingEducationCoreCourseSalespersonCurriculumandResourcesBrokerCurriculumandResourcesAdvice,Education,andReferralAdministrationofPrelicenseEducationProgram,Schools,andInstructorsAdministrationofExaminationsAdministrationofContinuingEducationProgram,Providers,andInstructorsAdministrationofContinuingEducationElectiveCoursesEducationEvaluationTaskForce(EETF)MeetingsandSymposiumAnnualReportandQuarterlyBulletinRealEstateEducationFund(REEF)NeighborIslandOutreachInteractiveParticipationwithOrganizationsRealEstateSeminarsLegislativeParticipation,Research,andReportInstructor’sDevelopmentWorkshop

•••••

••

•

••••••••

•

EvaluationandEducationSystemforContinuingEducationandPrelicensingInstructors,Courses,Providers,andSchoolsRealEstateSpecialistOfficefortheDayRealEstateSpeakershipProgramPrelicensingEducationEquivalencyAdministrationUniformSectionEquivalencyofPrelicensingExaminationTechnologyandWebsiteRecordsManagementInformationDistributionSystemNewSalespersonandNewBrokerStart-upKitsCooperativeEducation,Research,andAdministrationProgramDivisionandDepartmentProgramsStaffandCommissionersDevelopmentRealEstateReferenceLibrary

•

•••

•

••••

•

•••

CHART14.TotalRealEstateLicensees

CondominiumReviewCommitteeReport2�

CONDOMINIUMREVIEWCOMMITTEE(CRC)REPORT TheCRC,forfiscalyear2009,undertheleadershipofChairWilliamCheeandViceChairMarkSuisocontinuedwiththeimplementationchallengesofChapter514B,HawaiiRevisedStatutes(HRS),includingthechallengesofnewlegislation.Concurrently,inthissameperiod,theCommitteecontinuedwiththeadministrationoftheoriginalcondominiumlaw,Chapter514A,HRS,aswellasotherimportantplannedprogramofwork.

TheCRCisaCommissionstandingcommitteethatholdsmonthlypublicmeetingsinwhichcondominiumissuesarepresented,discussed,examined,andconsidered.Thisisaworkingcommitteethathandles“nutsandbolts”issues.Developers,apartmentowners,boardsofdirectors,condominiummanagingagents,attorneys,educators,researchers,governmentofficials,andotherswithcondo-miniumconcernsparticipateatthemeetings.TheresponsibilitiesoftheCRCinclude:registrationofcondominiumprojectsbydevelopers;condominiumassociationregistrations;andgovernance,educa-tionandresearchprograminclusiveoftheprograms,fundedundertheCondominiumEducationTrustFund(CETF).

ThelawallowstheCommissiontoexpendmoniesfromtheCETFforeducationalpurposeswhichincludefinancingorpromoting:

Educationandresearchinthefieldofcondominiummanagement,condominiumprojectreg-istration,andrealestate,forthebenefitofthepublicandthoserequiredtoberegisteredunderthischapter;Theimprovementandmoreefficientadministrationofassociations;andexpeditiousandinexpensiveproceduresforresolvingassociationdisputes.

TheCommissionmayuseanyandallmoniesintheCETFforpurposesconsistentwiththeabove.Additionally,thelawrequirestheCommissiontosubmittothelegislatureannuallyandhereinincorporatedis:(1)asummaryoftheprogramsfundedduringthepriorfiscalyearwithfundsfromtheCETF,(2)astatementofwhichprogramsweredirectedspecificallyattheeducationofcondominiumowners(bolded),(3)summaryinformationonprogramsthatwerefundedoraretobefundedandthetargetaudienceforeachprogram,(4)acopyofthebudgetforthecurrentfiscalyear,includingsum-maryinformationonprogramswhichwerefundedoraretobefunded,(5)theamountofmoneyinthefundduringthepriorfiscalyear,and(6)abudgetforthecurrentfiscalyearthatincludesalineitemreflectingthetotalamountcollectedfromcondominiumassociations.

Inaddition,thisyeartheCRCReportincludesanAddendumthatrespondstotwosimilar2009legislativeresolutions.SpecificallyHouseResolutionNo.128HD1requested“TheRealEstateCom-missionToConsiderAllowingDevelopersToSubmitCondominiumRegistrationFilingsInElectronicFormat,”andSenateResolutionNo.113SD1requested“TheRealEstateCommissionToAdoptAStrategicPlanToAllowCondominiumRegistrationFilingsInElectronicFormat.”

20012003

20052007

2009

0

5000

10000

15000

20000

25000

30000

Fiscal Year

Walk Ins Written Requests/Applications Emails Calls Total

Walk Ins 1235 1229 1395 1480 1473 1551 1388 1322 874

Written Requests/Applications 12481 12449 12217 9819 7027 9461 12535 11035 8566

Emails 1259 1819 1812 2487 2940 1890 2394

Calls 13947 11387 10971 9050 8064 8863 8157 7014 6459

Total 27663 27067 25842 22168 18376 22362 25020 21261 18293

2001 2002 2003 2004 2005 2006 2007 2008 2009

28 CondominiumReviewCommitteeReport

Chart15.CondominiumAdvice,Education,andReferral

FY2009PROGRAMOFWORKNOTE: Thetextthatisboldedareformattersthatweredirectedspecificallyattheeducationofcondominiumowners(althoughmanyothersalsobenefittedfromtheeducation).

Condominium Laws and Education–Con-currentlywiththeadministrationofChapter514A,HRS,theCommissionparticipatedinthelegislativeprocesstofinetuneChapter514B,HRS.Withthehelpofstakeholderorganiza-tionsandvolunteers,theCommissioncontinuedthedevelopmentandrefinementofappropriatenewandamendedforms(includingwebbasedonlinefillableforms),instructions,information-alsheets,proceduresandevaluativeprocesses,curriculum,materials,handouts,andpowerpointpresentationsforuseinstatewideeduca-tionalefforts.TheCommissioncontinuedwiththedevelopmentofstatewideadvertisinganddeliveryofCommission-subsidizedseminars.Thisfiscalyear’sthree-hourfreeseminaronChapter514B,HRS,andChapter514A,HRS,waspostponedwhiletheCommissionworked

onitsdevelopment.TheCommissionantici-patesitwillagainuseavolunteerfacultyofrepresentativesfromthecondominiumdevel-opmentandgovernancecommunity,includingattorneysandrealestateindustryrepresenta-tives,andCommissionstaffwhentheCommis-siondeliverstheCommission-developedthree-hourfreeseminar.Sucheducationaleffortsaretargetedtoinformandeducate condominium ownersandallothersthoseimpactedbythenewcondominiumlaw,includingboards,man-agingagents,residentmanagers,developers,realestatelicensees,theirrespectiveattorneys,prospectivecondominiumpurchasers,andthegeneralpublic.Concurrentbreakoutsessionswillcontinuetobeheldshouldthevariousstakeholdersindicateaneedforseparateeduca-tionalsessions.

TheCommitteeissuedteninformalnon-bind-inginterpretationsoftheprovisionsofChapter514B,HRS,ascomparedtosixinformalnon-bindinginterpretationsissuedlastfiscalyear

CondominiumReviewCommitteeReport29

Condominium Apartment Owners on the Commission

CommissionersLouis Abrams isamemberoftheRealEstateCommissionwhoisacondominiumowner/occupant.

ThefollowingmembersoftheRealEstateCommissionarecondominiumowners:

Carol Ball Annette Aiona Mark Suiso

andmadethemavailabletointerestedpartiesdirectlyandonlineattheCommission’swebsite.InimplementingChapter514B,HRS,theCom-mitteelooksforwardtothecontinuingsupportofthecondominiumgovernanceanddevelop-mentcommunities,attorneysspecializingincondominiumlaw,theHawaiiStateBarAssoci-ation-RealPropertySection,andtherealestateindustry.Tothesecommittedorganizationsandgroups,theCommissionextendsabigMahalo.

