Three state House committees have eviscerated a bill to increase single-family housing densities statewide after receiving much more negative than positive testimony.

The committees, which had divided views, advanced an amended draft of Senate Bill 3202 Monday with a compromise to eliminate two primary provisions to reduce the minimum size for residential lots zoned for single-family use to 2,000 square feet and allow at least two additional homes on such lots.

SB 3202 passed the Senate after two public hearings in February, and there was only one public hearing in the House.

It’s still possible that the highly divisive bill could see further changes, including provisions potentially revived by House and Senate negotiators in a conference committee if the full House of Representatives passes the measure.

The bill is being promoted as a way to generate affordable housing for local residents by allowing a greater number of smaller homes on smaller lots in urban, suburban and even rural neighborhoods zoned for single-family use.

But many opponents of SB 3202 fear its proposed changes will ruin the character of communities by making them overly dense and attracting developers to subdivide existing lots covered by one house to produce additional homes that won’t necessarily be affordable to working kamaaina households.

For Monday’s hearing, 488 pages of written testimony were submitted, and opponents outnumbered proponents 3-to-1.

Among roughly 90 supporters testifying were the state Office of Planning and Sustainable Development, planning department directors for Kauai and Hawaii island, Maui County Mayor Richard Bissen, nonprofit affordable-housing advocacy organizations, construction and real estate industry entities and the University of Hawaii Economic Research Organization.

About 270 individuals and organizations opposed SB 3202. They were predominantly community members, including representatives of three Oahu neighborhood boards. The nine-member Honolulu City Council recently passed a resolution opposing the bill, while the the city Department of Planning and Permitting expressed concerns in written testimony.

Much of the vying testimony focused on whether reducing the minimum lot size in single-family neighborhoods to 2,000 square feet from 3,500 square feet, and potentially allowing three homes on each lot, would produce significant affordable housing for Hawaii residents.

There also was a clash over whether the state should be overriding county zoning rules and development plans produced in part with community-based planning.

‘Good’ bill

Sterling Higa, executive director of the nonprofit Housing Hawai‘i’s Future, called SB 3202 good policy that will counteract the high price of housing that he said causes 10,000 people to leave the state every year. He also criticized counties for not doing enough to solve housing shortages for over 50 years.

“We need to be building missing middle housing (duplexes, triplexes, quadplexes) for young families and aging kupuna alike,” he said at Monday’s hearing.

Matt Popovich representing Hawai‘i YIMBY (yes in my back yard) suggested that a vast majority of Hawaii residents support measures like SB 3202, and cited a Holomua Collaborative poll where he said 87% of respondents support allowing two to four homes on a typical size lot.

“We’re in a crisis, and Hawaii residents recognize we’re in a crisis,” Popovich told the committees. “Serious measures have to be taken to counteract this.”

Josh Wisch, Holomua Collaborative president and executive director, urged the committees to pass the bill, and clarified that the survey found 87% of respondents support loosening zoning requirements in urban areas to allow construction of “starter homes” if it would keep local workforce families in Hawaii.

Wisch called SB 3202 a “good, reasonable, fair approach” that would limit more dense housing to places where adequate infrastructure exists.

The bill also requires compliance with county rules regarding setbacks from property lines, building coverage limits, parking requirements and other things.

In written testimony, UH housing economist Justin Tyndall and UHERO Executive Director Carl Bonham said housing is legally permitted on only 4% of land statewide, and that 93% of this small amount is restricted to single-family use.

Tyndall and Bonham said county governments face political incentives to limit housing supply at the expense of people who don’t already own homes.

“State-level intervention, like what is proposed in this bill, can help overcome this market failure,” they said. “In Hawaii, all counties face a severe housing shortage, in part caused by overly restrictive housing regulations.”

‘Bad’ bill

Local affordable-housing developer Peter Savio urged the committees to abandon SB 3202, which he said would fail to achieve its goal because it wouldn’t require homes to be developed for local residents or at affordable prices.

“This is not going to reduce the cost of housing,” he said.

Savio predicted that adding density to existing lots would add value to those lots and make them more attractive to investors and others from outside the state at higher prices.

Choon James, a residential real estate broker on Oahu’s North Shore, made a similar prediction. “The minute land is entitled to a higher density, the property value automatically escalates,” she said at the hearing. “We are going to be packed like sardines with increased home prices, and long-term residents will be left with the negative impacts.”

David Paulson in written testimony called the bill “bad urban planning” and said it will further harm residential communities already struggling with impacts of illegal “monster” homes.

Reid Mizue representing the American Institute of Architects Hawaii State Council told the committees that zoning is better left to counties.

“We just adamantly believe that this type of measure is an overstep by the state onto county home rule responsibilities,” he said.

A couple committee members suggested that neighbor island county government officials shouldn’t be asking the state to do what counties could do on their own.

Honolulu City Council Chair Tommy Waters said in written testimony that he has concerns with the bill’s top-down, one-size-fits-all approach that cuts out county councils from making informed and reasonable decisions on zoning and development for individual communities with unique circumstances.

“The concept of County homerule with regards to planning and development recognizes the importance of each County being able to preserve and protect the unique qualities and values of their residents,” Waters said. “As such, any effort to diminish the long standing powers of the counties must be carefully considered and even then approached in the narrowest way possible.”

Waters suggested, among other things, that the minimum lot size be removed from the bill.

Compromise

Rep. Luke Evslin, chair of the House Committee on Housing, recommended passing SB 3202 with such an amendment.

“I know that this is a really sensitive subject to so many on both sides,” he said before the vote. Evslin (D, Wailua-Lihue) led 16 colleagues introducing a companion measure to SB 3202 that stalled in the Senate in March.

Rep. Linda Ichiyama, chair of the House Water and Land Committee, said she appreciated the effort to reach a middle ground achieving the bill’s goal, but couldn’t support the provision allowing at least two additional dwelling units on lots zoned for single-family use in the state urban land-use district that includes suburban and rural areas.

“I am just not sure, and I am not comfortable that … this is the right way to go,” Ichiyama (D, Fort Shafter Flats-Salt Lake-Pearl Harbor) said, noting that some members of her family have struggled with finding affordable housing in Hawaii.

Rep. David Tarnas, chair of the House Judiciary and Hawaiian Affairs Committee, agreed to the recommendations by Evslin and Ichiyama to keep the bill alive.

“I want to see this move forward,” said Tarnas (D, Hawi-Waimea-Waikoloa).

Evslin endorsed the compromise, and a unanimous vote resulted to send the bill to the 51-member House for consideration.