The Green administration’s campaign to develop more affordable housing with less government delay has taken a modest but important step forward. A working group established to help speed proposals along recently voted to waive, for one developer, the school impact fee that state law assesses for new housing projects.
The Build Beyond Barriers Working Group was convened by Gov. Josh Green in July as part of an emergency proclamation aimed at giving housing more of a glide path to completion.
The reason, of course, is the long-standing deficit in housing statewide. One state analysis concluded in 2019 that Hawaii needed 50,000 homes to be built by 2025, including about 36,000 priced for low-to-moderate-income households.
So there was ample justification for the working group’s vote on Dec. 20 to grant a waiver on the school impact fee for 1060 Bishop Street LLC, a developer seeking to convert that downtown office building to 52 rental apartments. The fee is to help build capital for the construction of school facilities needed to accommodate new students moving into an area.
With some exceptions, the school populations in the central urban core generally have been contracting, so the waiver for a downtown apartment project seems reasonable. In this and similar cases, easing this burden on developers could be in the public interest by encouraging new housing units to be produced.
It makes little sense to impose a fee for revenue that’s not needed; the state schools bureaucracy that manages such construction has not delivered those projects with efficiency lately, anyway.
Where the impact fee does make sense is in areas where new schools are needed for a growing population of young families with school-age children.
That is why it’s premature for the Legislature to consider abolishing the fee entirely, as one of the working group members suggested.
Sterling Higa, who represents the nonprofit advocacy group Housing Hawai‘i’s Future on the state’s working group, said the fees are passed on to homeowners or renters and generate only limited cash for new construction. He’s right that student populations are declining in some areas, but that does not support dispensing with the revenue-raising mechanism altogether.
However, it does support a serious discussion by lawmakers about ways the school-impact-fee tool could be refined. That could be an element in a broader review of the affordable-housing emergency proclamation status, but it also could lead to changes to the impact-fee law for the long term.
The Green administration would be quick to assert that funding is needed for added classrooms statewide, even in some zones where populations are not increasing. Many schools are lacking in classrooms for preschool students, for instance, something that the Ready Keiki Initiative was established to correct.
Last month’s school-fee waiver was the first working-group decision affecting a specific housing proposal, but the panel had previously voted to ease staffing problems that could impede project oversight.
In November the group agreed to exempt hiring regulations for Hawaii County planning and public works departments so they could easily boost the agencies to full staffing. Again, these rules are not to be lifted casually, but while the state is in this problem-solving mode, exemptions can help the administration achieve its housing development goals.
The working group was set up, after all, to find and clear precisely these kinds of choke points in the development pipeline while the housing emergency remains active. But it also could shine a light on ways to make more permanent improvements in Hawaii’s regulatory system — something the state has needed for years.