Committee holds off votes on vacation rental bills

Two bills aimed at carving out rules and a permitting process for short-term vacation rentals were held up Tuesday by the City Council Planning Committee to allow committee members more time to look into the different impacts the legislation would have on the community.

After more than five hours of testimony, the committee agreed to defer action until it meets again at 11:15 a.m. Monday.

Planning Committee Chairman Ikaika Anderson urged colleagues to return “ready to make a decision, one way or the other.”

Councilwoman Kymberly Pine said too much was at stake for Council members to rush. “We’re very close to passing legislation that everyone can be comfortable with,” she said.

The votes, if they are taken, would be the last committee decisions on the two bills before the measures go up for a final vote of the full Council, likely on May 8.

The current draft of the omnibus Bill 89 (2018) would permit up to 4,000 bed-and-breakfast operations — those run by owner-occupants — across Oahu but no new “whole home” vacation rentals, also known as TVUs, where there is no owner- occupant present.

But a new draft of the bill, introduced by interim Council Chairwoman Ann Kobayashi, would allow for whole-home vacation rentals if operators can prove they live in another Oahu residence they own by providing a homeowner exemption. The draft also calls for the operators to pay the same rate of taxes as owners of hotels and resorts instead of a new vacation rental rate for B&Bs, and wants them to submit a telephone number for neighbors to voice their concerns 24 hours a day.

Kobayashi’s draft was supported by TVU supporters, who argue that vacation rentals are a vital component of the visitor industry locally and believe it would be disastrous to the visitor industry and the Oahu economy if the Department of Planning and Permitting began abruptly cracking down on thousands of vacation rentals.

The new draft raised the most questions, and several Council members said they are still looking at the impacts it would have on apartment zones in Waikiki.

Bill 85 (2018) aims to crack down on illegal bed-and-breakfast and transient vacation unit operators by requiring those advertising their short-term rentals to list their permit numbers or, if in hotel-resort zones, their street addresses. It also would make hosting platforms liable for illegal transactions and would allow neighbors to seek legal action against operators of illegal vacation homes. The bill is widely supported by those who oppose vacation rentals and believe they disrupt neighborhoods and take away housing stock.

The Council and a string of mayors have been trying unsuccessfully to tackle the complex vacation rental issue for several decades since the city stopped issuing permits for them in 1989. DPP estimates there are only 816 legal units outside of resort zones but between 6,000 and 8,000 illegal units on Oahu.