HomeMy WebLinkAbout2024-04-14 PL-CCI-2024-000003 Bill 121 Glenn Willson & Roberta Etter Testimony From: Glenn Willson
To: LPCtestimony;Glenn Willson
Subject: Written Testimony for the Leeward Planning Meeting April 18,2024
Date: Sunday,April 14, 2024 4:06:14 PM
Dear Leeward Planning Committee Members,
Before we go into facts and figures, I would like each of you to put yourselves in the shoes of
all of the people the proposed bills will affect by answering a simple question:
Let's say your elderly parents bought their home 30 years ago and count on the extra money
generated by renting out their Ohana to supplement their income. They pay their taxes, they
take great care of their guests,they refer them to the local restaurants, farmers markets,
grocery stores, gift shops, coffee farms, etc in their local area, they teach them how to respect
the aina, and have earned a 4.9 (out of 5) guest satisfaction rating making a viable business
that allows them to live comfortably in retirement. Then,you, as a politician or other decision
maker is being pressured to push these bills through, essentially putting your parents, and
many other community members out of business.Now,your parents can't afford to live in
their home town, or even their home state, anymore. That is essentially the situation you are
putting thousands of responsible,tax paying,voting, local citizens in if you vote to pass these
extremely flawed bills.
While we understand the goal or"spirit" of the proposed changes are to limit absentee owners
that don't reside in Hawai'i and the issue with having STRs in incompatible high-density
neighborhoods but the proposed rule changes will absolutely have serious unintended
consequences, especially in rural, economically depressed areas such as the Kau
District/Ocean View, Puna, etc. Please keep in mind that there are very few accommodation
options in these rural areas besides these STR's and the proposed rule changes would shut
down most of these STR options causing serious, long reaching consequences for its residents,
businesses, farms, etc. Our specific concern is for the Hosted Rentals which has long been a
right of local homeowners and,while the income earned from these rural hosted rentals is
insignificant to the Kona and Waikoloa Resort districts, it is a lifeline for many residents,
Farmers, and other Businesses in these economically depressed areas that count on this income
to make ends meet.
Many of these Farms, Restaurants, Shops, Farmers Markets, etc are just now starting to get
their heads above water after the Covid lockdowns and are now starting to feel the pinch of the
recession. If these proposed rule changes are passed, these rural, economically depressed, and
food insecure areas will be dealt a final death blow to the many Restaurants, Farms, Shops,
and local homeowners that count on this income from their hosted rentals. I am sure the
"spirit" of these proposed rule changes is to limit the number of absentee owners that don't live
in Hawaii renting STR's in high density neighborhoods but the reality of these proposed rule
changes, if passed, is economic disaster for the already most economically depressed areas
including mass foreclosures (many residents count on their hosted rental income to make ends
meet), small businesses that were able to survive Covid will go out of business (not only will
they lose the tourist business but local residents will not be able to afford to eat out), Local
Farmers will finally have to close their doors, Farmers Markets that are just now starting to
pop up after Covid will be shut down, etc. All of this while not meeting the goals or "spirit" of
the proposed changes, especially for hosted rentals, and leaving these rural areas without any
accomodation options. As another note on Hosted Rentals in these rural areas, the nightly
asking price is much lower than in Kona or Waikola(for instance) and along with lower
vacancy rates,the costs of the proposed permits for Hosted Rentals are not sustainable but
bringing in the Transient Occupancy Taxes and other tourist dollars into the local economy is
not only sustainable but absolutely vital. Many of us are also farmers just trying to stay alive
after being dealt so many blows the last few years.
For example, the Oceanview area currently has around 200 advertised STR's. If the average
occupancy is around 60% and the average nightly room-rate around$150 (both conservative
numbers), that equates to 43,800 booked nights and an annual infusion of$5,475,000 into the
local economy. This likely makes STR income the single greatest source of income for
Ka'u/Oceanview residents and the community. That$5,475,000 also should generate around
$928,000 in GET/TAT collected taxes. These are just the direct dollars from the bookings,
these 200+rentals bring much needed tourist dollars into one of the most economically
depressed districts in Hawaii. These guests patronize local restaurants, shops, Farms, Farmers
Markets, Food Trucks, and the amount of money they spread around is not insignificant, at an
average of around$200 per person, per day, this is much needed local income. Again, using
the conservative number of 43,800 booked nights per year(figuring the average booking
includes 3-4 visitors)that equates to around an additional $20,805,000 spent in the community
($26 mil minus the $5 mil of booking fees). This is representative of the Oceanview/Ka'u
area, but applies to all rural areas where STR's are currently the only real option for
accommodations. So,we're looking at taking away all that income from very depressed areas,
from farmers, from residents and businesses still trying to survive after the Covid
Lockdowns/struggling with a recession, and replacing it with what? There are plenty of Help
Wanted signs in Waikoloa and Kailua Kona, but not in Oceanview. So moving all the tourism
dollars back to the resort areas only hurts the communities that can least afford it. We
understand that regulation is needed to limit the number of absentee owners not living in
Hawaii and the number of STR's in high density neighborhoods but let's do it in a way that
makes sense and keeps these residents, farmers, and local businesses thriving rather than
struggling.
Thank you in advance for your time, attention, and consideration. We respectfully challenge
the Committee to demand accurate numbers as it relates to the STR issue - not the numbers
being spewed by the politicians trying to push it through to keep their donors happy rather
than the voting citizens that put them in office. As a for instance, we just sent in our quarterly
taxes for month ending March 31, and it was approx $1500 - and that is just one couple
renting one small ohana. Before you put all of these people out of business and wipe out this
substantial tax revenue,we ask that you take the time to get the REAL numbers and facts
associated with these bills. We respectfully ask that you vote "no" on the current draft
regulations in favor of regulations that don't have these unintended dire consequences for the
residents,businesses, and farmers of the most financially depressed,rural areas.
With much respect and Aloha,
Glenn Willson and Roberta Etter