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IMPACT of Draft 4

DRAFT 4 - 6/19/23(HK)

Due to the limited lead time our volunteer team has had to analyze Draft 5 and post to this website in an informative way to and for the public, before the county Zoom meeting on November 6, 2023; currently, only the highlight presentation of Draft 5 is available.

If this bill passes most resident hosts will be forced out of the short-term rental business.

The consequences will be devastating to the eco-system of Hawaii’s tourism and it’s long term sustainability.

If this bill passes…

HERE IS HOW IT WILL AFFECT YOU:

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THE VISITOR/VACATIONER

Hawaii – at its core – is about Aloha. People from all over the world come to experience what Aloha is while visiting our beaches, learning about Hawaiian culture, and connecting with our land and ocean.

The short-term vacation rental industry has dominated the market and plays as a major source of income to the local tourism industry. This is because a majority of visitors prefer financially reasonable, personal, immersive experiences with the local community that they do not receive at the expensive, fabricated hotel resorts filled with hundreds of other tourists.

If you are a visitor/vacationer who comes to Hawaii to immerse yourself in the Aloha this bill will affect you directly!

This bill is designed in such a way that it will take away your ability to choose where and how you would like to stay on the island while you enjoy the true Aloha of the Hawaii experience. That cute Hawaii cottage… the house filled with local charm and ocean views… returning to your favorite vacation rental to be close to your favorite places to swim or hike will no longer be available to you.

This bill will force the hosts of your favorite places out of business and force your next stay to be limited to the high-priced resorts designed specifically to capture and contain your dollars to their off-island corporations.

You, like the majority of vacationers who prefer a more intimate/private personal real Aloha experience, won’t want to come back. If this bill passes, you will have to find alternate island vacation destinations where you can have your authentic island adventures like you used to enjoy here in Hawaii. If you help us fight the bill you will preserve your Aloha experience for your future and your family/friends future too.

You, the visitor/vacationer, are the primary drivers of the Hawaiian economy. This bill is taking away your options to freely choose how and where you wish to have your “Aloha experience”.

THE INTER-ISLAND PROFESSIONAL/FAMILY

Yes, this bill will affect you who travel interisland for work or simply come to the Big Island to visit extended family and prefer to rent local near your Ohana.

While the bill “appears” to exempt hosts who rent to some of you including traveling medical professionals, the only way to sustain the rent local options so they remain affordable to you is the host’s ability to supplement the “in-between dates” with vacation/visitor rentals that this current bill is attempting to prohibit them from also renting to.

If you allow this bill to pass, your options of local ohanas near the hospitals, the local businesses you are traveling for, or families you are visiting will be significantly reduced or eliminated completely forcing you to find accommodations restricted to the high-priced resorts with other tourists and far from your desired destination.

THE LOCAL SERVICE - HOUSEKEEPERS, LANDSCAPERS, PROPERTY CARETAKERS...

Local service providers are the collective backbone of Hawaii’s tourism. They are essential to keep Hawaii’s tourism economy operational for Hawaii’s visitors and business owners including the vacation/short-term rental business.

Local residents make up the majority of the local service providers as housekeepers, landscapers, handymen/women, farmers, and community-based restaurants, shops, and activities providers.

The vacation/short-term rentals support local residents by offering them jobs often as their main source of income. In many cases, it is also their second and/or third source of income that is required to make ends meet for themselves and their families.

If you are a local resident who is a service provider or have family who are service providers for a vacation/short-term rental be aware that if this bill passes most likely you and/or they will now be without work!

You will be without work because the host of the vacation/short-term rental will no longer have the necessary income to afford to continue to hire you and/or your family!

Then, like so many of your other friends and family, you will be forced to leave the island as you will no longer have the money required to remain here.

This will then severely impact the Hawaii economy as local hosts and local service providers will not have the financial means to participate in the local economy such as investing in community-based restaurants, farmers’ markets, local shops, etc.

THE VACATION RENTAL HOST

These are the residents of Big Island who support the largest industry on the Big Island of Hawaii – tourism/hospitality.

  • You share the Aloha spirit of the islands with a personalized Hawaiian experience for the visitors/vacationer.
  • You open your ohanas to inter-island professionals and locals from other islands coming to visit their families here on the Big Island.
  • You offer housing to traveling nurses and doctors.
  • You employ the majority of local service providers.
  • You ensure that tourists’ dollars “Stays Local and Supports Local”
  • You are the reason the tourism of Hawaii is abundant and thriving as much as it is!

As a Big Island resident, you need as many options as possible to supplement what is required to live here and thrive. Participating in Hawaii’s tourism ecosystem is necessary for your sustainability and the ONLY WAY the eco-system of Hawaii will continue to thrive.

