WAILUKU - With home construction at a near standstill, Maui County will - and must - make some changes to its controversial residential work force housing policy, Council Member Wayne Nishiki said Wednesday.
But what those alterations turn out to be may depend more on what people ask for, rather than rely only on ideas from council members, Nishiki said after a Public Services Committee meeting.
Nishiki is chairman of the committee, which has been reviewing the ordinance periodically since the start of this year, a caveat within the law. Nishiki said he's placed no timetable on when the committee's work will end.
Under his leadership, members are redrafting a portion of the two-year-old residential work force housing ordinance, aiming to create more affordable homes for local folks by lowering the number of less-expensive homes a developer must build, a move that would allow more market-priced homes and spur residential construction.
Critics, especially in the construction and real estate industries, have maintained that the ordinance has stifled Maui home building - even before the housing market tanked.
The proposal, which Nishiki introduced last month, would reduce from 40 percent to 25 percent the number of affordable homes a developer must build to comply with the ordinance. So far, if it passes the entire council, the reduction would only apply to developers who build subdivisions with market-priced homes that are $600,000 or less.
"This is just a small part of the ordinance, and this is just the start," Nishiki said.
He said he intends to present a draft bill of the 25 percent amendment at the next Public Services Committee meeting.
Nishiki said he was approached by people who wanted to build small subdivisions as well as nonprofits with similar plans. The change is intended to help the little guy, he said.
Developer David Goode, who is president of KSD Hawaii, wants to lower the percentage of affordable units to 15 percent "to really get things moving," he wrote in a letter to committee members.
He said 15 percent is the standard for similar laws across the country "because it works." Goode also suggested that the county conduct a formal study rather than continuing to rely on anecdotal information to set its percentages.
Department of Housing and Human Concerns Deputy Director Jo-Ann Ridao said that unfortunately the market crash coincided with the law's implementation so its actual progress is difficult to gauge.
The residential work force housing policy is needed, she said. Hopefully, it just needs some tweaking to coax new construction, Ridao said.
"We don't want to go down too far because that defeats the purpose of the bill," Nishiki said.
Council Member Jo Anne Johnson said she doesn't agree with 15 percent but is comfortable with 25 percent. And she didn't get any disagreement from other council members.
"The bottom line for me is not the numbers, but when the hell the houses are going to get built," said County Council Chairman Danny Mateo, who authored the original residential work force housing bill.
To date, just three subdivisions that fit the work force housing ordinance criteria have been built in the past two years, Ridao said.
Those include 17 new and rehabilitated homes for Goode's KSD Hawaii in Ma-kawao and Maui developer Everett Dowling's $5.7 million contribution toward the roughly $20 million Hale Mahaolu project for the elderly in Kihei. That Ehiku facility will have 114 one-bedroom units.
The third project allows Maui Land & Pineapple Co. to move forward with its planned 51-unit, market-rate Mahana Estates project in West Maui by using 26 affordable housing credits. Mahana Estates is part of the larger Kapalua Mauka project; and the company garnered the affordable housing credits when it built a surplus work force housing units in two of its other subdivisions in the area, Ridao said.
About 3,100 dwellings have been proposed since the ordinance went into effect, Ridao has said. Some of those projects are still in the planning phase, while other developers have either lost financing or are waiting for the housing market to improve.
The ordinance now requires developers of five or more market-priced residences or lots valued at more than $600,000 to build 50 percent of the total project as affordable homes either on-site or somewhere in the same community plan area.
* Chris Hamilton can be reached at chamilton@mauinews.com.