Advice, Education, and Referral–TheCom-missionrespondedandprovidedinformationandeducation to condominium ownersandotherinterestedmembersofthecondominiumcommunityincluding,developers,consumers,licensees,governmentofficials,organizations,interestedpartiesandthepublic,viatelephone,walk-ins,faxes,writtencorrespondence,emails,theCondominiumBulletinandthroughtheCommission’swebsite.SeeChart15.

Condominium Project and Developer’s Public Reports–Staffcontinuedtheimple-mentationandadministrationofthecondo-miniumprojectregistrationprogram,pursuanttoChapters514Aand514B,HRS.Withthehelpofstakeholderorganizations,volunteers,othergovernmentalagencies,andinterestedattorneys,theCommissioncontinueditsevaluationanddevelopmentof,whereappropriate,new processes,records,forms,informationdocu-mentsandrules.Staffcontinuedworkingwithprocuredconsultantstoassistwithcondomini-umproject-relatedtasks.Itcontinuedtomakedeveloper’spublicreportsavailableforpublicviewingandcopyingtodiscviatheCommis-sion’swebsite.TheCommissioncontinuedtostudyandresearchtheformulationofacompre-hensiveevaluationsystemontheprojectregis-trationandreviewprocess,includingtheuseofevaluationformsbydevelopersandattorneys.Staffcontinuedtoresearchandstudyaplanforelectronicadministration,includingthescan-ningofdocumentsonCDs.TheCommissioncontinueditsworkwithprocuringandcontract-ingwithcondominiumconsultantstoassistthe

Commissionwiththeadministrationofregis-teringcondominiumprojectsandissuanceofeffectivedatesfordeveloper’spublicreports,whichreportsarerequiredfortheconductofcondominiumunitsales.

Hawaii Condominium Bulletin–TheCom-missioncontinuedtheresearch,development,publicationanddistributionofaquarterlybulle-tintoallregisteredassociationsandcondomin-iummanagingagents(CMAs).ThebulletinswerealsoavailableontheCommission’sweb-sitefortheeducation of condominium owners, developers,realestatelicensees,consumersandthepublic.Staffcontinuedtheresearchandstudyofin-houseelectronicpublicationanddeliveryofthebulletin,andthepublicationofareferencefilewithvolunteerexpertscontribut-ingarticles.Staffcontinuedtheprocurementcodemanagementandadministrationofthecontractwithaconsultantassistingintheprint-ingofthebulletin.

Condominium Mediation and Arbitration Program–TheCommissioncontinuedtosubsidizemediationprogramsonfourislandsandworkedwithvariousmediationproviderstoprovide educational seminarsaboutalternativedisputeresolutionandmediationfor condomin-

0

5

10

15

20

25

30

35

Total Number of Requests

Mediation Center of the Pacific Inc. 11 28 9 16 4 10 33 21

Mediation Services of Maui Inc. 11 16 14 5 1 7 17 9

Kauai Economic Opportunity Inc. 2 3 3 1 0 0 1 2

Big Island Mediation Inc. dba West HawaiiMediation Services

0 0 0 2 1 5 0 2

Ku'ikahi Mediation Center 0 0 0 0 0 0 0 0

2002 2003 2004 2005 2006 2007 2008 2009


ium owners,boardsofdirectors,andCMAs.Staffcollectedstatisticalinformationforedu-cationandAnnualReportpurposes,includinginformationandstatisticsrelatingtomandatorymediationpursuanttoAct232(SLH2001).SeeChart16.

Condominium Dispute Resolution Pilot Pro-gram–StaffcontinuedtoassisttheAdministra-tiveHearingsOfficeineducationandawarenessprogramsregarding“condominiumcourt.”ThispilotprogramhasbeenextendedandnowwillendonJune30,2011.TheCommissionsup-portedlegislationclarifyingtheavailabilityofthisprogramtocondominiumunitownersandboardsforcondominiumscreatedpriortoJuly1,2006andthereafter.

Condominium Association Registration–TheCommissionadministeredthecondominiumas-sociationregistrationprogram,includingreview

ofsubmittedapplicationsandtheassessmentofCommissionregistrationpoliciesandproce-dures.Italsoconsideredappeals,subpoenas,andrequestsforrecordsunderOfficeofInfor-mationPractices(OIP)rulesandprocedures.TheCommissioncontinueditsbiennialcondo-miniumassociationregistration.Forthisnon-reregistrationyear,theCommissionprocessed28newcondominiumassociationregistrationsrepresenting2,618units,foratotalof1,629as-sociationsregisteredrepresenting153,856unitsforthebiennium(July1,200�–June30,2009).Inaddition,theCommissioncontinuedtheimplementationofanelectronic/computerizedregistrationandcontinuedtomakeavailableontheCommissionwebsitealistofallassociationcontactinformation,includingpreprintedlistsavailableuponrequest.SeeChart1�.

Condominium Seminars and Symposium–TheCommissioncontinuedto

Chart16.CondominiumGovernanceMediations

Condominium Association Registration FY 1999 - 2009

1,200

1,300

1,400

1,500

1,600

1,700N

o. o

f Reg

iste

red

Ass

ocia

tions

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

No.

of A

part

men

ts R

egis

tere

d

No. of Registered Associations No. of Apartments Represented

No. of Registered Associations 1,361 1,389 1,419 1,439 1,456 1,469 1,501 1,546 1,565 1,601 1,629

No. of Apartments Represented 114,449 116,750 118,209 133,276 134,444 135,708 138,334 142,171 145,124 151,238 153,856

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009


Chart17.CondominiumAssociationRegistration

produceeducational seminars for condo-minium owners,boardmembers,residentmanagers,representativesfromself-managedassociations,CMAsandcondominiumorgani-zations,andeducators.UtilizingCommissionstaff,aprocuredproviderandvolunteerfacultyofrepresentativesfromthecondominiumgover-nance,development,andrealestatecommunity,theCommissioncontinuedtoadministerCMEFandCETFsubsidiesforCommission-approvedseminars,includingthefollowing:

LegislativeUpdate July24,2008CovenantEnforcementAug.21,2008TopTraitsofBoardsandManagers Sept.25,2008DefendingandWinningSuitsAgainstBoards Oct.25,2008NavigatingthroughTurbulentAnnualMeetings Jan.22,2009NavigatingthroughTurbulentAnnualMeetings-Kona Feb.2�,2009ChallengesofAgingBuildings Mar.12,2009ABCs-Essentialsof

•••

•

•

•

•

•

CommunityAssociations May.6,2009Contracts,InsuranceandPitfalls June3,2009

TheCommissionproactivelysoughtadditionalconsultantsascondominiumeducationprovid-ers,exploredelectronicpublicationofconsumerbrochuresandcontinuedadministrationoftheCRCeducationaladhocadvisorygrouptopro-viderecommendationsandinputregardingtheCRCeducationalprograms.

Ad Hoc Committee On Condominium Edu-cation and Research–TheCRCcontinuestoadministerthisvolunteergroupwhichreviews,recommendsandassistsinthedevelopment,updateandadministrationofcondominiumeducation-relatedprojects.TheCommissionexpandedtheadvisorygroup’sfocustoincluderecommendationsforaCommissionfiveyeareducationalstrategicplanforcondominiumeducation.Italsoincorporatedthisgroupaspartofthe“AdHocCommitteeonCondominiumEducationandResearch.”ThisfiscalyeartheCommissionprocuredfortheupdateandrewriteoftwo1991Commission produced education-

•

0

20

40

60

80

100

120

140

No. o

f regis

trants

CHOs 117 119 123 123 17 17 16 19 19 24 19CMAs 113 110 100 115 0 0 0 0 0 0 0

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009


al brochures entitled “Condominium Owners Rights and Responsibilities”andthe“Condo-miniumBoardMembersPowersandDuties”toprovideconsistencywiththecurrentcondomini-umlaws(HRSChapters514Aand514B).