For most of you, you understand that short-term rental is the only option for your ability to sustain your property and livelihood. For many of you, you know offering long-term rentals is not worth the risk. as the threat of squatters is very real if you alternatively are forced to only offer your ohanas as long-term rentals.

THE LOCAL MARKET VENDER, EDUCATOR, ARTIST AND SMALL BUSINESS

Visitors and vacations from all over the world come to Hawaii to witness its natural wonders and while immersing themselves in the Hawaiian history, Aloha spirit, and culture. We are famous for our farmer’s markets filled with local artists and local merchants. Cultural education and programs as well as our local businesses are critical to the health and sustainability of the tourism eco-system on Hawaii Island.

This bill has a quick and devastating domino effect.

Limit/restrict or eliminate short-term rentals…. you force the visitor and vacation who prefer the rent local experience to take their dollars to other islands (Bali, Fiji) destinations that will offer them the authentic local immersion adventures/experiences they prefer over the fabricated resorts.

If visitors and vacations take their dollars to other island destinations…. Hawaii Tourism suffers and jobs for the local cultural educators are eliminated. Farmers’ markets filled with local artists and local merchants will find their businesses suffering greatly.

If this bill passes…

HERE IS HOW IT WILL AFFECT CURRENT and FUTURE HOMEOWNERS:

IF YOU ARE A…

Homeowner and primary residence occupant with current short-term rental unit on your property

WHAT HAPPENS TO YOU IF THIS BILL IS PASSED…

  • You must register for TAR will requires an affidavit submitted under penalty of perjury (a crime punishable by fines and prison time) that your unit is fully compliant with all health, safety and building code requirements.
  • The rental unit cannot be an additional dwelling unit, or detached structure (guesthouses and detached bedrooms are allowed). Ohanas are allowed if they are CURRENTLY in use as a TAR (and you obtain an NUC).
  • You must live in the larger main home and not in any of the other smaller structures.
  • You must register for and pay Transient Accommodation Tax to the State and County and you must file a change of use form with the County whereby you will lose your homeowner tax class rate and Property Value Assessment Cap.

IF YOU ARE A…

Homeowner and primary residence occupant ON AGRICULTURAL LAND with current short term rental unit

WHAT HAPPENS TO YOU IF THIS BILL IS PASSED…

  • You MAY be allowed to continue to operate based on the director’s interpretation of HRS 205-4.5. You must apply for a non-conforming use permit to recieve your determination.
  • If you are denied a NUC you will no longer be allowed to operate.

IF YOU ARE A…

Non-resident homeowner without short-term rental unit on your Hawaii property.

WHAT HAPPENS TO YOU IF THIS BILL IS PASSED…

  • You will never be allowed to operate a short-term vacation rental accommodation as a non-permanent resident occupant of your Hawaii property unless your property is located in the appropriate zones (V, VG, CN, PD, and CDH or in a resort zone or node).
  • If you are denied a NUC you will no longer be allowed to operate.

IF YOU ARE A…

Non-resident Homeowner with current short term rental unit on property that rents for less than 30 days..

WHAT HAPPENS TO YOU IF THIS BILL IS PASSED…

  • You will be allowed to continue to operate and do not need to register your TAR again. .
  • You will need to renew annually however now renewal fees will be based on the number of bedrooms in the unit as well as the Assessed value.

IF YOU ARE A…

Non-resident Homeowner with current short term rental unit on property that always rents for more than 30 days.

WHAT HAPPENS TO YOU IF THIS BILL IS PASSED…

  • You are NO LONGER allowed to OPERATE AND WILL BECOME IMMEDIATELY ILLEGAL upon passage of this bill.
  • You will need to change your occupancy to either 180+ tenancy periods or cease operations.
  • What was previously legal is now immediately illegal without further consideration.

Exclusions

TENANTS…

If you provide Accomodation to these occupants ONLY (no others for even one day), you do not need to register.
(1) Nonpaying guests of the family occupying the unit
(2) Clients in health care facilities
(3) Full-time students enrolled in an educational institution in the County of Hawaiʻi
(4) Employees who receive room and/or board as part of their salary or compensation including agricultural workers
(5) Occupants of group living facilities, authorized by the Department of health
(6) Military personnel
(7) Health care workers temporarily employed at a medical facility in the County of Hawaiʻi
(8) Low-income renters receiving rental subsistence from the state or federal governments whose rental periods are for durations shorter than sixty days; or

Exclusions

BUILDINGS…

If you provide transient accomodation in any of the following structures you are exempt from TAR registration.
(1) Hotels
(2) Apartment hotels
(3) Motels
(4) Lodges
(5) Bed and Breakfasts
(6) Condominium, or unit as defined in chapter 514B, Hawai’i Revised Statutes
(7) Timeshares
(8) Cooperative apartment.”