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Home My WebLink AboutCOM 0063.001 2024-2026 I Ashley L.Kierkiewicz -�tisY:,? •'! Office:(808)961-8265 Council Member •:' 1 '''+, Fax:(808)961-8912 District 4 Puna :.i S.. •t ashley.kierkiewicz@hawaiicounty.gov = +r _____,) HAWAII COUNTY COUNCIL Hawai`i County Building 25 Aupuni Street • Hilo,Hawai`i 96720 ct 0 MEMORANDUM n 0 o 7 10 DATE: October 2, 2026 c g o k H TO: Dr. Holeka Goro Inaba, Council Chairperson a`. d And Members of the Hawai`i County Council i g R H FROM: 10Ashley L. Kierkiewicz, Council Member Chair, Housing SUBJECT: Chapter 11 Ad Hoc Committee Recommendations I submit this report to conclude the work of the second Chapter 11 Ad Hoc Committee and transmit its recommendations for the Council's consideration. Building on the first Ad Hoc Committee's 2024 findings, this effort has produced a proposed rewrite of Chapter 11 to strengthen Hawai`i County's affordable housing policy and better support housing development throughout Hawai`i Island. Background and Purpose Chapter 11 establishes affordable housing requirements for certain developments and provides tools to support housing production. The first Ad Hoc Committee reviewed these provisions, engaged housing partners, and identified gaps and opportunities within the County's policy. Its October 2024 report recommended establishing a second ad hoc to continue stakeholder engagement and translate those recommendations into proposed legislation. In December 2024, Communication 63 requested formation of a new Ad Hoc Committee to further examine Chapter 11, develop policy recommendations, and advance programs that respond to the housing crisis. This effort continued work informed by Resolution 431-20, the County Auditor's review of housing credits, and the analysis prepared by Keyser Marston Associates. Comm. No. (.P • 1 Ref.To: PCP%-vieO 1 Ref. Date OCT 0 15 `=' The District 4 Office and the Office of Housing& Community Development(OHCD) co-facilitated the process,with participation from Council Chair Holeka Inaba and Council Members Jennifer Kagiwada and James Hustace. Corporation Counsel and the Planning Department provided technical support,with additional contributions from County departments and housing partners. Scope of the Work Throughout 2025 and 2026,the Ad Hoc examined how County policy could support housing development while strengthening accountability and preserving affordability. Discussions addressed financing barriers, infrastructure constraints,housing credits, development incentives, funding mechanisms, and administration of Chapter 11. The objective was to establish a clear, consistent framework grounded in the realities of housing development and the needs of Hawaii Island residents.The following chronology documents the meetings and principal topics considered. 2025 • February 12: Established the meeting schedule and key priorities. • February 25: Examined financing barriers and household affordability gaps,with participation from Hawai`i Community Federal Credit Union,Bank of Hawaii,First 1 Hawaiian Bank,Hawaiian Community Lending,Hawaiian Community Assets, and Hawai`i Island Community Development Corporation. • March 12:Reviewed infrastructure needs and constraints involving water availability, wastewater treatment, cesspool conversion, and roads,with participation from the Departments of Water Supply,Environmental Management, and Public Works. • March 25: Discussed by-right exemptions, eligibility, and administrative procedures,with participation from Hawaii Island Community Development Corporation. • May 13: Reviewed the Affordable Housing Production Fund. • May 28: Continued review of proposed Ch. 11 amendments and OHCD funding streams. • July 7: Examined development incentives and compliance options, including housing credits, density bonuses, by-right exemptions, streamlined permitting, in-lieu fees,fair share contributions, finished lots, and land conveyance. • July 30: Discussed housing affordability and financial tools. • August 12, September 9, and September 15: Continued review and refinement of proposed Chapter 11 amendments. • October 15: Reviewed proposed Chapter 11 language in preparation for community engagement. • October 30: Prepared for the housing summits. • November 12: Convened the housing summit at the West Hawai`i Civic Center. • December 1: Convened the housing summit at the Hilo Council Chambers. 