Condominium Managing Agents Registration –Staffreviewedpoliciesandproceduresforregistrationandrespondedtoap-peals,subpoenas,andrequestsforrecordsunderOIPrulesandprocedures.SeeChart18.

Condominium Hotel Operator Registration–TheCommissiondelegatedthisprogramtotheCondominiumReviewCommittee.SeeChart18.

Rule Making, Chapter 107–Sincetheadop-tionofChapter514B,HRS,in2006,theCom-missionresearched,studied,evaluated,andcompiledrulemakinginformationfortheformalrulemakingprocess.TheCommissionsummarizesinthisreportitsrulemakingefforts.Infiscalyear2009,theCommissionfinalizedascheduledplanforformalrulemakingandac-ceptedanofferbyacondominiumconsultanttovoluntarilyleadtheCommissioninitseffortsonthissignificantprogramofworkitem.

Chart18.CMAandCHORegistration

Meetings–TheCommissioncontinuedtoplan,coordinate,andconductmonthlyCRCmeetingsandincludethescheduleofmeetingsandagendasontheCommission’swebsiteandmeetingminutesweremadeavailableinPDFandsearchableformat.Meetingsareopentothepublicandareameansforcondominium own-ersandanyothermemberofthecondominiumcommunityto be educatedontheactivitiesoftheCRC.

Government and Legislative Participation and Report–TheCommissionparticipatedinallaspectsofthelegislativeprocess.Itre-searchedandreportedonrequestsbytheLegislature,includingresolutions,agreements,andissuesofmutualconcern.Inadditiontoresearching,preparing,andpresentingtestimonyonanumberofcondominiumbills,staffassistedtheCRCinmonitoringandtracking�2Houseand93Senatecondominiumrelatedbillsand5resolutions.TheCommissionresearched,devel-oped,anddistributeditsAnnualReporttotheLegislatureontheCMEFandCETFprogramsandfunds,anduponcompletion,postedthere-portontheCommission’swebsite.TheAnnualreportisaneducational tool for condominium ownersandanyothermemberofthecondomin-iumcommunityontheCRCprogramofwork.


Legislative Acts and Resolutions–AswastheintentoftheCommissionwhenHRS514Bwasadopted,theCommissionsupportedlegisla-tiontorepealtheCondominiumManagementEducationFundinChapter514A,HRS,andmergeitwiththeCondominiumEducationTrustFund(CETF).TheCommissioncontinuedwithreviewing,reporting,anddevelopingofsum-mariesonallrelatedActsandresolutionsandimplementedrequirementsofdirectly-relatedActsandresolutions.TheenactmentofnewlawsandtheadoptionofresolutionsattheendofthefiscalyearimpactedtheCRC’sAdvice,EducationandReferralprogramofworkitem.Inresponsetoinquiries,staffeducated con-dominium owners,boardmembers,managingagentsothersaboutthefollowingnewlaws:

ACT 009 (SLH 2009) SB No. 574 SD1–Extendsthecondominiumdisputereso-lutionpilotprojectuntilJune30,2011.

ACT 010 (SLH 2009) SB No. 298 SD1 –Increasestheamountthatcondominiumassociationsmayrecoverinmaintenancefeesfromtheforeclosureofacondomini-umapartmentfrom$1,800to$3,600.

ACT 012 (SLH 2009) SB No. 1113 SD1 –Repealstherequirementthattimeshareunitsinanexistinghotelinacountywithapopulationinexcessof500,000arere-quiredtocontainatleast60unitsatleast40%ofwhicharetobemadeavailableforsaleorrentalasresidentialapartments.

ACT 038 (SLH 2009) SB No. 862 SD1, HB No. 1044–EnablesHawaiiHousingFinanceandDevelopmentCorporationtomoreeasilycollectthevalueofsharedappreciationequityandotherrestrictionswhenanaffordablehousingpropertyispubliclysoldthroughaforeclosure.Re-quireswrittennotificationofintenttoforecloseonpropertiesencumberedbysuchpriorityliens.

•

•

•

•

ACT 128 (SLH 2009) HB No. 876 HD1 SD2 CD2–Expandslimitationsonasso-ciationliabilityforelderlyunitownersorresidentsaginginplacetoincludedisabledpersons(§514B-142,HRS).

ACT 129 (SLH 2009) SB No. 1107 SD2 HD2 CD1–MergestheCondominiumManagementEducationFundintotheCondominiumEducationTrustFund.

ACT 158 (SLH 2009) HB No. 1415 CD1–Requirescondominiumassocia-tions,plannedcommunityassociations,andcooperativehousingcorporationswithpropertiesinaccessibletothepublictoestablishapolicytoprovideaccessforapersonauthorizedtoservecivilprocess.SunsetsonJuly1,2012.

ResolutionsAdopted:

HR No. 128 HD1 (SLH 2009)–“UrgingTheRealEstateCommissiontoconsiderallowingdevelopersandattorneystosubmitcondominiumregistrationfilingsinelectronicformat.”

SR No. 113 SD1 (SLH 2009)–“UrgingTheRealEstateCommissionToAdoptAndSubmitAStrategicPlanToAllowDe-velopersAndAttorneysToSubmitCondo-miniumRegistrationFilingsInElectronicFormat.”

TheCommissionalsocontinuedthepreparationforprintinganddistributedamendedunofficialcopiesofChapters514Aand514B,HRS,viaitswebsiteandahardcopywherefundsareavail-able.

Interactive Participation with Organizations – TheCommissioncontinuedactiveparticipationwithlocalorganizationsandgovernmentagenciesfortheexchangeofinformationandconcerns,sharingofeducationandresearchefforts,jointprojectsofmutual

•

•

•

•

•


concern,training,etc.,throughattendance,membershipandparticipationatlocalmeetings,includingCAIHawaii,HCAAO,HICCO,Con-dominiumCouncilofMaui,IREM,andtheHa-waiiStateBar.ParticipationwithagenciesandorganizationsincludededucationalprogramsonChapter514B,HRS.

Neighbor Island Outreach–TheCommissionheldcommitteemeetingsatneighborislandsitesincollaborationwiththelocalboards,HAR,condominiumorganizations,etc.ThisfiscalyeartheCommitteemetonAugust13,2008ontheislandofKauai,onNovember12,2008ontheislandofHawaii,andonJanuary�,2009,ontheislandofMaui.Theneighborislandmeetingsaffordanopportunityforattendanceandparticipationincommitteemeetings,andprovidesameanstoeducatecondominium ownersandothermembersofthecondominiumcommunityincludingboards,relatedprofession-als,governmentofficials,andinterestedparties.

Condominium Education Trust Fund (CETF)–TheCommissionadministeredtheCMEFandtheCETFfunds.Act129(SLH2009)mergedthetwocondominiumeducationfunds(CMEFandCETF)intoonefund,theCondominiumEducationTrustFund.TheCom-missionsupportedthislegislation.TheCom-missionprepared,maintained,andreviewedquarterlyandannualfinancialstatements,budgetandfinancerecordsforbotheducationalfunds,andadministeredthefundsinvestment.TheCommissionalsoplannedandworkedwiththeDCCAtoincreasethebudgetforfundingtheCommission’seducationaleffortsfortheimplementationofChapter514B,HRS,andad-ditionaleducationalprogramssubjecttorevenueprojections.

