HLU-3(18) SCOPE OF WORK FOR THE COUNCIL'S REQUEST FOR PROPOSALS ON A STUDY OF THE PHASE-OUT OF TRANSIENT VACATION RENTALS IN THE A-1 AND A-2 APARTMENT DISTRICTS (HLU-3(18))
Aloha Chair Kama, Vice Chair Cook and Council Members,
We believe this process and the subsequent study are crucial for understanding the unintended consequences of the Mayor's proposed bill.
Firstly, the study should thoroughly examine the impact on local residents' livelihoods and employment. It should assess the scope and effect on local jobs, including the estimated hourly wages of employees in the STR industry. Consideration should be given to whether alternative job opportunities offer comparable wages and quality of life, particularly noting current employment vacancies across Maui County.
Secondly, the affordability of Minatoya properties is a complex issue that must be extensively factored into the impact study. Key questions include who benefits from this proposal and who may be adversely affected. Will these properties become affordable for purchase by local residents? If not, could investors potentially convert them into long-term rentals that are accessible to locals seeking affordable housing? The study should also analyze the Average Median Income of local residents and explore potential County subsidies to bridge affordability gaps.
Furthermore, the study should investigate properties on the Minatoya list already utilized as owner-occupied or long-term rentals, examining factors such as purchase history and current occupancy. It should also review condominium declarations to identify developments originally designed for STR use and assess their suitability for long-term tenants, particularly families.
Additionally, the economic implications of reduced real property taxes and contributions to the affordable housing fund should be thoroughly evaluated. Currently, STRs contribute significantly to both areas, and the study should assess the potential shortfall in County revenue and propose mitigation strategies beyond increased non-owner-occupied property taxes.
Furthermore, the study should quantify the additional tax revenue generated through General Excise, Transient Accommodations, and Maui County Transient Accommodation taxes attributable to STRs. It should also examine visitor spending impacts on these tax classifications and local businesses, illustrating the broader economic repercussions beyond the STR industry.
Moreover, the overall economic impact extends beyond STRs to encompass local businesses and workers, particularly in tourism-dependent sectors. The study should conduct a comprehensive evaluation of the broader economic effects stemming from reduced tourist accommodations and visitor spending.
In addition to financial impacts, we recommend conducting surveys to gauge community needs and sentiments. This should include surveys on desired housing types, ownership versus rental preferences, and community attitudes towards STRs. These surveys should include reaching out to property owners to understand their intentions if this bill passes.
Lastly, while recognizing these recommendations represent a fraction of the complexities involved, we stand ready to provide further information and assistance throughout this process. We strongly advise engaging a professional economist with expertise in similar studies, such as Paul Brewbaker or Kloninger & Sims, to expedite the study and reduce costs through leveraging existing research.
We ask that if the council chooses that we be included in the study moving forward. Thank you once again for your time today.
I have worked on geographic and non-geographic analysis for 18 years in planning, law enforcement, oil & gas, and conservation. I currently work in disaster management. I have a degree in geography with coursework in urban planning and human geography. My opinion as a professional in this field is analysis is often over-analysis. I don't believe there is much useful analysis that can be done on this topic that hasn't already been done by UHERO and Matt Jachowski.
We can figure out the upper/lower ends of: housing created, jobs lost, tourists staying away, tourists staying in Hotel zoned condos or resorts instead, jobs created, locals and residents being able to stay in Maui County, etc. But we can't predict where in those ranges the numbers will fall.
I think your decisions as Council Members should be based on doing what is right and serving the public interest, and who actually votes for you. I believe Matt Jachowski said at Molokai Planning Commission that 94% of the Minatoya owners live in other states or counties. Finally, Paul Brewbaker's study is skewed and biased, it neglected the positive impacts and cherry picked data to reach the conclusions he wanted.
Brewbaker's middle finger during Justin Kekiwi's testimony yesterday shows that he is emotionally motivated. We can now see the root of the bias in his report. The "finger" encapsulates what I saw in dozens of testimonies and the fact that so few Minatoya owners rented their units to Lahaina fire survivors. They view Maui as a resource for them to profit off of from offshore, much like the plantation economy in our Hawaiian, Caribbean, and American history. They're giving the community the finger, and especially the Native Hawaiians who are most impacted by the housing crisis.
Here are some of the subjects and questions that I believe should be part of any study concerning the proposed phase out of short term rentals from the apartment districts.
Cost/Benefit analysis
1. How many jobs may be lost? Directly: property managers, booking agents, property maintenance, accountants, cleaners, Indirectly: island businesses.
2. How many units would potentially become resident housing vs how many would remain as second homes? Analysis of apartment district properties built since 1990.
