3 days ago
Maui vacation rental bill draws support, opposition at heated hearing
Owners and managers of some Maui vacation rentals predicted that Mayor Richard Bissen's proposal to convert 6, 100 units into long-term housing will not work and could have unintended consequences.
Some argued at Monday's hearing of the Maui County Council's Housing and Land Use Committee that most Valley Isle residents cannot afford the $4, 000 and more they need in monthly rent to keep up with mortgages, taxes, association fees and other expenses.
Several said the value on their units ever since Bissen proposed Bill 9 last year has plummeted and they have received no offers—either from local residents or out-of-state investors frightened away because they might not be able to use them as short-term rentals.
As a result, they said, renters and buyers who can afford the rent or sales costs might move in from the mainland, meaning Bill 9 would not attain its goal of affordable housing for residents.
One woman said she listed one of her two Kihei rental units for sale for $900, 000 last year, then dropped the price to $600, 000 and still received no offers, which she said proves the cost of her unit remains out of reach for local residents.
At Monday's hearing, 176 people signed up to testify but only 52 had the chance to speak.
The meeting adjourned until June 18 when Council members are prepared to hear a full day of additional testimony. They also earmarked June 23 for a possible third day of hearings.
All nine Council members serve on the Housing and Land Use Committee and their votes will provide a preview of what could happen when Bill 9 goes before the Council.
The proposal has drawn 'passionate discussion ' that has included bullying and threats, Committee Chair Tasha Kama said.
People on both sides of Bill 9 told the committee they have been harassed, and one said he was threatened in person that his house should be burned.
Kama regularly admonished people in the audience to refrain from cheering for comments both for and against Bill 9.
The hearing began with Bissen and members of his administration arguing the need to reign in housing costs and create more affordable housing for residents, which was exacerbated by the Aug. 8, 2023, wildfires that destroyed 3, 500 homes and killed 102 people.
Bissen amended Bill 9 to give owners three years to transition out of the short-term rental industry, either by renting long term or selling to local residents.
Proponents and opponents for the bill repeatedly cited a University of Hawaii Economic Research Organization study in April that predicted losses of jobs, property taxes and visitors among other negative economic impacts of Bill 9.
But Bissen said the UHERO report does not tell the 'full story ' of the ongoing departures of Maui families, kupuna, local knowledge and critical workers such as teachers and firefighters, in addition to forcing children to grow up somewhere other than Maui.
He argued that short-term rentals have helped exacerbate Maui's housing shortage and have been banned in places like London, Los Angeles and New York.
At the same time, Bissen said, 'we cannot build fast enough.'
Bill 9, by contrast, will 'make immediate progress, not years down the line, ' he said.
Currently, only 4 % of homes are affordable for local residents, Bissen's executive assistant Matt Jachowski said. He cited the UHERO report that the price of condos would drop 25 % in 2027, which would make them affordable to 11, 600 more Maui households.
Bill 9 also has been forecast to lead to a 33 % drop in tourists, which would give Maui a ratio of 1 visitor for every 3.3 residents, putting it more in line with other island counties.
Before the wildfires, Maui had a ratio of one tourist for every 2.3 residents, Jachowski said.
The need for clean water also hurts construction development and Jachowski said vacation rentals use 60 % to 120 % more water than permanent housing.
'We have a moral obligation to act, ' Bissen said. 'The status quo is failing our people.'