Consumer Education–TheCommissionfo-cuseditseffortsonthedevelopmentandpubli-cationofthetwobookletsaspreviouslyreportedunderthe“AdHocCommitteeOnCondomin-iumEducationandResearch”.Thishowever,postponedadditionalresearchandconsultation

ofaconsumereducationprogramanddevelop-mentofabrochuretargetingprospectivepur-chasersofcondominiumunitsandnewownersofcondominiumunitsoninitialprojectsalesandresales.ThisprogramwillcontinueaspartoftheCRCEducationalAdvisoryGroup’sfiveyeareducationalstrategicplanforcondominiumeducation.Rule Making, Chapter 53, Fees–TheCom-missionmonitored,reviewed,researched,andrecommendedtotheLicensingAdministratorincreasingthecondominiumdevelopers’andunitowners’contributionstotheCondominiumEducationTrustFundtoaddresstheCondo-miniumEducationTrustFundprojectedbudgetshortfallsanticipatedtobeginasearlyasfiscalyear2012.

CPR Project Workshop and Meetings–TheCommissionprocuredfortheprofessionalservicesof12condominiumconsultants.Theincreaseoffourconsultantsoverlastfiscalyearwasdueinparttothecomplexityandtimedemandsofregisteringcondominiumprojectspursuanttotwocondominiumlaws,Chapter514A,HRS,andChapter514B,HRS.TheCommissionconductedorientationandinforma-tionalsessionsandtheyearlyforumforallcon-dominiumprojectconsultantswhichincludedanupdateoftheprojectregistrationrequirementsofChapter514B,HRS,andChapter514A,HRS.SeerelatedCharts19-21,andTable4.

Condominium Specialists’ Office for the Day–Withadvancedpublicity,mailouts,andappointments,CondominiumSpecialistssetupofficeatRICOneighborislandofficesandothersitestoprovidethecondominiumcommunity,developers,governmentofficials,consumerpur-chasers,andotherrelatedprofessionalsadvice,education,andreferral.Uponrequest,Special-istprovidedtrainingtoRICOinvestigators.ThecondominiumspecialistsheldofficesonAugust13,2008ontheislandofKauai,November12,2008ontheislandofHawaii,andonJanuary�,2009ontheislandofMaui.TheSpecialists

2003 2004 2005 2006 2007 2008 2009

Conversion Filings

New Project Filings

Total of Apartments Represented - New & ConversionFilings

0100020003000400050006000700080009000

10000110001200013000140001500016000

Numb

er of

Apa

rtmen

ts Re

pres

ented

Conversion Filings 1191 7788 3818 2834 1619 1619 1910New Project Filings 3514 2318 11877 8409 9538 7509 4594Total of Apartments Represented -New & Conversion Filings

4705 10106 15695 11243 11157 9128 6504

2003 2004 2005 2006 2007 2008 2009

Note: Contingent Final Public Report effective June 16, 1997.

0

100

200

300

400

500

600

700

800

No. o

f dev

elop

er's

pub

lic re

ports

Contingent Final 7 6 7 12 18 27 42 40 26 4 1Preliminary 23 26 41 35 60 59 37 41 8 0 0Final 241 249 191 219 228 290 277 338 133 21 3Supplementary 49 35 51 41 71 52 106 78 95 61 59514B Reports 157 271 202514B Amend 17 61 85Extensions 253 233 169 178 159 125 150 171 217 162 122Annual Reports 41 70

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009


Chart20.NumberofCondominiumApartments

Chart19.Developer’sPublicReportsEffectiveDatesIssued

1999

2001

2003

2005

2007

2009

Over 50

16 -- 50

3 -- 15

2 or less

Total

050

100150200250

No. of Units

Fiscal Year

Project Size

Over 50 5 4 10 12 20 56 64 52 47 27 25

16 -- 50 11 17 12 15 13 30 66 67 65 23 29

3 -- 15 18 26 27 27 42 72 33 37 33 21 21

2 or less 13 17 17 23 28 34 57 70 28 49 38

Total 47 64 66 77 103 192 220 226 173 120 113

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

New Projects 2003 2004 2005 2006 2007 2008 2009

Residential 103 192 219 230 178* 146 118No. of Apartments Represented 3012 6274 9334 6203 6582 4249 2928

Commercial and Other 10 12 25 47 29 37 20No. of Apartments Represented 67 1444 2338 89 2793 3208 1473

Agricultural 30 29 44 34 42 41 53No. of Apartments Represented 435 70 205 2117 163 52 193

Total New Projects 143 234 288 311 249 224 191Total No. of Apartments Represented 3514 2318 11877 8409 9538 7509 4594

Conversions

Residential 92 116 135 164 157 132 112No. of Apartments Represented 740 1422 2347 1177 903 664 1592

Commercial and Other 20 10 16 14 8 14 4No. of Apartments Represented 360 777 1325 1584 649 894 234

Agricultural 46 51 30 54 45 47 40No. of Apartments Represented 91 119 146 73 67 61 84

Total Conversion Projects 158 177 181 232 210 193 156Total No. of Apartments Represented 1191 7788 3818 2834 1619 1619 1910

Combined New & Converted Project Filings 301 411 469 543 459 417 347Combined No. of Apartments Represented 4705 10106 15695 11243 11157 9128 6504

* Total includes five (5) projects that were either withdrawn or returned.Note 1: Numbers and totals may differ from those reported in prior annual reports due in part to the change in the database management software.Note 2: In mixed use condominium projects, the predominant use is reported. This is done to prevent the multiple counting of a project filing.


Chart21.NewResidentialProjects-BySize

Table4.CondominiumProjectFilings

CondominiumReviewCommitteeReport3�

fortheDayProgramaffordstheopportunitytoeducate condominium owners.

Condominium Speakership Program–Sub-jecttoStategovernmentapprovalsandpriori-ties,theCommissionhonoredrequeststopro-videaspeaker,resourceperson,orparticipantinafunctionrelatedtocondominiumeducation,thecondominiumlawandrelatedissues,andcondominiumprojectregistration,includinganinvitationtopresenttotheKailuaNeighborhoodBoard,informationregardingthenewrecodifiedcondominiumlaw,Chapter514B,HRS.Thisprogramallowedstafftoeducatethegeneralpublicandcondominium owners.

Technology and Website–TheCommissioncontinuedtooperateitswebsiteforinteractionandeducation by condominium ownersandothermembersofthecondominiumcommunity,includingcondominiumboards,licensees,gov-ernmentofficials,andmembersofthepublic.Itmaintainedandupdatedtheelectronicstorageofmaterialsprovidingpubliconlineaccesstothedeveloper’spublicreports,condominiumassociationregistrationdataandotherinfor-mation.PursuanttoChapter514B,HRS,theCommissioncontinuedtopostandmakethenewdeveloper’spublicreportformandotherrelatedformsformfillableanddownloadable.Theformswereevaluatedandamendedtomeetthecontinuingimplementationchallenges.TheCommissioncontinuestoworktowardsitslongrangegoalofprovidingallcondominiuminfor-mationonline;studyingthefeasibilityofpro-vidingassociationsacentraldepositoryforallgoverningdocumentsonthewebsite,includingminutesofassociationmeetings.

Case Law Review Program–TheCommis-sioncontinuedtomonitor,collectandreportonstateandfederallawjudgmentsanddecisions,administrativedecisions,andpoliciesandproce-dures;reportongovernanceandprojectdevel-opmentcases;andevaluatecasesforinclusionintheCondominiumBulletin.

Start-up Kit for New AOUOs –Commissionstaffdistributedstart-upkitstonewlyregisteredAOUOs,whichincludedunofficialcopiesofChapters514Aand514B,HRS,copiesofad-ministrativerulesforChapters514Aand514B,HRS,guidesforbudgetandreserves,boardsofdirectors,condominiumownersandpastcondo-miniumbulletins.

