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HomeMy WebLinkAboutMIN CRCOC 2025/09/16 (2024-2026)DRAFT Committee on Communications, Reports, and Council Oversight llth Session West Hawaii Civic Center 74-5044 Ane Keohokalole Highway, Building A Kailua-Kona, Hawaii September 16, 2025 CALL TO The regular meeting of the Committee on Communications, Reports, and ORDER: Council Oversight was called to order at 9:M a.m., in the Council Chambers, Kailua-Kona, by Ms. Michelle M. Galimba, Chair. ROLL CALL: Present: Ms. Michelle M. Galimba, Chair Ms. Rebecca Villegas, Vice Chair (carve in later) Mr. James E. Hustace, Member Mr. Holeka Goro Inaba,Member Ms. Jenn Kagiwada, Member Ms. Ashley L. Kierkiewicz, Member(via videoconference from Hilo) Ms. Heather L. Kimball, Member(via videoconfetence from Hilo) Mr. Dennis "Fresh" Onishi, Member(via vieoconference from Hilo, came in later) Absent& Excused: Mr. Matt Kaneali`i-Kleinfelder, Member STATEMENTS The Chair directed the Committee to proceed to the next order of business, FROM THE Statements from the Public on Agenda Items. PUBLIC ON AGENDA ITEMS: (There were none.) COMM-UNI- The Acting Chair directed the Committee to proceed to the next order of business, CATIONS-:-- Communications. Comm. 476: FISCAL YEAR 2024-2025 AFFORDABLE HOUSING PRODUCTION PROGRAM ANNUAL REPORT From Housing Administrator Kehaulani Costa, dated August 13, 2025, pursuant to Section 2-2 of the Affordable Housing Production Program Administrative Rules. Motion to Close File: Mr. Inaba moved to close file on Comm. 476. Seconded by Ms. Kagiwada. CHR. GALIMBA: We have Administrator Kehau Costa here to discuss this communication. Thank you. CRCOC-11 September 16,2025 (Note: At this time, Housing Administrator Kehaulani Costa came forward to address the members of the Committee.) MS. COSTA: Hi. Good morning. Kehau Costa, Housing Administrator. So we've submitted to you the annual report on our Affordable Housing Production (AHP)program. The goal of this report is to promote transparency and accountability regarding the use of public funds and the status of funded projects. The main portion of this report highlights the second,round of projects awarded through the AHP program. The summary section provides an overview of all projects funded to date. This report along with previous years' reports and plans are available on the OHCD (Office of Housing and Community Development) website for public viewing. The affordable housing production,program was establishedunder Ordinance 22- 77, appropriating at least$5 million annually to OHCD for affordable housing initiatives. OHCD oversees planning,,administration, and implementation of County housing programs to foster viable communities. The goals and priorities for round two of this fund, which was fiscal year 2024- 2025, those goals and priorities were developed,through a series of public meetings and surveys and housing studies aimed4tunderstanding the community's affordable housing needs. OHCD established the goals and priorities for the second round as foll6s, seruing the gap group 81 to 140 percent AMI (Area Median Income) and expanding housing options for moderate income households that are not eligible for subsidies and unable to afford market rate housing. The second goal priority is to promote homeownership; for sale housing, down payment assistance,'and,rent to own models for workforce families. And then the third goal ancpriority was new construction and adaptive reuse. The key takeaways from this report are that OHCD awarded $13.275 million to four projects in the second round directly advancing the County's housing goals. The program is strategically addressing workforce housing and the gap group, compliments federal and state housing supports. The selected projects are currently in various stages of pre-development and development and there are a few representatives here today in Hilo and here to talk about their projects if you have questions. So just kind of to recap, four projects were awarded. Hale Ola O Mohouli for construction of a multi-family units for elderly and families. They were awarded $3.2 million, but they were not awarded LIHTC (Low-Income Housing Tax Credit) funding so that$3.2 million came back to our affordable housing production fund and will be reprogrammed in this next round in the third round of funding. Page 2 CRCOC-11 September 16,2025 The second project was Kuakini Family Affordable. That's here in Kailua-Kona. Jeff Furuta should be on Zoom. That was for acquisition of land and construction of multi-family housing units. The third project is Kaiminani Subdivision. That's a County project. OHCD is managing that project. That's for infrastructure development to support future housing opportunities in Kaiminani. And then the fourth project is our Home Improvement Loan Program (HILP) and that is kind of like our residential repair program that we're managing out of OHCD. We have program staff in Hilo to talk about that program if you have questions. CHR. GALIMBA: Council Member Hustace_, MR. HUSTACE: Thank you, Chair. Could you share some thoughts, Administrator, and the progress on'the HILP and kind of the recent outreach you've had from your departments and interested parties and what that process is going through right now? MS. COSTA: So I will if I can ask Courtney Vincent, who's managing this project, she should be in'Hilo Chamber to kind'of,give some highlights. I am really excited about this program that we're offering through OHCD. It's for low- income families to receive a deferred loan up to $50,000 for home repairs. It's a 15-year deferment, low interest. We've awarded, through our competitive process, we awarded this program $875,000. So it's really about only 17 families if they take the full $50,000. We're only serving about 17 families, so we'd like to see that program expanded in the future. MS. T4IMBALL: There's no one over here from Housing in the Chambers. MS. COSTA', Okay. Okay. So basically what we do with this program once a family;applies we qualify them for the program. We send our contractor out to work with them on,what they would like to repair in their home and it's almost like a home inspection. So the contractor will—maybe they want to change their roof but maybe it's really not the priority. The contractor will go out and say,you know, actually it's your electrical that needs to be upgraded and that's a health and safety priority. They work on an action plan for those repairs with the family and then we fund the repairs. MIS. HUSTACE: So 17 families. Have we had 17 apply and have we filled all 17 possible seats then? MS. COSTA: Yeah. We're in the application process. We've had more than 17 families apply. I think right now we have nine or ten that are MR. HUSTACE: Could I ask how many have applied? Page 3 CRCOC-11 September 16,2025 MS. COSTA: I can get back to you on that. MR. HUSTACE: I'm just curious on kind of that distribution process. MS. KIMBALL: We have the Housing folks here now that maybe can answer that question. Thank you. MR. HUSTACE: Thank you, Council Member. MS. COSTA: So this is Courtney Vincent, and`she manages the program. And so she can probably answer those detailed questions for you. MR. HUSTACE: Thank you, Administrator, Yeah,just a question of the distribution across the island and the total number of families that have applied now that you're working with justyou have selected 17 of those.'