Dozens of transient vacation rentals that operate legally in the Wainiha-Haena area closed to the public since last April’s disastrous storms got a one-year reprieve on Monday that will permit them to go back into business when Kuhio Highway reopens — projected for later this year.
Without the provisions of a proclamation signed Monday by Mayor Derek S.K. Kawakami, the 81 legal TVRs in the corridor west of Hanalei would have had to shut down on about April 15 because, in normal circumstances, they lose their legal right to operate if they remain closed for one year or more.
Enforcing existing county ordinances under circumstances as extraordinary as last year’s storms, said Kawakami’s proclamation, “would cause hardship and inequity for such owners by requiring them to suspend operations despite being required to operate” under circumstances where operating is impossible because of provisions of the emergency orders that have kept the Wainiha-Haena area closed for nearly a year.
The vacation rentals in question were forced to shut down after the county imposed an indefinite ban on public access to the area because of severe damage from the storms, which severed the highway in several places and resulted in numerous collapsed and heavily damaged houses. While there were no serious injuries in the catastrophe, the Wainiha-Haena area remains largely inaccessible to the public as crews work to complete highway repairs.
Kawakami’s proclamation will continue the closure imposed on the area for at least another 60 days in addition to the new TVR exemption. The Monday order was silent on the situations of an estimated three or four dozen additional TVRs that are believed to operate illegally in the closed area.
It is not clear how many — if any — of those illegal operators have actually continued to accommodate guests with the highway shut down, but many in the community believe at least some of the illegal TVRs have managed to continue in business by spiriting guests past security and convoy checkpoints. Actual evidence of such illegal operations has been elusive.
At the same time, however, County Planning Director Kaaina Hull said on Monday that the county is about to harness new technology in an effort to identify and shut down illegal TVRs all over the island.
Islandwide, Hull said there are 3,500 to 4,000 legal TVRs that operate in various parts of the county’s Visitor Destination Area. He said another 420 operate legally outside of the VDA in places like Hanalei.
Hull said an estimated 800 to 1,200 illegal TVRs are in operation islandwide. If they are caught, they face $10,000 fines for each violation, but online platforms like Airbnb and VRBO often obscure the exact locations of rental properties, making it difficult for vacation rental enforcement investigators to identify and shut them down.
In an interview on Monday, Hull said the county is in negotiations with several Silicone Valley software providers that have developed special programs to identify illegal TVRs by specific addresses even if the online ads that promote them don’t give a precise location. As technology has started to close in on illegal operators in such places as San Francisco and New York City, unscrupulous operators have gotten more creative and upped the sophistication of technology they use to mask their true locations.
“As the illegal operators dig in,” and use more sophisticated methods, Hull said, “the more creative we have to get.” But, he said, “as good as our people are, the vast majority of illegal TVRs are still advertising in a manner where it isn’t easy for our guys to identify them.”
One way illegal TVR operators attempt to avoid detection, Hull said, is to limit their advertisements on platforms like Airbnb to evening and weekend hours, apparently on the theory that county employees will be off duty at those times. To counter the strategy, he said, county inspectors now typically monitor vacation rental online platforms in the middle of the night and at all hours over weekends.
The number of illegal TVRs against which the county took action last year dropped significantly from 2017 — from 93 to just 28 — because inspectors typically assigned to those duties had to be diverted to disaster response activities, Hull said. One of their tasks, for example, has been to implement the convoy program that limits hours anyone can use the highway and restricts access to residents and people with legitimate business in the closed area.
“We are now fully staffed up again,” he said, “and we expect to get those numbers (of illegal TVRs closed down per year) to go back up to 100 to 110.”
Recently, Hull said, “our team logged into the Worldwide Web at 1 a.m. on a Sunday and we caught one of them.”
Illegal TVR operators frequently contest orders that they shut their operations down. There are currently about 40 appeals or shutdown orders for allegedly illegal TVRs pending before the Planning Commission, Hull said.
Hull said Kauai County may also seek to emulate cities like San Francisco, which have fought litigation from illegal TVR owners and forced them to accept settlements under which they agree to limit their advertising so their operations fully comply with anti-vacation rental restrictions that may exist locally.
Although Hawaii has not yet given counties the authority to do the same thing, Hull said a pending State Senate bill would allow far more aggressive tactics in fighting back against unethical TVR operators.
