Cayetano OKs $3 million affordable housing plan

Gov. Ben Cayetano gave final approval for more than $3 million in low- or no-interest loans for rentals for the elderly, mentally ill and poor.

Most of the projects are to be built by nonprofit developers, underscoring Cayetano's call for the public and private sectors to join in tackling Hawaii's housing problem for groups most in need.

Cayetano on Wednesday morning said the projects represent his administration's first big step in its new housing policy, which emphasizes the development of affordable rentals.

Developers shy away from building such housing because it is difficult to do profitably. That means governments usually must offer assistance to make the projects economically feasible and keep rents affordable.

While plenty of rentals are available in Hawaii for the general public, demand for affordable units by the elderly, poor and other special-needs groups far exceeds supply, Cayetano said. He noted that the state and county have waiting lists of 5,000 to 7,500.

The state commission for the Rental Housing Trust Fund previously approved construction loans for the eight projects, but Cayetano's blessing was needed for final approval.

Kathleen Hasegawa of the Affordable Housing and Homeless Alliance applauded the state action, saying the trust fund should be the heart of Cayetano's housing strategy. "This is the key way of bringing about affordable rentals," she said.

With housing costs down because of Hawaii's sluggish economy, the state has an opportunity to make inroads in the affordability crisis, Hasegawa said.

"Now is the time we should be moving ahead to start making up the enormous gap we have in affordability for about 40 percent of the people in the state," Hasegawa said, referring to the percentage of residents earning below 80 percent of Hawaii's median income.

The eight projects approved for financing total 319 units, mostly on Oahu. A $50,000 planning grant also was authorized for a planned 40-unit elderly rental complex in Kalihi.