Maui Planning Commission members breezed by a proposed policy statement in the draft South Maui Community Plan update Tuesday evening, agreeing by consensus that the plan would aim to increase long-term residential housing by phasing-out short-term rentals from Māʻalaea to Kanaio.

The draft plan’s Section 2.2.25 policy statement says: “Increase the inventory of long-term housing units, whether owner-occupied or long-term rental, and whether single-family or multi-family, by phasing-out and converting existing vacation rentals to long-term occupancy.”

After earlier discussion of draft policy words like “require” and “encourage” in various statements, commissioners came to the short-term phase-out policy in the community plan draft. They quickly determined that they had already dealt with the so-called Minatoya List of vacation rentals. They did so by recommending approval on July 23 of a bill proposed by Mayor Richard Bissen to make vacation rentals a non-permitted use in apartment-zoned districts in Maui County. If approved by the Maui County Council, that bill would impact about 7,000 units, mostly in South and West Maui.

Planning staff told commissioners the South Maui draft plan statement might lower the number of allowed bed-and-breakfast permits, but beyond what was already forwarded to the County Council for limiting short-term rentals, the plan statement is “not super impactful.”

Commissioner Ashley Lindsey said: “Given our recent Minatoya List meeting and also the limited size of the B&Bs and short-term rentals in each area, I think we have tackled this one for now.”

Commission Chair Kimberly Thayer said: “Okay. So leave this (policy statement) as is. So, that’s what you’re saying? (Lindsey: “Yes.”) Okay, I see thumbs up from everybody else online.”

The so-called “Minatoya List” refers to vacation rentals that have been grandfathered, or allowed to continue, even after Maui County passed an ordinance in 1989 making transient accommodations non-permitted uses in apartment-zoned districts. Most of the affected units are in South and West Maui.

Aside from transient vacation rentals in apartment districts, Maui County has permitted transient vacation rentals by conditional permit, short-term rental homes and bed-and-breakfast operations. The numbers are broken down by community plan area and are available by clicking here; see hyperlinks under “Resources.”

The commission received dozens of written testimonies, virtually all opposed to including the draft plan’s Section 2.2.25 policy statement.

When asked about enforcing plan provisions, in general, the Planning Department said via email that the County Council could pass conditional zoning to effectuate the policy, and special management area conditions or new ordinances could also be used.

Later in deliberations Tuesday evening, commissioners took up draft policy statement 2.2.27. It says the plan would “prohibit new transient units and require the development of high-end and luxury homes to provide their required workforce housing on-site until adequate workforce housing is established to meet existing needs.”

The Planning Department recommended deleting the word “prohibit” and replacing it with “discourage.” And, the department called for deleting the word “on-site” and the words “until adequate workforce housing is established to meet existing needs.”

Commissioners agreed, and the revised statement reads: “Discourage new transient units and require the development of high-end and luxury homes to provide their required workforce housing within the project area.”

The Planning Department recommended softening the language because “developments may already have entitlements and more direct language regarding workforce housing to be more easily implemented.”

The statements are among numerous proposed policies in the South Maui Community Plan Advisory Committee draft, dated February 2024.

Early in Tuesday’s meeting, commissioners heard numerous appeals from South Maui residents, urging them to retain the draft plan’s tougher, more restrictive language; For example, retaining “require” instead of replacing it with “encourage.”

“The South Maui Community Plan is the voice of the people of South Maui,” said Randy Wagner, a Kihei Community Association board member and chair of its design review committee. “The volunteers of the Community Plan Advisory Committee created this draft with specific ideas and vision through countless hours of deliberation, collaboration and long meetings. We have no governmental body to look out exclusively for what is best for South Maui. Even our council member is chosen by the entire island. (And), for that reason, it’s really important to honor the South Maui Community Plan as a true representation of what the community is striving for.”

Wagner said the definitive language in the plan must be upheld, giving as an example to not change “required to encourage in the diversity of location for affordable housing.”

When the commission considered that provision, the Planning Department recommended changing the language to drop “require” and instead “encourage workforce housing units to be spread out equitably throughout the South Maui Community Plan subareas to create diverse communities in all South Maui residential areas.”

The department said that requiring affordable housing to be spread equitably throughout the community plan area “may hinder the overall development of affordable housing.”

As a compromise, Commissioner Mark Deakos suggested keeping the word “require” but to add ” ‘to the extent practicable’ to those situations where it’s unrealistic.”

Vice Chair Dale Thompson supported Deakos’ suggestion. “I’m sure there’s people watching the TV now that are swearing that they just said ‘require,’ but we required 50% affordable housing before from 2006 to 2014 and nothing got built. . . . No builder would build because there’s no money in it.”

“I think when we require and we strangle those people then nothing can happen,” he said. “As much as everybody came out and said, ‘We want require,’ I still think we’re doing a positive thing for them. We’re trying to help the community there.”

The commission ultimately agreed to Deakos’ suggestion and struck out the word “equitably,” as suggested by Commissioner Lindsey.

Attorney Cal Chipchase cautioned against including mandatory language in the community plan, especially when Hawaiʻi courts have held that developments must be in compliance with the community plans.

Such restrictions have led to the high cost of housing in the islands, he said.

“It takes $220,000 of annual income to afford the median home on Maui,” he said. “And the processing time for a single-family home is 206 days to get a permit. For two or more units, it is 416 days to get a permit. We have to ask ourselves when we review these policies: Are we making it harder to build homes for the folks who live here? Are we making it harder to earn a living here? If the answer to both of those is yes, we are making it harder; we should have a very good reason for it.”

The commission is expected to continue its consideration of the South Maui plan update next month.