1 2 2026 • January 16: Continued review of proposed Ch. 11 amendments following community engagement. • August 24: Conducted final review of the proposed Chapter 11 amendments. This report presents the findings and recommendations developed through that process.A list of participants is provided at the end of the report. Community Engagement Two housing summits expanded the discussion beyond the Ad Hoc's working meetings. The first was held on November 12, 2025, at the West Hawai`i Civic Center.A second convening took place on December 1, 2025, in Hilo and was open to the public,with notice shared through an article in the Hawai`i Tribune-Herald. Participants included affordable housing developers, financial and real estate professionals, community land trusts,nonprofit and business organizations, County and State agencies, and community members. The summits provided opportunities to review proposed amendments addressing housing obligations, credits, compliance options, eligibility, affordability protections, funding, and development incentives. Feedback from participants informed the Ad Hoc's continued refinement of the proposed legislation. Key Findings Clear requirements and consistent administration. Chapter 11 must provide an understandable framework for developers, County agencies, and residents.Developers need certainty regarding their obligations and available compliance options. County agencies need consistent procedures to review projects,track commitments, and enforce requirements. Residents need clear information about eligibility and access to affordable housing. Diverse housing opportunities.Hawai`i Island's housing needs require a range of approaches. Affordable rentals,homeownership opportunities,finished lots, smaller developments, and community-based housing models each have a role. County policy should accommodate these approaches while maintaining safeguards that preserve affordability and public benefit. Accountability for housing outcomes.Housing credits and alternatives to direct construction require clear standards and oversight. The County must be able to verify how obligations are satisfied and how those contributions support affordable housing. The proposed rewrite addresses these concerns through changes to the credit system,housing agreements, reporting, and compliance procedures. 3 • Infrastructure and financing. Water availability,wastewater capacity,roads, construction costs, and access to financing remain significant barriers to housing development and household affordability. Chapter 11 provides tools to address some of these challenges, but sustained investment and coordination beyond the ordinance remain essential. Proposed Policy Updates The proposed rewrite clarifies affordable housing requirements and compliance options, strengthens administration of housing credits, and improves protections for affordable units and lots.It also expands the housing funding framework and establishes incentives and exemptions for qualifying affordable housing developments. These updates translate the first Ad Hoc's recommendations into a legislative proposal. The ordinance presented for Council review reflects substantial work by Council offices, County agencies, and housing and community partners over the course of both ad hocs. Recommendations and Next Steps The Ad Hoc recommends advancing the proposed ordinance through the Council's legislative process. The rewrite provides a framework for clearer expectations, more consistent administration, and stronger support for affordable housing. OHCD, Corporation Counsel, Planning, and other affected departments should coordinate implementation. Clear administrative rules and guidance will be necessary to apply the policy consistently, support compliance, and ensure transparency. The County should continue addressing infrastructure, financing, and coordination among permitting agencies. These efforts must complement the Chapter 11 updates to support completed housing. Partnerships with nonprofit housing organizations,financial institutions, community land trusts, and other housing contributors should remain central to this work. The Council and OHCD should also evaluate implementation through regular reporting and review.Housing production,preservation of affordability, fulfillment of developer obligations, and access for eligible households should guide future policy adjustments. Conclusion of the Ad Hoc Work The second Ad Hoc Committee has fulfilled its purpose by developing a proposed rewrite of Chapter 11 for the Council's consideration. With submission of this report and the accompanying legislative proposal,we conclude the Ad Hoc's assignment. Further review and implementation will proceed through the Council and responsible County agencies. 