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HomeMy WebLinkAboutCOM 0675.153 2022-2024 January 22, 2024 HAWAII COUNTY COUNCIL POLICY COMMITTEE ON PLANNING, LAND USE AND ECONOMIC DEVELOPMENT Councilmember Ashley Kierkiewicz, Chair, Dr. Holeka Inaba,Vice Chair MEETING DATE: Tuesday, January 23, 2024 TIME: 1:00 pm CD(-) PLACE: Kona RE: TESTIMONY IN OPPOSITION TO BILL NO. 121-24 • Dear Chair Kierkiewicz, Vice Chair Inaba and Council Committee Members: I testify today as a homeowner, full-time resident of Hawaii Island, permitted STVR owner and employer of 4 part time regular vendors, in opposition to Bill No. 121-24. I believe this bill is flawed and cannot achieve the goals intended by the authors. The stated purpose of Bill 121-24 is three-fold: (1) ensure that all TARs in the county are operating safely, legally and in adherence to the same set of operational standards; (2)preserve the character of our residential and agriculture areas, while reducing the speculative investment of properties; and(3) address housing affordability for residents by keeping more housing in the long-term rental market, reducing the inflationary pressure TARs have on long-term rental rates, and making it very easy to build accessory dwellings (`ohanas) for family or long-term rentals.Although these are noble goals for very real issues, as discussed more fully below the bill has the potential to disproportionately affect those residents on the lower socio-economic scale and who rely both on the income and availability of temporary housing and could conflict with existing state statutes. For these reasons, I respectfully request that this Committee not pass this bill as written and offer suggestions for amendments that would minimize the harm to my community members. A. Stated Purposes are not Achievable with this Legislation As touched on in the paragraph above, Bill 121-24 is proposed to ensure safety and adherence to a set of"operational standards,"preserve the character of our neighborhoods while reducing speculative investment, and address housing affordability. Unfortunately, rather than ensure compliance, many of the standards simply duplicate regulations already in code(noise abatement, parking requirements and zoning and code compliance)which continue to be an issue for all residents, not just neighbors of short-term rentals. If Bill 108 with regulated unhosted rentals did not solve these problems, additional rules targeting hosts who live on the same property of the rentals will not have a different result. Rather,the greater number of parking, noise and code issues appear to be the result of long-term occupants and residents. Unless and until there is an actual analysis performed to suggest most of these issues arise in rentals where landlord is onsite with the tenant,perhaps the focus of the council, in their efforts to address these complaints, should be to work with the existing agencies responsible for enforcement of these complaints for the entire islands'residents, rather than target a subset of homeowners who happen to be the least likely to allow such behavior. Comm. N . U�&• 1 Ref. To: V Ref. Date JAN 2 3 2024 The standards proposed are beyond reasonable in many areas where they may actually present privacy and security concerns. The signage requirement along with the public list of rentals present a security issue, particularly for single women or older folks. It isn't safe to alert(by signage)passersby (and any potentially nefarious persons)that a particular home is a short-term rental and therefore intermittently nearly or completely empty. This signage requiring the display of a registration number large enough to be visible from the roadway (§25-4-16.17(3)(D)) is a bad idea. I would not want my elderly neighbor or single female friend who each rent out a room to have to worry about burglary, robbery, or worse,when their online calendar shows they may be home alone.A public list of rentals could also be used by criminals to identify targets for burglary, squatting or home invasion. These may not.be problems yet in our County, but we certainly hope the council doesn't inadvertently make these criminal acts easier to achieve. This bill will do nothing to further reduce "speculative investment" or"preserve neighborhoods" as stated. The Planning Department has openly commented that NUC certificates issued to STVRs in residential areas have decreased since the passage of Bill 108, 5 years ago. That legislation did effectively curtail the widespread speculative investment in our neighborhoods,but this will do nothing to curb future investors. In fact, it will result in an increase in vacant homes because future or current owners who can afford to hold properties vacant will choose to do so rather than entering the long-term market or trying to manage the onerous standards this bill seeks to implement. The UHERO report noted that vacant homes put upward pressure on housing costs and according to Airdna,the US Census and the HTA, in the last 5 years the number of vacant homes has increased by 21% across the state. This number is sure to increase if this bill is passed.And, as this bill would allow an owner-hosted rental to operate at "any time in any zone,"the preservation of the "character" of our neighborhoods isn't changed by this bill. It only serves to burden owners with greater fees, threaten higher penalties, and ultimately, eliminate their ability to use their real property to improve their future—as an operator run rental. Finally, the