House Standing Committee on Housing

Good morning. I'd like to call to order the joint public hearing with the Committee's House Committees on Housing and Water and Land. We are on our 8:45am agenda in conference room 430. With me here we have Chair Hashem and Vice Chair Morikawa and Rep. Grandinetti and Vice Chair, Vice Chair Miyake and Rep. Pierick.

Thank you for being here. So we have only an hour and 15 minutes to get through this agenda. We have a very hard 10 o' clock stop time so we are going to go pretty fast through the agenda by urgent Members of the public, if you have submitted written testimony, you could rise and stand on your testimony.

If you want to add some clarifying remarks, we'd appreciate that as well. But please keep your testimony within two minutes. Members of the Committee, if we can make sure to just keep our questions concise and keep our comments to the end of the Committee, that would be appreciated to make sure that we get it through here.

If you're on Zoom, please keep yourself muted and your video off while waiting to testify and after your testimony is complete. The Zoom chat function will allow you to chat with technical staff only. And please avoid using any trademarked or copyrighted images. Please refrain from profanity or uncivil behavior.

Such behavior may be grounds for removal from the hearing without the ability to rejoin. And as always, just urge everybody I know everybody's passionate about these issues. We have some potentially controversial items on here. Just urge everybody public Advocates Members to always keep it respectful while communicating communicating our our passion.

With that said, we will dive right into the agenda. First item on the agenda is HB 1719 related to housing. Among other things, this bill establishes that manufactured homes are permitted use by right on residentially zoned lots within the district. Vice Chair for testimony.

Hawaii Realtors and support.

Stand in support, thank you.

Thank you. Hawaii YIMBY in Support. Grassroots Institute of Hawaii in Support. Thank you. Housing Hawaii's Future in support. Two individuals in support and one individual with comments. Anyone online or in person wishing to testify on HB 1719? Seeing none, Chair

Any questions on HB 1719? None. Next item on the agenda is HB 1742 related to housing. This authorizes the construction and occupation of self contained relocatable housing units with certain restrictions. Vice Chair for the testimony.

Members.

Department of Health with comments. Thank you Hawaii Realtors in support.

Stand on our testimony and support.

Thank you. Grassroots Institute of Hawaii in Support.

Stand on our written testimony and support.

Thank you. Housing Hawaii's Future in Support. Modular Building Institute in support. One individual and support and one individual with comments. Anyone online or in person wishing to. Testify on HB 1742?

Members, any questions? Seeing we're gonna be done in four minutes at this rate guys. Seeing none for the Members who just got here.

Just a reminder, we have a really hard stop at 10 o'clock, so I just urged testifiers to stand on their testimony if they submitted it and Members to be concise if we have questions so we can keep it rolling. Next item on the agenda is HB 1737 relating to farm employee housing.

This clarifies that a farm dwelling permitted in an agricultural district includes a single family farm dwelling with an accessory employee housing structure subject to certain restrictions. Vice chair for the testimony,

OPSD and support.

OPSD will stand on execution testimony providing. It's a part of the intent but also providing.

Thank you, Department of Agriculture and Biosecurity with comments.

Department stands on its written testimony or freedoms as concerns.

Thank you. I have OPSD with comments.

Yeah, we just refiled the tactics.

Thank you. Hawaii Realtors in support.

Thank you. We stand on our testimony.

Thank you. Hawaii Farmers Union in support.

We'll send our written testimony in support.

Thank you. Grassroots Institute of Hawaii in support.

Keep this brief, Chairs. Ted Kaphalas with Grassroots Institute of Hawaii. We are in support. We think this is a great win for farmers that can expand operations. A great win for employees that you know will have housing close to work. It's a win for all of us that are going to have more food as a result.

I will say we offered a proposed amendment, but after looking at OPSD's amendment, we'll defer to their proposal. Aloha. Thank you.

Hawaii Farm Bureau with comments. Housing Hawaii's future in support. One individual in support, one in opposition and one with comments. Anyone online or in person wishing to testify on HB 1737.

Any questions? Seeing none. HB 2049 related to housing. This Bill restructures, among many things, it restructures the conveyance tax to a marginal rate system and it allocates revenue from the conveyance tax collection, including a portion of the Dwelling and Revolving Fund and a portion to the Department of Hawaiian Homelands Trust Fund.

Vice Chair for the testimony.

OPSD and support. Thank you. Department of Taxation with comments.