— (Note: At this time, Housing Development Specialist Courtney Vincent came forward to address the members of the Committee.) MS. VINCENT: So far,we've received 28 applications and nine were deemed eligible and are currently going through the application process. And just for other information, two were deemed,ineligible, five'applications are still pending because we're waiting for missing documents and things like that. And then the remaining 12 are still currently under review. MR, HUSTACE: Okay. MS. VINCENT: And in regard to geographically, I've noticed that most applications have been,corning in for the Puna and Hilo areas, and a few have been received,for the west side. MR. HUSTACE' 'Thank you. And what was the sort of outreach that you conducted this program to be able to get that geographic equity? MS. VINCENT: Sure. So we sent out a bi-monthly newsletter from our division so advertising for the program has been sent out through that newsletter. It also Bolds a permanent spot on that newsletter as well, so every time it goes out people can use that link in the newsletter to access the program webpage and information. We've also held different resource fair events. One was just done in partnership with the Prosecutor's Office. It's called, "It takes a Villages." We had a table there to advertise the program at that event. I've also been asked to attend a visit in Pahala to present to the kupuna. They have a kupuna group out there that meets. So I did a presentation there in August. Page 4 CRCOC-11 September 16,2025 And we've also done a blast about the program through our department social media and through our webpage. And we also have another upcoming resource fair event, again in partnership with Prosector's Office, but for the west side. I think that's on October 17'', if I remember correctly. So I'll be advertising the program there as well. MR. HUSTACE: Thank you. The program is technically still open then for people to apply. Do you have a timeline of when, okay we've because we only have 17 possibilities and nine of them are currently called for, and then you're reviewing a couple and maybe some are ineligible. I don't know; I can't say for that. But you would leave it open for a period of length then still? MS. VINCENT: Yeah, sure. So I plan to have the application be available even if we dedicate funding for those 17 households just in case, you know, maybe something falls through, and it turns out that funding is actually still available for potential applicants. I'll also be accepting applications to keep those folks on a wait list, so when more funding does become available, they'll be notified that they can either submit updated informaticn,for their applications to be eligible for the next round of available funding. MR. HUSTACE: Very good: And the last question'I had is in terms of the type of distribution or type of outreach, what do you feel has been most effective? Because, you know, these are families that:are low to moderate income, maybe the are,not signed up for the department's emails or have quick access to technology but do you feel that those in-person outreach have been more effective? MS. COSTA If I could answer just really quick. To expand on the newsletter, the bi-monthly newsletter that we send out, that newsletter is specifically for our Ho`owaiwai Community of practice. So it's all of our agencies that are resource providers in the community. We are exchanging information. So it's not necessarily only to individuals, but that newsletter is specifically targeted to resource providers to further the reach of our information. We also partner with Vibrant Hawaii Community Navigators in all of our areas to promote these programs. We did a press release on this program, and I think we did public hearing on this program. So we really have worked hard to get this program out. I'm really proud of this program. I think it is an incredible opportunity for fariiihes to age in place, retrofit their homes for energy-saving, cesspool conversion. And so I'm hoping that we continue to fund this program and that is what Courtney is speaking to in leaving these applications open, developing a waitlist so that we know what the need is, and we'll continue to fund it, and we'll continue to promote it. So this is a good opportunity for each of you in your districts. If you know of community meetings that would really help us to get the word out, we're happy to come out and promote, and we've been distributing Page 5 CRCOC-11 September 16,2025 fliers. I know Parks and Recreation has distributed fliers for us on bulletin boards and in the public rec facilities. MR. HUSTACE: This is fantastic, Administrator. And thank you, Courtney, for sharing those details on it. And I hope we can allocate some more funding to this purpose in the future. So thank you for championing this. MS. COSTA: Yup. Thank you. MR. HUSTACE: Thank you, Chair. CHR. GALIMBA: Thank you. Council Member Villega . MS. VILLEGAS: Yes. Thank you. And thank you for being here, Administrator Costa. You know, this is the program you mentioned during one of the,sessions at Hawaii State Association of Counties conference last week. It was a joy to get to share the information you shared with me, so thank you so much for that. And it really showed the connectivity between what County is doing to help support, facilitate, and collaborate with state as we move towards complete energy independence. So I wantto thank you for the information you shared and all the details. And I see HSAC and us having this conversation here today also being a means to spread the word and share this good news with people because as I was in one of the conversations in that HSAC session, sometimes it's perceived that moving into energy independence, only the wealthy can afford, right? That it becomes kind of this socioeconomically exclusive opportunity, and this program helps ensure that's not the case. And having to redo my own roof a number of years ago and the tens of thousands of dollars that cost in order to replace our solar water heater panels, this makes it feasible. And as we navigate the heavy lift of transitioning off of cesspools and connecting to sewer, I know that that per home can cost,you know,just to connect from the home to the street can cost upwards of$30,000. So this money, it