3. Who would the most likely future owners or renters be? current residents or new residents.
4. How would this proposal impact property values?
5. How much tax revenue would be lost by the County?: Property tax, TAT, GET.
6. How much tax revenue would be lost by the State? GET, TAT, income tax?
7. How much island spending by visitors would be lost? Restaurants, activity providers, etc.
8. What incentives, disincentives or regulations could encourage short term to long term conversions without a phase out?
9. Survey residents in need of housing to define their housing needs and rents they could afford.
10. Survey STR owners about their reasons for STR ownership.
Housing and Land Use Committee
Meeting July 24, 2024
Mayor’s Proposal to Phase out TVR use in the Apartment zoning
Suggestions on the Scope of the Economic Impacts Study
Aloha Committee Members,
As part of the scope of the economic impact study, I’d like to recommend that each apartment building being proposed to end it’s TVR use, be reviewed, on a building by building basis.
Starting with these details:
• bedroom counts,
• bathroom counts,
• size of unit,
• number of dedicated parking stalls per unit,
• Number of Guest stalls for complex
• Is there street or offsite parking allowed?
• Is there in unit laundry?
• Are pets allowed
• How much storage is available to tenants
• HOA Fees
These details should be reviewed for each building and be used to determine if the building offers feasible, appropriate, affordable and sufficient housing for Maui families, ie. will studios and one bedroom apartments with one parking stall and no in unit laundry, with no storage and no pets allowed, be sought after housing for families? Etc.
Secondly, focus on the actual demand for apartments and the areas of highest demand. When FEMA was offering housing to fire victims, I knew of several landlords with houses in Kula, Haiku and Paia whose houses sat empty for 3 months because Lahaina families were turning them down because they wanted to stay in Lahaina. I also knew of several Lahaina families who turned down perfectly livable homes because the homes were not in Lahaina. Point being, with the bulk of apartments in Kihei, will families actually want to live in Kihei? Or, with the other concentration of apartments north of Lahaina, be more feasible? Then who will get that housing? Will fire victim families get that housing? Or anyone? What's to stop folks who are not already residents from taking that housing? If part of the intention is to flood the market with apartments for sale at lower pricing, will Maui families purchase this housing? Historically (past 40 years) these apartments have been the MOST AFFORDABLE housing on the market, and have NOT been popular with local families.
Next, calculate how many Maui and Hawaii residents will be negatively financially impacted by this. Not all TVR owners are out of state owners. Thousands are are Hawaii and Maui residents. Then calculate how many associated Maui resident sub-contractors will lose their jobs.
Testimonies received from HLU Committee meeting
Please see attached testimony on the scope of work.
Aloha Chair Kama, Vice Chair Cook and Council Members,
We believe this process and the subsequent study are crucial for understanding the unintended consequences of the Mayor's proposed bill.
Firstly, the study should thoroughly examine the impact on local residents' livelihoods and employment. It should assess the scope and effect on local jobs, including the estimated hourly wages of employees in the STR industry. Consideration should be given to whether alternative job opportunities offer comparable wages and quality of life, particularly noting current employment vacancies across Maui County.
Secondly, the affordability of Minatoya properties is a complex issue that must be extensively factored into the impact study. Key questions include who benefits from this proposal and who may be adversely affected. Will these properties become affordable for purchase by local residents? If not, could investors potentially convert them into long-term rentals that are accessible to locals seeking affordable housing? The study should also analyze the Average Median Income of local residents and explore potential County subsidies to bridge affordability gaps.
Furthermore, the study should investigate properties on the Minatoya list already utilized as owner-occupied or long-term rentals, examining factors such as purchase history and current occupancy. It should also review condominium declarations to identify developments originally designed for STR use and assess their suitability for long-term tenants, particularly families.
Additionally, the economic implications of reduced real property taxes and contributions to the affordable housing fund should be thoroughly evaluated. Currently, STRs contribute significantly to both areas, and the study should assess the potential shortfall in County revenue and propose mitigation strategies beyond increased non-owner-occupied property taxes.
Furthermore, the study should quantify the additional tax revenue generated through General Excise, Transient Accommodations, and Maui County Transient Accommodation taxes attributable to STRs. It should also examine visitor spending impacts on these tax classifications and local businesses, illustrating the broader economic repercussions beyond the STR industry.
Moreover, the overall economic impact extends beyond STRs to encompass local businesses and workers, particularly in tourism-dependent sectors. The study should conduct a comprehensive evaluation of the broader economic effects stemming from reduced tourist accommodations and visitor spending.
In addition to financial impacts, we recommend conducting surveys to gauge community needs and sentiments. This should include surveys on desired housing types, ownership versus rental preferences, and community attitudes towards STRs. These surveys should include reaching out to property owners to understand their intentions if this bill passes.