We'll stand on our comments. Thank you.

Thank you, Department of Hawaiian Homelands and support.

Yeah, we'll stand on our testimony. I just want to add that this is the most important bill for us. As a Legislature, so we're in very, very strong support.

Thank you. DLNR with comments.

Good morning, Chairs, Vice Chairs, Members of the Committee and people everywhere. I'm David Penn, Program specialist for Legacy Land Conservation in the Department of Land and Natural Resources. The comments in our written testimony regrettably did not consider the increased amount of conveyance tax revenue that might be collected through the proposed overhaul or restructuring of conveyance tax rates.

After looking again at this through several lenses of key factors, we would be comfortable for now with a 10% share of revenue and a $10 million cap as suggested by several other factors. So we did find within some of the testimony for today an estimate of 68.5 million additional revenue from this new tax structure.

We also look always at the projections from the council on revenues on future conveyance taxes. We look at the existing $9 million new ceiling for the Land Conservation Fund.

And we also look at several other measures that may or may not move through this session, including Senate Bill 3031 that's going to be heard this afternoon, which would divert conveyance tax directly into the beach restoration Fund from the transfer of interest in properties within the sea level rise exposure zone, which could be very high value, but we don't have an estimate on that either.

So it appears that for the upcoming fiscal year and in future down year, a 5% share might not provide sufficient funding for the Land Conservation Fund to fulfill its ever expanding mission in the current real estate market. I could go on, but I see everybody nodding, so I think you got it. Thank you.

Thank you. Next we got Oahu Youth Action Board and support. Molokai Land Trust in opposition. Tax foundation of Hawaii with comments.

Aloha. Colleen Teramai for Thomas Yamachika who's in another hearing. Tax Foundation of Hawaii stands on its written comments. Thank you.

Thank you. Oahu Metropolitan Planning Organization in support. Hawaii Land Trust in opposition. Hawaii YIMBY in support. NAIOP Hawaii in opposition.

Good morning. Chairs, Vice Chairs, Members of both committees. Evan Oy, on behalf of NAIOP Hawaii, we respectfully stand in opposition to this bill. While we first want to acknowledge and appreciate the intent behind it to support Native Hawaiian housing for all, you know, we do and have traditionally always opposed increases in conveyance tax.

And I know this is a restructuring, so it's slightly different. But from, you know, from we have always held that, you know, conveyance tax is never supposed to be a revenue generating form. It's supposed to be an administrative fee and it's, you know, to cover the cost of the transactions for the Department.

So, you know, we've always opposed based on that grounds and Then the second concern, of course, of us, for us is going to be the increases in the, you know, in the conveyance tax.

I know it switches to a marginal system, but we are concerned that the increases for each of the tiers, especially on the higher ends, could create additional upfront costs for, you know, a lot of projects. And we are concerned about that.

And then third, you know, we would just respectfully ask that if this is changed to a marginal system and know, intended to be more of a revenue generating system, that it be allocated toward all forms of housing and, you know, based on readiness and project readiness and available projects that are ready to go.

So for those reasons, we respect.

Thank you.

Thank you. The Nature Conservancy with comments. Hawaii Realtors in opposition stand on our testimony.

Thank you.

Thank you, Hawaii Appleseed Center for Law and Economic justice and support.

Arjuna Heim on behalf of Hawaii Appleseed. We're in support of this bill. Importantly, it would actually be a tax cut for the majority of residents buying and selling homes. It reduces the conveyance tax rates up to about $1.7 million and it slowly, marginally increases them. We're in full support of the allocation to DHHL. Thank you.

Thank you. Hui Children's Action Network speaks and support. Kobayashi group in opposition and 26 individuals in support. Five in opposition and two with comments. Anyone online or in person wishing to testify on HB2049?

Members. Any questions? But just 1.0 of clarification. I appreciated the clarifying comments from Leaving His Legacy Land that the bill changes the allocation to the Legacy Land Trust from, or sorry, Legacy Ban Conservation Fund from a 10% allocation to a 5% allocation. It does lower it, but it raises the cap from 5 million to 10 million.

The revenue from the bill is almost kind of double conveyance tax revenue. So it'll actually lead to more money going into the Land Conservation Fund. Based on the estimates we have in the first year, it'd be 3.5 million additional to the fund. So I think some of the testimony we got wasn't taken into account.