being such a low interest loan with deferment and for our kupuna, there's a potential for a 50 percent forgiveness. So anybody listening right now,please feel free to share the word. You can also find details and specifics about the program on the County website at housing.hawaii county.gov. It's called the home improvement plan program, HILP. So take a look, see if you qualify, and if you think of anybody that could benefit. I thank you for all your efforts to line this up to be successful. MS. COSTA: Thank you. And since we're doing an infomercial on this right now. I would like to say what I'm hoping happens with this program is that families can expand their, you know, add on to the house for generational, multi- Page 6 CRCOC-11 September 16,2025 generational housing, take advantage of the ADU (Accessory Dwelling Unit)bill, do it legally. Some of the barriers are that cesspool conversion. So if we can help families preserve their home, stay in their home, age in place, legally put on an addition, legally put on an ADU, we're just helping our families stay here and in their homes longer. So thanks for bringing all that up. MS. VILLEGAS: Yeah, mahalo. That is the intention. That's how we keep out next generations here. I yield. CHR. GALIMBA: Thank you. Council Member IKagiwada. Okay. Council Member Onishi. MR. ONISHL Thank you, Madam Chair. So I'just have a couple questions. So with this program, I see on the front'of it has that Hale O Hawaii University Heights house that was dedicated maybe a month ago or so. MS. COSTA: Correct. MR. ONISHL And that was through Pete Hoffman and their organization, correct? MS. COSTA: Correct. MR. ONISHI: Yeah. So with this funding we're talking about, I guess now it's like at least, 5 million, can that help with building more homes say in that Haihai property or help with the infrastructure? MS. COSTA: So your question is asking if these funds can help with the Haihai subdivision:that O 4C ''i currently looking at a feasibility study? MR. ONISHI: Yeah, correct. MS. COSTA: Yes. It can. MR. ONISHI: Okay. Good. And then my last question would be for that other program for those homeowners, does it allow I guess homeowners who are renting for affordable housing through Section 8, are they allowed to participate ilths program too? MS. COSTA: Which program? MR. ONISHL I mean, with that loan program, with the HILP. MS. COSTA: Okay. So the HILP program is for owner-occupied homes. So it has to be their primary residence. So this is not a program for a rental unit. Page 7 CRCOC-11 September 16,2025 MR. ONISHL Okay. MS. COSTA: You know you bring up a good question that I can explore further and also because we can do a little education here. So Section 8 voucher holders can move their voucher, their rental assistance voucher into a mortgage assistance voucher. They can use their voucher to subsidize their mortgage, and they are homeowners. We could ask Courtney if they would qualify for the loan improvement program. I believe they would as a homeowner. MR. ONISHL You can come up. You can introduce yourself again. MS. VINCENT: Hi. Courtney Vincent again. So yes;,as Tong as the applicant is listed on either the deed or mortgage statement, then they would qualify for the program as long as they occupy it as their primary residence. MR. ONISHL Okay. So there's no funding right now for someone who is in your program where their lease, having it like as affordable, right, and having like a Section 8 client renting that home; there's no help for that homeowner to improve their house? MS. VINCENT: The renters',not through this program. Yeah. MR. ONISHL Okay, okay, okay. -bb you think in the future there might be? MS. COSTA: I'm going to answer that, Courtney. So we do not currently have a program for investors to do repairs even if the tenant in that home is a Section 8 voucher holder. Could we do that in the future? I'm not sure. MR. ONISHT: Okay. Well you know why, because you mentioned earlier about this HILP could help with conversions of the cesspool to septic, right? MS. COSTA: Correct. MR. ONISHL So these homes that are being so called rented to affordable housing, some of them might be on cesspool yet. So for them to do the conversion, that might cost more, right? Well it's going to cost them more so then they might have to raise the rent. So they might not be able to participate in the affordable housing, right? So there needs to be something that we need to help them to do that conversion so that we can keep it affordable, right? So something to look at, right. And I yield. MS. COSTA: Agreed. Thank you. MR. ONISHL I yield. Thank you. Page 8 CRCOC-11 September 16,2025 CHR. GALIMBA: Council Member Kagiwada. MS. KAGIWADA: Thank you, Chair. Thank you, Administrator Costa, for being here and bringing this information forward. I just want to also kind of second what I've heard here, which is, you know,we have only $5 million going into this fund this year and you've been doing really amazing things with this money. If we want to do things like subsidize the Haihai project and other things I think we're going to need to look at considering doing more than $5 million a year. That's just the very base; that's the minimum ewe can do, but we can do more. So I just want to put that out there. I also think we should consider whether this wonderful home improvement loan program, which I very much support, belongs in an affordable housing production program or if it belongs somewhere else because I see it much more as kind of keeping our housing stock and keeping people in their homes than producing new homes. So I think it's just there's a lot there. I do think that we can'probably help more families and that's a relatively inexpensive way to keep somebody in their home who might otherwise lose it. Andit is a revolving fund, right? So if they pay back their loans in time or part of their loan if they get part of it forgiven, that's additional money that we have to keep putting out to the public. So I love the program. I think we need to look at, you know,how these pieces fit together a little better and get them in the appropriate kind of pots, and then look at how we're funding them: But thank you so much. I'm sorry to see the Mohouli project didn't go through, but funderstand there's just a lot of moving parts right now. And I'm so happy,to see the two bigger west side°ones or the two other west side ones are going through. So thank you so much for all your efforts. I yield. CHR. GALIMBA: Thank you. Anyone else in Hilo? MS. KIMBALL: Yes, Chair. CHR. GALIMBA: Council Member Kimball. MS. KIMBALL: Yeah, thank you. Just a quick response to Council Member agiwda's comment. When Council Member Kierkiewicz introduced the housing production fund legislation and I believe that was before Council Member Kagiwada was on the Council, we did have a long list of uses that were