Records Management–Commissionstaffevaluated,planned,reorganized,andimple-mentedacentralized,consistent,userfriendly,computerizedglossaryofexistingandfutureeducationalmaterials,records,anddevelopers’publicreportsandfiles.Staffalsomaintainedandupdatedthescanningandelectronicstorageofrecords,includingdeveloper’spublicreports.

Cooperative Education, Research, and Ad-ministrative Program – DueinparttotheState’stravelrestrictions,theCommissionwasunabletosponsorasmuchtraveltonationaleducationalprogramsforstaffofthebranch,department,andtheOfficeoftheAttorneyGen-eralwhichprovidedirectorindirectservicestotheCommissionanditscondominiumeducationtrustfundandcondominiumprojectregistrationprogram.

Division and Department Program–TheCommissioncontinuedthecoordinationofactivitiesandprogramsofmutualconcernwithPVLD,RICO,andDCCA.

Staff and Commissioners Development – StaffdevelopedandtrainedstaffandCommissionersforbetteradministrationofthecondominiumeducationandregistrationprograms.Commis-sioners,aswellasstaff,participatedintrainingandeducationalopportunitiesprovidedbyCAIHawaiiandotherlocalorganizationsanddueinparttotheState’stravelrestrictions,couldnotsponsorasmuchparticipationinCAInationalconferencesandseminars.


HawaiiCondominiumBulletin;CondominiumMediationandArbitrationProgram;CondominiumSeminarsandSymposium;AdHocCommitteeOnCondominiumEducationandResearch;Meetings;GovernmentandLegislativeParticipationandReport;LegislativeActsandResolutions;NeighborIslandOutreach;CondominiumSpecialistsOfficefortheDay;CondominiumSpeakershipProgram;TechnologyandWebsite;CondominiumReferenceLibrary.

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Condominium Reference Library–StaffmaintainedattheRealEstateBranchofficeandontheCommission’swebsite,acatalogofallpublicreferencematerialsprovidedtoStateLi-braries(especiallyinhighlyconcentratedCPRareas)andmediationservicesoffices(neighborislandsincluded).Staffalsoupdateditsre-searchonthecostofupdatingallcondominiumlibraryreferencematerials.TheCommissionrecommendedtheinclusionoftheseupdatesaspartofanydevelopedfiveyeareducationalstrategicplanforcondominiumeducation.TheCommissioncontinuedtoexpendmoniesfromtheCondominiumEducationTrustFundandtheCondominiumManagementEducationFundtoprovidenationaleducational information and materials to condominium owners,develop-ers,andthegeneralpublic.ThisfiscalyeartheCommissionparticipatedwiththeHawaiiChap-terofCAI(CommunityAssociationInstitute)andtheNationalCAIFoundationforCom-munityAssociationResearchinprovidingsuchmaterialthroughtheAdoptaLibraryProgram.Throughthisprogram,withtheintenttoreachandeducate a broader condominium owner audience,fivelibrariesreceivedagiftcom-prisedofCAIpublicationsaswellasacompletesetofCAI’s2�GuidesfortheAssociationPrac-titionerofferingnuts-and-boltsguidelineson:

managingbudgetsandreservefunds;theresponsibilitiesoftheboardandtheprofessionalmanager;legalandtaxissues;communicationwithassociationmem-bersandrenters;buyinginsuranceandmanagingrisk;draftingrules;disputeresolution;andworkingwithcontractors.

TheCRCispleasedthatthisfiscalyear,thefollowingprogramsconductedactivitiesdi-rectedattheeducationofcondominiumowners:

CondominiumLawsandEducation;Advice,Education,andReferral;

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FY2010PROGRAMOFWORKCondominium Laws and Education–TheCommission’stargetedaudienceincludescon-dominiumownersincludingboardsofdirec-tors,associations,condominiumdevelopers,condominiummanagement,realestate,andthepublic.ConcurrentlywiththeadministrationofChapter514A,HRS,theCommissionwillcon-tinuetofinetuneandimplementChapter514B,HRS,includingcontinuingparticipationinthelegislativeprocess.WithacknowledgementoftheState’seconomicchallengesanditsbudget-aryimpacts,theCommission,totheextentthatcondominiumeducationfundsareavailable,willcontinuebriefings,updates,andpresenta-tionstothecondominiumcommunity;adminis-tration,andtheinclusionofthepresentationsontheCommission’swebsite,theCondominiumBulletinandtheRealEstateBulletin,etc.Itwillcontinuethedeliveryofstatewidemultifacetedlowcosteducationalprogramswiththehelpofstakeholderorganizationsandvolunteersonallislands.Inaddition,withthehelpofstakeholderorganizationsandvolunteers,theCommissionwillcontinuetoreviewandamendexistingCommission-developededucationalmaterials,newandamendedforms,instructions,informationalsheets,proceduresandevaluativeprocesses.

Advice, Education, and Referral–TheCommission’stargetedaudienceincludescon-dominiumownersincludingboardsofdirec-tors,associations,condominiummanagement,developers,consumers,realestatelicensees,governmentofficials,consumers,andthepublic.Staff,onbehalfoftheCommission,continuestorespondandprovideinformationrelatedtoinquiriesfromthecondominiumcommunity,developers,consumers,licensees,govern-mentofficials,organizations,interestedothersandthepublic,viatelephone,walk-ins,faxes,writtencorrespondence,emails,CondominiumBulletinandtheCommission’swebsite.StaffwillpreparefortheprintinganddistributionofCommission-developedinformation,includingcopiesofChapters514Aand514B,HRS,viaits

websitetoeachregisteredassociationandCMA.TheCommissionwillstudythefeasibilityofagrantprogramforboardofdirectorparticipationinCommission-approvededucationprograms.MaintainandupdatetheCommissionwebsiteasnecessary.

Condominium Project and Developer’s Pub-lic Reports–TheCommission’stargetedaudi-enceincludesdevelopers,realestatelicensees,governmentofficials,consumers,andthepub-lic.TheCommissioncontinuestoadministertwocondominiumprojectregistrationprograms(Chapters514Aand514B,HRS)andcontinuesaccordingly,theongoingadministrationofissu-anceofeffectivedatesfordeveloperpreparedpublicreports.Withthehelpofstakeholderorganizations,volunteers,othergovernmentalagenciesandinterestedattorneys,staffcontin-uestorefineonlineunalterablefillabledevelop-er’spublicreportformsandtheevaluationanddevelopment,whereappropriate,ofnewpro-cesses,records,forms,informationdocuments,andrulesrelatingtocondominiumprojectregis-trations.Ifnecessary,itwillprocureadditionalcondominiumconsultantstoassistwiththereviewofdocumentsandinformationsubmittedtotheCommissioninconjunctionwithcondo-miniumprojectregistrations.Staffwillcontinuetoconductinformationandorientationsessionsforallnewprocuredconsultants.Itcontinuestomonitortheconsultants’performanceofthecon-tracts.Staffalsocontinuestomakedeveloper’spublicreportsavailableforpublicviewingandcopyingtodiscviatheCommission’swebsiteandcontinuetocompileinformationandCom-missiondecisionsandmaketheseavailabletotheconsumingpublic,consultantsandotherin-terestedpersons.TheCommissioncontinuestostudyandresearchacomprehensiveevaluationsystemontheprojectregistrationandreviewprocesstoincludeconsideringaplanforelec-tronicadministrationofthedevelopers’publicreports,includingthescanningofdocumentsonCDs.Itwillalsocontinuetomonitorlegislationrelevanttocondominiumprojectregistrationforimpactonpoliciesandproceduresuponcondo-


