Gov. Green pledges to sign rentals legislation

HONOLULU — Gov. Josh Green on Tuesday pledged to sign a bill into law that would give each county clear authority over vacation rentals — including the possibility of banning them — if it arrives on his desk, as expected.

Green told a cheering crowd of Lahaina Strong members at the state Capitol Monday that, “When this bill passes, I will sign it.

“It will have a positive, profound impact on our people,” Green said. “People will be able to get housing again.”

Dozens of Lahaina Strong members traveled from Maui to the state Capitol on Tuesday to urge passage of Senate Bill 2919.

Paele Kiakona, Lahaina Strong’s advocacy and communications coordinator, said it took the devastating Aug. 8 wildfires for public officials to realize the “dire need” to address visitors occupying Hawai‘i housing units while residents struggle to find affordable housing.

“Today, we are here again pushing our state officials to help us, to help the people of Hawai‘i, to protect the sanctity and identity for our neighborhoods and defend what gives Hawai‘i its authenticity — the people,” Kiakona said.

Hawai‘i already faced an estimated shortage of 50,000 affordable homes when the Maui wildfires destroyed or left uninhabitable an estimated 3,900 homes, exacerbating Maui’s housing crisis.

Some survivors continue to live in West Maui hotels as they wait for longer-term housing to become available.

“There are tens of thousands of short-term rentals across the state that should not be short-term rentals,” Green said. “They should be houses for our local people.”

Honolulu Councilmember Tyler Dos Santos-Tam attended Tuesday’s rally and estimated there are 75,000 illegal short-term rentals across the state.

If they become available for local residents, Dos Santos-­Tam said that Hawaii’s cost of living and rent will decrease, making life easier for residents tempted to join the exodus of island residents moving to more affordable states.

Maui County Council­member Keani Rawlins­-Fernandez estimated there are 14,000 short-term rentals on Maui, although Green previously said Maui has 31,000 legal and illegal short-term rentals.

State Sen. Jarrett Keohokalole (D, Kaneohe-­Kailua) introduced SB 2919 because, he said, he wants to take action, “not just on Maui, but also to help everyone who’s struggling to find a place to stay and to find a way for families to continue to stay here together in Hawai‘i.”

The bill has several goals aimed at vacation rentals, including ensuring that each county has the power to regulate short-term rentals — including banning them. The measure also would rewrite a 1957 state law that was successfully used against the City and County of Honolulu to limit its ability to crack down on vacation rentals.

On Dec. 21, U.S. District Judge Derrick Watson granted the Hawai‘i Legal Short-Term Rental Alliance a permanent injunction that exempts existing home rental owners from a provision in a 2022 city law that sought to increase the minimum rental period for residential properties on O‘ahu to 89 days from 30 days.

The order prevents the city from enforcing or implementing Ordinance 22-7, which essentially prohibits home rentals for fewer than 90 days.

Owners who rent for fewer than 30 consecutive days are considered short-term rental owners and are subject to different city regulations from the owners covered in Watson’s order.

After Ordinance 22-7 was signed into law on April 26, 2022, the Hawai‘i Legal Short-Term Rental Alliance filed suit in federal court in June 2022, and Watson later issued a temporary injunction.

In December 2023, Watson limited the scope of his subsequent permanent injunction. But he still based it on HRS 46-4(a), which was enacted by the Legislature in 1957, giving counties the authority to promulgate zoning ordinances.

Keohokalole, a lawyer, helped draft SB 2919 to clarify the law in the hope of preventing a future court challenge.

He said the House and Senate versions have the same intention and the conference committee has agreed on uniform language to be voted on today.

Rawlins-Fernandez said, “Laws are not meant to be stagnant. They are meant to evolve as our environment and needs evolve. Though we’ve made some great strides, SB 2919 is what’s needed now more than ever.”

As SB 2919 moved through the Legislature this session, Keohokalole said he was “deeply frustrated and angered” by the response from owners of vacation rentals.

Keohokalole was inundated with emails, testimony and calls from owners “who were offended at the notion that their dream investing property on Maui would be compromised by our efforts here to get fire victims housed and provide some stability and certainty to so many families who have been suffering on Maui.”

He emphasized that the measure would only allow counties to make decisions they feel are necessary and in the best interest of their own communities.

“Illegal or not, these types of activities reflect a policy decision that we’ve made both by our actions at the state level but also by our inaction,” Keohokalole said. “That needs to change, and we cannot continue to contribute to this type of conversion of our communities.”

Rawlins-Fernandez said that even before the fires, conversions of long-term rental housing to short-term vacation rentals negatively affected residents.

“The idea of B&B was to share our home, not to be pushed out of our home,” she said.

The short-term rental industry challenged Maui County’s ability to properly manage short-term rentals in a way that balances the community’s need for affordable housing, Rawlins-Fernandez said.

“This systemic housing crisis exacerbates disparity, forcing our residents to compete with investors and tourists for housing,” she said. “We must correct this injustice.”

SB 2919 was unanimously approved, with amendments, by a House-Senate conference committee on Wednesday.