drafter's attempt to address housing affordability, which we know is a complex issue as evidenced by the fact that housing has been a primary concern of this island/state for decades. According to the drafters, and if the UHERO blog post is right, and all short-term rentals were eliminated tomorrow, area rents would decrease by 5%. That$2000 a month studio would now be $1900. Is that a material reduction in pressure? It's debatable. But what is statistically significant is that according to Hawaii Tourism Authority's Economic Impact Report, if all STRs were eliminated tomorrow,the Big Island would lose 11,323 jobs which pay an average of$39/hr, creating $566 million in household income and over$2 billion in sales to county businesses. The bill drafters acknowledge inflation and housing scarcity has also contributed to rising housing costs which makes this income stream even more important for those who need it to survive, from local owners to local businesses. B. Unintended Consequences Disproportionately Affect Low-Income Residents and Reduce Housing Security Residents seem to be the forgotten segment of people who need short-term rentals—even as we carry a torch and create laws that we say are on their behalf. HTA found that 21% of travelers are non- visitors. These are the residents who use short term rentals. These are people traveling for work, for medical services, to visit family on their own island or neighboring islands. These are the folks who are waiting for their home to be tented or repaired,needing a place to live in between long-term homes and those who are just entering the workforce and don't have the rental history needed to secure long-term 2 housing. These are also almost always on the lower end of the socio-economic scale: those young folks transitioning out of the family home, recently divorced, don't have a high enough income, or credit score,just getting back on their feet, or just want to live in areas before purchasing or signing a year lease they are locked into. These aren't folks who want, or can afford, to pay resort fees and stay an hour away from schools,work, family, doctors' offices. Without temporary housing options for these residents, in residential areas, their housing costs would skyrocket. On the other side of the same coin are all those who work in the industry. They have the ability to work a more flexible schedule, in their own neighborhoods and for a livable wage. In fact, some of these folks would benefit from becoming a long-term tenant operator where they can work and live in the same place. Over time, as likely intended by this bill and demonstrated by Bill 108, availability of these options will dwindle, always resulting in an upward pressure on housing costs and the reduction of housing security for all those involved. C. Provisions Preempted by State Law Finally, the passage of this bill would create immediate standing to that subsection of owners not grandfathered in and who will be deprived of their vested rights as residential homeowners and would likely result in substantial and costly litigation. This Council created law 5 years ago(Bill 108)that made the operation of unhosted rentals for a minimum of 30 or more days legal. Those rentals were specifically NOT short-term vacation rentals, by the definition created by this Council. Hawaii Revised Statutes state that no county can subsequently phase out preexisting residential use properties that are legal when the laws are revised. This preemption was reiterated in December when our District Court found in favor of the Plaintiffs in the HILSTRA vs City & County of Honolulu: "Pre-existing lawful residential use is protected by state law." If this bill grandfathers in Ohana units and operator-run units in residential areas, why not also grandfather in those units that are currently legally operating as unhosted, with the same proof as you require all others? To knowingly leave one segment out-the segment that has a demonstrably good legal cause of action and likelihood of success—seems like bad faith and negligent use of public funds. D. Recommend Amendments Registration is not a bad idea. It will make it decided easier for the County to ensure appropriate property tax treatment and payments. It will make it easier to identify the legitimacy of complaints and increase revenue in the County to support the budget for enforcement of basic rules when needed. However, some of the provisions in this bill are overreaching, punitive, disproportionately harmful, and conflict with existing state law. Please consider the following amendments: Remove the affidavit requirement. Grandfather in all pre-existing legal unhosted 30+ day rentals (proof of operation prior to Jan 24. Equal treatment of owner host and operator host. Remove restrictions about where you can live as an owner host(as long as on the same parcel); Remove dangerous signage requirement. Use a unique identifier for the `public' list rather than an address. Remove the full site plan and `drawn to scale'requirements.Allow hand-drawn applications. 3 Finally,publish the full complaint and violation process and allow an owner to work with the investigator rather than pushing everything through an Appeals Board. We should all work together to solve violations. That is the community I want to be part of. For these reasons, I respectfully request that this Committee not pass this bill as written. Thank you for the opportunity to testify. Respectfully submitted, Jennifer Wilkinson 4