Balancing Affordable Housing in Kihei

About Bill 10:  On April 6, 2021 we saw the passing of Bill 10 that changed the 201H requirement from 50% to 75% affordable housing.

What is true affordability?  Affordable housing projects must actually create affordable and attainable housing. We need to ensure that more local people can actually achieve home-ownership. And affordable housing should remain affordable in perpetuity.

Waiting Lists:  We also agree with other testifiers that say that there should be waiting lists for residents so that the people who’ve been waiting the longest can get priority. Another thing that concerns me is that the AMI (Average Median Income) of $97,000 per household is based on the income of 5 working people. This does not seem like fair criteria. This reduces the ability for an affordable housing unit for the many people who have been affected by the pandemic and have suffered a loss of income. This is a very difficult time for many people to qualify for a loan.

County Assisted Finance:  We think the county should create a program to give people with low credit scores access to finance with low interest. A County-sponsored mortgage program could help people get into an affordable home. And if they defaulted on the loan, the property would revert back to the County’s affordable housing pool.  The County cannot lose doing this.

Affordable housing rules have the potential to be abused:  High-density, substandard, affordable housing projects have the potential to ruin neighborhoods and communities where there is little to no infrastructure. We have seen affordable housing projects being built in environmentally sensitive areas. And some have been approved or planned in flood zones and wetlands.

Affordable housing should never be built in flood zones. This should be a steadfast requirement.

The community pays the high-cost of affordable housing:  Affordable housing rules already give too many subsidies and exemptions, and we the taxpayers pay for all that. But we also pay for it in other ways, such as overburdening our infrastructure and creating high-density, overcrowded neighborhoods. Where traffic is affected, and pedestrian safety is at risk. The community should see a benefit from their investment. So we need to ensure that affordable housing will not negatively impact the communities where they are located. Incentives for affordable developments should be spent on bolstering the infrastructure that will benefit the community as well. For example, sidewalks are paid for by the county instead of developers. Park fees are not simply waived, but actual park expansions should be created in these areas by the county before these homes are sold.

We need to keep affordable housing where it is needed:  We need to keep affordable housing where it is needed, for example, close to jobs. We also need to maintain a mix of affordable housing in all our communities, and not just all lumped together.

Stop the trading of affordable housing credits:   We should not allow the trading of affordable housing credits from one area to another. This allows developers to shift the affordable housing from communities into cheaper high-density communities such as North Kihei.  This creates dislocation, polarization, and economic stratification. Shifting affordable housing from Wailea to North Kihei for example will raise housing prices further in Wailea and depress housing prices in North Kihei for the community. Credit-Trading has allowed developers to relocate affordable workforce housing from the employer’s actual location in Wailea to places like Haiku. And this is wrong.

The affordability fallacy:  When developers build affordable housing projects with only 50% affordable units and sell off the other remaining 50% at Market rates, these market-priced homes help to push up house values, which makes homeownership more difficult for the lower-income bracket. When you only build 50% affordable housing you are also building 50% unaffordable houses.

No exemptions from environmental protections:  Affordable housing should not receive any exemptions for Environmental Protections or essential infrastructures like drainage and safe access. For example, they should not receive exemptions to the building code, for example, a road-width exemption, that could restrict access for emergency vehicles to access properties. Affordable housing projects have been approved with dangerously narrow internal roads and driveways that could impede access to emergency vehicles, or emergency evacuation.

Our “essential” construction industry worked during the pandemic:  The construction industry was able to work during the pandemic. Construction workers were classified as essential workers, and as such, they were able to work throughout the pandemic. Many workers crews and developers freely traveled interisland, and to and from the mainland with travel exemptions. The construction industry did not suffer the same economic hardship compared to the majority of other people on Maui.  The developer’s repeated mantra that we need construction to bolster a depressed economy is erroneous. Construction jobs by nature are temporary employment. Short-term jobs, that need a constant supply of new building and relentless development.

Construction for its own sake is not sustainable:  But construction for its own sake is not sustainable on a small island with limited water, and limited space. Just like they told all the people in the tourism industry after the Covid downturn, “it might be time to start looking for another type of job”. So maybe we should also be asking for quality construction over quantity.

The legacy of construction remains long after the job is done:  But after construction projects are done, we are left with buildings that can last 50, 70, 80 years, or more. And we need to ensure that whatever is constructed today we can live with for generations to come.

The legacy of over-building cheap homes:  If these buildings are designed on the cheap are allowed to cut corners with regards to amenities and basic infrastructures like proper roadways, sidewalks, and drainage. Then we are going to be living with, and dealing with these sub-standard developments and their negative effects on their surrounding communities for generations to come.

Who can afford these affordable homes?  it seems like the only people that will be able to afford these affordable homes are the construction workers who are building them. Many regular people in our community like firemen, policemen, school teachers, and other types of workers will most likely not get the chance to buy into one of these affordable housing units. If they cannot qualify for a loan, they will not get in. If they are single-income households, they will likely not qualify. Home-buyers also need to have a substantial down payment, which is unrealistic for many struggling families. One testifier, “Junya,” said that some low-income loan programs are not acceptable to these developments.

The right people need to get into affordable housing:  We need to ensure that the right people are getting this affordable housing, and that affordable housing is being built in the right way, in the right places. We also should do away with the developer’s ability to sell off affordable homes at market prices. Currently, there is a short window where local people can apply for an affordable home, They need time to get loan approval, but if developers do not immediately sell these homes within a set time-period they can flip them over to market-priced housing. But do they have to give the money back? Developers who do not sell a house to the local person at an affordable price should be required to forfeit any financial assistance that they receive for the home to be affordable.