acceptable which did include items like this repair program or loan program. And I actually would contradict that I think this is the place that it belongs and I'm really, really thrilled that you guys have started it up again. I think it is an important part of the process to preserve more housing. Like you said, it will allow people to age in place. The response in my district has been really, really Page 9 CRCOC-11 September 16,2025 favorable. I would love to see even more funding go there because I think in terms of bang for our buck, it's a really good return on investment. I would also note that one of the additional provisions that we had added to the residential repair program was the opportunity for deed restrictions. And I know that there's a housing ad hoc that's meeting and I'm sure that they've discussed this option, but I do see that as another usage of these funds. Again, not necessarily production, but we get preserving housing in the affordable category. So I will agree that I think we should continue to fund this particular pot of money, even more than $5 million, because I think there's ways to leverage what we've made available as options. You know, talking to Council Member Villegas point, the stuff that the Hawaiian Council are doing,you know, if we can partner with them too in their plans to provide funding for hurricane readiness and energy, you know, I,think there's a way to really maximize the usage of all these funds by partnering together. Thank you. CHR. GALIMBA: Seeing no other lights or desires to speak, thank you. Go ahead. MS. COSTA: So before L leave, I just wanted to thank Royce Shiroma. He's our grant manager, so he oversees this grant program. And Linda Bui in our office, she manages the affordable housing production fund program. Courtney is a grantee of this fund, so it's kind of a you got to hear from a grantee. But the two that manage this program in our office are Royce and Linda and they came over today to just represent. So thank you to them. CHR. GAL IMBA: Yeah. Thank you to everyone that worked on this program. And I also, you know, I was actually looking around for this kind of program. I was looking atresidential repair, and I didn't actually pick up on the fact that there was a new program, so I also would be enthusiastic about expanding the funding, And I think maybe to Council Member Kagiwada's point, maybe making it bigger, going out for more partnerships,you know, perhaps getting the private sector involved and definitely want to put more money from this source of funding towards it because I think this is great and also would be willing to look at other ways as well or encourage other partnerships to do more around this. So all in,favor of closing file on Communication 476,please say "aye." Page 10 CRCOC-11 September 16,2025 Vote on Comm. 476: The motion to close file on Comm. 476 was carried by the Filed following voice vote: Ayes: Committee Members Hustace, Inaba, Kagiwada, Kierkiewicz, Kimball, Onishi, Villegas and Chair Galimba—8. Noes: None. Absent: Committee Member Kaneah'i-Kleirifelder— 1. Excused: None. CHR. GALIMBA: Next item,please. Comm. 500: REQUESTS A PRESENTATION BY HUNDEN PARTNERS AND THE DEPARTMENT OF RESEARCH AND DEVELOPMENT: COUNTY OF HAWAI`I ECONOMIC IMPACT STUDY ON SHORT-TERM VACATION RENTALS From Council Member Heather L. Kimball,,dated September 5, 2025. Motion to Close File: Ms. Kimball moved to close file on Comm. 500. Seconded by Mr. Hustacc. CHR. GALIMBA: We have Deputy Director Lin here from County of Hawaii R&D (Research and Development) here who,can lead us in discussion. Thank you. (Note: At this time, Research and Development Deputy Director Dennis Lin and Economic Development Specialist Lori came forward to address the members of the Committee.) MR. LIN: Thank you, Council Members, for this opportunity to present the economic impact study (EIS) on the short-term vacation rentals that we contracted with Hunden Partners. Today I have with me Lori Okami, who is the Economic Development Specialist who was assigned to facilitate this study, and on the call, we have the representatives from Hunden Partners that will be doing the m presentation today. So I'll let them introduce themselves. (Note: At this time, Hunden Partners Executive Vice President Bethanie DeRose, Project Manager Derek Bratrud, and Analyst Franco Matti Coli, came forward to address the members of the Committee.) MS. DEROSE: Good morning, everyone. Thank you all for having us here today virtually. We're excited to present this material on the study that we've worked very closely with staff on today at County Council today. I'm Bethanie DeRose, Executive Vice President with the team here at Hunden Partners. Again, thank you for the time today and I'll pass it off to Derek. Page 11 CRCOC-11 September 16,2025 MR. BRATRUD: Morning, everyone. I'm Derek Bratrud; I'm a Project Manager with Hunden Partners. MR. MATTI COLL Hi, everybody. Franco Matti Coli, Analyst on the Hunden Partners team. It's a pleasure to be here and to be able to present this work to you guys. MS. DEROSE: Dennis, should we just dive into our presentation? MR. LIN: Yes. CHR. GALIMBA: Please do. Thank you. MR. LIN: Okay. Go ahead, Bethanie. (Note: At this time, Ms". b6 ose, Mr. Bratrud, and Mr. Matti Coli came forward and provided a PowerPoint presentation to the members of the Committee. For viewing of the subject presentation, see the DVD copy of the meeting proceedings on file in the Clerk's Office or online at http:Hhawaiigaunt ,gov.granicus.com'. A copy of the PowerPoint presentation is made a part of the record, see Comm. 500.) CHR. GALIMBA: Thank you very much. And I was remised, I probably should've called on Council Member Kimball, who was the one that introduced this'commun cation. So Council Member Kimball, if you would like to say anything? Sorry.' Please go ahead. MS. KIMJ3ALL: Yeah. I;think first of all,just mahalo the Research and Development;Department'as'well as Hunden Partners for this very thorough analysis. I think there are some really interesting datapoints here, both in sort of the overview and the summary by way of the recommendations as well as in some of those appendices that talk about the specific queries that were given. I do have a couple of questions, but I'd actually like to open the floor to my colleagues to ask their questions first and then I can summarize at the end. Thank you. CHR. GALIMBA: Thank you. Anyone in Hilo? If not, Council Member Hustace. MR. HUSTACE: I just had a couple of quick questions on just the methodology for the survey and the snapshot. What was the time period for the market snapshot? MS. DEROSE: You mean in terms of the market research that we conducted to look at our current inventory? Page 12 CRCOC-11 September 16,2025 MR. HUSTACE: That's correct. MR. BRATRUD: I think the snapshot slide that Franco showed. MR. MATTI COLL