miniumdevelopersandthepublicreportpro-cess.TheCommissionwillfocusitseffortsincarryingoutastrategicplanasdescribedinthe“Addendum”attachedtotheendofthisreportandmadepartofthisAnnualReport.Hawaii Condominium Bulletin–TheCom-mission’stargetedaudienceincludescondo-miniumownersincludingboardsofdirectors,associations,condominiummanagement,devel-opers,realestatelicensees,consumers,andthepublic.TheCommissioncontinuestheresearch,development,publicationanddistributionofaquarterlybulletintoallregisteredassocia-tionsandCMAs.ItalsomaintainscopiesofthebulletinontheCommission’swebsiteandincludeselectronicdelivery.Staffcontinuestheresearchandstudyofin-houseelectronicpublicationanddelivery,andthepublicationofa“developers’referencefile,”withconsultantscontributingarticles.TheCommissionwillalsotakeintoconsiderationtheadditionofanongo-ingsectioninthebulletindedicatedtoissuesrelevanttocondominiumprojectregistrationanddeveloper’sissues,witharticleswrittenbycondominiumconsultants.Staffcontinuestheprocurementcodemanagementandadministra-tionofthecontractwithaconsultantassistingintheprintingofthebulletin.Condominium Mediation and Arbitration Program–TheCommission’stargetedaudi-enceincludescondominiumowners,boardofdirectors,association,andmanagingagents.TheCommissioncontinuestomonitorthedeliv-eryofmediationprograms,includingtheop-tionalevaluativemediationprogramaddedthisfiscalyear,andthemediationcontracts.StaffcontinuestoworkwiththeMediationCenterofthePacific(MCP)andotherprocuredproviderstopresenteducationalseminarsaboutalterna-tivedisputeresolutionandmediationtoboardofdirectorsandcondominiumowners.StaffcontinuestocollectinformationandstatisticsforeducationandAnnualReportpurposes,includinginformationandstatisticsrelatingtomandatorymediationpursuanttoAct232(SLH

2001).TheCommissionisstudyingthefeasibil-ityofCETFfundingofarbitrationforthosepar-tieseligibleformediation.StaffalsocontinuestoupdatetheCommission’smediationbrochuretoreflectchangesinthelawandfordistributiontothecondominiumcommunity.ItcontinuestoworkwithMCPtoupdatetheMCPmediationtraininginstructionmanual.

CDR Pilot Program–TheCommission’stargetedaudienceincludescondominiumown-ers.TheCommissioncontinuestoassistintheadministrationofthepilotprogram,whichprogrampursuanttoAct009(SLH2009)wasextendedtoendJune30,2011,andcontinuestoassisttheOfficeofAdministrativeHearingswithanyeducationalandawarenessprogramsforcondominiumownersandboardmembers.

Condominium Association Registration –TheCommission’stargetedau-dienceincludescondominiumowners,includingboardsofdirectors,associations,condominiummanagement,developers,realestatelicensees,governmentofficials,consumers,andthepublic.Staffcontinuestoadministertheelectronic/com-puterizedregistrationofcondominiumasso-ciations;includingreviewingandupdating,asnecessary,applicationsforregistration,policies,procedures,appeals.Itwillrespondtosubpoe-nasandrequestsforrecordsunderOIP.Itcon-tinueslistingallassociationcontactinformationontheCommission’swebsitewithpreprintedlistsavailableuponrequest.TheCommissioncontinuestoresearchandstudythefeasibilityofcompilingabiennialprofileofregisteredasso-ciationsbasedonthedatafieldsgatheredfromtheregistrationinformation.

Condominium Seminars and Symposium –TheCommission’stargetedaudi-enceincludescondominiumownersincludingboardofdirectors,condominiummanagement,andpublic.TheCommissioncontinuestopro-duceseminarsforthecondominiumcommunitythroughprocuredcontractswithvariousprovid-ersandcontinuestoprocureforadditionalnew


providersonrelevanttopics.ItcontinuestoadministerCETFsubsidiesforCommission-ap-provedseminars.TheCommissionisconsider-ingproducingaseminaronreserves,especiallythecashflowfundingmethod,incollaborationwithCAIHawaiiandotherinterestedparties.Staffproactivelyseeksadditionalconsultants,especiallyontheneighborislands.Itwillre-searchthepossibilityofwebre-broadcastofallCETFseminars.TheCommissioncontinuestheadministrationofaCRCeducationaladvisorygrouptoproviderecommendationsandinputabouttheCRCeducationalprograms.Thegroupcontinuestoincludeboardmembers,residentmanagers,andrepresentativesfromselfman-agedassociations,CMAs,condominiumorgani-zations,andeducators.

Ad Hoc Committee on Condominium Educa-tion and Research–TheCommission’star-getedaudienceincludescondominiumownersincludingboardsofdirectors,associations,con-dominiummanagement,developers,consumers,realestatelicensees,consumers,andthepublic.TheCommissioncontinuestheadministrationofthisgroupwhichmakesrecommendationsandassistsindevelopment,updateandadminis-trationofcondominiumeducation-relatedproj-ects.Itcontinuestodeveloparoll-overfiveyearstrategicCETFeducationplan;andelectronicconsumers’brochuresforseniors,condominiumowners,andrealestatebrokers.

Condominium Managing Agents Registra-tion–TheCommission’stargetedaudienceincludescondominiumownersincludingboardsofdirectors,associations,condominiumman-agement,realestatelicensees,consumers,andthepublic.TheCommissioncontinuallyadmin-istersCMAregistrationrequirements,includingreviewofapplicationsforregistration,policies,procedures,appeals,subpoenas,andrequestsforrecordsunderOIP.Itisworkingtowardsdevel-opingapaperlessfidelitybondreviewprocess.

Rule Making, Chapter 107–TheCommis-sion’stargetedaudienceincludescondominium

ownersincludingboardofdirectors,associa-tions,condominiummanagement,develop-ers,consumers,realestatelicensees,andthepublic.TheCommissioncontinuestostudy,evaluate,research,anddevelopruleamend-mentsfortheformalrulemakingprocess.Itwillalsoconsiderrecommendations,issues,comments,andconcernsreceivedfromvari-ousstakeholdersinthecondominiumcommu-nity,CRC,communityworkshopparticipants,governmentofficialsandorganizationsregard-ingrulemakingforChapter514A,HRS,andChapter514B,HRS.

Meetings–TheCommission’stargetedaudi-enceincludescondominiumownersincludingboardofdirectors,associations,condominiummanagement,developers,consumers,realestatelicensees,andthepublic.TheCom-mission,withsupportfromstaff,continuestoplan,coordinate,andconductmonthlyCRCmeetings.Staffincludesthescheduleofmeet-ingsandagendasontheCommission’sweb-siteandcontinuestomaintainthemeetingsminutesinPDFandsearchableformat.

Government and Legislative Participation and Report–TheCommission’stargetedau-dienceincludescondominiumownersinclud-ingboardofdirectors,associations,condo-miniummanagement,developers,realestatelicensees,governmentofficials,consumers,andthepublic.TheCommissioncontinuestoresearch,participate,andreportonrequestsbytheLegislature,includingresolutions,agreements,andissuesofmutualconcern.Itwillalsocontinuetoresearch,developanddistributetheAnnualReporttotheLegislatureonCETFprogramsandfunds;immediatelyuponcompletion,placeontheCommission’swebsite.

