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Rules and ordinances are a major cause for the high cost of housing

Viewpoint

The lack of affordable housing is not new on Maui. Around 1983, under then-Mayor Hannibal Tavares, I was appointed to an “Affordable Housing Taskforce.” We met for six weeks and then issued our findings and recommendations. Some of them were implemented and others were not. At that time one of the biggest hurdles that kept people from buying houses was the cost of money, 30-year mortgage rates ranged from 7 to 10 percent.

There are multiple causes for today’s so-called “affordable housing crisis” on Maui. The main one is that the majority of people living here want to limit land development and change, particularly in their neighborhood. Our elected leaders have responded to this by making rules and passing ordinances that most people would support, but that are making land development difficult, risky and expensive.

Here are a few rule and ordinance changes that have been made by state and county leaders since the 1970s:

* Charges for water meters from zero to $12,000 for a 5/8″ meter.

* “Show Me the Water” rule and the Upcountry water meter moratorium.

* Sewer fee charges where there were none before.

* Compliance with requirements in shoreline management areas that extend far inland.

* Requirement for archeological surveys and monitoring in many areas.

* Park assessments that range from $1,360 to $17,910 per house or apartment unit.

* Urban growth boundaries (Maui Island Plan) and stricter zoning codes.

* Requirement for traffic studies and traffic impact fees.

* Department of Education assessments at $5,778 per house or apartment unit.

After buying the land, usually in the millions, a developer starting a project has to fund the entire entitlement process knowing that the project may not be approved. The project has to go through a number of public hearings and may face legal challenges from adjoining property owners. To present a project for review by state and county agencies and at public hearings, the developer must hire planners, engineers and numerous consultants. A land entitlement process usually takes three to five years before all entitlements have been obtained. Conditions that are placed on the project during this process may make the development of the project uneconomical.

In 1970, residential lots were sold for 20 times less than today. Lots in Dream City (Kahului) sold for less than $4,000, Maui Meadow lots sold for $9,000. Today, residential lots sell for over $200,000. That is a 2,000 percent increase in cost and is much higher than the rate of inflation, which for the same period is 521 percent. Obviously this trend can not continue if we ever hope to provide housing on Maui that people can afford to buy or rent.

This is not to argue that the above listed rules and ordinances are worthless or unnecessary. One can argue, however, that they are a major cause for the high cost of housing on Maui.

* Hans Riecke is a Maui resident who has practiced architecture on Maui and the other islands since 1969.

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