So in terms of visitor arrivals we looked at 2024 for that total arrival number and spending to the island for housing. Also looked at 2024 for homes sold but then also looked at current numbers in terms of housing units, median sale price, and homes available for sale. And then hotel, we looked at current occupancy rate, average daily rate, revenue per available room, and then also looked at current numbers using AirDNA for the short-term rental performance as well as active supply. MR. HUSTACE: So it accurately captures J 2 months then: MR. MATTI COLL Yes. Correct; MS. DEROSE: Yes. That's correct. MR. HUSTACE: Okay.. Okay. Thank you. And then in terms of the survey itself, what was the method of delivery for the survey for specifically, I guess you could highlight all of them, lout Mtn the demands survey? Because you captured 100 responses for the demand survey. MS. DEROSE: Correct. So there were three different surveys, the visitors' survey, the demand side; we went out publicly to try to capture visitors to the island as well as potential visitors to get their feedback and input. We leveraged a visitor list that we acquired, which we have done before in other projects. So we've targeted about 7,000; I think it was a little over 7,000 individuals, who have either visited the island previously or have expressed interest in visiting the island. So we had a targeted list of about 7,000. We also leveragedsome additional owned channels from Hawaii County that visit Hawa `i group that tours receive VB (Visitors Bureau) group to try and publish it and we pushed it out through channels that we own as well. So we know we've reached at least 7,000, likely closer to 10,000 in trying to get the word out. But yes, we've received feedback on just over 100. MR. HUSTACE: Okay. Thank you. And then if you could just elaborate on the statements about nature-based outdoor recreation. What does that entail, even local activities as well as local culture? MR. BRATRUD: Yeah. So I believe that is in the appendix of the full study, but some of the questions for the visitors survey were asking about the types of excursions and activities that visitors are interested in. And so that includes anything from hiking to the volcano, agrotourism,water sports and activities, all Page 13 CRCOC-11 September 16,2025 of those kind of island-specific tourism focuses beyond, you know, shopping and those other kinds of things. So we had different categories of understanding what your average visitor is doing and how they're spending their time while on the island. MR. HUSTACE: And that includes some of the volunteer, voluntourism, those sort of things as well? MS. DEROSE: Yes. MR. HUSTACE: Okay. Thank you, Chair, Those are my questions at the moment. Thank you. MR. LIN: Council Member, if I may just add some clarity to ypur question regarding the demand survey and,you know, we did recognize that there's only 100 responses, right? The issue was there was no incentive for the visitors to answer the survey, right? Lori here was actually outside of the airport handing out physical copies, asking them,you know,if you had a choice would you stay at a hotel or at an STVR(Short-Term Vacation,Rental), and they said, "Well, we already booked our accommodations, so we don't care. We're not going to fill out your survey." So the ones that we could get an answer from were the ones that answered the survey. You know, as Bethanie said, we did also reach out to the Island of Hawaii Visitors Bureau for their support to get the survey out. But unfortunately,you know, most people that came, they already had their bookings done. MR. HUSTACE: I;appreciate that insight, Deputy Director. And I appreciate the effort you took to be physically at those spaces and try and engage with parties thatwantedto be here and wanted to stay on the island and trying to get their feedback on all the work we're trying to achieve here. So thank you. CHR. GALIMBA: Council Member Kagiwada. MS. KAGIWADA: Thank you, Chair. Deputy Director Lin, so these outcomes, the two dichotomies that they looked at; today with STVRs and introducing strict bans without STVRs. Was that a direction that you gave them to look at or was that something that they came up with? MR. LIN: No. They had very little direction from the department on how they would conduct their study as we wanted it to be as objective as possible based on the data that they collected. So those outcomes were strictly based off of their findings. Page 14 CRCOC-11 September 16,2025 MS. KAGIWADA: Okay. Thank you. So to the researchers, thank you for being with us today and sharing this information. I'm wondering why you came up with that dichotomy given that we've never talked about introducing strict bans. I'm just wondering how you came up with that because there are so many other things that I think we're interested in knowing about and that isn't really one. So how did you come up as using that as the kind of balance to look at outcomes with what we have today? MS. DEROSE: Yeah. I can start, and Derek, if I go, please feel free to add to this. But it's a great question. The directive was not to necessarily study one of the other but to look at the range of impacts, Feedback that was gleaned from stakeholders, owners, operators, and residents.in our conversations, there was talk of or sentiment around what if this occurs. And so we looked at those two dichotomies intentionally to say, what if this happened, this would be sort of the impact of it not existing if that were ever to take place. So we looked at that more for I guess an extreme example to'say here's the full impact if it were to go away. There are certainly, as you've mentioned, and,in different places where we work across the country and internationally, different ways to approach management and regulation. We're not recommending or thought that anybody was considering a full ban, butjust to show the range,of impact. MS. KAGIWADA: Okay. So in order to understand what possible outcomes would be I find this a little bit unhelpful as well as just asking if STVRs were unavailable,you know, whatwould happen because that's not really what we're talking'about. So in your bullet point under Implications: Number 4; "If STVRs were restricted on the island, only 4 percent..." So does this mean if they were banned,,it says restricted on the island? MS. DEROSE: Yeah. So+essentially if there was restriction to growth or an incentive or policy to change the ownership status to make from a short-term rental to a long-term rental, would they convert their rental to something that was long-term? The response rate was only four percent would convert that to a long- term rental. MS. KAGIWADA: Did you have any other questions like would you sell your vacation rental or anything like that? Because that would also put that property back into the potential market for