HomeMy WebLinkAboutCOM 0200.022 2006-2008 Mtn a M1y,
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Harry Kim Christopher J.1
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Mayor Director
~'+~•t•o;~N+' Brad Kurokawa, ASLA
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/fi~ix~ytt Q.t '~j~~.~ll Deputy Director
PLANNING Dl4EP~As+RiTUMENT
101 Pauahi Street, Suite 3 Hilo, Hawaii 967203043
(808) 961-8288 FAX (808) 961-8742
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April 9, 2007
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Honorable Pete Hoffmann
Chair and Presiding Officer
and Members of the County Council ~
COUNTY COUNCIL
333 Kilauea Avenue, Second Floor
Hilo, HI 96720
Dear Chair Hoffmann and Members of the County Council:
SUBJECT: BILL 156, DRAFT 4 -AFFORDABLE HOUSING REQUIREMENTS
There was a considerable discussion in the council meeting on Apri14, 2007, about how the
affordable housing problem on this island differs by region, and the concept that we do not want
to discourage job generation in azeas where affordable housing is currently available.
It is worth mentioning that Bill 156, draft 4, and the current Chap. 11, do contain a mechanism
that reduces or eliminates the affordable housing requirement for industrial uses in districts where
housing is relatively affordable. This comes from the way that the "in-lieu" fee works in such
situations.
The in-lieu fee is one option for a developer to fulfill affordable housing requirements. For resort
and industrial uses, the in-lieu fee, per required affordable housing credit, is 25% of the difference
between the median sale price for single-family homes in the tax map zone containing the project,
in the previous year, and the affordable price for a family earning 120% of the median.
In Hawaii County, currently, the affordable price for a family earning 120% of the median is
about $272,000. (This would be a family of four with a family income of about $66,000/yr.) To
take one example of how the in-lieu fee for an industrial project under Bill 156, draft 4 would
work, the median sales price for asingle-family home in North Kona was $645,000. So the in-
lieu fee, per credit, is (.25) X ($645,000-$272,000), or $93,250. Now, under Bill 156, Draft 4, the
subdivider in an industrial park that had an affordable housing requirement, if it was satisfied at
the time of subdivision, would have to earn one credit for every ten employees, and would be
assumed to generate ten employees per acre. This means that the subdivider would have to earn
one credit per acre, and the in-lieu fee would be $93,250/acre. •Z, Z
Comm. No.
Ref. Tg:Prespx
Ref. C}ate GPR 1 fi 2007
Hawaii County is an Equa( Opportunity Provider and Employer.
Honorable Pete Hoffmann
Chair and Presiding Officer
and Members of the County Council
COUNTY COUNCIL
Page 2
Apri19, 2007
For various other districts on the island, the in-lieu fee, per acre, under Bill 156, drafr 4, under
current conditions, would be as follows:
Puna: -0- (median sales price $269,000)
Ka'u: -0- (median sales price $272,000)
S. Hilo: $22,500 (median sales price $362,500)
S. Kohala: $69,500 (median sales price $550,000)
Hamakua: $48,750 (median sales price $467,000)
S. Kona: $66,875 (median sales price $539,500)
N. Kohala: $112,250 (median sales price $721,000)
N. Hilo: $25,750 (median sales price $375,000)
Please note that in Puna and Ka'u, where home prices are relatively low, this results in the
developer not being charged an in-lieu fee. This was a deliberately designed feature of the
affordable housing policy: it relaxes the requirements in areas where homes are being sold at an
affordable level.
Sincerely,
J
C STOPHERJ EN
Planning Director
CJY:pak
Wpwin60/Chris 07Bill 156, Draft 4 -Affordable Housing Requirements
cc: Office of Housing and Community Development
Corporation Counsel
Planning Section