KAILUA-KONA — A bill to regulate short-term rentals on Hawaii Island will get another go before the County Council Planning Committee after more amendments were proposed Tuesday.
The committee met to mull proposed changes by Hilo Councilwoman Susan Lee Loy that were heard May 8. They also heard testimony from eight people who were mostly in support of the measure.
Lee Loy’s amendments include a requirement that a new owner notify the county of a change in ownership, though the registration as a short-term rental will continue until terminated; reference to existing county laws regarding signage in the county right of way; and clarification to wording, including changing a “designated contact” to a “reachable person.”
“We tried to find some very refined, consistent language so that anyone entering into this short-term vacation rental understood what they were getting into and what the parameters were,” Lee Loy said Tuesday.
Kona Councilwoman Karen Eoff commended Lee Loy’s work, adding the “committee is honing in on some good refinements” thanks to public input.
“We heard a lot of really great comments and great ways to improve the bill,” said Kona Councilman Dru Kanuha, who co-introduced the bill with Eoff. “It’s going to be a long process (and) we’re going to be going through that process with the community, and please don’t stop giving us good information to make this bill better.”
The committee then voted 9-0 to amend the measure.
Bill 108, now on its third draft, applies only to unhosted, short-term or vacation rentals where the owner does not live on-site. Hosted rentals, such as bed and breakfasts and home-sharing units, are not addressed in the bill.
The measure is an attempt to prohibit unhosted short-term rentals in residential and agricultural zones, while allowing them in hotel and resort zones as well as commercial districts. Existing rentals in disallowed areas would be able to apply for a nonconforming use certificate that must be renewed annually at a cost of $500.
After voting on the bill, the committee took up discussion about additional amendments proposed by Puna Councilwoman Eileen O’Hara. However, because O’Hara’s communication seeking consideration of the changes was submitted late and therefore not included in Tuesday’s meeting agenda, the committee was unable to vote on the matter.
Among the changes she proposed are requiring verification of notification letters sent to all property owners within 500 feet of any short-term rental upon submitting registration, terminating registration upon change of ownership and requiring a $100 annual fee for short-term rentals in hotel and resort zones as well as commercial districts.
“It’s really important that we keep accurate records here at the county,” O’Hara said about the need for registering all short-term rentals. “And the magnitude of the disaster in Puna right now is making us well aware of that — not knowing where our visitor population is at any given time.”
In addition, O’Hara’s proposed amendments call for lowering the annual $500 fee for the nonconforming use permit to a scaled program based on the amount of transient accommodations tax paid during the prior year. For example, a short-term rental that pays less than $500 in TAT would be charged an annual fee of $50 while a short-term rental paying more than $10,000 in TAT would dole out $1,000.
O’Hara estimated a “good deal” of the nonconforming users would end up paying $100 to $350 annually.
“It’s stepped up to be a more equitable fee,” she said.
Amid discussion about O’Hara’s proposed amendments, Mayor Harry Kim stepped in on the meeting, noting the work that has gone into creating regulations for short-term rentals.
“I appreciate people that have testified before you saying ‘This is my income,’ and nobody wants to take people’s income away, but I cannot let that be a reason why we don’t regulate it, why we just throw up our hands and say no regulations, we do what we want with this business,” Kim said.
“And not to get sarcastic about it, but to me it’s no different than saying we would allow stores, service stations or whatever to open up anywhere — it is a business — but this is a little more in a sense that because it infringes on the lifestyle.”
The Planning Committee will take up O’Hara’s proposed amendments at its next meeting June 18 at the West Hawaii Civic Center in Kailua-Kona.
Email Chelsea Jensen at cjensen@westhawaiitoday.com.