4 I extend a warm mahalo to my fellow Council Members, OHCD,the Legislative Research Branch, Corporation Counsel,the Planning Department, other participating County agencies, and our Council staff for their sustained commitment. I also thank the housing, financial, nonprofit, and community partners who contributed their expertise and participated in the two summits. It has been my honor to convene both Chapter 11 Ad Hoc Committees.Their work reflects a shared commitment to expanding housing opportunities for Hawai`i Island residents.I offer this report and the proposed legislation for the Council's consideration. AK/ak 5 Chapter 11 Ad Hoc Committee Participants 1.Ad Hoc Meetings February 2025 through August 2026 Council Members • Ashley L.Kierkiewicz—Ad Hoc Chair,Council District 4 • Holeka Goro Inaba—Council Chair,Council District 8 • Jennifer Kagiwada—Council District 2 • James Hustace—Council District 9 Council Staff • Shannon Matson—Council District 2 • Ivory Quintal—Council District 4 • Ku`uhiapo Jeong—Council District 4 • Wendy Baez—Council District 8 • Eva Braman—Council District 8 • Dennis Kauka Jr.—Council District 9 • Elwen Freitas—Council District 9 Office of Housing& Community Development • Anne Bailey • Chelsea Jensen • Cristina Pineda • Kehaulani Costa • Keiko Mercado • Kaloa Robinson • Kyla Lee • Linda Bui • Royce Shiroma Corporation Counsel • Sylvia Wan • Cody Frenz Planning Department • Bethany Morrison • Jeff Darrow Department of Water Supply • Keith Okamoto • Kawika Uyehara Department of Environmental Management • Craig Kawaguchi • Kelly Hartman 6 Legislative Research Branch • Jacob Perry Housing and Financial Partners • Ashleigh Loa—Hawaiian Community Assets • Jason Ayers—Hawai`i Community Federal Credit Union • Jeff Gilbreath—Hawaiian Community Lending • Jeremy McComber—Hawai`i Island Community Development Corporation • Keith Kato—Hawai`i Island Community Development Corporation • Melissa Ka'apuni—Hawaiian Community Assets • Paulette Suzuki—First Hawaiian Bank • Steven Sylvester—Bank of Hawaii 2.November 12 2025 Housing Summit Participants,West Hawaii Civic Center • Almodina Lopez—Tinguely Development,Inc. • Ashley L.Kierkiewicz—Hawai`i County Council • Chelsea Jensen—Office of Housing&Community Development • Chris Marlett Patulski—Habitat for Humanity • Cristina Pineda—Office of Housing&Community Development • Ed Rapoza—West Hawai`i Association of REALTORS • Holeka Goro Inaba—Hawai`i County Council • Ivory Quintal—Office of Council District 4 • Jacob Perry—Legislative Research Branch • James Hustace—Hawai`i County Council • Jeff Darrow—Planning Department • Jennifer Kagiwada—Hawai`i County Council • Joelle Chiu—Ahe Group • Joy Dillon—Hawai`i Island Chamber of Commerce • Kalani Fronda—Department of Hawaiian Home Lands • Kaloa Robinson—Office of Housing&Community Development • Kawika Uyehara—Department of Water Supply • Keith Kato—Hawai`i Island Community Development Corporation • Keith Okamoto—Department of Water Supply • Kimo Lee—W.H. Shipman,Ltd. • Ku`uhiapo Jeong—Office of Council District 4 • Makani Maeva—Ahe Group • Merrick Nishimoto—Hawai`i County Mayor's Office* • Neal Tanaka—Department of Public Works,Building Division • Pete Hoffmann—HALE o HAWAII • Richard Wheelock—Pacific Realty Organization • Ross Wilson—Kona-Kohala Chamber of Commerce • Sue Keohokapu-Lee Loy—Hawai`i State House of Representatives 7 3.December 12025 Housing Summit Participants,Hilo Council Chambers • Ashley L.Kierkiewicz—Hawai`i County Council • Beth Robinson—Kohala Community Land Trust • Carla Kuo—Hawai`i Island Chamber of Commerce • Chanel Josiah—Hawai`i Community Lending • Doug Adams—Hawai`i Community College • Holeka Goro Inaba—Hawai`i County Council • Ivory Quintal—Office of Council District 4 • James Hustace—Hawai`i County Council • Janice Ikeda—Vibrant Hawai`i • Jennifer Kagiwada—Hawai`i County Council • Joy Dillon—Co-Chair,Hawaii Island REALTORS Government Affairs Committee • Katherine Luga—Parker Ranch • Keith Okamoto—Department of Water Supply • Ku`uhiapo Jeong—Office of Council District 4 • Lisa Miura—Real Property Tax Division • Richard Henderson—Hawai`i Island REALTORS • Roland Higashi—RJL LLC • Whitney Harvey—Kohala Community Land Trust 8