Today’s State of the State address by Governor Green addressed a multitude of important issues, many of which had already been on the table. These will now be before the state legislature and impact Hawaii residents and visitors alike.
Maui vacation rental moratorium is possible by March.
First, there remains no easy solution to housing on Maui in the aftermath of the Lahaina fire. Today, in his State Of The State address before the Hawaii Legislature, Green said that there is still a need for approximately 3,000 short-term rental units to be converted to long-term rentals to house those Hawaii residents in need. He said there are some 27,000 short-term rental units, of which he wants 10% to be converted to long-term rentals for fire victims and others. In exchange, the Governor plans to provide “fair market value” returns for two years and an 18-month tax exemption.
He warned, “If not enough partners join us by March 1, I will be forced to declare a moratorium on short-term rentals in West Maui to house displaced families.” How that would be done, or the exact impact that would have, was not indicated.
Green pointed out that those who own short-term rentals are making, on average, four times the amount they would if they rented the same properties to local families. He also reiterated that 52% of short-term rentals are owned by non-Hawaii residents and that 27% of short-term rental unit owners own twenty or more units.
More regulations and taxes on Hawaii vacation rentals.
Both for housing fire victims and to counteract the extreme shortage and high expense of housing throughout Hawaii, Green wants to return short-term rentals to the long-term rental market.
To do that, the Governor wants more regulation on Hawaii vacation rentals. The exact nature of that plan was again not revealed, but he did say that there would be “tax changes to short-term rentals.” Green said that “should bring sanity to bear.”
He also envisions a tax amnesty that would help turn short-term rentals into long-term rentals. His stated goal is to get “Short-term rental owners “around the world to sell back their short-term rentals to Hawaii families.”
Climate impact fee, as predicted, is back with a vengeance.
Green said his current thinking is for a climate impact fee. “I’ll renew our efforts to implement a fee. A $25 fee when they arrive and check into a hotel or short-term rental. This modest fee is far less than other fees.” He said that would immediately generate $68 million in annual revenue. “We’ll invest it for beach preservation, fire breaks, and other measures,” said Green.
Option to increase Hawaii’s 18% tax on accommodations.
Governor Green said that alternatively, he would seek an Increase in the accommodation tax that visitors (and residents) pay for hotels and vacation rentals. He hopes that statewide tourism income will be slightly higher this year than last despite the tourism losses on Maui.
“We have to convert short significant numbers of short term rentals to long term rentals” — Governor Josh Green.
Previously, Green had said that if there isn’t more affordable housing, “we will have a two-tiered society. We will continue to have too little housing for working families, firefighters, nurses, and all the people that we know. And we’ll gradually drift to a society that doesn’t have services and can’t keep local people here. I’m learning things in this job.”
This comes as messaging about Hawaii visitors remains confused.
Maui visitor numbers are finally starting to indicate a recovery is in sight. The way the state and some residents view visitors, however, remains a big question mark, as seen in hundreds of comments in the past few days regarding the potential for increases in taxes and fees. Those come in addition to already over-the-top costs of a Hawaii vacation.
Why are STR’s the “sudden” reason for lack of affordable housing after so many years of knowing such a predicament was already in place? Is this really our fault?
STR’s provide affordable rentals for guests who spend lots of taxable dollars and further provide the jobs necessary to spend them. Forcing them out of the market will eliminate many tourists and thus eliminate the jobs needed to take care of them. What then? Locals living in FEMA paid housing for a limited time, their jobs decimated (thus less income) and your tax base seriously damaged. Less jobs means less income tax and more tax money going out to provide for housing and unemployment. That is a no-win for everybody except corporate-owned hotels/resorts.
Real estate taxes and fees for vacation rentals are already the highest in the country. Three times higher for comparable rental ocean front properties in Florida. Eventually you will kill the Golden Goose
Vast majority of west maui is condo’s where HOA are in the thousands per month, The people who lost their homes, Not many people anywhere in the USA can afford rent that would be 5 grand a month.
As usual screw the little guy, Hotels will make even more as they will jack rates even higher
Hawaii visitors and condo purchasers are becoming affordable only to the wealthy
More killing the goose that lays the golden eggs
More evidence of the government simply hiking it’s taxes on out of state condo owners to pay for their rapidly increasing spending on welfare programs, pensions, and who knows what else with obvious mismanagement of funds and liberal priorities.
Despite the large amount of taxes paid by Poipu visitors, we have dealt with tons of potholes, lack of safe and attractive roadside walkways that make walking between hotels safe – for the 34 years I have owned a condo there – and my guests paying $22,100 in taxes imposed on rental condo owners only. My overhead includes $22,640, $34, 056 management, cleaning fees $10,000, property tax $13,000 per year – and more. If you have to pay a mortgage?
Rolf,
Exactly.
And with those liberal policies and what it has brought, one would think that Hawaiin voters would learn. Doing the same thing over and over and expecting a different result does not make sense.
I have read your articles for several years. I sense mismanagement of money at all levels. I know that’s a very general statement, but we experienced something specific last week. We visited Waimea Canyon January 25, 2024. We paid $30 for parking and for the four people in our group. A female of our group used the restroom, and she said it was the worst restroom she’s been in. That says a lot because we have traveled in Europe and South America. It seems that, with a collection of $10 parking/vehicle and $5/visitor, the restrooms should be maintained properly – facilities updated and kept clean. I have never been to a national park restroom that was in gross and terrible shape.
Hi Carolyn.
We’re so sorry to hear that. We’ve actually done articles about the state maintained beach/park facilities before. Thanks for your comment.
Aloha.
If they want my timeshare week they can pay for it. I’m fine with that. My wife and I are only nurses who get rest on our trips. We will save more by going somewhere else where we are appreciated and not ostracized by their elected representatives.
I feel bad for the investors. After my trip this summer, I’ll stick to the Caribbean. Less people, better beaches, and less government overreach.
The Mexican Tourist Board thinks this is a great idea
When you price visitors out of coming to Hawaii what will be the plan then?
Planning to visit Kaanapali in April. Are visitors welcome to that area? What is the impact to visitors?
i was a life long visitor to all the islands . . just like I was to Vegas . . until like you, I was choked out of ever coming back.
Vegas hotels are now bumping resort fee’s to $50
Very true. Prices are going up everywhere, but based on what I have priced-Hawaii leads. Plus the last trip was not the best-you could tell the Aloha Spirit was gone. So, we’ve cancel our trip and will return when it sounds like Hawaii wants people to visit.
Perhaps, the mainland tourists need to contact our legislators to stop federal funding on interstate Highways in Hawaii since they don’t connect states. Anywhere else, the roads would be state funded highways. Why are mainland tax dollars paying for highways we are not welcome to drive on.
Welcome or not, you are driving our roads when you visit and most are not small cars either ….
The Interstate Highway System has always had a military purpose. Perhaps not its main one, but it’s been in the list.
H1 connects Barbers Point/Ewa to Pearl Harbor/Hickam, and I suspect the Waikiki extension was to UH-Manoa primarily.
H2 adds Schofield Barracks and Wheeler AAR (formerly AFB) to the mix.
H3 added Kaneohe MCAS to the list of connected military facilities. As I remember Like Like and Pali were getting a bit crowded, even back in the 80s.
Many people forget that the official name is National System of Interstate and Defense Highways.