Calling on our Hawaii Legislators for Support
YOUR MISSION
Public Engagement in the Legislative Process: The difficulty for working-class folks to appear at legislative hearings is profound, and written testimony often does not carry the same weight as in-person appearances. We ask you to commit to facilitating proactive efforts to ensure that when it comes time to vote, the voices of all Hawaii residents and homeowners are remembered and considered.
Both residents and owners share the financial burden of maintenance fee increases, which impact everyone in different ways—whether through higher monthly fees, reduced property values, or increased living expenses. These rising costs place undue strain on working families, retirees, and renters alike, making it critical to address the systemic issues driving these expenses.
A CALL FOR LEGISLATIVE ACTION
Transparency, Accountability & Protection for Hawaii Condo Owners
Hawaii’s condominium owners are facing a crisis—one rooted in lack of transparency, accountability, and oversight. Many AOAOs (Association of Apartment Owners) struggle under poor management, financial mismanagement, and failing infrastructure, yet the professionals entrusted with their governance—property managers, association attorneys, insurance brokers, and reserve study consultants—face little to no accountability for the advice and decisions they make.
ACTION THAT MAKES A DIFFERENCE
As legislators, you have the opportunity to champion significant change that upholds fairness and integrity within Hawaii’s condominium management system. The proposed Senate Resolution, below, emphasizes the necessity for a comprehensive audit of the Real Estate Commission’s oversight concerning Hawaii Revised Statutes Chapter 514B. This audit is crucial in revealing and rectifying the systemic issues that currently disadvantage condominium owners while disproportionately favoring management agencies and boards.
WHY LEGISLATIVE CHANGE IS URGENT
Condo owners pay thousands of dollars annually in maintenance fees, special assessments, and insurance premiums, trusting that their homes are being properly maintained and their funds responsibly managed. Yet, time and again, we see:
- Embezzlement and financial mismanagement with no mandated reporting by industry professionals.
- Deferred maintenance and deteriorating buildings, leading to unsafe conditions.
- Insurance brokers collecting premiums while failing to ensure AOAOs are meeting maintenance requirements per their reserve studies.
- Property managers and association attorneys shielding bad actors instead of enforcing ethical and legal obligations.
The consequences of these failures fall entirely on homeowners—many of whom are working-class residents, retirees, and families struggling to keep up with rising costs and avoid losing their homes. This must change.
OUR LEGISLATIVE GOALS
We are calling on lawmakers to introduce and support bills that bring real, functional solutions, including:
- Mandated reporting of financial crimes—Industry professionals must be required to report suspected embezzlement and financial mismanagement.
- Accountability for insurance brokers—If they collect premiums, they must ensure compliance with reserve study requirements.
- Stronger oversight of property managers & association attorneys—Holding them responsible for unethical or negligent management.
- Enhanced financial transparency—Requiring real-time disclosure of financial records and contracts to owners.
- Stronger protections for whistleblowers—Encouraging owners and board members to report misconduct without retaliation.
LEGISLATORS: WE NEED YOUR LEADERSHIP
Hawaii’s condo laws must prioritize homeowners over industry coffers. If we do not see functional bills addressing these issues this session, we ask for your leadership in crafting and championing real reform. Will you stand with us?
Please review these issues, engage with us, and support meaningful legislative action. Let’s work together to bring transparency, accountability, and protection to Hawaii’s condo owners.
BACKED BY NATIONWIDE RESEARCH
Legislative support for these reforms is crucial to promoting fairness, transparency, and accountability within Hawaii’s HOA/AOAO communities. Can we count on you to review the upcoming proposals with homeowners’ experiences in mind and support these critical reforms?
Several states have recently enacted condominium laws aimed at enhancing protections for owners, emphasizing transparency, accountability, and safety. Notable examples include:
Florida: In response to the tragic Surfside condominium collapse in 2021, Florida implemented stringent regulations to improve building safety and protect condo owners. Key provisions include:
- Mandatory Structural Inspections: Condominium buildings over 30 years old and taller than three stories must undergo regular structural inspections to identify and address potential safety issues. The Firm Miami
- Reserve Fund Requirements: Associations are now required to maintain sufficient reserves to cover major repairs, preventing deferred maintenance and ensuring funds are available for necessary upkeep. The Firm Miami
- Enhanced Financial Disclosures: New laws mandate greater transparency in financial matters, ensuring owners have access to pertinent information about their association’s financial health. The Firm Miami
While these measures aim to protect owners, they have led to increased costs for some, prompting debates about their economic impact.