The fact that even though the percentage goes down, the pie is significantly expanding. So I just wanted to clarify that for the membership. But yeah. Members, any questions? Yeah.

Mr. Chair, apologize for being late. We were pushing from a previous Committee hearing, PSD here.

Excuse, excuse me for the question, if this information is already available, but do we have a comparison of the existing structure with this new structure that's being proposed and seeing the difference of the funds that will be paid by taxpayers and you know, of course, collected for good purposes. I'm going to turn to our tog folks.

Did you know? Yeah. Yeah, don't believe so. I represent, you know, who would have that information.

I think the question is probably best directed at Department of Taxation.

Is Department of Taxation here available to. Answer that question.

I wanted to get information that shows a comparison of the existing conveyance tax structure and what is the new proposed that we will be going to if this Bill gets passed and what is the difference in the taxpayers liability and funds that we will be receiving that you know is going to be for a good purpose.

I just want to see that information. A revenue estimate just line by line comparison of the tax structure, of the percentages and the. Yeah.

Marginal rate, something like that.

Yes, as much as clearly as you can explain it. That would be helpful.

For me anyway. Maybe I don't know about others but I'd like to see that.

Okay.

Thank you. Members of the Committee. We have a line by line comparison which we can provide to Members before decision making. So you can see see it. That was dotax was able to provide a revenue estimate showing the estimate allocations based on you know, estimated sales data.

And then we have a line by line impact at each sale price which.

Thank you Chair.

Thank you Members. Further questions. I actually have a question for do tax also. Hello. So right now the conveyance tax has two structures. You know the paragraph one and paragraph two, paragraph one which goes to owner occupied homes in paragraph two which is applied on non owner occupied homes as I understand. Where are commercial properties charged currently?

Do you know under what to the catch all. Which is the first one. Wait, the first one? Yeah. So the one that. So there's one with the, with the purchaser that doesn't have a county home exemption. And then this is catch all.

Okay. So. So it's the one that does not have a. Well, so. Sorry.

So number two, the reason it's confusing is it number one it says accept as provided in number in paragraph two and then paragraph two says for the sale of a condominium or single family residence for which the purchaser is ineligible for a county homeowner's exemption.

That's right.

So the commercial rates would be in that one.

In number one.

In number one. Okay, okay, that helps. Thank you very much. And then. Sorry, one more. Could you explain the cost of living adjustment in the Bill how that would. There's an adjustment.

So they're going to take the cost of living. They're going to take the unis, the U.S. Department of labor published consumer price index. I Mean, it's just right here in the Bill that calculated by adding one to the quotient of the percentage change in the urban Hawaii consumer price index for all Items divided by 100.

And there was some concerns that the language in subsection B for that cost of living adjustment that that would be a double tax in that we are applying an inflation adjustment to the amount that somebody is paying. So as property values go up, we're also applying a second cost of living adjustment to that.

So there were some concerns brought up in, maybe not in the testimony, but from stakeholders, that that would be a double tax. Whereas the intention of that language, as drafted in coordination with you guys, was more so that the amount that the tiers would rise with cost of living.

So could you maybe not so much explaining how you get to the cost of living adjustment, but what the cost of living adjustment would apply to. If you could walk us through that. So it says, shall recompute the actual and full consideration paid or to be paid in subsection A, which is, to be honest, a little confusing.

Okay. So I thought the cost of living adjustment was going to apply to not the percentages, but the marginal rates. So they start at, you know, say 600,000. They go up to a million, a million to two. Yeah. And then those would be increased.

But I have to go back and just confirm that is the cost of living adjustment.

Okay. So, yeah, and that was the intention of the language. I just want to be doubly sure that the language that we have in the Bill gets to that. The idea being that maybe median cost of housing right now is 1.2 million.

We want to make sure that in 10 years, if the median cost of housing is 2 million, that not everybody is in those upper rates, that that tier rises correspondingly. So maybe. Yeah. Before it gets her to the Next Committee, if we could just double check that the language we have in the Bill would achieve that effect.

Okay, thank you so much.

Chair.

Oh, yes, Rep. Cochran. Sorry, who?

Oh, yeah, Mr. Ascension, you're PSD now, right? Yes. Yes. Okay. No PUC. I think maybe for you, or maybe if you're not the proper person, the percentage earmarked will drop the RHRF, the rental housing revolving from from 50% to 20%. Is that. Would that be a question to you or is that someone else? I'm not sure.

