Maui Real Estate Blog

County Council Continues Attempts to Resolve Vacation Rental Debate

County council member Gladys Baisa entered this Tuesday’s planning committee meeting with the hope that the council would be able to resolve the ongoing Transient Vacation Rental (TVR) Debate by the end of their meeting. The committee met all day and while they came to some important agreements, they still have a number of issues to resolve. The TVR debate has been a hot button in the community since the mayor had the planning department step up enforcement on non-permitted vacation rentals outside of the resort area a year ago. Previous county administrations had allowed non permitted vacation rentals and bed and breakfast to exist while the county worked out a better permitting process. Many who had applied for permits found the process to be a black hole of time and money.

The big issue resolved on Tuesday related to properties with two homes. Previously, bed and breakfasts only allowed for a scenario where a home owner rented rooms within their own residence. The council agreed to expand the definition of B & B’s to allow owners to live in one residence while renting out another home on the same property. This is a bit of reversal as last week it appeared that the council would maintain the status quo.

It was also decided that B&B’s should be allowed in rural districts, but prohibited in agricultural districts. The agricultural ban stemmed from complaints that B&B’s might push farmer’s out of business. This is something of a reversal in that previous discussions appeared to be moving towards a compromise that would allow B&B’s in ag zones if the property produced gross annual farming receipts in excess of $3,000.

A few other items that were decided upon included the deletion of a provision that would have allowed lessees to operate B&B’s and a provision that mandates that B&B owner’s must live on site full time. Another issue that was raised but not decided on was community caps for B and B’s. County planning director Jeff Hunt suggested a number of 400.

The main issue still to be discussed are TVRs or vacation rentals where the owner does not live on site. This figures to be the most contentious issue for debate. While it was encouraging, that some positive concessions were made on B and B’s, it is thought that TVR’s may face greater opposition from committee members. It will be interesting to see if county budget and tax revenues become a factor in the debate. Maui, like municipalities throughout the country, is struggling with its budget. The county is being hit by a double whammy of increasing gas and energy bills and declining tax revenue. Transient accommodation tax revenues are down both from lower visitor counts at legal rentals and non-permitted rentals. Does it make sense for the county to shutter more rentals when revenues are dwindling? We will continue to follow this debate and provide status updates on THE Maui Real Estate blog.

Pete Jalbert

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