Vacation rental bill on hold until May 8: Almost 100 testifiers evenly divided on pros, cons of new regulations

  • Council chambers in Hilo was packed with testifiers as almost people sign up to testify islandwide on a bill that would limit vacation rentals. (Nancy Cook Lauer/West Hawaii Today)
  • Signs and testifiers line the corridor outside council chambers in Hilo on Tuesday, as almost people sign up to testify islandwide on a bill that would limit vacation rentals. (Nancy Cook Lauer/West Hawaii Today)
  • Deputy Corporation Counsel Amy Self and Deputy Planning Director Daryn Arai listen to testimony on Bill 108 relating to vacation rentals Tuesday in council chambers at the West Hawaii Civic Center. (Laura Ruminski/West Hawaii Today)
  • Planning Committee Chair Karen Eoff leads public testimony on bill 108 relating to vacation rentals Tuesday in council chambers at the West Hawaii Civic Center. (Laura Ruminski/West Hawaii Today)
  • Rick Thompson testifies in favor of bill 108 relating to vacation rentals Tuesday in council chambers at the West Hawaii Civic Center. (Laura Ruminski/West Hawaii Today)
  • "Andrew" testifies in favor of bill 108 relating to vacation rentals Tuesday in council chambers at the West Hawaii Civic Center. (Laura Ruminski/West Hawaii Today)
  • Realtor Gretchen Osgood testifies against bill 108 relating to vacation rentals Tuesday in council chambers at the West Hawaii Civic Center. (Laura Ruminski/West Hawaii Today)
  • Mac McInnis testifies in favor of bill 108 relating to vacation rentals Tuesday in council chambers at the West Hawaii Civic Center. (Laura Ruminski/West Hawaii Today)
  • A standing room only crowd, waiting to testify on Bill 108 relating to vacation rentals, fills council chambers Tuesday at the West Hawaii Civic Center. (Laura Ruminski/West Hawaii Today)

HILO — No matter where they stand on the issue, one thing was clear Tuesday. People care very deeply about vacation rentals.

Residents packed council chambers in Hilo and Kona, and almost 100 signed up to talk about Bill 108, the County Council’s first attempt to regulate the increasingly popular Airbnb, VRBO and other short-term rentals. The county is the only one in the state not regulating such rentals.

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Testifiers over five hours were fairly evenly divided between those supporting and opposing the bill.

The council Planning Committee took its first stab at the bill during an additional two hours of discussion before recessing until May 8.

It’s an emotional issue. On the one hand, there are people who moved to residential neighborhoods, some at personal financial sacrifice, for the peace and quiet of a residential neighborhood, only to see it taken over by rentals.

Testifiers described lost strangers knocking on their doors late at night looking for their rental, loud, “alcohol-infused” conversations past midnight, children splashing and shouting in swimming pools at 6 a.m. and more than a dozen vacationers packed into a single-family home.

“Homes for families, not for profits,” “You, too, can live like a local” and “Choose residents, not greed” were among hand-made signs hoisted by Hilo testifiers.

On the other hand, there are people who, some also at personal financial sacrifice, bought a home in Hawaii and plan to rent it out until they retire or can afford to move here. Vacation rentals are a way to pay mortgages and taxes on their investment, they say.

“This bill seems to imply that tourists are a plague that need to be confined to the resort areas,” said Rick Shonhauer, who is currently purchasing property in Kona for a vacation rental in anticipation of retiring there someday.

Bill 108 is an attempt to prevent unhosted short-term rentals in residential and agricultural zones. Existing rentals in good standing in those areas would be able to apply for a nonconforming use certificate that must be renewed annually for a $500 fee.

The county estimates there are 8,000 vacation rentals currently operating.

Mayor Harry Kim, who asked the council to pass a measure regulating the rentals, urged the council to continue its effort.

“People demanded that government needs to do something about what is happening to Hawaii,” Kim said. “One thing in common they’re saying is we have to regulate this business. And that’s what we’re trying to do.”

Some testifiers pointed out that regions such as Puna and Volcano have no resort or hotel zones and very little commercial zones where vacation rentals would be allowed. Any new law should be able to accommodate those areas, they said.

Others said they don’t think nonconforming uses should be grandfathered in at all.

“Why should we reward them for getting in before we realized they were an invasive species?” said Sarah Moon, who lives in Leleiwi, an oceanfront community near Hilo.

Short-term vacation rental is defined in the bill as a residential dwelling where the owner or operator does not reside on the building site, that has no more than five bedrooms on the building site for transient use, and is rented to transients for a period of 30 consecutive days or less.

Proponents of allowing short-term vacation rentals say the practice brings tax dollars and investment money into the county and employs construction and maintenance companies, while attracting visitors who don’t like staying in hotels. Too much regulation will hurt the economy, they say.

“Most vacation rental home owners we know personally, who do not live on our island, are couples with dreams to retire here and in the meantime rent out their homes to help with the mortgage payments,” said Magdalene Phillips, who owns a vacation rental in Puna.

If there were fewer short-term rentals, perhaps there would be more housing opportunities for long-term residents, some opponents of vacation rentals say.

“There is already a shortage of affordable homes in the Kona district and vacation rentals by absentee owners only exacerbate that problem and drive up the costs of housing for residents,” said Charles Young of Honaunau.

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Others say the government should just enforce the laws already in place.

“The state of Hawaii needs to address the laws they have in place before making new laws,” said Patricia Starkie, of Pahoa, who has owned vacation rentals on the Big Island since 2004.