Maryland: Maryland has taken steps to safeguard condo owners through legislation such as House Bill 107, which includes:
- Mandatory Reserve Studies: Condominium associations are required to conduct regular reserve studies to assess the condition of common elements and plan for future repairs. Wikipedia
- Funding Requirements: Associations must budget adequately to meet the recommendations of reserve studies, ensuring financial preparedness for necessary maintenance and repairs. Wikipedia
These initiatives are designed to prevent unexpected special assessments and promote long-term planning, thereby protecting owners from sudden financial burdens.
It’s important to note that while these laws enhance protections for owners, they may also introduce new financial obligations for associations and their members. The balance between increased safety and financial impact continues to be a topic of discussion among stakeholders. However, if condominium associations were truly self-governing, they would not be funneling homeowners’ money into massive management agencies that profit off their lack of oversight. These agencies have grown into corporate machines, embedding themselves into associations under the guise of convenience, while removing essential checks and balances that should be protecting owners.
A genuinely self-managed association would rely on independent professionals only where expertise is necessary—such as hiring an accountant to reconcile financial statements or using an HR/payroll service to ensure legal compliance for any association employees. This eliminates unnecessary overhead while keeping control in the hands of the owners rather than a third-party company with its own financial interests.
Furthermore, real estate agents and property managers should never have been allowed to position themselves as indispensable to condo governance. Their expansion into full-scale management agencies has turned what should be a collaborative, owner-driven process into a business model that thrives on discouraging owner participation. By making governance so overwhelming and opaque, they push homeowners into apathy—or worse, force them to sell and move on, allowing the cycle to continue.
While large-scale management companies may be an efficient business model for the agencies themselves, it comes at the expense of fairness, accountability, and owner empowerment. This structure removes the necessary checks and balances, leaving owners at a severe disadvantage when it comes to protecting their investments, ensuring financial transparency, and maintaining proper oversight.
Legislative reform must restore the integrity of self-governance by limiting the unchecked influence of these management companies and empowering owners with clear rights, better oversight mechanisms, and the ability to hold industry professionals accountable for their actions.
IN THE NEWS
Recent Developments in Condo Laws and Their Impact on Owners
AP News Florida condo owners look at higher costs as new regulations take effect in the new year
New York Post Experts warn Florida’s condo market could teeter on collapse amid soaring costs and new safety rules
ABC News The Strata Trap: What the Condo Industry Doesn’t Want You to Know about insurance and the management industry
The investigative report “The Strata Trap” by ABC journalist Linton Besser uncovers the alarming realities of the strata (condo) trade industry in Australia. This exposé sheds light on the intersection of skyrocketing insurance premiums, unscrupulous insurance agents, and mismanaged association governance—problems that undoubtedly resonate with condo owners in Hawaii as well.
Through shocking revelations and real-life accounts, the report details how unethical practices drain billions of dollars from property owners while governments turn a blind eye to industry abuses. This must-watch investigation highlights the urgent need for transparency, accountability, and consumer protection within the condo management industry. Watch the full report here: The Strata Trap
PROPOSED NATIONAL LEGISLATION
To understand the unfortunate scale of this issue, we invite you to visit the HOA Reform Leaders National Group (HRLNG). Their proposed legislation—developed through extensive research and refinement with homeowners across the country—addresses the most pressing concerns in condo and HOA governance.
HRLNG founder Patrick Johansen states that their multifaceted approach, if fully adopted, could resolve upwards of 90% of HOA/AOAO disputes. The impact on public resources and real human lives would be so beneficial to our communities!
States like Florida and is a proven path forward, and we need your support to bring it to Hawaii..
We thank you for considering this significant matter and look forward to your positive response and the opportunity to discuss these reforms further.
Condo Owner Rights
Local condo activists report that the industry is not geared towards protecting nor promoting the rights of the association members who are the property owners. To this end, a group of citizens created the following poster that they believe should be a mandatory disclosure when buying into an association in Hawaii.
CONDO LAW 101
It’s essential for lawmakers, condominium owners, especially board members to familiarize themselves with these laws to ensure proper governance and compliance within their associations. Consulting with legal professionals experienced in Hawaii condominium law can provide tailored guidance for specific situations. However, without proper oversight, the costs associated with this form of “self-governance” can quickly spiral out of control, creating opportunities for financial mismanagement and unethical practices. Many board members, often volunteers with little to no formal training in property governance, unintentionally fall prey to unscrupulous agents, management companies, and service providers who take advantage of their inexperience. This can lead to inflated contracts, unnecessary legal fees, and a system that benefits industry professionals rather than the homeowners it is meant to serve.
