HomeMy WebLinkAbout2024-04-15 Bill 121 Nathan Eggen From: Nathan Eooen
To: LPCtestimony
Subject: Testimony Regarding Bill 121
Date: Monday,April 15,2024 4:29:29 PM
Chairperson Barbara Defranco
Leeward Planning Commission
County of Hawai'i
25 Aupuni St.
Unit 1502
Hilo, HI 96720
Aloha Chairperson Defranco& Commission Members,
As a property owner on agricultural land in North Kohala, I am reaching out to express my
concerns regarding Hawaii Bill 121. This bill presents significant problems, and I do not
support it for several reasons detailed below:
First,the bill will make it very difficult for the majority of resident-owned vacation rentals in
small towns and rural areas with agricultural zoning to continue operating, effectively
outlawing them. While the bill states it allows an owner in any zone to register at any time,the
additional rules and restrictions for agricultural land make this practically impossible. The
regulations regarding which parts of your agricultural property can be rented and where you
can sleep mean that most ag zone rentals will be prohibited. This is particularly impactful
because it is common to rent out a 2nd structure in rural areas where more land is available
and second dwellings are common. This would eliminate 90% of the resident-owned hosted
rentals in North Kohala, which will profoundly impact the local economy. This pattern will
likely repeat in every small town area on Hawaii Island.
Many kupuna rely on renting their ohanas on their property through Airbnb as their sole
source of income. This practice of renting out ohanas to visitors has existed long before
Airbnb or the internet. Dictating which parts of your property you can rent or which bedroom
you can sleep in is an example of government overreach.
As you may know, agricultural zoning makes up about 48% of the entire island. Preventing
existing resident-owned vacation rentals from operating in these rural areas means that the
visitor economy in the smaller towns of Hawaii County will collapse,leading to further tax
revenue decline and job loss at restaurants, stores, and other venues as they shrink or close.
Towns such as North Kohala, Kau, Hamakua, and Puna have no resort areas,yet their retail
stores and restaurant options are almost entirely visitor-supported. These small towns were
struggling badly for decades after the end of sugar production. The visitor economy is their
primary source of revenue. Residents of Hawai'i should be able to participate in the high-value
tourism activity of providing lodging to guests instead of working for mainland corporations
for low wages.
Furthermore, the bill will lead to job losses and reduce tax income from supporting businesses
that work with Transient Accommodation Rentals (TARS) such as cleaners, landscapers,
construction, and maintenance jobs due to the shrinkage of this market.
Second, because of these economic risks, it is imperative that an economic impact study
specific to the actions within Hawaii County occurs before this bill moves forward. This has
not been done. The studies that were referenced are based on flawed, outdated research from
places like New York, San Francisco, or even Honolulu,which are not very relevant to small,
non-diversified,primarily visitor-supported small economies.
Third, the bill as written appears to have many legal problems that will almost certainly result
in costly litigation for the County of Hawai'i, spending taxpayer money for years. The County
of Hawai'i and therefore Hawaii County taxpayers could also be liable due to constitutional
takings of individual property rights through this regulation. The 180-day restriction has
already been blocked by a federal injunction, and it appears that Hawaii County is blindly
walking into the same mistake and litigation.
Fourth, this bill has been floated as a "fix" for the housing crisis in Hawai'i. However, short-
term vacation rentals of all types represent less than 5% of the housing stock in the state. The
need for housing is far greater than just 5% of the housing stock. Look closely at the statistics
floated by the Kohala Coast Resort Association; they have extremely flawed data showing
duplicate properties (counting the same unit that is listed on Airbnb, VRBO, and HomeAway
as three STVR units) and even show that the majority of the units in their report are actually
hotel rooms from the resorts listed as rentable. Marriott International and other chain hotels
list on these peer-to-peer rental platforms too. These flawed statistics are leading to false
conclusions.
Finally, consider that the housing crisis in Hawaii existed well before AirbnbNRBO or even
the internet. House construction started lagging demand in the 1980s. It is now a decades-long
problem. The majority of Hawaii County's housing issues are due to factors like rigid state
Land Use Commission (LUC) zoning, lengthy and challenging development processes
(rezoning, subdividing), lengthy permitting delays,the huge affordable housing department
corruption scandal in Hawaii County, and the cost of a limited supply of buildable land with
water, services, etc. Hawaii County could help affordable housing a lot more by more easily
creating small residentially zoned parcels and removing barriers to new lot creation and
housing development. The Planning Commission can be leaders of this housing change
instead of supporting damaging measures against the largest economic sector in Hawaii
County.
With Aloha,
Nathan Eggen
Hawi, Kohala, Hawaii