§206-9 Disposition of lands. (a) Generally. It shall be the policy of the board of land and natural resources to encourage insofar as possible the widespread fee simple ownership of residential lots of modest size and price. Where necessary or desirable, the board may issue residential leases or leases with an option to purchase the fee in any development area upon such reasonable terms and conditions as may be determined by the board. Disposition of lands shall be by such public method as shall most likely carry out the purposes of this chapter.
(b) Land disposed of by private developers. Land disposed of through private developers shall be sold in accord with the terms prescribed by the board. A reasonable developer's profit shall be allowed, but the board shall reserve the right to inspect books, records, and construction, take necessary precautions against speculation by the private developer in lands acquired under this chapter and renegotiate any contract to prevent unconscionable profit by the private developer.
An unconscionable profit means any profit or return in excess of what the board considers as reasonable. The board may survey the prevailing rates of profit for developers in determining a reasonable rate.
(c) Land disposed of by the board. To be eligible to purchase or lease a residence lot from the board, the buyer shall furnish satisfactory evidence to the board, under oath, and otherwise as required by the board, that the buyer:
(1) Is a citizen of the United States or a declarant alien who has resided in the State for a period of five years or more;
(2) Is at least eighteen years of age;
(3) Is a bona fide resident of the State and has a bona fide intent to reside in the development area concerned, if successful in purchasing or leasing a lot in the area under this chapter; and
(4) Has a gross income sufficient to meet the cost of the land being disposed of by the board. The board shall develop policies whereby those most deserving of housing shall be given preference. In developing the policies, the board shall consider the applicant's household income, the number of dependents, and other factors that the board may deem pertinent.
Any person whom the board finds to be within one of the following classes, shall not be eligible to become an original purchaser or lessee of a resident lot, to wit:
(A) A person who oneself or whose husband or wife or both (when husband and wife are living together) owns or own in fee simple lands suitable for residential purposes within the political subdivision and in or reasonably near the place of residence or place of business of the person; and
(B) A person who oneself or whose husband or wife (when husband and wife are living together) has pending an unrefused application to purchase a lot in a development area under this chapter from the board.
Any person, firm, association, or corporation may purchase business lots within a development project for business necessary to service the project. The lots shall be sold at public auction to the highest bidder for cash.
The board shall require all applicants for the purchase or lease of residence lots to make application therefor under oath, and may require additional testimony or evidence under oath in connection with any application. The determination of any applicant's eligibility under this chapter by the board shall be conclusive as to all persons thereafter dealing with the property; but the making of any false statement knowingly by the applicant or other person to the board in connection with any application shall constitute perjury and be punishable as perjury.
When a development project or projects has or have been sufficiently completed to be suitable for disposition to individual purchasers or lessees, the board shall sell or lease the lots therein to eligible purchasers or lessees and shall give public notice of the disposition on the island of Oahu. The notice shall state in general terms the size, location, and prices or rental of lots to be sold or leased, the terms of sale or lease, and the last date on which application will be received by the board, which date shall not be less than thirty days after the first notice. The notice shall also state the times and places at which more detailed information with respect to the sale or lease may be secured by interested persons. Not more than one lot shall be sold or leased to each applicant.
The purchaser at the purchaser's option may pay the purchase price in full on delivery of a deed or pay not less than ten per cent of the purchase price and execute with the board an agreement of sale under the terms of which the unpaid balance is to be paid in monthly installments and over a period that the board determines, with interest on unpaid balances at a rate not to exceed six and one-half per cent, payable monthly, deed to be delivered on final payment; provided that not less than one-half of one per cent on account of principal shall be required by the agreement to be paid each month. Taxes shall be prorated as of the date of delivery of deed in the case of a cash sale and as of the date of execution of the agreement of sale in the case of a sale in other cases. Each agreement of sale shall provide that the whole or any part of the unpaid balance of the purchase price plus accrued interests may be paid at any time. [L 1961, c 6, pt of §10; am L 1965, c 157, pt of §4; Supp, pt of §98J-10; HRS §206-9; am L 1972, c 2, §4; gen ch 1985; am L 1998, c 2, §64]