Legislative Acts and Resolutions–TheCommission’stargetedaudienceincludescon-dominiumownersincludingboardofdirec-tors,associations,condominiummanagement,developers,consumers,realestatelicensees,


andthepublic.TheCommissionwillcontinuetoreview,report,anddevelopsummariesonallrelatedActsandresolutionsproposedinthe2010legislativesession;implementrequire-mentsofdirectlyrelatedActsandresolutions.StaffwillprepareamendedunofficialcopiesofChapters514Aand514B,HRS,forprintinganddistributionincludingviaitswebsiteandstudythefeasibilityofRamseyerformatofunofficialcopiesofChapters514Aand514B,HRS.

Interactive Participation with Organizations – TheCommission,aswellasstaff,will,continueactiveparticipationwithlocalorganizationsandgovernmentagenciesfortheexchangeofinformationandconcerns,shar-ingofeducationandresearchefforts,jointproj-ectsofmutualconcern,training,etc.,throughattendance,membershipandparticipationatlocalmeetings,includingCAIHawaii,HCAAO,HICCO,CondominiumCouncilofMaui,andtheHawaiiStateBar.Theywillparticipatewithagenciesandorganizationstoincluderecodifica-tioneducationprograms.Participationinna-tional,regionalorganizations,suchasCAI,aresubjecttoapplicablebudgetaryconstraintsandtravelrestrictions.

Neighbor Island Outreach – TheCommis-sion’stargetedaudienceincludescondominiumownersincludingboardofdirectors,associa-tions,condominiummanagement,developers,realestatelicensees,consumers,andthepublic.TheCommissionwillholdthreecommitteemeetingsatneighborislandsites(Kauai,MauiandHawaii)incollaborationwiththelocalboards,HAR,condominiumorganizations,etc.,subjecttoapplicablebudgetaryconstraintsandtravelrestrictions.

Condominium Education Trust Fund (CETF) –TheCommission’stargetedaudi-enceincludescondominiumownersincludingboardofdirectors,associations,condominiummanagement,developers,realestatelicensees,consumers,andthepublic.TheCommissioncontinuestoadministerthefundsforeducation-

allydefinedpurposes.Itprepares,maintains,andreviewsquarterlyandannualfinancialstatements,budgetandfinancerecordsforbotheducationalfunds,andadministersfundinvest-ment.TheCommissionalsoplansandworkswiththeDCCAtoincreasethebudgetforfund-ingtheCommission’seducationaleffortsfortheimplementationofChapter514B,HRS,andad-ditionaleducationalprogramssubjecttorevenueprojections.

Consumer Education–TheCommission’stargetedaudienceincludescondominiumown-ersincludingboardofdirectors,associations,condominiummanagement,developers,realestatelicensees,consumers,andthepublic.TheCommissionisworkingtodevelopaconsumereducationprogramaboutinitialprojectsalesandresalestargetingprospectiveandnewpurchas-ersofcondominiumunits.Itisconsideringapamphletorbrochureoncondominiumlivingandgovernanceinconsultationwithrealestateprofessionals,condominiumboardmembers,condominiumunitowners,anddevelopers.Thisprogramisadministratedaspartofafiveyearcondominiumstrategiceducationplanwhichrollsovereachyear.

Rule Making, Chapter 53, and Fees–TheCommission’stargetedaudienceincludescondominiumownersincludingboardofdirec-tors,associations,condominiummanagement,anddevelopers.TheCommissioncontinuestomonitor,review,research,andmakerecommen-dationsonruleamendmentsforfeesthroughco-ordinationwiththeLicensingAdministrator.ItisalsostudyingexistingandnewcondominiumservicesanddeterminingappropriatefeesandamendmentstoChapter53,HawaiiAdministra-tiveRules.

CPR Project Workshop and Meetings–TheCommission’stargetedaudienceincludescondominiumownersincludingboardofdirec-tors,associations,condominiummanagement,developers,realestatelicensees,consumers,andthepublic.Staffcontinuestoconductperiodic


informationsessionsandforumsforcondo-miniumconsultantsforpurposesoforientationandinformation.Staffalsocontinuestoplanforfacilitatingforumsforrepresentativesofde-velopers,attorneys,condominiumconsultants,CMAs,andassociationfocusgroupsregardingtheongoingimplementationofChapters514Aand514B,HRS.

Condominium Specialists Office for the Day – TheCommission’stargetedaudienceincludescondominiumownersincludingboardofdirectors,associations,condominiumman-agement,developers,realestatelicensees,consumers,andthepublic.Subjecttoapplicablebudgetaryconstraintsandtravelrestrictions,theCommissioncontinuesthesetupofCondo-miniumSpecialistsofficeforthedayatRICOneighborislandofficesandorothersitestopro-videthecondominiumcommunity,developers,governmentofficials,consumerpurchasers,andotherrelatedprofessionalsadvice,education,andreferral,andtrainingofRICOinvestigators.

Condominium Speakership Program – TheCommission’stargetedaudienceincludescon-dominiumownersincludingboardofdirectors,associations,condominiummanagement,devel-opers,realestatelicensees,consumers,andthepublic.Thisprogramhonorsrequeststoprovideaspeaker,resourceperson,orparticipateinafunctionrelatedtocondominiumeducation,Chapters514Aand514B,HRS,condominiumissues,andcondominiumprojectregistration.

Technology and Website–TheCommission’stargetedaudienceincludescondominiumown-ersincludingboardofdirectors,associations,condominiummanagement,developers,reales-tatelicensees,governmentofficials,consumers,andthepublic.TheCommissioncontinuestooperateitswebsiteforpublicinteractionanded-ucation.Itmaintainsandupdatestheelectronicstorageofmaterialsprovidingthepubliconlineaccesstothedeveloper’spublicreports,condo-miniumassociationregistrationdataandotherinformation.PursuanttoChapter514B,HRS,

theCommissioncontinuestopostandmakethenewdeveloper’spublicreportformandotherrelatedformsformfillableanddownloadable.Theformsareevaluatedandamendedtomeettheimplementationchallengeswhichsurfacedthroughouttheyear.TheCommissioncontinuestoworktowardsitslongrangegoalofprovidingallcondominiuminformationavailableonline;studyingthefeasibilityofprovidingassociationsacentraldepositoryforallgoverningdocumentsonthewebsite,includingminutesofassociationmeetings.

Case Law Review Program–TheCommis-sion’stargetedaudienceincludescondominiumownersincludingboardofdirectors,associa-tions,condominiummanagement,developers,realestatelicensees,consumers,andthepublic.TheCommissioncontinuestomonitor,collectandreportonstateandfederallawjudgmentsanddecisions,administrativedecisions,andpoliciesandprocedures;reportongovernanceandprojectdevelopmentcases;evaluatecasesforinclusionintheCondominiumBulletin.

Start-up Kit for New AOUO’s –TheCommis-sion’stargetedaudienceincludesnewcondo-miniumownersincludingboardofdirectors,associations,andcondominiummanagement.Staffcontinuestodistributestart-upkitstonewlyregisteredassociations,includingunof-ficialcopiesofChapters514Aand514B,HRS,administrativerules,budgetandreservesguide,boardofdirectors’andcondominiumowners’guides,andpastCondominiumBulletins.

Records Management–TheCommission’stargetedaudienceincludescondominiumown-ersincludingboardofdirectors,associations,condominiummanagement,developers,realestatelicensees,consumers,andthepublic.Staffcontinuestoevaluate,plan,reorganize,andimplementacentralized,consistent,userfriendly,computerizedglossaryoftheexistingandfutureeducationalmaterials,records,devel-opers’publicreportsandfiles.Theymaintainandupdatethescanningandelectronicstorage


ofrecordsincludingminutesanddeveloper’spublicreports.

Cooperative Education, Research, and Ad-ministrative Program –TheCommissionactivelyparticipatesandsponsorscooperativeeducation,researchandadministrativeprogramsforthoseindividuals,branches,divisions,de-partmentpersonnel,andtheAttorneyGeneral’sOfficethatprovidedirectorindirectservicestotheCommissionanditscondominiumeducationfundsandorcondominiumprojectregistrationresponsibilities.

