LIHU‘E — The Kaua‘i County Council, almost 10 months and five drafts later, passed Bill No. 2774 on Wednesday, amending the county’s housing policy in an attempt to better address a staggering housing crisis faced by the county.
First introduced on Jan. 29 by Council Chair Arryl Kaneshiro and Housing and Intergovernmental Relations Committee Chair KipuKai Kuali‘i, the bill passed 5-1, with councilmember Felicia Cowden as the sole nay vote.
Heard often during the process is the fact that the current housing policy had netted zero affordable-housing units in its existence. Known as Ordinance 860, this policy has been in effect since June 2008.
Part of that reason, County Housing Agency Director Adam Roversi said, has to do with “triggers” in the ordinance (certain permits and zoning requirements) that did not activate the policy.
In its passed form, Bill No. 2774 decreases the workforce-housing assessment from 30% to 20%, which means for projects of 10 or more units, 20% will need to be considered “workforce-housing units,” which are priced for people who earn lower than the market rate and above what they need to make to qualify for federal assistance.
The bill exempts multi-family workforce-housing projects in the special planning areas mostly found in Lihu‘e, Koloa and Kalaheo in areas zoned R-10 or higher, at or above the maximum density, which promotes denser, and in some cases, more-walkable communities.
The bill also drops what is considered affordable by eliminating the 140% area median income level (AMI), and maxing it out at 120%.
To put this into context, a for-sale, two-bedroom home at 120% of the county’s median income would sell for $533,600, whereas at 140% that would go for $631,300. Rent wise, a two-bedroom with utilities would go for $2,750 a month at 120% of the AMI. At 140%, that would be $3,208, according to U.S. Department of Housing and Urban Development numbers.
Additionally, the bill extends the term of affordability from 20 years to 50 years, which gives the county a sort of dibs on these types of units within 50 years of purchase. This allows the county to repurchase homes and sell them at affordable rates.
The council received at least 72 pieces of written testimony, including one in support, 55 in opposition and 16 classified “other” opinions before Wednesday’s meeting.
“I don’t understand why we have to pass this today,” Cowden said prior to the vote. She said she was “not comfortable” with the policy, and believes it would make developing affordable housing more difficult based on conversations with stakeholders.
Cowden, at an earlier October committee meeting, proposed an amendment removing all town-core exemptions, reducing the 30% affordability requirement to 15% across the board, and a 30-year buy-back period. The amendment was struck down, but had it passed it would have brought the bill back to the public hearing stage.
“I know there’s a lot of good in here, but I am not going to be voting in support of it,” Cowden said. “It seems like it will pass just fine regardless. And I hope that you all are right, and I am wrong.”
Over the past 10 months, the council has continued to tweak the bill with the ongoing coronavirus pandemic in mind.
“The notion that because of COVID-19 we should do nothing doesn’t make any sense,” Roversi said. “We have a housing crisis. It’s only going to get worse with the economic crisis and economic stress in our community generated by COVID-19 financial losses. Because people are financially in trouble, it seems illogical to me we should not do something about affordable housing.”
Former Mayor JoAnn Yukimura testified Wednesday, noting that many developers avoid town cores of Kalaheo, Kilauea, Hanalei and Koloa because of a lack of a sewer system.
“The county has failed to do good land-use planning,” Yukimura said. “It has designated places for growth but failed to provide the infrastructure for it, leaving the private developers to install their own sewage-treatment systems.”
Yukimura recommended that the bill’s “exemptions” statements be changed to “exceptions,” require a 10% housing assessment from Koloa, change the land-in-lieu option to land and offsite infrastructure option, and clarify housing contributions.
Voting in favor of the bill were Kaneshiro, Kuali‘i, Vice Chair Ross Kagawa and councilmembers Mason Chock and Luke Evslin, all noting that this is just the start to affordable housing, not the final answer.
“We have carved out an avenue and a direction for the kind of development that we want to encourage and provide a way for it to serve our needs,” Chock said.
The bill has a 10-year sunset, Kuali‘i explained, and there’s no more important time than now to “give this a shot.”
“We need to give it a try,” Kuali‘i said. “We need to actually do what the bill was intended to do.”
Kaneshiro likened the bill to peeling an onion, with these amendments as one layer.
“I don’t think we can do worse than zero,” Kaneshiro said.
Home tax exemption also passes
The council also passed Bill No. 2803, an ordinance that would change the requirements for a person to qualify for a home real property tax exemption.
Now, to qualify for a home exemption, a person must occupy their home on Kaua‘i for at least 270 days, or about nine months, up from the previous 181 days. Prior to the passing of this bill, Kaua‘i had the fewest home-occupancy qualifications. Maui County and the City & County of Honolulu require 271 days, and Hawai‘i Island requires 181 days to qualify.
The county now also requires a homeowner to file a state tax return with a reported address in the county, have a valid state license or identification card, or be stationed in the county under military orders.
The bill, which was first introduced by Evslin on Aug. 19, passed unanimously.