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Panel: More study needed on short-term rental caps

Proposed bill to lower caps heads back to council

After multiple meetings to discuss a Maui County Council bill that would lower the number of short-term rentals on Maui and Lanai, the Maui Planning Commission on Tuesday recommended that the council conduct more studies and set caps based on the demand for short-term rentals in each community.

The commission voted 5-1 in favor of the motion, which included a recommendation that the council be given six months to conduct the study in community plan areas and then set the caps accordingly. During the meeting, some commissioners said they hoped that the council would come back to them with refined numbers so they could make a better decision.

Ultimately, however, the commission can only make recommendations; final decision rests with the council.

In March, the council sent the bill down to the commission, proposing to reduce the number of permitted rentals from 349 to 278. The bill was authored by Council Member Tamara Paltin, who was initially looking to reduce the number of short-term rentals in her district of West Maui but decided to include other districts after learning that fellow council members were also writing similar legislation. Council Member Kelly King asked that her district of South Maui not be included.

Currently there are 212 short-term rental permits on Maui and Lanai and 18 are pending, said Jacky Takakura, administrative planning officer. The Maui County Planning Department proposed a cap of 230 to conform with current numbers. The bill would not stop those already going through the permit process.

Supporters of the proposal have said at past meetings that reducing the cap would help reduce the impacts of tourism on local neighborhoods. But opponents, including many short-tern rental owners, have said their businesses employ local residents and that their homes bring in smaller groups of families as opposed to the scores of tourists drawn by the hotels and resorts. Some also feared that lowering the caps would be the start of phasing out short-term rentals completely.

On Tuesday, commissioner Christian Tackett, who was the lone dissenter on the motion, said until the community can get a handle on COVID-19 and how tourism will be handled in the state, it would probably be better to keep short-term rentals out of residential neighborhoods.

He attributed higher property values to investment properties and said he’d rather see a focus on people buying homes to live in.

Tackett also said that hotel rooms should be filled first, which would direct tourists away from neighborhoods and help provide jobs to local residents.

However, commissioner Kellie Pali pointed out that hotels have hundreds of rooms. The number of visitors who would stay in the county’s permitted short-term rentals would barely make a difference in hotel occupancy.

“I just lovingly disagree (the current cap of) 349 is going to impact us,” Pali said.

Pali said she put her faith in the process, where short-term rental permits are vetted, applicants are reviewed and neighbors are notified of any possible new short-term rentals, with the opportunity to comment.

Commission Chairman Lawrence Carnicelli pointed out that the bill was put forward before the COVID-19 pandemic hit Hawaii and felt that a broader conversation was needed. He said it’s still unclear when visitors will come back to the islands.

“The dynamics of our island will completely change who comes here,” he said. “When they come here, where they stay, that’s all going to change.”

He said he wanted the commission’s recommendation to be that “the nine council members and the mayor need to sit down” as they are the ones tasked with setting policy.

The current caps for short-term rental permits in each district and the council’s proposed reductions are as follows: Hana, 30 to 23; Kihei-Makena, 100 (revised cap still to be decided); Makawao-Pukalani-Kula, 40 to 11; Wailuku-Kahului, 36 to 6; West Maui, 88 to 63; and Lanai, no cap to 20. The Paia-Haiku district cap is being proposed to stay at 55 after it was reduced last year from 88.

In February, the council adopted a law eliminating short-term rental permits on Molokai. The island’s 17 existing permits will remain valid through the end of the year. The Maui Vacation Rental Association and four Molokai homeowners have filed a federal lawsuit against the county over the bill.

* Melissa Tanji can be reached at mtanji@mauinews.com.

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