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HomeMy WebLinkAbout2018-03-29 Letter to Donovan M. Dela Cruz and Gilbert S. C. Keith-Agaran re HB 2605, HD 2, SD 1 Relating to Transient AccomodationsHarry Kim (11(0'or r Wil Okabe Managing Director Barbara J. Kossow Deputy Managing Director 25 Aupuni Street, Suite 2603 • Hilo, Hawaii 96720 * (808) 961-8211 • Fax (808) 961-6553 KONA: 74-5044 Ane Keohokalole Hwy., Bldg C • Kailua-Kona, Hawaii 96740 (808) 323-4444 • Fax (808) 323-4440 March 29, 2018 Senator Donovan M. Dela Cruz, Chair Committee on Ways and Means Hawail State Capitol, Room 211 Honolulu, HI 96813 Senator Gilbert S.C. Keith-Agaran, Vice -Chair Committee on Ways and Means Hawaii State Capitol, Room 211 Honolulu, Hi 96813 Dear Chair Dela Cruz, Vice -Chair Keith-Agaran, and Committee Members: Re: HB 2605, HD 2, SD 1 Relating to Transient Accommodations Hearing Date: 04/03/2018 — 10 00 am; Conference Room 211 Thank you for the opportunity to comment on B 2605, HD 2, SD1 . will leave most of the details of this bill to others, and limit my remarks to the proposed civil penalty and to Section 7 of SD 1. SECTION 7 "SECTION 7. Upon the establishment by a county of a process for providing verification of compliance by an operator or plan manager with that county's land use ordinances, the State shall transfer, from the transient accommodations tax revenues, up to $10000,000 to each county for implementation or enforcement of those land use ordinances. First, 1 cannot be certain from the language whether these monies are meant to replace or to supplement the TAT funds that the counties presently receive. Only if these payments would be in addition to current allocations, could Hawaii County support it. This issue is especially impo ant since the Attorney General, in a hearing on an earlier version of this bill, raised a question as to whether "the $4,000,000 allocation to the counties is meant to come out of the TAT revenues before section 237D- 6.5(b)(4)is $103,000,000 allocation to the counties." We think it is clear that this 'up to $1,000,000" for each county is separate and in addition to the $103,000,000 County portion of the TAT, but would ask that this be reemehasized. County of ilawai`i is an Equal Opportunity Provider and Eniployer. March 29, 2018 Page 2 A separate question is the amount. What is the right amount for the State to invest in fixing this problem? As formerly provided, a $1 million allocation per county seemed viable. Anything less would be inadequate to solve the pros lem with vacation rental enforcement. Third, if the State is looking for increased enforcement of vacation rentals, what is the financial impact of that increased enforcement? It is more inspectors, and more appeals, and contested cases on enforce ent of vacation rentals, and the problem will •ersist indefinitely. Therefore the payments to the counties should be every year. 1 think that Section 7 is providing a one-time allocation to the counties. iwould ask that the provision be amended to provide annual payments. Finally, Section 7, as written, seems unworkable, since it does not provise language as to who decides how much of the available funds are given to a county, nor what criteria are to be used in exercising that discretion. We strongly urge that the "up to" language be deleted. CIVIL PENALTY SD 1 calls for a civil penalty of "not less than $25,000 to be levied by the county planning director" for "any violation of a county transient accommodations ordinance. While we want to encourage compliance with all ordinances, one can imagine that there may be minor violations that do not warrant such harsh treatment. Perha s a penalty of "not more than $25,000" would allow the punishment to better fit the crime, or leave it entirely to the county ordinance to set the parameters rather than specifying an ar 'tang amount in statute. Harry Kim Mayor, County of Hawali ' County of IIawai is an Lqual Opporiunity Provider and [niployer.