The dangers of 201-G fast-track affordable housing developments


Source: January 2005 Ka Wai Ola o OHA Article

`Ano`ai kakou…  With housing prices in Hawaii climbing out of reach for even middle-income families, the dream of owning a home is becoming just that – a dream.

The state agency in charge of tackling Hawaii’s affordable housing shortage is the Housing and Community Development Corporation of Hawaii (HCDCH).  The corporation has many programs to help families get into affordable homes.  What many people don’t know is that they also have a powerful tool to encourage private developers to build more affordable homes.

State Law 201-G-118 authorizes HCDCH to fast-track the development of housing projects by exempting them from all statutes, ordinances, charter provisions, and rules of any governmental agency relating to planning, zoning, construction standards for subdivisions, development and improvement of land, and the construction of units on the land.  The point of 201-G is to allow a developer to bypass the lengthy process normally required to develop a property if they promised to keep some of the homes they build priced below market.  

One of the big problems with 201-G development projects is that the counties councils have only 45-days to either approve or disapprove the project.  The Counties also do not have the power to modify the plans or specifications based on community input.  All they can do is approve it or reject it.  If the county council does not disapprove the project by the 46th day of the project’s submittal, it will automatically be considered “approved.”

In recent months, the County of Maui has had mixed reactions to proposals for 201-G projects.  According to an article by Harry Eagar in The Maui News (12/05/04), the Ka’anapali Development Corp. is preparing an environmental impact statement for a 750-unit residential project at Wainee and things look as if it will go smoothly.  However, developer Kent Smith’s 201-G affordable housing project at Puunoa was shot down by the Maui County Council in November of 2004.  One of the big objections, especially from the administration of Mayor Alan Arakawa, concerned the potential traffic problems that Smith’s Puunoa housing project would cause.  But, since the law does not allow the counties to modify the HCDCH’s preliminary plans, all Maui County could do was approve it or disapprove it.  What’s lost is the ability of the county and state to specify what lands ought to be in housing.

Edwin Tanji, City Editor for The Maui News (11/26/04) noted in his column that Maui County Council Member Charmaine Tavares defined one of the critical elements of the issue.  She said that the applicable state law, 201-G-118, is designed to allow use of agricultural land for affordable housing because under the economic demands of the marketplace there is little other choice.  “Where do the developers go? They have to go to agricultural land,” she said.  But if urban lands have hit peak values, the alternative is land that is not urban, such as the 235 acres of fallow former sugar cane lands at Puunoa.

This should be a real concern for the Hawaiian community.  With developable urban lands getting scarcer, what lands do you think developers are going to try to build on next?  We should all be concerned that Kuleana and ceded lands will be next on the developers’ list and be vigilant for any new projects near and dear to us.

We need to take another look at 201-G and go back to its original purpose, which is to fast-track the construction of more affordable housing.  The law should never be used by developers as a way to get around the zoning or planning process.  Community input and scrutiny of the process must be protected.

Also, affordable homes are defined as those below market value.  Unfortunately, the median price for a previously owned single-family home on Oahu was $485,000 as of October 2004.  So, theoretically, a developer could sell a home for as high as $400,000 and still call it affordable if it’s below the market value for that area.

State Representative Sol Kaho`ohalahala is currently looking at the 201-G’s intent and hopes to close any loopholes and make positive changes.  Hopefully something can be done to balance the greater community’s need for affordable housing while protecting us against detrimental developments.  Have a safe, happy, and prosperous 2005!