Shown verbatim: the complete text as captured from the official page posted by the Hawaii State Legislature, fetched 2026-08-29. Where this bill amends existing law, language marked for deletion in the official page appears here in brackets. This is the first conference draft. The official bill page.
THE SENATE S.B. NO. 2544 THIRTY-THIRD LEGISLATURE, 2026 S.D. 2 STATE OF HAWAII H.D. 1 C.D. 1 A BILL FOR AN ACT RELATING TO HOUSING. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII: SECTION 1. The legislature finds that the State continues to experience a severe shortage of housing that is affordable for households earning between sixty per cent and one hundred forty per cent of the area median income, a portion of the housing market commonly referred to as "missing middle" housing. The legislature further finds that successful housing programs in other jurisdictions, such as the BC Builds program implemented in British Columbia, Canada, demonstrate that a housing agency must act as a public developer by proactively acquiring land, securing entitlements, and prepackaging shovel-ready projects to cut delivery times. The legislature finds that the BC Builds program is structured according to a "rocket fuel" project timeline strategy, which has contributed substantially to the program's success. BC Build's rocket fuel strategy replaces the standard thirty-six to sixty-month timeline typical of most construction projects with a much shorter twelve to eighteen-month project timeline. BC Builds accomplishes this significant reduction in project timelines by streamlining development processes and working collaboratively with landowners, municipalities, and residential developers to work through and remove any barriers. BC Builds also leverages underused public lands to create more viable rental projects, along with grant money to keep rents more affordable and get projects off the ground. BC Build's approach to housing development has resulted in over thirty projects in pre-development in the two years since the program was launched. Many of these projects will deliver over one hundred units each, significantly expanding the available housing supply. Accordingly, the purpose of this Act is to: (1) Establish within the Hawaii housing finance and development corporation the Hawaii builds pilot program as a five-year pilot program, under which: (A) The corporation may deploy moneys from the dwelling unit revolving fund for certain development activities and as active construction equity; (B) Interagency coordination and expedited review for designated pilot projects are required by law; and (C) A majority of housing units must comply with requirements established by the Hawaii housing finance and development corporation under section 201H-38, Hawaii Revised Statutes; and (2) Establish an annual expenditure cap on the use of dwelling unit revolving funds that may be used to implement the Hawaii builds pilot program. SECTION 2. (a) There is established the Hawaii builds pilot program within the Hawaii housing finance and development corporation. The pilot program shall run for a period of five years as provided in subsection (m). (b) The board of directors of the corporation shall designate specific projects as Hawaii builds pilot program projects, pursuant to the requirements of this Act. To qualify as a Hawaii builds pilot program project, a project shall: (1) Be located on a site that possesses, at a minimum, adequate existing infrastructure capacity, including water, sewer, and transportation access, to support the density of the proposed project; (2) Preferably be located on land zoned for residential use; provided that project sites that have adequate infrastructure but are not zoned for residential use shall remain eligible through the use of exemptions authorized under section 201H-38, Hawaii Revised Statutes; and (3) Ensure that all units in a housing project shall be consistent with the purposes and intent of chapter 201H, Hawaii Revised Statutes. (c) The corporation shall designate at least one Hawaii builds pilot project in each county of the State to ensure statewide participation in the pilot program. (d) Notwithstanding any provision of part III, subpart I, of chapter 201H, Hawaii Revised Statutes, or any other law to the contrary, the corporation may use not more than $20,000,000 each fiscal year, in the aggregate, from the dwelling unit revolving fund for the Hawaii builds pilot program for: (1) Predevelopment activities, including land acquisition, architectural and engineering services, environmental and due diligence studies, entitlement processing, and other preparatory activities necessary to advance a project; and (2) Construction equity, including short-term construction equity or equity investment, as deemed appropriate by the corporation's board of directors. (e) Predevelopment activities under subsection (d)(1) shall not require separate gubernatorial approval for each specific disbursement; provided that the project has been designated and approved as a Hawaii builds pilot program project by the corporation's board of directors. (f) Any use of moneys from the dwelling unit revolving fund, including but not limited to construction equity or equity investment under subsection (d)(2), shall be structured to ensure a reasonable return to the dwelling unit revolving fund. (g) Notwithstanding any other law to the contrary, while the Hawaii builds pilot program is active, the corporation shall give the highest priority to Hawaii builds pilot program projects when allocating and disbursing moneys from the dwelling unit revolving fund. (h) The executive director of the corporation may convene a Hawaii builds expedited review team. The team shall consist of the directors of relevant state and county agencies or their designees, including the chairperson of the board of land and natural resources, director of health, and each county's planning and public works departments. (i) Notwithstanding any other law to the contrary, all state and county agencies shall cooperate with the corporation in processing Hawaii builds pilot program projects, including prioritizing the review of permits, licenses, and entitlements for pilot projects above all other non-emergency applications. (j) Contracts for professional services, construction, and development related to Hawaii builds pilot program projects shall be subject to approval by the corporation's board of directors and shall be exempt from chapter 103D, Hawaii Revised Statutes. (k) The department of health shall complete its review of hazard evaluation, wastewater, and safe drinking water applications for Hawaii builds pilot program projects within sixty days. If additional time is required to complete a review under this subsection, the department of health shall provide written justification for the extension before the sixty-day period expires. If the department of health does not provide written justification, the application shall be deemed approved. (l) The appropriate county planning director, or an equivalent official having jurisdiction over permitting and exemptions, shall grant a Hawaii builds pilot program project all necessary exemptions from county ordinances and rules pursuant to section 201H-38, Hawaii Revised Statutes. Notwithstanding any law, county charter provision, or ordinance to the contrary, an exemption under this subsection shall not require approval by the county legislative body. The processing of an exemption for a Hawaii builds pilot program project shall be deemed a ministerial act and shall be completed within forty‑five days of receipt by the planning director or equivalent official. (m) The authority of the corporation to designate new Hawaii builds pilot program projects under this section shall expire on June 30, 2031; provided that any project designated as a Hawaii builds pilot program project before July 1, 2031, shall continue to be governed by this section until the completion of the project. (n) For the purposes of this section, "corporation" means the Hawaii housing finance and development corporation. SECTION 3. No later than twenty days prior to the convening of the regular sessions of 2027, 2028, 2029, 2030, 2031, and 2032, the Hawaii housing finance and development corporation shall submit to the legislature a report on the Hawaii builds pilot program that includes: (1) A list and description of all Hawaii builds pilot program projects designated, approved, or advanced during the prior fiscal year; (2) The amount and type of dwelling unit revolving fund moneys expended for predevelopment activities and construction equity, including the status of repayment or monetization; (3) The number of housing projects approved, under construction, and completed, disaggregated by county and area median income category; (4) A summary of interagency coordination efforts and the extent to which statutory timelines were met; (5) Any barriers encountered in project delivery, including statutory, regulatory, or infrastructure constraints; (6) Recommendations for any amendments to the pilot program and whether the pilot program should be continued or terminated; and (7) Any proposed legislation. SECTION 4. This Act shall take effect upon its approval.
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