Wednesday, August 18, 2004

Task force tackles
affordable housing

Gov. Linda Lingle's Affordable Housing Task Force met at the Capitol yesterday and narrowed its focus on ways to provide lower-cost houses and rental apartments in the face of the skyrocketing cost of housing in the islands.

Lingle, however, immediately shot down one proposal seemingly popular with task force members: To increase the state's conveyance tax to provide money to build or subsidize lower-cost housing.

The roughly 80 members of the task force -- including developers, property managers, bankers, business leaders, social workers and state officials -- split into three groups to address cutting bureaucratic red tape, getting money and providing the needed infrastructure such as streets, utilities, schools and parking.

Soaring home prices and rents fueled by nonresident purchases, low interest rates and short supply are putting the pinch on more isle families who can't compete in a market that has modest 40-year-old homes in some neighborhoods going for $500,000 or more.

In July, the median price of a previously owned single-family home on Oahu was $480,000, and $217,000 for a previously owned condominium, according to the Honolulu Board of Realtors. The median resale price for houses on Maui was $530,000, $472,500 on Kauai and $350,000 on the Big Island.

Lingle named the task force last month, saying there is a need to fast-track the construction of 17,000 subsidized rental housing units on state land in urban areas over the next five years.

She spoke briefly to the group and thanked the members for helping her create a six-year plan "that's something doable and not something that's pie in the sky, but something that's real that if we get focused and really put in a lot of effort that we can achieve over that six-year period."

Lingle later in the day met with the mayors of Honolulu, Hawaii, Kauai and Maui counties, other county officials and developers to review what can be done to cut bureaucratic red tape and regulations that delay housing projects.

"It's the delays that we in government are creating that's really adding to the cost of affordable housing or gap group housing," she said.

Honolulu Mayor Jeremy Harris emerged from the meeting saying he agreed that the permit process needs to be streamlined and that the state's Land Use Commission should be eliminated.

However, he disagreed that delays in the permit process affect the cost of housing and he disagreed with Lingle's suggestion for private developers to get involved in providing affordable housing.

"My advice was that it doesn't make sense to get the private sector to develop affordable rentals," Harris said. "That's very easy for government to do without cost."

After the task force meeting, Lingle was quick to shoot down the suggestion that a hike in the state's tax on property sales could raise money for affordable housing projects.

One advocate of a surcharge on the conveyance tax on the sale of housing property to investors is Claudia Shay, executive director Self-Help Housing Corp. of Hawaii, which helps families build their own homes.

"We're never going to curtail the investment market in Hawaii because, especially after 9/11, more and more people want to invest domestically rather than overseas," she said. "So what we should do is get something out of it because it's exacerbating our market and it basically takes affordable rentals out of the market."

Priorities to get
lower-rent projects

Priorities for providing lower-cost houses and rental apartments in Hawaii based on a consensus from voting by members of Gov. Linda Lingle's Affordable Housing Task Force.

>> Making more government land available.
>> Using private firms to help the counties more quickly process building and development permits.
>> Increasing the state conveyance tax.
>> Eliminating duplication of state and county zoning powers.
>> Gaining legislative support to provide public-private financing and development of infrastructure.
>> Coordinating state and county construction budgets in line with long-term development of housing projects.
>> Incentives for landlords to keep lower-rent housing units on the market.
>> Better efforts and coordination in tapping federal, state, county, nonprofit and private funds available for housing programs.
>> Making "affordable housing" a priority policy of the state, but not necessarily to be operated by the state.

The Associated Press



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