HB 2136 Summary

• Permits public benefit corporations to make current distributions to members and affiliates that are also public benefit corporations, which was previously prohibited under the Hawaii Nonprofit Corporations Act.

• Distributions must align with the distributing corporation's stated purposes and cannot jeopardize the corporation's ability to pay debts or maintain assets equal to liabilities.

• Defines "affiliate" as an entity that directly or indirectly controls, is controlled by, or is under common control with the public benefit corporation, including power to select the board of directors.

• Amends Section 414D-245 to require dissolved corporations to wind up affairs only (changing "may" to "shall"), with provisions for transferring assets to IRS Section 501(c)(3) organizations or other public benefit corporations.

• Takes effect upon approval.