COM 0358.000 2006-2008 - Laserfiche WebLink

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Honorable Pete Hoffmann Chair and Presiding Officer and Members of the County Council COUNTY COUNCIL Page 2 Apri12Q 2007 a strong market for upscale housing, private development will cater to the high-end market if we don't have a requirement to serve a broad range of the population. Market forces have pushed home prices on the island out of reach of ordinary working people. The average family of four on the island earns about $55,000/year, and at current interest rates, can afford a home costing about $227,000 according to HUD guidelines. But the median price of homes in North Kona last year was $645,000, in South Kohala, $550,000, and in South Hilo, $362,000. Although home prices have stabilized and may be dropping somewhat, they are still far out of reach for most families. The current affordable housing requirement is very reasonable. It requires that 20% of homes being sold are offered at a price that people earning 120% of the median income can afford. If homes are sold at lower prices, the percentage requirement is less. For example, at the 100% of median price level, the requirement is 13.33%. By definition, half the population earns less than 100% of the median, so we are only requiring that 13.33% of homes be sold at a price that the average family can afford. If only lots are developed, a percentage of lots must be sold at affordable prices. Hawaii County recently had an analysis done (by David Rosen & Associates), as part of the Kona Community Development Plan, that showed that the current affordable housing requirements are financially feasible for private developers. We have consulted with corporation counsel in preparing this bill and we believe Hawaii County has the legal power to apply these affordable housing requirements to properties without specific affordable housing conditions attached to their zoning. This is commonly done in Mainland communities with inclusionary zoning laws, for example, San Diego Municipal Code sec. 142.1301-1312, and Napa County Code Chap. 15.60. This proposed ordinance does not change a landowner's zoning. They can still build according to their zoning, and, in fact, Chap. I 1 gives them incentives to develop more housing. The proposed amendments would be applied at final subdivision approval. For projects that typically do not go through subdivision, such as multifamily developments, the checkpoint will be plan approval, an administrative stage where the site plan is reviewed at the Planning Department, typically just before the building permit. The affordable requirement would also apply to sites that go through a condominium process.