WAILUKU - Council Members Danny Mateo and Joe Pontanilla rendered their verdicts on the first two years of the Residential Workforce Housing ordinance Wednesday: It isn't working for the gap group of working families.
Jo-Ann Ridao, deputy director of the county Department of Housing and Human Concerns, remarked that so far, many of the proposals to meet the requirements of the ordinance are partnerships between developers and nonprofits, offering 100 percent of units to qualified persons making no more than 80 percent of the median income (around $72,000 for a family of four on Maui).
And how many units are being prepared for working people making up to 140 percent of median? Mateo asked.
None. And for 120 percent? None. And for 100 percent? None.
"I rest my case," Mateo said, maintaining the ordinance was intended to help working families but hasn't done so.
It is helping the special-needs clients of the nonprofits but not "the working individuals of the county." Pontanilla said, although he later also chided the council for taking years to approve projects.
Vanessa Medeiros, a former county housing administrator and now a nonprofit administrator, said: "I'm sorry you don't see it. The nonprofits are not meeting only the special needs."
"We have the gap group that needs to be addressed," said Pontanilla.
Medeiros said that with home prices falling, families making 110 percent of median income can find housing on the open market today. "Right now they have a wealth of opportunity," she said.
Ridao said: "It is premature for us to say it is working or it is not working." She reminded members of the council's Public Services Committee that "when the law was enacted the economy was booming. Now it's the opposite."
The committee was reviewing the ordinance, after taking testimony last week on proposed changes.
Although Mateo said it was the sour lending environment and not the burdens of the ordinance that have led, so far, to only one project being built. And a commitment to build another affordable project has been made.
When asked whether the county administration is able to monitor commitments, Ridao said: "At this time, we are not overburdened with monitoring."
Mateo said, however, that under previous policies "there are many units still owed to the county that we must go after."
But not, Ridao said, 13,000 affordable homes, a figure that has been repeated in many forums. She said that after winnowing out projects that turned out to be just talk, the figure is far lower.
As for the new ordinance, so far KSD Development has delivered 13 new or rehabilitated units with four more to go. And developer Everett Dowling has promised a cash contribution (half already paid in) of $5.8 million (equal to 51 units) toward a Hale Mahaolu project for the elderly in Kihei.
Ridao had a chart showing what is on the table: About 3,100 dwellings have been proposed since the ordinance went into effect. It requires either a 40 percent or 50 percent affordable housing contribution, but the proposed number of affordable units is much less than half - about 892 right now.
There are several reasons. State Act 201-H all-affordable projects don't trigger Chapter 2.96, the county workforce housing ordinance. (The state act provides a process to grant developers of affordable homes exemptions from planning, zoning and construction rules that don't negatively affect the public's health and safety.)
Lots-only subdivisions are not assessed.
Many of those 3,100 dwellings have far to go. Some are under environmental review, others are facing difficulties with other county requirements, such as the "Show Me the Water" ordinance.
Of 15 projects Ridao has reviewed, only two (KSD, Dowling) have signed agreements. The rest are in the talk-story stage.
Pontanilla wondered how to address a problem that he said is becoming more and more common, communities that do not want affordable housing. He cited especially the Maalaea Mauka project lately taken over by Jesse Spencer. This is proposed as an Act 201-H project and would be unaffected by the workforce ordinance, but it is being opposed not only by Maalaea residents but also by the county Planning Department.
Pontanilla also referred back to another project, Puunoa in West Maui, that the council refused to approve, after seven years. Those dwellings were to have been priced at $125,000, very affordable by today's standards.
Committee Chairman Wayne Nishiki opened the discussion by saying he thought there were two long-term problems with county attempts to provide cheap housing: "a lack of consistency in how affordable housing was required" and "little or no accounting or follow-through on what's owed to the county."
He did not offer any specific changes to the ordinance and deferred consideration to another meeting. But Nishiki's questions suggested he thinks the council should have more input on agreements worked out between developers and the housing administrator.
Alice Lee, former council member and former Housing and Human Concerns Department director, offered a review of some of the history of county housing regulation. It began with concern for housing employees at big new hotels being built in the 1980s, she said.
Part of the argument was that by putting employees close to work, it would cut down on traffic, she said. The employees did not respond, and subsidized rental apartments went begging.
So the rationale for regulation evolved from employee housing for particular businesses to workforce housing generally, she said.
David Goode, the president of KSD, said he thought his project was a success from the point of view of the ordinance, even if only three of 13 houses were sold under the affordable guidelines.
So far, nine of 13 are sold or contracted for. After a time, a workforce unit under the ordinance that is unsold to qualified buyers under income guidelines can be sold at market prices.
As it worked out, Goode said, the other buyers were from the same income class targeted by the ordinance - one is a teacher - but by waiting they avoided the deed restrictions of the three who bought early.
"They didn't want them (the restrictions)," he said.
Eight of the 13 were renovated homes, but Goode said they were virtually like new, considering the amount of work that needed to be done to make them habitable.
It will be another six months or so before Goode is ready to sell his 34 market-priced agricultural lots in the Pulehu Farm subdivision, the project that triggered the affordable housing requirement.
* Harry Eagar can be reached at heagar@mauinews.com.
