2024-04-01 PL-CCI-2024-000003 Bill 121 Brian Fredrickson Testimony

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B. Priced Out of Hawaiian Vacations: There is almost no recognition or discussion of how the strict regulation of transient vacation rental properties impacts the availability of Hawaiian vacations and tourism lodging to a broad cross of the traveling public. According to a recent study,Hawaiian hotels are the highest earning hotels in the United States.'It goes without saying that restricting the supply of transient vacation rentals is in the interest of these hoteliers and drives up the price of a Hawaiian vacation. One estimate put the average cost of a ten day Hawaiian vacation on Oahu for a family of four at$13,493.9 How realistic is it to think average Americans can afford a Hawaiian vacation when the median household income in 2021 is$69,021?10 It is hard to imagine that 50% of the US population,or over 166 million people,would be in a position to spend at least 20% of their annual income on a Hawaiian vacation. Maybe it is by design that the state and Hawaii County favor high income earners as vacationers. The strict regulation of transient vacation rentals adds to this economic favoritism by forcing vacationers to stay in expensive hotels and to eat in restaurants rather than use kitchen facilities typically found in transient vacation properties. C'. TARs are Not Iniurious to the Preservation of Agricultural Land and Farming: The goal of preserving agriculture and agricultural land on Hawaii Island is not negatively impacted by the presence of TVRs or TARS. In fact,most small-scale farmers are dependent upon outside income sources to supplement their income and to preserve their way of life. "For fruit and vegetable farmers, off-farm earnings accounted for 43 percent of their income,while field crop farmers earned nearly all their income-84 percent of it—by working off-farm."11 As such,TARS provide farmers with an income stream that negates the need to travel or work off-site. It also preserves a valuable commodity to farmers,which is time. Agricultural land conversion and farming success on Hawaii Island and elsewhere are caused by a plethora of issues, almost none of which involve TARS or TVRs. According to a University of Hawaii policy paper, overall farming success in Hawaii has been hampered due a multitude of factors,including the exodus of the sugar industry,considerable fallow land,low mechanization rates and higher than average labor costs.12 Agricultural land conversions have been governed by the Land Use Commission (LUC) since the 1960s. As such,the conversion of agricultural land to housing or another use is controlled by the LUC's decisions.13 D. Are Arguments about Safety Considerations for Transient Vacation Rentals Accurate? Safety is frequently used as another motive for the stringent regulation of transient vacation rentals. The assumption is that a lack of frequent inspections or differences in construction standards logically leads to the conclusion that vacation rentals are less safe. It is unclear what"less safe"means in this context since all structures,including single family homes,hotels and other types of business have been subjected to a wide range of engineering and construction reviews and permit requirements by Hawaii County. While follow up inspections by public officials on private properties occurs infrequently,most insurance companies also do routine inspections of insured properties to help clients avoid problems with the potential for personal injury or property damage. Health inspections for transient vacation rentals are completely at odds with the reality of how people use these types of accommodations.Most vacationers use transient vacation rentals so they have some control over their own lodging arrangements and meals. If the rental is not maintained and sanitary,these facts will be reflected in the reputation ratings that follow each property. Transient vacation rentals are not commercial restaurants or food production facilities. As such, food safety is the responsibility of each individual user. So,unless the County wants to get in the business of policing food safety in single family homes,this is an inconsequential issue. 3 1 P a g e