  1. Castle April 25, 2018 6:29 am

    I agree that the State needs to implement the laws that they had in place before moving onto the next law. If there are 8000 short term listings, make sure they are in compliance with taxes. If wanting to regulate their growth, attach the annual non-compliance fee of $500. That should give the state plenty of money to maintain community roads infrastructure, and develop plans for affordable housing villages.


    1. Bigislandfarmer April 25, 2018 9:18 am

      No it won’t. There are only a few hundred units that will be paying this fee. The vast majority of the alleged 8000 are in resort zones where they’re specifically allowed, are actually duplicates–a single unit can be on 5 sites and it counts as 5 of these 8000. The true number is far lower. Also, if someone owns the property, rents a room or separate structure or in the same house, that won’t be regulated at all, and that makes up the vast majority of other vacation rentals outside of resort zones. Registered vacation rentals won’t even have to prove they are permitted structures! This bill is a complete mess and it’s embarassing that anyone with more than a middle school diploma would even put their name on such a non-sensical and vague document. Unfortunately, that’s the level of incompetence we get with Kim and the council. Remember, these are the folks who have set it up so that no one can ever evict a tenant without paying $10k to hire a sheriff from Oahu or Maui. Maybe they should solve that problem first. Nobody wants to provide long term rentals if they can’t even evict tenants running a meth lab!


  2. Say What? April 25, 2018 7:37 am

    I have three short-term rental houses surrounding my house. Their presence degrades the quality of life for every resident of the neighborhood. Loud, drunken, rude tourists think they have entered a “let’s go wild” zone, instead of a working-class neighborhood, with school children and retirees all wondering why they can’t get a decent night’s sleep because mainland partiers want to act like Spring Break maniacs.


    1. Bigislandfarmer April 25, 2018 9:12 am

      The bill you’re supporting will allow someone to instead put five tarps on the lots next to you, with no bathroom facilities, and keep renting them out as long as they can claim the property as a primary residence, without even having to register! This bill is vague and will create more problems than it solves.


      1. Castle April 25, 2018 9:43 am

        Can’t they specify in their legal terms -what is a legitimate accommodation- as opposed to a tarp and bucket?


        1. Bigislandfarmer April 25, 2018 9:46 am

          They could, but they are specifically refusing to do anything about these “hosted” rentals which make up the vast majority of listings outside of resort zones. The County knows there are tens of thousands of people residing on the island and doesn’t do anything even when formal complaints are filed using their system to do so. Since this bill exempts hosted rentals completely, expect to see many more of them!


    2. Jimmy Dean April 25, 2018 10:43 am

      See my post above. We see the same thing here. It is a tough issue all around, bu there are some good solutions, or at least compromises that can help. Good luck!


  3. konablue April 25, 2018 11:16 am

    I have three homes where short term rentals take place and have never had a problem. I have more problems from long term renters who show no respect for their neighbors or the properties they occupy. These are homes bought and paid for by people who already pay more in property tax than the average home owner in our county, I think it is only right that they can do with their property as they wish. Reducing the number of air b n b’s or VRBO’s will not reduce cost of a home only the release of state owned land and a change in the rezoning proceedures can do that.


    1. TN April 25, 2018 1:34 pm

      Long term tenants who work full time disrupt the residential community more than people on vacation?

      Yeah I find that really hard to believe.

      Just because you purchase property doesn’t mean you can do whatever you want with it. You can’t buy a property in residential zoning and turn it into an operating commercial business. Should be the same for vacay rentals if you ask me.


  4. onceawarrior April 25, 2018 2:07 pm

    After all is said, I hope the Council legislates and reaffirms zoning regulations that are correct.
    Keep agricultural and residential zones as they should be. Keep vacation rentals away and place them in the commercial hotel areas. Granting exemptions is a form of abetting corruption especially if they were illegal to begin with. Business enterprises are adept to adjust to changing economic conditions.


  5. oceanwatcher.com April 25, 2018 2:42 pm

    Our once quiet one lane road ag zoned neighborhood has been literally overrun by Air BnB’s or VRBO’s or make shift “ohana” dwellings, or rooms for rent, that have exacerbated noise, traffic, speeding, littering, and general disrespect for other neighbors and their rights. Whether short term or long term, this seriously impacts in the most negative way the possibility for any resident family to find a reasonable rental anywhere in west Hawaii unless you can commute 60 – 90 miles, or pay upwards of $2500 – $3000 a month for something likely less than desirable. It is out of control, people! NOBODY should be granted any exemptions or “grandfathered” in. And does anyone really believe all these people cashing in that don’t have property managers, etc. are actually paying taxes on this income? In my neighborhood, it’s all under the radar, and they just keep coming. We need to enforce current laws and update them, if need be, to disallow this – no passes! Take care of our own first, not the well to do investors looking to retire – enough ALOHA has already been lost!


    1. Bigislandfarmer April 26, 2018 7:44 am

      The bill will specifically exempt these ohanas, which will guarantee there will be far more of them. They don’t even need to be permitted! They’ve actually done studies around the country and the best argument that hotel industry (who is pushing this bill despite record profits and the highest hotel rates in the country) is that for every 100% more vacation rental listings rents go up a whopping 4%. In other words it has essentially no impact on availability of long-term housing. Why aren’t you upset that our incompetent local government provides no way whatsoever to kick out a long-term renter even if they’re running a meth lab? The only option is to hire a sheriff from another island to come out here for $10k. If the tenants aren’t there when the sheriff comes, too bad, you lost $10k. Kim and his cronies have known this for years and have done nothing about it. No sane person would rent a unit long-term under such conditions. It’s already the law that these people have to pay these taxes. So beef up enforcement. This isn’t rocket science.


  6. naeporue April 26, 2018 2:31 pm

    So, make more hotels with affordable room rates, then the tourists will go there instead.


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