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Home My WebLink AboutCOM 0675.508 2022-2024HEATHER L. KIMBALL COUNCIL CHAIR Council District I (North Hilo, Himikua, and portion of Waimea) Phone: (808) 961-8828 (808) 961-8912 Email: heather.kimball(( ,�hawaiicounfy. goi) HAWAPI COUNTY COUNCIL COUNTY OF HAWAI'l 25 Aupuni Street, Ste. 1402, Hilo, Hawai'i 96720 DATE: October 2, 2024 TO: Hawaii County Council Members FROM:rl Heather Kimball, Council Chair Council District 1, County of Hawaii SUBJECT: Bill 121, Draft 4 and its Proposed Amendments Attached for your review is an outline and slide deck highlighting Bill 121, Draft 4 and its proposed amendments. Due to the importance of the transient accommodation topic and the wealth of modifications being proposed, the attached content provides a simpler review of the proposed amendments before you today. Should you have any questions regarding this communication, please do not hesitate to contact me. Thank you. HLK/dbk Hawaii County is an Equal Opportunity Provider and Employer Comm. No Ref. To: Ref. D'ate—IOCT 2 2024 Bill 121 Outline October 2, 2024 Bill Section 1: Repeals the definition of short-term vacation rental Bill Section 2: Adds several definitions the most important of which are: 1. Transient or transients — This is where we exclude rentals to students, military personnel, traveling nurses etc. from being transient accommodation rentals by noting that they are not transients. This list comes primarily from the HRS, though some have been added 2. Transient accommodation and transient accommodation this differs from the STVR definition in it is a rental of 180 days or less and defines what types of rentals are excluded. 3. Amendment puts back in the 5-bedroom limit. 4. Amendment adds Family Trust for the ownership section 5. Amendment adds Host, amends Operator and Owner -hosted, and removes Operator hosted to account for the combining of owner and operator hosted. Bill Section 3: Amends the definition of reachable person so that it refers to TAR rather than STVR Bill Section 4: Repeals the current STVR code Bill Section 5: Inserts the new TAR code 1. Section 25-4-16. — Lists the exemptions when a rental does NOT need to be registered as a TAR. This is where we exclude non -transients from the definitions. It also excludes short term rental in an emergency, home exchanges, month to month leases and people who have an existing Bed and Breakfast permit. Clerical amendments 2. Section 25-4-16.1 — Describes where an owner -hosted rental can be established: anywhere at any time. Except not in an additional farm dwelling because of HRS 205- 4.5. Requires the owner to live onsite. Amendment: a) Will combine owner hosted with operator hosted. b) Will require evidence of agricultural activity in the first farm dwelling. c) Will move NUC to section d) Removes the fee list from this area so fees are just in the table 3. Section 25-4-16.2 — List where an operator hosted can be (same as un-hosted going forward) and allows for a NUC to grandfather in those not in the permitted area. This would prevent any new operator -hosted TARs outside of the permitted areas. Amendment will remove this section due to case law that indicates that operator and owner hosted must be treated the same. 4. Section 25-4-16.3 - Lists where new un-hosted TARs can be started and creates a non- conforming use to grandfather in TARs ONLY rented for 31-179 days since bill 108 took effect. This will become Section 25-4-16.2. 5. Amendment will change Section 25-4-16.3 - to describe how a TAR can be owned. Must be natural person or persons with at least 50% ownership. Can be owned by Trust, LLC etc. under certain conditions. 6. Section 25-4-16.4 - FEE TABLE 7. Section 25-4-16.5 - Lists other registration requirements such as parking, health and safety, and current on taxes. 8. Section 25-4-16.6 - Defines the timing for registration. Sets it up so that after the bill passes people will have a certain amount of time to submit their registration. They can keep operating while their application is reviewed. If they already have a registration the department will set a renewal date. Clerical edit 9. Section 25-4-16.7 - describes what documentation is needed to register. Amendment would add documentation of agricultural activities if in a first farm dwelling and require an affidavit provided in person authorizing the operator to address violations and health and safety. 10. Section 25-4-16.8 - Says you get fined if you don't register. 11. Section 25-4-16.9 - Sets deadlines documentation requirements and a late fee for registration renewals. Amendment would add annual verification of agricultural activities and clerical edit. 12. Section 25-4-16.10 - Lists why a renewal might be denied. 13. Section 25-4-16.11 - Standard language to allow for an appeal of denial 14. Section 25-4-16.12 - Lists what someone needs to do when are changes to a TAR operation as far as notifying the department. It also covers what happens when a TAR is sold or transferred. Amendment would phase out NUC on sale or transfer, now permitted under Act 17 2024 and clerical edit. 15. Section 25-4-16.13. Describes what happens and the timing to apply when you get an NUC. Clarifies if you violate the condition under which you get the NUC that will cause you to lose the NUC. Amendment would establish the following NUCs to "grandfather": a) Owners with more than one transient accommodation rental; b) Owners who do not meet the ownership criteria; c) Transient accommodation rentals located on an adjacent building site; or d) An un-hosted transient accommodation rental that has been rented only more than 30 days and therefore didn't get an NUC under 108. Excludes farm dwellings. 16. Section 25-4-16.14 - Sets up annual NUC renewal process and late fees. 17. Section 25-4-16.15 - Lists why a NUC might be denied. Amendment would add change or transfer of ownership to this list. 18. Section 25-4-16.16 - Standard language to allow for an appeal of denial of NUC 19. Section 25-4-16.17 - Lists rental standards: a. Posted information and responsive management standards: certain information must be posted for the renters, host must be on site, there must be a reachable person for un-hosted rentals. Amendment adds adjacent property allowance b. Good neighbor standards: Renter limit (Amendment sets the max at 12), non -guest limit at double renter limit, no meals other than breakfast, no events without a permit, noise limits, parking. c. Advertising and signage standards: requirement to list TAR and NUC numbers on advertising, no events advertising without a special use permit, sign code alignment, visible addresses. 20. Section 25-4-16.18 — Lists the evidence that the county can use to determine that a TAR is in use. 21. Section 25-4-16.19 — Sets the Fine schedule 22. Section 25-4-16.20 — Lists what the director must do if a complaint is submitted regarding a TAR 23. Section 25-4-16.21— Sets up the TAR enforcement account, where all the fees and fines go. 24. Section 25-4-16.22 — Allows the director to add additional fines of two times the nightly rate. Makes it clear that both the host and owner are liable if there is a violation. Amendment: shall to a may 25. Section 25-4-16.23 — Standard language to allow for an appeal of the directors finding of a violation. 26. Section 25-4-16.24 —Allows the director to suspend registration for two years for repeated violations and allows for the denial of renewal if a violation is not addressed. 27. Section 25-4-16.25 — This is taken out of Chapter 19 and describes the tax impacts on homeowners if they do a TAR. This is just so people have the information in the same place as the rest of the TAR information. 28. Section 25-4-16.26 — Since we want people to register this creates a way to give amnesty to people who have been operating a TAR and didn't know the tax implications, so don't want to keep doing it. They won't be charged back taxes or lose the Homeowner tax class (this cannot be retroactive). It also eliminates rollback taxes for people who want to keep renting a TAR. 29. Section 25-4-16.27 — allows the director to open up NUCs again if there are a number of TARS lost in a district. Bill Section 6: Visitor Destination Areas Bill Section 7: Requires reporting by Air B&B, VRBO and the like of the TMKs they have listed on their sites on a monthly basis. 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