Vacation rental suit dismissed in federal court

WAILUKU – A federal court judge has dismissed a complaint by the Maui Vacation Rental Association over Maui County’s decision to crack down on unpermitted vacation rental operations.

A preliminary order issued by U.S. District Judge Michael Seabright dismisses outright three counts dealing with claims of contractual rights, dismissing two others with leave that allow MVRA to amend the counts alleging equal rights violations.

James Fosbinder, attorney for the association, reserved comment until the judge issues a complete order with findings. But he anticipated that the association would appeal the order issued Monday.

While a full opinion is still pending, Maui County Deputy Corporation Counsel Jane Lovell said Seabright’s order does not allow the MVRA to renew allegations that the county has violated due process rights of the businesses.

The three claims denied outright all deal with allegations that the county had contractual agreements with vacation rental operators because of decisions made by planning directors under two prior administrations, she said.

“We’re very pleased that with this ruling, all of those contractual claims, all those claims of promises made, those are gone,” she said.

“I think there probably is a recognition that different administrations may have different law enforcement priorities and one administration may put its scarce resources in one direction, but that doesn’t commit another administration.”

The association filed the suit in U.S. District Court on Sept. 28 after Planning Director Jeff Hunt began issuing notices to unpermitted vacation rental operators that they would be cited for having unpermitted businesses in violation of county zoning laws. On July 3, Hunt told the Maui Planning Commission that unpermitted operations would have until Jan. 1 to close or face enforcement action.

Hunt also said operators applying for county conditional permits or state special use permits would not be granted amnesty to continue their businesses pending approval of the permits.

Under Mayors James “Kimo” Apana and Alan Arakawa, the county had allowed unpermitted vacation rentals while the County Council considered a bill to permit short-term rentals outside the hotel/resort zones. The council filed the bill in February.