Maui managed retreat fund would come to rescue when infrastructure falls into ocean

West Maui has nine condo complexes at risk of falling into the ocean. The road fronting Kaʻopala Bay, along with water and sewer lines, may soon be under water. And many West Maui county parks are threatened by coastal erosion. 

That’s why Council Member Tamara Paltin, whose residency seat covers West Maui, recently introduced a proposal to create a managed retreat revolving fund that would help mitigate impacts of shoreline erosion and sea-level rise. 

Bill 68, which was discussed at the council’s Budget, Finance, and Economic Development Committee on Thursday, would establish a new chapter in Maui County Code to help when people abandon property that falls into the ocean or when public infrastructure is put at risk by sea-level rise.

Paltin said the majority of real property tax revenue comes from shoreline properties. But when sea-level rise “is going to be hitting the fan,” revenue will dry up. Then, it’s too late to take action.

Even now, some shoreline owners are sticking their heads in the sand. In two decades, another foot of sea-level rise is predicted.

“When you talk to property owners, obviously nobody wants to talk about this, especially if they don’t plan on being alive in the next 20 years,” Paltin said. “I hope to live 20 years from now; my kids will live 20 years from now; their kids will live 20 years from now.”

The proposal suggests tapping into one-third of the Maui County transient accommodation tax, along with any applicable fees, supplemental transfers or money from pertinent grants or programs, to bolster the fund. 

“We need millions for the projects on the horizon,” Paltin said. Just to reroute a 200-yard stretch of road fronting Kaʻopala Bay, it will cost $15 million. 

Funding could be used to back studies, programs and permitting, including environmental assessments.

Also, the money could be leveraged with dollars from federal, state, nonprofits, for-profits and other non-county entities.

Acknowledging that the concept is similar to the Special Management Area fund, the managed retreat fund has a key difference: It would not be used to purchase property, Paltin said.

Council Chairperson Alice Lee said she likes the proposal. However, she suggested a comprehensive plan to assess priority public projects. She also wondered if TAT should be the funding source. 

“I like your bill because of course we have to plan for the future,” Lee said. 

Council Member Gabe Johnson said it is a “very creative” bill. 

“I appreciate this type of thinking,” he said. “This will affect tax revenue when properties fall into the ocean. This will be a big problem and that will be big money.”

The committee is in the early stages of discussing the bill, which was deferred so details can be ironed out.