Mayor Kirk Caldwell unveils new vacation rental bill

Mayor Kirk Caldwell on Wednesday will try for a third time to obtain from the Honolulu Planning Commission a favorable recommendation for a draft omnibus bill addressing all things related to short-term vacation rentals, this time with a version that places more stringent limits on the number of bed-and-breakfast establishments and transient vacation units that would be allowed.

The vastly revamped, 15-page draft bill will be taken up by the commission at its 1:30 p.m. meeting at the KEY Project Multi- Purpose Community Center in Kahaluu.

The latest plan addresses concerns raised by commissioners and the public at previous meetings about the Department of Planning and Permitting’s original draft, DPP Acting Director Kathy Sokugawa said. DPP’s submittal is required to go before the Honolulu City Council for a final decision with or without a favorable recommendation from the commission, which is advisory on this issue.

The commission voted Sept. 19 to forward Caldwell’s original draft bill to the Council without any recommendation. On Oct. 17, despite a personal plea for commissioners to reconsider their “no recommendation,” the panel rejected him a second time.

A positive commission recommendation could make a big difference for this plan because under city law a positive recommendation would allow the plan to be approved with five of the nine Council members voting “yes.” Without a positive recommendation the plan would need a supermajority of six votes to pass.

On a Council where members have divided feelings on both the short-term vacation issue and Caldwell, one Council vote could make a difference.

The city has been grappling with the issue of TVUs and B&Bs for decades. Proponents of vacation rentals in residential areas argue they offer homeowners a chance to earn some money to help make ends meet while providing Oahu’s visitors an alternative type of overnight accommodation. Opponents say they destroy the ambience and overtax street parking and other infrastructure in residential neighborhoods while taking valuable units out of the island’s tight affordable-housing market.

Sokugawa, in an Oct. 19 memo accompanying the latest draft, said changes were made in response to issues raised by both the commission and the public. “We remain convinced that legislation is needed to better address short-term rentals in Hawaii and believe the City Council would benefit from the Planning Commission’s insights,” she said.

Key changes made in the latest draft include:

>> Allowing those short-term rentals with legal, existing nonconforming use certificates (NUCs) to continue operating as a TVU or B&B. The previous draft required all 816 legally operating TVUs and B&Bs in nonresort zones, those with NUCs, to reapply based on the new rules. The city stopped issuing NUCs in 1989, and DPP estimates there are between 6,000 and 8,000 illegal vacation rentals. (An unlimited number of TVUs and B&Bs are allowed in resort zones.)

>> Capping the combined number of TVUs and B&Bs at no more than 1 percent of all dwelling units in each of the island’s Development Plan areas. The previous draft allowed for an unlimited number of B&Bs in most zones that allow residential use — a clause disliked by opponents of short-term rentals — but limited TVUs only to areas not zoned for single-family residential use.

>> Restricting the amount of TVUs and B&Bs in apartment buildings to no more than 50 percent of all units in an individual apartment building, unless specifically allowed by a building’s bylaws, covenants or some other consent by its owners association.

>> Allowing an unlimited number of B&Bs in the Waikiki apartment precinct. DPP officials said that due to a typo, the previous draft required B&Bs in Waikiki to be subject to the new rules. Currently, both B&Bs and TVUs are allowed without permits in resort zones.

>> Pushing back the effective date of the proposed law to Nov. 1, 2019. The previous draft had a May 1 implementation date.

Not changed from the previous draft are tougher enforcement provisions, specifically bigger fines for violators and a requirement that all ads for short-term rentals include B&B or TVU registration numbers.

Andrew Pereira, Caldwell’s communications director, said in a statement, “After discussions before the Planning Commission, the administration is working on some changes to the short-term rental bill that we hope will receive thoughtful consideration.”