who does this affect?
Local property owners, business owners, service industry professionals, investment property owners and the overall Maui economy will all be impacted by this decision.
The state and counties derive a lot of their funds and jobs from the legal vacation rental trade, and visitors and mid term renters including nurses and doctors depend on and relish the diverse options for accommodation.
Many owners of vacation rentals are local families. This is one of the only ways we give our local residents ways to participate directly in the hospitality industry.
Other owners of vacation rentals are our return visitors, living part time in the islands. They are some of Hawaiiʻs most engaged visitors, supporting small businesses, caring for the environment, taking care of residents that work in the industry, and paying premium tax rates for the privilege to do so.
this will be devastating for the maui economy
Vacation Rentals have been a part of Maui’s visitor industry accommodations since the 60’s. In 1964 the condo regime legislation was enacted, by 1970 Maui had 17 resort condominium projects. In 1997 the county created the permitting system for Bed and Breakfast homes through Maui County Ordinance 19.64, then expanded the process by broadening its application. Then in 2013 the county furthered the diversification of visitor accommodations with ordinance chapter 19.65 creating the permitting system for legal short term rental homes.
By 2020 Vacation Rentals were the number one source of revenue for Maui County in Real Property Taxes, and has been ever since. In fiscal year 2020 about 14 cents of every dollar budgeted in Maui County came from vacation rentals. Short term rentals were mandated to be closed due to COVID 19 during 2020.
The legal vacation rental industry is a large and legitimate industry in Hawaii, raising billions in revenue, property taxes and visitor spending, but individual ownership makes it a fractured industry, hard for legislators and county and state administrations to understand. It is easier for them to deal with big corporations, top down one size fits all legislation, management with big payrolls and unions.
The short term rentals generated 40% of real property tax revenue this fiscal year (FY23-24), or $213.7M. This amount represents 20% of the county operating budget. This is the largest single revenue generating category in the real property tax classifications. Next would be Non Owner Occupied property $127.6M, followed by Timeshare $54.7M and Hotel Resort with $51M.
The short term rental category is the only category out of all twelve of the county land use classifications that has seen 6 consecutive years of increased tax revenue generation. It is also the only land use classification that has seen 6 consecutive years of increased assessment value in this period as well. The TVR/STR classification grew from 28% in FY2018-2019 to 40% of the total Real Property Tax revenue in 5 years.
voices from our community
I’m a resident who owns a short term rental. All of the people I employ, all the taxes, all the revenue …. it all remains on Maui. This is not true for the big hotels, which are taxed at a lower rate. This bill favors the big hotels over the little guys like me who live here and employ the local plumbers, electricians, cleaners, accountants, property managers, local businesses, etc….besides paying the majority of the property taxes.
My husband and I purchased our condo in 1973 and have spent 50 years loving our experience with Maui. From the day the building opened through today, we have serviced the short term rental market.
Our love for Maui will never fade, but we are very concerned we will not be able to afford to keep our condo without income to cover the extensive costs.
A small business in West Maui that spruces up 27 vacation rentals, survived the sharp decline in tourists during the Covid-19 pandemic and after the devastating Aug. 8 wildfire in Lahaina.
But now the owner, who runs the operation with his wife, is worried the Mayor's recent proposal to permanently eliminate 7,000 short-term rental units in an effort to create much-needed long-term housing for the county.
“Is this going to be the blow that knocks us down?” the owner said. “Other independent contractors also are worried. It’s always the little guy that gets shot down first.”.
In my estimation, this proposal will bankrupt Maui and affect every resident, person, and family on the island. Taxes on the remaining people will be negatively affected. Alternative choices must be considered; removing TVRs is not the solution. Governor Josh Green and Mayor Bissen work for the people of Hawaii and Maui County, and it is not their place to unilaterally impose laws and rules that will determine our fate.
I’m a 15 year resident of Kihei who bought my condo with the understanding that the Maui County Planning Department permitted STR usage if I desire. I paid extra for a facility that allowed such as I always intended to STR when I could afford to travel seasonally.
Don’t waste money on lawsuits and attorneys but fast track affordable residential housing.
