Bill Text: HI HB2604 | 2020 | Regular Session | Amended
Bill Title: Relating To Concessions.
Spectrum: Partisan Bill (Democrat 6-0)
Status: (Engrossed - Dead) 2020-03-06 - Re-Referred to GVO/PSM, WAM. [HB2604 Detail]
Download: Hawaii-2020-HB2604-Amended.html
|
HOUSE OF REPRESENTATIVES |
H.B. NO. |
2604 |
|
THIRTIETH LEGISLATURE, 2020 |
H.D. 1 |
|
|
STATE OF HAWAII |
|
|
|
|
|
|
|
|
||
|
|
||
A BILL FOR AN ACT
RELATING TO CONCESSIONS.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The
legislature finds that state and county governments sometimes lack the
flexibility in concession contracts to quickly address unexpected problems and emergencies
that may arise, resulting in a loss of services to the public and loss of
revenues to state and county governments.
The
legislature notes that state and county governments would benefit from added
flexibility in concession contracts to address the following issues:
(1) Delays in construction of premises by state and county governments;
(2) Unexpected circumstances, including increased construction costs due to tariffs, construction site problems, or other circumstances making it no longer feasible for a concessionaire to complete planned concession improvements during the contract term;
(3) Situations where a concession operator's location is in
default, withdrawn, or being transferred, and the state and county governments
as landlords need to be able to avoid disruption of services and loss of
revenues by immediately negotiating with another person or entity to assume the
contract, including anyone who may have unamortized costs relating to
concessions improvements; or
(4) Where
other concession contracts have more generous relief terms to address financial
or other hardships that a concession contract does not have.
The
purpose of this Act is to provide more flexibility and
discretion to state and county governments to address unexpected substantial
hardship situations that are not provided in their concessions contracts.
SECTION 2. Section 102-10, Hawaii Revised Statutes, is amended to read as follows:
"§102-10 Modification of concession
contract terms. (a) [If]
Notwithstanding any other law to the contrary, if during the term of the
contract [(],including contracts which have been executed and are
presently in force[) there has been a reduction of fifteen per cent or more
in the volume of business of the concessionaire for a period of sixty days or
more, computed on the average monthly gross income for the eighteen months just
prior to the period or as long as the concessionaire has been in the business,
whichever period is shorter,], a significant hardship is anticipated or
has occurred, and [such reduction] the significant hardship, as
determined by the officer letting the contract, is related to
improvements or operations on premises governed by the contract or caused
by construction work conducted during the period of time on, or within or
contiguous to, the public property upon which the concession is located,
by either the state or county governments, or both, the officer, with the
approval of the governor in the case of a state officer and the chief executive
of the respective county in the case of a county officer, may grant relief
by entering into a new contract or modify any of the terms of the existing
contract, including the agreed upon rent, extension of term, or assumption
of the contract, for a period [which] or upon terms that the
state or county officer determines in their discretion will allow the
concessionaire to recoup the amount or portion of the amount lost by [such
reduction;] the significant hardship; provided that [if] upon
granting relief the state or county officer shall consider and state in
writing, the duration and extent of the significant hardship during the term of
the contract, the relief granted, and reason for granting relief.
(b) Subsection (a) shall not apply:
(1) If the existing
contract includes provisions allowing modification for [the above
contingencies, this section shall not be applicable thereto; provided further
that this provision shall not apply to] a substantial hardship; and
(2) To any
particular concession if the application [thereto] may impair any
contractual obligations with bondholders of the State or counties or with any
other parties.
(c) The extension of any term shall not be more
than fifty per cent of the maximum term of sixty-five years as set forth in
section 171-36(2) when counting the remaining term of the concession plus any
extension thereof.
(d) The other provisions of chapter 171 shall not
apply if in conflict with the intent and purposes of this section providing
broad discretion to the state and county governments and their respective
agencies and subdivisions to grant relief.
(e) For the purposes of this section:
"Significant hardship"
means:
(1) A reduction of:
(A) Fifteen
per cent or more in the volume of business of the concessionaire for a period
of sixty days or more; or
(B) Five
per cent to fourteen per cent in business of the concessionaire for a period of
one hundred days or more,
computed on the average
monthly gross income for the eighteen months just prior to the period or as
long as the concessionaire has been in the business, whichever period is
shorter;
(2) A delay of more than
thirty days in the anticipated substantial completion of premises being
constructed by the state or county governments resulting in less time for the
concessionaire to construct, occupy, and amortize its tenant improvements
before the contract termination date;
(3) Unexpected
circumstances, including but not limited to rising international tariffs,
construction site problems, or other circumstances resulting in the infeasibility
of the concessionaire to proceed with its improvements;
(4) Where one
or more of a concession operator's locations are in default, withdrawn, or in
the process of being transferred; or
(5) Where one or
more concession contracts have more generous relief terms to address financial
or other hardships suffered by a concession when compared to other concession
contacts."
SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 4. This Act shall take effect on January 1, 2050.
Report Title:
Concessions; Substantial Hardship; Public Property; Contracts
Description:
Provides state and county governments more flexibility and discretion to address substantial hardship situations that impact concession contracts. Effective 1/1/2050. (HD1)
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.