Division and Department Program–TheCommissioncontinuesthecoordinationofactivitiesandprogramsofmutualconcernwithPVLD,RICO,andDCCA.CoordinatepositionsonChapter436B,HRS,Chapter46�,HRS,withChapters514Aand514B,HRS;monitorinteractionandeffectofotherregula-torylawsandrulesonChapters514Aand514B,HRS.

Staff and Commissioner Development – StaffcontinuestodevelopandtrainstaffandCom-missionersforbetteradministrationofthecondominiumeducationandregistrationpro-grams.Subjecttothestate’stravelrestrictions,StaffandCommissionersparticipateintrainingandeducationalopportunitiesprovidedbyCAI,national,CLEAR,andotherorganizations.

Condominium Reference Library–TheCom-mission’stargetedaudienceincludescondomini-umownersincludingboardofdirectors,associa-tions,condominiummanagement,developers,realestatelicensees,consumers,andthepublic.StaffmaintainsandupdatestheCommission’swebsitecatalogofallpublicreferencemateri-als(includingtheboardofdirectors’guidesandlawamendments)andcontinuestoprovidethesematerialstotheStateLibrarySystemespeciallyinhighly-concentratedCPRareas,mediationservicesoffices(neighborislandsincluded),andattheRealEstateBranchoffice.Wheneverfea-sible,theCommissionwillprovideinformation

inconjunctionwithcondominiumlaweduca-tionalprograms.Staffcontinuestoresearchandstudythecostofupdatingandmaintainingallcondominiumlibraryreferencematerials,andretainingofconsultantstoupdatetheboardofdirectors’andcondominiumowners’guidesanditsprinting.Staffwillalsocontinuetorecom-mendtheinclusionoftheseupdatesaspartofanydevelopedfiveyearstrategiceducationalplanforcondominiumeducation.


AddendumPreliminary Strategic Plan For Considering Condominium Registration Filings Via Electronic

Format

PursuanttoSR113andHR128theRealEstateCommission(“Commission”)presentsthefollowingpreliminarystrategicplantoacceptfilingsforcondominiumregistrationsandsupportingdocumentsinCD-ROMorotherelectronicformatcompatiblewithchapter489E,HawaiiRevisedStatutes.

Preliminary Strategic Plan

1.Identify,research,andstudyotherStateofHawaiiandFederalagencies’implementationofelectronicfiling,includingbutnotlimitedto:

Researchingthevariousagencies’implementationchallengesincludingtime,costs,andresolu-tions;Surveyingtheagencies’choicesofmediaandreasonsforchoice;andIdentifying“lessonslearned”byotheragencies.

2.Identifythevariousmediaforelectronicfilingsandstudytheprosandconsofeach:

Includeinthestudyissuesrelatingto:

a.Delivery/receiptofelectronicfilings;b.Security,storage,easeofuse,costs,certification,training,impactonpersonnel,documentreview;c.ImpactontheCondominiumEducationTrustFund;andd.Legalconsiderations.

3.SurveyCommissionconsultants,developers,developers’attorneys,andgeneralpublic.

4.Identifydepartmental,divisional,andCommissionchallengesandconcerns.

5.Identifyanystatutoryand/orruleamendments.

6.PresentfindingsandrecommendationstotheCommission,DivisionandDepartment.

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46 FundInformation-RealEstateEducationFund

ASSETS I. Operations

Cash Personnel $312,918 In State Treasury $572,786 Supplies 4,206 Short term cash investments 1,000,000 Postage 3,568

Equipment Rentals/Maintenance 729 Total Assets 1,572,786 Machinery and Equipment 6,708

Books 0LIABILITIES AND FUND BALANCE Total Operations $328,130

Liabilities II. Direct Licensee Education Payables 18,029Fund Balance Real Estate Seminars 23,790 Reserve for Encumbrances 63,720 Neighbor Islands Outreach 4,140 Unreserved 1,491,037 Annual Report/Quarterly Bulletin 40,676 Balance 1,554,757 Programs 100,287

Total Direct Licensee Education 168,893Total Liabilities and Fund Balance $1,572,786

III. Indirect Licensee Education

Interactive Participation w/Orgs. 12,687 Staff/Commissioners Development 1,687 Dues & Subscriptions 1,332

Revenues Miscellaneous 0 Fees $718,384 Total Indirect Licensee Education 15,706 Interest (includes Recovery Fund) 16,299 Total Revenues 734,683 Total Expenditures and

Encumbrances $512,729Expenditures 449,009 Excess (deficiency) of revenues over expenditures 285,674Fund Balance Beginning of Year 1,269,083 End of Year $1,554,757

Revenues and ExpendituresFor the Year Ending June 30, 2009

(Unaudited)

Real Estate Education Fund

FY 2009 Expenditures and Encumbrances(Unaudited)

Fund BalanceAs of June 30, 2009

(Unaudited)

FundInformation-RealEstateRecoveryFund4�

ASSETS Case No. Licensee(s) AmountCV07-0093(1) Bucauto, Carol $15,906

Cash Country Land & Homes, Inc In State Treasury $343,981 Short term cash investments 500,000 CV207-1-000442 Bucauto, Carol $10,874Investment securities (cost) Country Land & Homes, Inc Total Assets $843,981

CV07-1-1803 Bucauto, Carol $4,774LIABILITIES AND FUND BALANCE

Total Payments $31,555Liabilities Payables $1,173 Investment income included "In State Treasury" and Paid to Real Estate Education Fund 0 Total Liabilities 1,173Fund Balance Reserve for encumbrance 0 Unreserved 842,808 Fund Balance 842,808

Total Liabilities and Fund Balance $843,981

Revenues Fees $62,350Expenditures Operations 21,467 Legal Services 26,861 Claims 31,555 Total Expenditures 79,883Excess (deficiency) of revenues over expenditures (17,533)Fund Balance Beginning of Year 860,340 End of Year $842,808


(Unaudited)

Real Estate Recovery Fund

FY 2009 Recovery Fund Payments


(Unaudited)

48 FundInformation-CondominiumEducationFund

ASSETS Personnel $338,325

Cash Supplies 2,779 In State Treasury $638,739 Postage 6,044 Short term cash investments 200,000 Equipment Rentals/Maintenance 3,524 Total Assets $838,739 Education and Research 0

Equipment for Office 96,824LIABILITIES AND FUND BALANCE Staff/Commissioner Development 820Liabilities Resource Materials 194 Payables $30,385 Dues & Subscriptions 403Fund Balance Miscellaneous 12 Reserve for Encumbrances 14,703 Unreserved 793,651 Fund Balance 808,354 Total Expenditures and Encumbrances $448,923Total Liabilities and Fund Balance $838,739

Personnel $433,470 Supplies 4,000

Revenues Postage 6,000 Fees - Other $10,445 Equipment Rentals/Maintenance 6,000 Fees - AOUO Registration $517,438 Contingency 500 Interest income 4,947 Education and Research 179,261 Total Revenues 532,831 Equipment for Office 4,000Expenditures 434,220 Staff/Commissioner Development 6,000 Excess (deficiency) of revenues Resource Materials 500 over expenditures 98,611 Dues & Subscriptions 500

Miscellaneous 750Fund Balance Total Expenditures and Encumbrances $640,981 Beginning of Year 709,743 End of Year $808,354

Condominium Education Fund

FY 2010 Budget

(Unaudited)


(Unaudited)FY 2009 Expenditures and Encumbrances

(Unaudited)


2009 annual report - hawaiifiles.hawaii.gov/dcca/reb/reports/annual report_2009...i respectfully...

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