Hawaii condominium owners and legislators should be aware of many key laws that govern such housing structures at the wisely utilized Association of Apartment Owners (AOAOs) and impact shared living co-ops:
- Hawaii Revised Statutes (HRS) Chapter 514B – Condominiums: This is the primary statute governing condominium property regimes in Hawaii. It covers the creation, management, and operation of condominiums, including the rights and responsibilities of unit owners and associations. Hawaii CCA
- HRS Chapter 414D – Hawaii Nonprofit Corporations Act: Many AOAOs are organized as nonprofit corporations and are thus subject to the regulations in this chapter, which governs the formation, operation, and dissolution of nonprofit entities in Hawaii.
- HRS Chapter 421I – Cooperative Housing Corporations. These entities are distinct from traditional condominium associations. In a cooperative housing corporation, the corporation owns the property, and residents purchase shares in the corporation, granting them the right to occupy a specific dwelling unit.
- HRS Chapter 421J – Planned Community Associations: While primarily focused on planned community associations, certain provisions may apply to condominiums, especially those structured as part of a larger planned community.
- HRS Chapter 467 – Real Estate Brokers and Salespersons Establishing the Real Estate Commission’s authority, setting forth licensing requirements, and outlining standards for professional practice to protect consumers in real estate transactions.
- HRS Chapter 667 – Foreclosures This governs the procedures and requirements for mortgage foreclosures within the state, detailing both judicial and nonjudicial processes, including notice provisions, rights of borrowers, and dispute resolution mechanisms.
- County Zoning and Building Codes: Condominium properties must comply with county-specific zoning laws and building codes, which can affect property use, modifications, and overall compliance.
- Federal Laws: Certain federal regulations, such as the Fair Housing Act, apply to condominiums, particularly concerning non-discrimination in housing and accommodations.
Ensuring transparency, accountability, and homeowner empowerment is critical to preventing these issues and restoring true self-governance within Hawaii’s condominium communities.
Condo History – Past Bills
- Condominium issues and legislative action. Here are bills that have been introduced at the current legislative session. You can track them, show your support or submit testimony on https://www.capitol.hawaii.gov/home.aspx
- 2024 HOA Legislative Bills Chart.PDF
- SB1512 Prohibits proxies, allows members to vote by mail and cast votes by electronic means.
- HB178 (ombudsman for HOAs)
- HB1501 (ombudsman for condos)
- SB3205/HB2680 (ombudsman for condos)
- SB3206/HB2681 (ombudsman for all HOAs)
- SB3204/HB2701 (prevent retaliation against owners who speak out)
- SB2549/HB2067 (no assignment of proxies to boards)
- SB2493/HB2286 (control fees of attorneys hired by associations)
- SB2128 (owners may opt-out of condominiums)
- HB1814 (Condo Task Force look at solutions to condo issues in other states. Hearing scheduled for 01/30/2024 at 2pm.)
- SB2404 (forbid proxies, allow voting by mail)
- SB2550 (ombudsman and Real Estate Commission)
- Having issues? Please speak out, so legislators will start to listen. Civil Beat has been covering stories about condo owners who had serious issues https://www.civilbeat.org/category/oahu-condo-issues/
Condo Owners Unite
If you are an owner, thank you for standing with us in the press for meaningful legislative reform to protect condo owners and residents in Hawaii. As we discussed, we are moving forward, having sent letters to all Hawaii legislators, urging them to take action on these critical issues on our behalf.
To strengthen our movement, we have also launched this webpage where we can share updates, messages, and testimony from supporters like you with legislators. Since we know not everyone can attend hearings when bills are proposed, this platform will serve as a centralized space to amplify our voices.
How You Can Help:
We are asking supporters to submit a brief testimony letter (300 words or less preferred) sharing their experiences, concerns, and why legislative reform is necessary. You can:
- Submit directly on our webpage [use the “Leave a Reply” box below] to be shared publicly as part of our advocacy.
- Email your testimony to us if you prefer for it to be referenced in future meetings without being posted online.
Your voice matters, and together, we can push for the changes we need. Please let us know if you have any questions, and thank you again for your commitment to this cause. Looking forward to your testimony!
Review our Letter to the Legislators and join the movement for Condo Law Reform!
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