Substandard housing reaches the market, and degrades our communities:  When you have a mixed development of affordable and market-priced housing, you create sub-standard housing. When you allow affordable housing to become market-proceed housing you are left will a downgraded community. Then you are still left with a market prices development, that has cut many corners and may be substandard, compared to a development that was built according to normal rules.

Period of affordability:  Affordable housing should stay affordable in perpetuity because currently, with a 10-year affordability requirement, the developers could be tempted to assist their friends and colleagues to acquire an affordable house today and flip it in 10 years for over $1,000,000.

With short-term affordability requirements, the benefit to the community and the investment by the community is short-lived and ultimately just encourages more speculative investment and the further exacerbation of the house-pricing inequities.

Possible solutions to help with the housing crisis:  If you really want to help the housing crisis there are other ways to go about it:

Solution #1 – Second Kitchen) 1 testifier suggested that you allow people to build second kitchens in homes.  This allows multi-generational families living under one roof to be able to live separate dignified lives. Local families are increasingly being forced to live in multigenerational homes because of the difficulties and affordability of Maui house prices. This generational-stacking and forced home-sharing actually have the undesirable effect of raising the average household income. Household incomes in overcrowded homes do not reflect the actual incomes of the individuals living there.

Solution #2 – Fast-track Ohanas) My suggestion to alleviate the housing shortage would be to allow for the fast-tracking of ohanas to be built in areas that are zoned for them.  For example, North Kihei has large areas zoned R3.  Many housing lots with a single dwelling on them, have the capacity to add up to two more ohanas.  Yet there is a significant amount of red tape and some prohibitively expensive permitting fees prevent many locals from building ohanas. Building ohanas is already part of the Kihei community plan and the current zoning so why not focus on maximizing the spaces we have in a way that the locals can afford. When a local family builds an ohana on their property, they do not have to buy land. This makes it affordable for them. You can make a fast track process for building ohanas, with stipulations, that is it for immediate family, or only to be rented to locals long-term etc.

The exploitation of desperation:   Unfortunately, some developers are exploiting our desperate need for affordable housing. Wen many cases they want us to change the rules to maximize their profits. They say “we all agree that we need affordable housing” yet they are asking us to allow them to build less affordable housing but still receive the maximum benefits and financial incentives.

70% of all affordable-housing projects built recently (9 out of 13) were 100% affordable. This proves it does work.

Encourage the good type of builders:  We need to encourage the good types of Builders and Developers that truly want to help with creating affordable housing.  We want to discourage the profit-motivated developers that are always asking for more money. We need to encourage more non-profit builders of affordable housing. Priority should be given to non-profits, and altruistic organizations that have a proven track record of building successful projects.

Create local jobs for local workers:  We also need to ensure that only local construction workers can be used on these projects. Too many interisland workers are being used or even mainland workers. Wet should be a requirement for all affordable housing that only local workers can be used. This is necessary to ensure that our community gets the benefit of the jobs created. We need houses for locals built by locals (as they are being subsidized by locals).

We need to stop overdevelopment on Maui.

Maui is already over-capacity and our carrying capacity has long since been exceeded:  We have to protect our open-spaces, riverbeds, streams, wetlands, and shorelines, from being exploited by profit-driven Developers.  open space riverbed streams and wetlands are often the last remaining open spaces for good reason and they may be cheaper than surrounding lands.  this makes them ripe for exploitation because the cheaper the land is, the more profit for the developer.  We have seen affordable housing being built and proposed in inappropriate places that will create problems for the environment and a hazard to the community.

Inappropriate locations should not be approved:  One such parcel approved for affordable housing development lies in the streambed of KaOnoUlu,  which is a wetland and a notorious flood zone. Affordable housing should never be placed in harm’s way (flood zone), and should not be destructive to the environment.

Sea-level-rise hazards and planned retreat from shoreline:  Because of global warming and predicted sea-level rise we should be planning for a population to retreat from the shoreline.  So all County-sponsored and subsidized developments such as affordable housing should not be approved close to the shoreline or on the Kihei floodplain for example.  Affordable housing should be located where it will not be impacted by sea-level rise, rising water tables, flooding, or located in areas that are already high-density housing. The predicted sea-level rise puts vital infrastructure underwater, or at risk from high wave events, storm surges, etc. infrastructure like roads, sewerage systems, electrical supply, and the shoreline itself is at risk. Sea level rise also raises the underground water tables causing them to saturate low-lying areas and increases the flood risk in these areas. Areas that were one-time wetlands will become wetlands again as nature takes back the land.

Affordable housing is meant to serve the community:  Affordable housing is meant to serve the community, it is not meant to destroy them. Poorly planned neighborhoods can harm the people in our community. Affordable housing rules should not be a license for developers to break from the community plan or to change zoning maps to suit their needs.

Affordable Housing should be compliant with environmental protections:  Affordable housing should be required to meet current zoning rules and follow community standards, the Maui Island Plan,  and the local community plans, such as the Kihei-Makena-Community Plan. Affordable housing must also conform to the requirements of the SMA areas and the CMZ rules where applicable.

What affordable should be:   We need to ensure that the right people are getting this affordable housing, and that affordable housing is being built in the right way, in the right places.  And we need to ensure that it is being built for the right reasons, by the right people, and that it actually serves the purpose for which it is being built. The purpose of affordable housing is to ensure that local people have the opportunity to rent or buy an affordable home, which will allow them to break the cycle of economic enslavement that comes from paying for the artificially high cost of housing, and high costs of living. And it should allow them to achieve financial stability, dignity, security, and the quality of life that affordable homeownership can provide.