Rental units bill deferred

LIHUE — Citing the need to get input from the administration, the Kauai County Council unanimously voted Wednesday to refer to committee a bill that would allow additional rental units in the Lihue Planning District.

Council members were expected to vote on Bill No. 2627, which would allow people in Puhi, Hanamaulu and Lihue to apply for a permit to build an additional rental unit, or ARU, on their property. Instead, they voted to refer it back to committee, giving stakeholders time to hammer out details.

Those details include an incentive package for those who apply for permits, whether the bill would grandfather in illegal ARUs that are already operating and the purpose of the bill itself.

If passed, the bill would allow property owners to build an 800-square-foot ARU, complete with a separate kitchen, bedroom and bathroom facilities on their property.

The bill states that “the County is anticipated to need an additional 10,000 new housing units to accommodate its resident population between 2010 and 2035. The Lihue district is expected to absorb nearly half of this increase, which would mean adding approximately 4,600 units to its current housing stock.”

Because of the expected growth in the area, the purpose of Bill No. 2627 to “encourage and accommodate the construction of additional rental units and to increase the number of affordable rental units.”

But Ka’aina Hull, deputy planning director for the County of Kauai, said its intent was to increase the inventory of housing options in general, not necessarily affordable housing options.

“Ultimately, the goal is to provide housing options,” he said. “If the owner wants to take advantage of it (as affordable housing), then that’s their prerogative.”

Before the council votes on the bill, they need to be sure of its focus, said Councilman Arryl Kaneshiro.

“Is it for affordable housing, or is it to increase housing supply in the market?” he said.

If the goal is to increase housing inventory, Mel Rapozo, council chair, questioned why the ARU permitting would be limited to the Lihue Planning District.

“Affordable housing needs to be taken out of the bill if that’s not the intent,” he said. “If we’re trying to boost inventory, wouldn’t it make sense to allow ARUs everywhere?”

If it is successful in Lihue, the bill can be amended to apply islandwide, said Councilman Gary Hooser.

“Lihue is where the community plan says increased density will go, and is a place where we’re adjusting significant sums of money to build walkable communities,” he said. “If it works, we can consider expanding it to other areas, but Lihue is where it should be.”

Because it would cost around $160,000 to construct an ARU, the only way to ensure affordability is to create an incentive package for those who build ARUs, Rapozo said.

Councilman Ross Kagawa voiced concerns that the bill would grandfather in ARUs that are operating illegally.

He asked Hull if there was a way to count how may ARUs are operating illegally in the Lihue Planning District.

“I don’t think it’s prudent of this council to legitimize illegal activity. And if the number is large, we should be cautious and do more diligence to know exactly what we are approving,” he said. “If we’re going to approve something like this, knowing there are large numbers, why are we being so strict with small numbers of B&B and TVRs (transient vacation rentals).”

There is no way to know how many illegal ARUs could be grandfathered in with the bill, Hull said.

But Hooser emphasized that the bill, which he introduced with Councilman Mason Chock, will not grandfather illegal ARUs.

“It will allow people to apply for a permit, it doesn’t legalize anything at all,” he said. “We have an urgent housing crisis, and this is a reasonable proposal.”

Bill No. 2627 will be in committee July 13.

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