housing. MS. DEROSE: We did not specifically ask about selling their unit. Most of the, and we'll pull the exact figure here, Franco had it up on the screen a few moments ago, most of the feedback that was received from owners and operators showed or demonstrated that they are using the short-term rental revenue to offset housing costs and to subsidize their living cost. So the conversion to a long-term rental wouldn't have done that. And so we did not ask about sale of their unit. Most Page 15 CRCOC-11 September 16,2025 were living in the unit or were living on site where they're hosting, so it was primarily used to subsidize their income. MS. KAGIWADA: Okay. I think I saw those numbers. I'm sorry, there's so many pages here. What percent are actually living on site? It's on the very first page, right, or the second page? Forty percent rent the unit as their secondary home, right? So that's not an insignificant number. I'm just concerned that this is not really giving us what we might need to know. I guess the last questions I have is of those 46 percent, almost half, who do not rely on income to cover their housing cost, how much money are they making,per unit? I mean, do we have any sense of the range; is that in the studies? .:.Sorry,I don't have it in front of me. MS. DEROSE: Yes. That is probably in the appendix material. We, again, used AirDNA to pull information on average rental rates and unit size and all of that detail. So the revenue per unit ou,average is included in that. We'll pull it so I say the correct figure, but I believe,it'is in our appendix. MS. KAGIWADA: Okay. If you are able to just site that sometime during this discussion that would,be great. I'd love to see that. Alright, thank you so much and thank you for bringing this information forward. I have nothing else at this time. I yield. CHR. GALIMBA: Thank you. Hilo? MS. KIERKIEWICZ: Yes, Chair. Thank you. CHR, GALIMBA: Go ahead, Council Member Kierkiewicz. MS. KIERKIEWICZ: Thank you, Chair Galimba. Thank you so much, Hunden Partners and bepartment of Research and Development, specifically Lori. I put the resolution forward to complete this economic analysis when we were in the throws,of discussing Bill 121, and it's many like redevelopments I think over the course of a year and a half of community engagement, and one of the things community members really wanted to know was what exactly does the short-term vacation rental market look like on Hawaii Island? Because we've got statewide data but nothing really that encapsulates the uniqueness of how STVRs are operating on Hawaii Island, and I think that this study really does the market justice: I think that there were many assumptions that were being made about how prevalent STVRs were, who's operating them. And so it's really great to have this data to know that many of our local residents actually do rely on this to support their household income that so many of folks that STVRs actually self- manage them. That's a pretty significant number. And then when folks are,you know, thinking about Hawaii Island as a destination, they're choosing to stay in Page 16 CRCOC-11 September 16,2025 STVRs. And if they're completely phased out, which is not something that we are looking to do, but if they're completely phased out, there is going to be significant impact to economy, way of life,you know, occupation. So just really appreciate the data and the recommendations. This is definitely going to help Council Member Kimball and I as we begin to shape, you know, what new legislation could look like recognizing the fact that they're here and we just want to make sure that we're capturing all of the necessary GET (General Excise Tax) and TAT (Transient Accommodation Tax). I think the findings here were very stark that there's so much uncaptured monies because folks are operating under the radar. So just really appreciate the engagement,and the great work and for this very specific Hawai`i Island data. Thank you., I yield; MS. DEROSE: Council Members, the;questions related to rental income, it is on Page 23 of the report. There is an STVR performance overview,,and the average annual rental revenue is $70,000 MS. KIERKIEWICZ: Thank you. That is a pretty significant number. And I had a note here; there was a question I think that Council Member Kagiwada had about the transition from short-term rental into long-term housing. I can't recall all of the questions from the survey, but just kind of scanning Airbnb.com, I don't know if a lot of the homes that are being listed are actually suitable for long-term habitation. I think they're fun fora little getaway vacation but not to support long-term housing. So I just want to put it out there that not all of the rental units are sort of suitable for that long-term housing strategy. Thank you. CUR. GALIMBA: Anyone else? Council Member Villegas. MS. VILLEGA : Yeah. Thank you, Hunden Partners, for doing this deep dive and bringing us thisdata. It's been an interesting couple of weeks. I was in Costco the other day and got cornered with lots of questions about potential short- term"vacation rental legislation and a lot of people are really afraid. And those I'm hearing from are our local kama`aina people who have, if they were able to purchase a home recently, the incorporation of a hosted short-term vacation rental in their home allows for them to pay their mortgage. So we're kind of dancing on a razor blade for how do we make any necessary legal positive changes, and I see, you know, the opportunity for garnering more potential lost revenue for the County. But I also just want to express my sympathy and empathy for the people out there who are looking at their way of making ends meet and covering their mortgages feeling threatened. So,yeah, it's a really tough dance. But this report and this document's very helpful. I appreciate kind of just breaking it down from black and white, no STVRs, this is what we end up with. With STVRs as it is today, this is what we're missing out on. So how to navigate that fine line. I also just always go back to, you know, when I was first coming into office, Bill 108 came forward, and Council Member Eoff worked long and Page 17 CRCOC-11 September 16,2025 hard on that and the intention was to limit short-term vacation rentals that were negatively impacting people in residential neighborhoods and the ability to have a hosted vacation rental allowed for our kama`aina to be responsible. This is a very global concept of being able to host people in your home. It's allowed for our kama`aina and, you know, those malihini who've moved here and purchased homes. But to be able to have a more interactive experience with one another and it's opened us up for another type of traveler. So I'm not quite sure what all this means but as everything's being put on the table, there's a lot of reflection here. I just go back to the