I'm just. And then my question is, if so, then is that going to affect our affordable, you know, our rental housing, you.

Know, inventory, and be better asked to HHFDC.

They administer the fund.

Oh, okay.

Oh, gotcha. Are they here in the room today? Yeah. Oh, deep. I'm sorry, Mr. Mina. Coming. Yeah. So I mean because with this cast and then it looks like it's going to take away. It's typically 50% now it's going to drop down to 20. So I feel, I feel like it's going to affect. Right. Our rental housing.

Right now we receive up to $38 million in gross tax revenue to rental house revolving fund. So yes, rental housing involving fund is very helpful for rental housing tax credit projects. So if that were taken away, you can always rely on operations Legislature also.

Right. Okay. And you know, since conveying taxes rely on the real estate market and things of that nature, which can very volat. So how is that taken into consideration? Because that could affect our tod, you know, efforts and dhhl, this potential, you know, money.

Yes, it is volunteer. So it is not a guaranteed funding source.

Okay. Because I thought if it, sorry, if it was, then my question would be will other pots of money be tapped into in order to fulfill, you know, the mandated required amount of money given so.

Well, we also rely on appropriations of the Legislature for revolving funding.

Okay, thank you. Thank you.

Sorry, Dean, if you could just clarify. So you did say that you rely on appropriations from the Legislature for ihrf. Would you just walk us through in a typical year or even last year, what that. The, the additional amount that the Legislature allocates to the rental housing valley Fund.

For example, I think for the biennium it was $50 million each in the rental housing revolving Fund and a separate $50 million for what's called the Tier 2 or higher income rental projects. So those funds are used by us to appropriate projects or to award to projects that apply for financing.

And so the conveyance tax allocation is just basically a floor of funds that are going to go into RHRF and then the Legislature typically will come in in most years and appropriate significantly more funds to rhrf. That's correct.

Thank you.

Excuse me, Chair.

Yeah. Rep . Shimizu.

repeat what you just said. As far as the amount that Legislature. Is.

For the current biennium, it was $50 million in fiscal year 26 and $50 million in fiscal year 27. There's also tier two. It's called the tier two funding. I believe that was also $50 million for each year.

Since you're there, Dean, I just want to give people perspective. What was in 2025? How much was the ask for your round? Your funding round?

The ask over $1 billion. And we awarded over $300 million last year. That's because we had in 24, we did not award allocation because projects were not ready to be awarded. So projects came in ready last year, billion dollars of fund.

So basically a three to one. Yes. Or in fact four to one. Right. Okay. Thank you. Thank you, Dean.

Excuse me.

Forgive me Chair, but before line of questioning you are asking some questions.

Yeah, sorry, missed it. So I was trying to ensure that we had clarity around what the cost of living adjustment in the conveyance tax does. And the intention of the language which was drafted in coordination with dotex, was that the essentially the tiers would lift with inflation.

So there's an argument around any type of tier taxation rate that with inflation you don't want more and more homes falling into those upper brackets. Right.

So if the median cost of a home in Hawaii right now is 1.2 million and we have an increase in conveyance tax rates at $2 million, what we don't necessarily want to see is in 20 years if the median cost of a home is $2 million that most residents are in, these are shifting into the higher conveyance tax brackets.

So the intention of the cost of living adjustment was that those brackets would rise with cost of living. Make sense? So my question was just ensuring that we are achieving that with the language that's in there, which is admittedly a. Little bit confusing on the surface. Thank you, Chair. Thank you.

No, you're a pro. You're next.

Someone before.

Sorry, HHFDC. Thank you again, Mr. Minami. So I think some uncertainties in this whole thing, I mean money gets allocated, you still has to trickle down into the counties and counties will have to, you know, make decisions upon permitting and you know, if it's approved and things appropriate that nature.

So that's do you have a plan strategy, you know, in order to make sure that we can utilize the funds and then have it fulfilled at the end of the day, really, when it comes down into the county level decision. Making.

Projects that are awarded financing, yes, they have to apply to the county for permits. We expect them to have all the discretionary approvals before we award in finance, we wouldn't want them to be, you know, delayed by an SMA permit, for example, which might take a year.

So they're expected to have the discretionary approvals before they apply for financing and they just have to receive building permits which are more ministerial approval.

Thank you so much again for your time. Thank you Chair.

