HomeMy WebLinkAboutCOM 0675.569 2022-2024b6U Kl/
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From: RaduNioara
Sent: Saturday, September 2l20243:27PK4
To: Council Testimony
Subject: Bill 121 Policy Committee Discussion on Short -Term Rentals
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Dear Committee Members,
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I am an owner of a Vacation Rental; therefore, I am not going to write from my point of view or interest, which
are well known. | anngoing tOwrite from 3Dobjective and practical point ofview, including county interest,
your voting block and hotel lobby who provide campaign donations. What | want to explain below isthe fact
that this Bill is going toaffect in a negative way everyone and that it is a lose -lose proposition across the
board.
Comments have been made by the committee members that the bill is going to help the poor and the working
people. | disagree with that even ifthe REprices are cut inhalf. However, isthat what the County wants? TO
cut the property taxes they collect tOhalf? Without ample amounts Dfcash, how will the county beable LD
help the poor, maintain and improve the infrastructure? Raising all other taxes? How is'thatbeneficial tothe
working people orthe hotel lobby? The county collects lots oftaxes, not only from the TAT but from the cars
the tourist rent and the restaurants the tourist go. All the money the tourists spend inthe local economy help
with the taxes. If the county wants to crack down on owners who don't pay the taxes, then I
understand. However, donot kill the goose laying the golden eggs.
Hawaii County has only two powerful industries to sustain the island economy - Tourism and Real Estate. That
provides most Ofthe money for working people and the county taxes. |none blow, this Bill is going to destroy
both. Although the people using the hotels and VRBO are called tourists, the market segments are different
and they overlap just a little bit. Couples without Children, prefer to use the hotels. Couples with children,
prefer to use VRBO/ABNB because of kitchen available and they are not separated from their children - they
are together. Sometimes, they have family reunions. |fthe county eliminates most Ofthese AbnBand VRB<]s
this market segment will disappear almost entirely and everyone loses. Most ofthe owners who have these
homes, for one reason or another travel quite a bit and they have the houses paid off anyway. They are not
going tosell; just keep them empty for many months inthe year. Exeryone|oses-theovvners,thecounty
(collects less taxes), the working poor. For example, the cleaning lady | use makes $SO/hourand she has more
work than she can handle. How many jobs on the island pay more than that???!!! At that price she is the least
expensive out ofthe reliable workers available. There are many jobs like that, that would disappear. There
are also many jobs in services dependent on these vacation rentals; many of these pay more than $150/hour.
Every year, between the property taxes and TAT, I give the county over $30,000 in taxes. |fyou cut the value
ofthe RE, the REtaxes will belower. One Vfthe stated objective ofthe bill is1mmake house prices more
affordable for the working people - that means drop the house prices. So, I'll probably give the county only
10,000 (less value for the house and less the TAT taxes) - I am losing massive for keeping the house empty
many months ofthe year and soisthe county. Myloss, isnot someone e|se's gain-itisa|osaacnossthe
board for everyone. What we have now, before the bill passes, iS8win for everyone.
Let's talk about the hotels. How would the hotel business benefit ifthe County has way less money tO
depressed economy where everyone is struggling? How can the county help the poor if they have way less
money than before and there will be more of them? How can the county employees keep their jobs if the
county will run big deficits? As you know, the county can not use the federal money system of deficits
because it can not print money. There will be only 2 options - cut many county expenditures or increase all
other taxes for all. Both are bad for everyone.
The rents and RE prices are high for many reasons, but not due to VRBOs: they are high mainly due to a
depreciating currency (due to massive money printing and massive federal deficits) - the county doesn't have
any control over that. They are high due to the fact that everything costs more due to shipping costs - a higher
cost of living then begs for higher maintenance cost. The more tourists come, the more of the newly created
money (money printing) will pour in the local economy and everyone benefits. I know the county built lots of
housing for the poor or working poor. With less money collected, the county will have less money to maintain
the existing stock of housing (like Section 8), forget about building more housing.
If the hotel lobby thinks that the VRBOs compete with them, then they are short sighted. They don't see the
bigger picture. They will not gain the extra tourists and they will lose far more, like I explained above. The
poor voting block, will also have far more to lose regardless if they understand the implications of this bill in
their lives. In the end, they will blame the county for not doing more to help them. How is the county going
to do more with less money???I I I....
Another argument in favor of the bill is the fact that tourists make noise. I totally disagree with this. I never
heard any of my neighbors complaining about this and I have a written policy for quiet times. Actually,
statistically speaking, people living on the island with friends or relatives create far more noise pollution
especially over the week end. Most people know that.
If a committee of business people, economists will do an objective analysis of ALL the implications of this bill, I
am sure they will reach the same conclusions like mine - it is a losing proposition across the board. It happens
that I was a business owner all my life (CEO) and I have an MBA. I took advanced classes in economics and
that helps me to see the bigger picture.
I believe that the committee is looking at this bill from a narrow perspective and it is going to affect the
members of the committee in a negative way, too. Nothing happens in a vacuum; everything is
interrelated. It might not affect the committee members in a direct immediate way, but it will.
I cannot be present there on Wednesday in person, but I would appreciate if the members will read this
email. It might help all the constituents. I could have explained in more details my position, but the email is
already long as it is.
Thank you,
Radu Nicoara