constituents in my district frotn'the get-go have asked for enforcement of the current legislation. And,I know County hasn't had the staff or the funding for enforcement. But I look forward to continuing to do a deep dive in here because it looks like some of the issues have already been remediated and some of the dishonest hosting situations have,you know, fallen;to the wayside. But a lot of other people,yeah, it's a really tough and interesting';dance;. So we'll continue to move forward with this but I wanted to state my empathy and concerns and validate them for community arid thank those that did this because I think this gives us something data driven and numerical that we get to utilize as we then incorporate our EQ (Emotional Quotient) and our value systems in how we make decisions, not just on economic models per say, but on long-term health, wellness, and wellbeing,of our community. So I yield. CHR. GALIMBA: Seeing no other MS. KIMBALL: Chair, I had a couple questions to follow up with. CHR. GALIMBA: Right. Council Member Kimball. MS. KIMBALL: Yeah,thank you. So if I could ask first,you mentioned that in addition to the survey you spoke with some stakeholders. Could you share with us Who some'ofthose stakeholders were? MS. DEROSE: Yeah. We can certainly provide a list of folks if it's not already in the appendix of the report. But we did have a series of conversations virtually through our survey process, we provided an opportunity for further input. And so anybody that reached out, we offered individual one on one follow-ups with. So I spoke to several residents, owners, and hosts individually as well as we spoke to lodging association, we spoke to a few hotel of yours, we spoke to a few associations that are in the operator space of short-term vacation rentals. So we tried to capture broad base input from different representatives on all sides of the issue. MS. KIMBALL: So to prior thought—go ahead. Page 18 CRCOC-11 September 16,2025 MR. BRATRUD: I was just going to say just to add a couple groups, HTA (Hawai`i Tourism Authority), we spoke to tourism, we spoke to Merrie Monarch and other even organizers to understand their kind of seasonality and pain points. We spoke to a few separate economists and yeah, like Bethany said, kind of got both sides of the aisle from property owners and lodging organizations. MS. KIMBALL: So it sounds like it was a combination of folks that were responding to the survey request that wanted to do a deeper dive as well as organizations that you identified as having a significant contribution. MR. BRATRUD: Correct. MS. DEROSE: Yes. MS. KIMBALL: Okay. I raise this just because I screened through the report again. I noticed that one of the highlights that you did in the TAR(Transient Accommodation Rental) webinar was the Grassroots Institute and,I was wondering how they were selected to be a contributing stakeholder in this conversation? MS. DEROSE: They reached,out to us at one point: MS. KIMBALL: Okay. Okay. With respect to the stats that 93 percent of these are whole hone rentals or entire home rentals; was that figure based on your AirDNA analysis or was that figure based on the respondents of the survey? MS: DEROSE I believe that is an ArDNA source. I don't know, Derek, if you can confirm thatreal quick? MR. BRATRUD: I am looking for the stats. MS. KIMBALL: And while you are looking for that, my question around that is are the"whole house rentals presumed to be unhosted or is there another way that you are looking at the determination between hosted or unhosted? MR. BRATRUD: So AirDNA does not specify if they're hosted or unhosted. They just offer how many rooms, whole house versus partial house, so us determining if it was hosted or unhosted, those would be through the survey results of the owners. MS. KIMBALL: And what is the percentage that they are hosted versus unhosted? Page 19 CRCOC-11 September 16,2025 MS. DEROSE: Unhosted would be just shy of about 20 percent. In our supply side survey, we broke down and asked questions about the unit and how they make it available. 27.6 percent own the unit as their primary residence. 40 percent own it as a secondary or part-time residence. And just about 20 percent use it as an investment property, and it is exclusively used for visitors. MS. KIMBALL: Okay. So just to my colleagues, I think that this is one of the interesting numbers that by having our registration process,we'll be able to look at because it's been challenging and even those datapoints just shared, if it is not your primary residence but you use it as a temporary,residence, unless you have an operator onsite while you're gone, it still constitutes an unhosted rental per our rules. And so reconciling these different percentages with the way that we are actually determining hosted and unhosted is,going to be important and I bring that up on Page 81 of the study is one of the survey questions, how,likely are you to support STRs in your community ifand if they're owner-occupies hosted, it's 67 percent are supportive of the STVR and 33 percent unlikely to be supportive. If you look at the unhosted number, it's completely.flipped. So if the STVR is unhosted, 71 percent are not supportive, are not likely to be supportive and it's roughly 30 percent that are. So when we've been talking about Bill 121 and hour to move forward with this process and clarify Chapter 25 on what is permitted 'and isn't permitted, I mean, the sentiment coming from the community is;supportive of those bed and breakfasts, those hosted rentals where there,is somebody onsite that is actually managing the,property and managing the visitors. So moving forward we will continue to look at preserving that option, which was always the intention of Bill 121 anyway. I wanted,to just also share., We did have Hunden Partners on a webinar on Friday the 5t', thatis recorded and available on hawaiicountytar.com. So Council Member Villegas, in particular, if you want to share that with the folks that you ran into the grocery`stoie who are concerned, there's a lot of good information on that webinar and of course, I'm always happy to respond to questions. I did want to just revisit one of the most important datapoints that I thought was in this survey which is that$12 million in TAT that nominally we should be collecting that we are not. Can you just briefly share how you came to that calculation for both the TAT and the GET? MS. DEROSE: Yeah. I'll let Derek and Franco add to this, but as we mentioned there's a lot of different sources of data that we pulled, so we leveraged again the inventory counts from AirDNA. We leveraged data from the Hawaii Tourism Authority on number of arrivals, and essentially, we applied findings from our survey to understand where visitors were staying to determine, knowing the occupancy rate of the short-term rentals and the average daily spend, we then