Hawaii has now reached the tipping point for reforming land use, especially where residential needs are concerned. Arguably, this was inevitable for a land-poor island state where residents pay a high premium for housing, if they can find it at all.
But it was the tragedy of Aug. 8 that has forced the issue, on Maui in particular, propelling the state into a much-needed regulatory overhaul of its short-term rentals system.
The displacement of thousands of residents in the Lahaina and Upcountry wildfires has turned a simmering housing shortage into a full-blown emergency demanding a bold response.
That response was the enactment of Senate Bill 2919, which enables the counties to “regulate the time, place, manner, and duration in which uses of land and structures may take place.” The effect is to allow county lawmakers to curb using residential property for short-term rentals (STR), a use that has taken hold across the tourism industry.
Vacation and bed-and-breakfast renters can turn over in days or weeks, compared with long-term residential rentals of months or years, boosting revenue incentives for landlords. Maui’s efforts to restrict B&Bs 35 years ago exempted 7,167 rentals that had been in place at the time. With the fires displacing 12,000 residents, reclaiming these units for long-term use became critical.
Mayor Richard Bissen has begun what will be a long and complex rebalancing of the residential landscape. It’s encouraging to see him starting with the necessary resolve.
His proposal is to phase out 2,200 vacation rentals in West Maui apartment districts by July 1, 2025, an aggressive first step. Bissen plans ultimately to phase out all 7,000 units in apartment districts across the island.
Speaking at a May 2 news conference, the mayor acknowledges that this policy is sure to draw legal challenges. But he also rightly defends the move because most of the affected vacation rentals had been built as workforce housing.
“Our goal is to return them to their intended purpose,” he added, which is the least that any government faced with an intractable housing shortage should do.
Other counties have work to do, too, although Kauai County already seems to have landed in a comfortable spot. Although SB 2919 lays the legal foundation for counties to phase out STR units, Kauai Mayor Derek Kawakami said his county would “stay the course” in what it’s been doing on its own to enforce existing rules against illegal STRs.
Given that Kauai has cut the 2017 tally of illegal units from 1,200 to about 50 today, that’s a rational position. Even so, it’s good that should vacation-rental abuse accelerate, Kawakami or his successor will have tools to keep things in line.
Hawaii island is still only at the starting gate with its regulatory scheme. Its mayor, Mitch Roth, does not have immediate plans for a phase-out.
But having SB 2919 in its back pocket does give the county leverage against opponents of even proposed amendments closing loopholes and requiring all rental operators to register their properties.
Oahu, the principal STR battlefield until now, already has implemented restrictions against vacation rentals in residential areas. Council members and planning officials now will consider whether to establish administrative rules under the new state law. The U.S. District Court last year allowed rentals offering a 30-day term to continue; reopening that issue demands a full discussion.
Guardrails protecting residential zones will take years to reestablish. But well-considered regulation should supply at least part of the solution to the state’s housing crisis, in clear service of the public good.