I am a condominium owner and a resident in the Kakaako district, and a constituent of Hawaii state Sen. Sharon Moriwaki and House Speaker Scott Saiki.

In 1996, two amendments were introduced by the Community Association Institute legislative action committee to Hawaii Revised Statutes 514A-123 on voting proxies. The first assigns proxies to the board as a whole. The second assigns proxies to the board, to be divided equally among the directors attending the meeting.

The Real Estate Commission also testified with a letter to the Senate Housing Committee, on House Bill 3241, “We question if the amendment will provide for more abuse on the use of proxies and whether a new set of problems will appear, such as a new type of proxies and/or more challenges to proxies.”

In many of the associations, as a result of proxies held by the majority of the directors, they have continued to re-elect themselves and to serve for decades during which owners experienced tremendous financial distress caused by poor governance including deferred maintenance and low reserves.

(For one example, read “The ‘Brutal Reality’ Of Owning A Condo In Hawaii.”)

The Problem With Proxies

Assigning proxies as a whole to the board is a problem because this rewards and encourages condo board member absenteeism at meetings, indifference to critical association issues, and a lack of adequate education on condo statutes. It also inflates the power of a small minority to decide for all residents, often with significant negative financial impacts on those with limited incomes.

There have been multiple earlier attempts in the last 20 years to remove this option and attempts to institute term limits for directors, all with the determination to abolish too much power in the hands of few for too long.

However, I do agree that CAI’s option to assign and equally divide an owner’s proxy among directors present at the meeting should be preserved so that board members who represent the minority as well as majority members have the opportunity to fairly represent all owners.

Please support the following measures: Senate Bill 724 introduced and supported by Sen. Maile Shimabukuro and Sens. Stanley Chang, Les Ihara, Gilbert Keith-Agaran, Donna Mercado Kim and Clarence Nishihara.

Also, support House Bill 347 (the companion bill to SB 724), introduced by Speaker Saiki. And please support Senate Bill 121, submitted by Sen. Moriwaki’s version of the bill on my behalf as a third party.

Although Sen. Moriwaki and I have different opinions on eliminating the proxies to the board as a whole, I respect her opinion.