Passing the Final Commission on Short-Term Rental Restrictions in Honolulu

The city’s proposal aimed at reining in short-term rents on Oahu removed another hurdle at a Honolulu City Council committee meeting on Wednesday.

The latest version of Bill 41 will ban short-term rentals for less than 90 days – up from the current 30 – in most areas of the island. It will also impose new restrictions, fees, and fines. The zoning committee chair Brandon Elephant’s draft committee passed its third reading in the zoning committee and is now heading to the full board for a final vote.

By law, rental reservations lasting less than 90 days will only be allowed on Oahu in resort areas as well as certain residential areas in Waikiki mauka on Kuhio Street, areas near Ko Olina Resort and in one residential area near Turtle Bay Beach Resort Northern.

The bill prohibits unregistered rentals from advertising daily rates, requires non-matching rental units in residential areas to limit visitors to four adults and requires an off-street parking space for each rented room.

Critics of short-term rentals say Airbnbs and the like have upset neighborhoods and bought up a stock of valuable housing. Cory Lom / Civil Beat / 2021

The bill has garnered support from the hotel industry and residents who want to keep vacationers out of residential neighborhoods. But it has also attracted heavy criticism from short-term rental operators who argue Law passed in 2019which would have allowed 1,700 new short-term units to be licensed, was fairer.

“The new law will not reform an existing ordinance that is not enforced,” Daniel Boothby, who rents out his Waianae condo for part of the year, said during the meeting.

Resident Christine Otto Zaa told council members that it was upsetting to see people from the mainland and abroad fighting against oppression.

“They are people and companies who do not need to internalize the consequences of what they are all asking you to do to protect their investment,” she said. “They don’t care about having to deal with the housing crisis and homelessness.”

Honolulu City Councilman Brandon Elphant listens to audience testimony over the phone at a council meeting held in Honolulu Hill.
Honolulu City Council President Brandon Elphant has worked with the administration to remove some of the law’s most controversial provisions. Cory Lom / Civil Beat / 2021

Critics of the bill also expressed concern that the 90-day hold period would place an undue burden on residents traveling between islands, college students, medical workers and others who do not wish to stay in hotels. Exceptions are considered for these groups but are not in the current release.

Councilwoman Andrea Topola has opposed the 90-day rule, saying in the proposed amendments that it supports the current 30-day clause, but that proposal lacks support.

The The original copy of the invoiceprovided by Mayor Rick Blangiardi’s Department, responded great opposition. As written, it Mandatory reservations of at least 180 days and will require short-term rental operators in hotel premises to hire the hotel management company.

The management’s original proposal was to also allow short-term rentals in the condominium areas of the Gold Coast near Diamond Head; requiring rental operators to notify property owners within 250 feet of the dwelling being used as rental; and obtain supplemental insurance coverage.

City I retracted some of those suggestions Earlier this year, Elephant’s measure hit those elements.

“I think the proposed (bill) is a significant improvement and addresses the concerns raised by witnesses,” Council Vice President Esther Kiena said at Wednesday’s meeting.

The bill charges an initial registration fee of $1,000 and a renewal fee of $500 for short-term rentals—much less than the mayor’s initial $5,000 a year proposal. Elefante suggested reducing the fees suggested by management to $2000 and $1,000 respectively, but Kiana urged to lower the price even further.

She said operators will already pay higher temporary residence taxes, higher property taxes, and may face increased fines. She said the purpose of the fee should be to cover the cost of the government service provided.

“They should not be treated differently than any other city-run operation,” Kienna said of the short-term rental operators.

Kienna also proposed banning visitors to non-conforming units from parking on public streets near units and proposed a provision requiring hosting platforms to “exercise reasonable care” to ensure units are operating lawfully before providing reservation services.

All of its amendments were adopted to the version of the bill that was passed by the committee.