Page 20 CRCOC-11 September 16,2025 calculated that level of potential capture. So Franco, do you want to expand on that? MR. MATTI LOLL Yeah, sure. So just looking at the approximate 3,500 registered units, we're able to apply the TAT calculation to that to see what the County is currently collecting. And then again, looking at AirDNA at what the total number of active short-term rentals truly are and that being just over 8,000. So just looking at that large gap of the amount of units that are currently not reporting, not registered, and the TAT and GET that could be attributed to those and the County could be collecting if they did have that full registration. So that's kind of where we found the $12 million and Ahe $1.6 million difference in the GET as well. MS. KIMBALL: Well I want to just conclude by highlighting that figure. And I think all of us can agree that we;could find plenty things to do with $12 million more per year in TAT revenue to help,support efforts to MR. ONISHL Excuse me. Kona is out right now. MS. KIMBALL: Okay. So I'm just talking to myself. MR. ONISHL So we have to do a recess. We're in recess. MS. KIMBALL: Sorry, we're going to have to recess. Apparently, Kona's not connected. Recess: At 10:48 a.m., the Chair called for a recess. Reconvene: The meeting reconvened at 10:58 a.m. CHR. GALIMBA: Okay, we are good to go. I'm sorry, Mr. Franco. You were in the midst of answering a question and we cut out, so if you could repeat? Thank you. MR. MATTI COLL Absolutely. I believe the question was regarding the uncollected TAT and GET revenue for Hawaii County and that was through looking at the County's 35,000 reported units that have registration and then looking at the different databases that show active units of upwards of 8,000 and then calculating the revenue associated with that gap for the County. And again, just showing how a full registration could result in upwards of$12 million annual in TAT revenues for the County. CHR. GALIMBA: Thank you so much. Council Member Kimball, I think you still have the floor. Page 21 CRCOC-11 September 16,2025 MS. KIMBALL: Yeah. I just wanted to take the opportunity to just highlight that number and the importance of Bill 47, now Ordinance 50, this registration process allowing for us to have the greater ability to ensure compliance. I'm sure all of us can think of ways to spend an additional $12 million a year in TAT to mitigate the impacts of visitors on our island. So thank you for, again,providing that information. And I'm not sure where we got cut off, but I did want to make sure that the public is aware and my colleagues are aware that if there are question, continue to be questions about the current legislation Ordinance 50, hawaiicountytar.com is the website we've put up to"share information about legislation around this process, that there is a recorded webinar there about the study and the process moving forward with Bill 50.°So thank you for the presentation today. And thanks forI hope it's not too late over there. MS. DEROSE: No, not at all. Thank you all for the time andfor the opportunity to work collaboratively with County Council and members of staff. It's been a great process, a very comprehensive,process. I know there are a lot of questions and there's a lot of detail and data in there, phase see us as a resource and a continued partner in your effort as you continue to study and think through the analysis and any legislation if there are things that we can do to model different scenarios or help consider different impacts. We're happy to be of service and help answer questions in this process. So thank you all for the time today. CHR. GALIMBA: Thank you. Council Member Hustace. MR. HUSTACE: Thank you,Chair. I just had one more question. Going through the survey questions and trying to match up some of these percentages that were displayed in implications. This one particular on, if restricted and the percentage of conversion, what question is that connected to? Because I'm not seeing itin the survey in the appendices. MS: DEROSE` I believe it is in the front end of the report. Let's see. MR. HUSTACE: But isn't it a question you would've asked them though? MS. DEROSE: Yes. That is specific to the question that we asked about if there was a ban,or restriction, I should say. If there was restriction on the inventory, Would you convert your unit to a long-term rental from a short-term rental? And that'is where the four percent comes from; four percent of those owners and operators that responded to this survey would make that conversion. MR. HUSTACE: Okay. I found it. It's on Page 117, I think. Is that correct? MR. MATTI COLL That's correct. Yes. That's what I was about to say. Page 22 CRCOC-11 September 16,2025 MR. HUSTACE: Okay. I was in the wrong service section then. Thank you for that clarification. Thank you, Chair. MR. ONISHL Chair? CHR. GALIMBA: Go ahead, Council Member Onishi. MR. ONISHL Thank you, Madam Chair. I just wanted to make a comment. Thank you very much for this study that you guys provided us. Now I think we need to look at how we can help Planning Department to get more investigators to help with getting those numbers down of unregistered., And so we're all going to need to work together with the administration to do that and help get that extra funding so we can do more programs,like we just had thatoresentation with Housing where $5 million is not enough. So they can have more money by getting these guys registered. Thank you. I yield. CHR. GALIMBA: Thank you. Seeing no one else and everyone is Hilo is okay. Yes, I want to thank Hunden Partners for their work on this. A lot of really great data for us to look at and sort of, there's like nuances, there's these big numbers but there's also nuances around all of this data,,and I think it's going to be really helpful for us to look at. Thank you for your offer to potentially model other scenarios. I think that might be something we might want to take you up on at some point. Thank you for R&D for getting this to us and for all of your efforts to make this possible including physically asking people to fill out surveys. And with that, I will,ask everyone who is in favor of closing file on Communication 500,please say "aye» Vote on Comm. 500: The motion to close file on Comm. 500 was carried by the Filed following voice vote: Ayes: Committee Members Hustace, Inaba, Kagiwada, Kierkiewicz, Kimball, Onishi, Villegas and Chair Galimba—8. Noes: None. Absent: Committee Member Kaneali`i-Kleinfelder— 1. Excused: None. CHR. GALIMBA: Thank you very much. That brings us to the end of our agenda for this committee. Page 23 CRCOC-11 September 16,2025 ADJOURN- There being no further business, at 11:05 a.m. Chair Galimba adjourned the MENT: meeting. Approved: Ms. Michelle M. Galimba, Chair (Date) Communications, Reports, and Council Oversight Committee MG/tk Page 24