Lastly, while recognizing these recommendations represent a fraction of the complexities involved, we stand ready to provide further information and assistance throughout this process. We strongly advise engaging a professional economist with expertise in similar studies, such as Paul Brewbaker or Kloninger & Sims, to expedite the study and reduce costs through leveraging existing research.
We ask that if the council chooses that we be included in the study moving forward. Thank you once again for your time today.
Maui Vacation Rental Association
I have worked on geographic and non-geographic analysis for 18 years in planning, law enforcement, oil & gas, and conservation. I currently work in disaster management. I have a degree in geography with coursework in urban planning and human geography. My opinion as a professional in this field is analysis is often over-analysis. I don't believe there is much useful analysis that can be done on this topic that hasn't already been done by UHERO and Matt Jachowski.
We can figure out the upper/lower ends of: housing created, jobs lost, tourists staying away, tourists staying in Hotel zoned condos or resorts instead, jobs created, locals and residents being able to stay in Maui County, etc. But we can't predict where in those ranges the numbers will fall.
I think your decisions as Council Members should be based on doing what is right and serving the public interest, and who actually votes for you. I believe Matt Jachowski said at Molokai Planning Commission that 94% of the Minatoya owners live in other states or counties. Finally, Paul Brewbaker's study is skewed and biased, it neglected the positive impacts and cherry picked data to reach the conclusions he wanted.
Brewbaker's middle finger during Justin Kekiwi's testimony yesterday shows that he is emotionally motivated. We can now see the root of the bias in his report. The "finger" encapsulates what I saw in dozens of testimonies and the fact that so few Minatoya owners rented their units to Lahaina fire survivors. They view Maui as a resource for them to profit off of from offshore, much like the plantation economy in our Hawaiian, Caribbean, and American history. They're giving the community the finger, and especially the Native Hawaiians who are most impacted by the housing crisis.
HLU-3(18) short term rental phase out study
Here are some of the subjects and questions that I believe should be part of any study concerning the proposed phase out of short term rentals from the apartment districts.
Cost/Benefit analysis
1. How many jobs may be lost? Directly: property managers, booking agents, property maintenance, accountants, cleaners, Indirectly: island businesses.
2. How many units would potentially become resident housing vs how many would remain as second homes? Analysis of apartment district properties built since 1990.
3. Who would the most likely future owners or renters be? current residents or new residents.
4. How would this proposal impact property values?
5. How much tax revenue would be lost by the County?: Property tax, TAT, GET.
6. How much tax revenue would be lost by the State? GET, TAT, income tax?
7. How much island spending by visitors would be lost? Restaurants, activity providers, etc.
8. What incentives, disincentives or regulations could encourage short term to long term conversions without a phase out?
9. Survey residents in need of housing to define their housing needs and rents they could afford.
10. Survey STR owners about their reasons for STR ownership.
Housing and Land Use Committee
Meeting July 24, 2024
Mayor’s Proposal to Phase out TVR use in the Apartment zoning
Suggestions on the Scope of the Economic Impacts Study
Aloha Committee Members,
As part of the scope of the economic impact study, I’d like to recommend that each apartment building being proposed to end it’s TVR use, be reviewed, on a building by building basis.
Starting with these details:
• bedroom counts,
• bathroom counts,
• size of unit,
• number of dedicated parking stalls per unit,
• Number of Guest stalls for complex
• Is there street or offsite parking allowed?
• Is there in unit laundry?
• Are pets allowed
• How much storage is available to tenants
• HOA Fees
These details should be reviewed for each building and be used to determine if the building offers feasible, appropriate, affordable and sufficient housing for Maui families, ie. will studios and one bedroom apartments with one parking stall and no in unit laundry, with no storage and no pets allowed, be sought after housing for families? Etc.
Secondly, focus on the actual demand for apartments and the areas of highest demand. When FEMA was offering housing to fire victims, I knew of several landlords with houses in Kula, Haiku and Paia whose houses sat empty for 3 months because Lahaina families were turning them down because they wanted to stay in Lahaina. I also knew of several Lahaina families who turned down perfectly livable homes because the homes were not in Lahaina. Point being, with the bulk of apartments in Kihei, will families actually want to live in Kihei? Or, with the other concentration of apartments north of Lahaina, be more feasible? Then who will get that housing? Will fire victim families get that housing? Or anyone? What's to stop folks who are not already residents from taking that housing? If part of the intention is to flood the market with apartments for sale at lower pricing, will Maui families purchase this housing? Historically (past 40 years) these apartments have been the MOST AFFORDABLE housing on the market, and have NOT been popular with local families.
Next, calculate how many Maui and Hawaii residents will be negatively financially impacted by this. Not all TVR owners are out of state owners. Thousands are are Hawaii and Maui residents. Then calculate how many associated Maui resident sub-contractors will lose their jobs.
Thank you,
Colleen Medeiros