Thank you. Rep. Members. Further questions on the condensed acts Seeing none. Next item on the agenda is HB1725 related to building codes. This Bill does a number of things. Fixes the applicable building codes as of the data county, accepts a complete building permit application or issues an authorization to proceed.

It specifies that the IRC applies to triplexes and fourplexes.

It authorizes a county to adopt amendments to safe building code that are more stringent or less stringent and it changes the building code cycle from a two year cycle to a six year cycle and appropriates funds for one staff position and necessary consultant services just to carry out statewide code adoption. Vice Chair for the testimony.

Kauai County Council Member Bulusan in support Collaborative in support.

On behalf of Polomua Collaborative we stand on our written testimony.

Thank you. Top priority and support Pacific Home Appliance and distribution and support International Code Council in opposition. Not present AYA Hawaii State Council and support D.R. Horton in support.

Chairs, Vice Chairs and Members of the committees. My name is Tracy Tanaki and I'm with D.R. Horton Hawaii and we stand in strong support of Bill 1725. The current adoption cycle is unmanageable and we believe this bill is well written and will make it manageable. I think everybody knows codes over time have increased.

Code books have become more voluminous and they've become more of a performance based code. So if you can imagine when I first started practicing code books were the UBC was the size of a Bible and I could carry it to the job site and review it at the job site.

Code books now are for those who can remember what the Encyclopedia Britannica looks like. That's what's on our shelves at the office and that's what we go through every day to ensure health and safety. Codes are very important to do that and we meet it every day.

But what that has done is we've needed to increase our time, our resources and ultimately cost into reviewing them, analyzing them, participating in discussions, collaborative collaboratively with the state Building Code council and the counties to adopt them before they are just implemented into law so they can be applicable to Hawaii and to the counties.

And that increase in time, resources and cost has trickled down to our consultants, the counties, the state permit reviewers at DPP and respective county building departments and inspectors in the field. And even if we're all working collaboratively right now, we still can't meet the current cycle. So I think really strongly believe that 1725 is well written.

It's a sensible Bill that will help this process become more manageable and still ensure health and safety. Thank you Very much.

Thank you Hawaii and support. National association of Home Builders in support. BIA Hawaii in support.

Aloha. Rosanne Freitas with BIA Hawaii. And we do stand by our testimony, our written testimony that this really is a great solution for us to part of a solution to help address that housing issue.

We have allow us to build safe and effective homes and efficient, but at the same time make it manageable not just for the industry but for the government departments of permanent planning that have to go through each and every code as well. Thank you.

Thank you. NIOP Hawaii in support. Thank you. Specific resource partnership and support. Not present. American Society of Heating Refrigerating and Air Conditioning Engineers in opposition. Grassroots Institute of Hawaiian support. We'll stand. Underwritten testimony and support. Thank you. Housing Hawaii's future in support. Stanford Car Development and support. Gentry Homes in support.

Title Guarantee of Hawaii model OPT in support. Chamber of Commerce Hawaii in support. And two individuals in zero. Gina Thielen in support.

Aloha Chairs, Vice Chairs, Members of the Committee. My name is Gina Thielen. I develop affordable housing under the city's Bill 7 program. And I also serve as a volunteer for the BIA Hawaii's Codes Committee, the Building Board of Appeals for the City and County of Honolulu and Habitat for Humanity.

Our code adoption process is broken from top to bottom and the state of Hawaii can make a big step towards correcting that by passing HB 1725, which I'm here in support of.

I would just like to add that I think that as this Bill progresses, hopefully progresses, you folks will be treated to a lot of smoke and mirrors about Fema, life safety, all these sorts of things. They're simply not accurate.

The fact of the matter is, in every other code cycle is something that's being used throughout this country in many states, and it's perfectly suitable for Hawaii. And it's a much more sensible approach to the process of adopting codes.

Thank you. Thank you. We also got two individuals in support. Anyone online or in person wishing to testify on HB 1725?

Yes, please. I missed the call. This is Brian Imai appearing on behalf of the International Code Council. And I want to thank the Chairs and Members of the Committee a moment.

We largely stand in our written testimony asking that section of HB 1725 that would delay code adoption from six to six years, which is 10 years and kind of real adoption time be removed.

But I did want to add that last session there was a resolution requesting the Governor and others to develop a strategy to address the statewide adoption of Updated building codes. And there is a comprehensive plan already in motion which includes requests to Fund staff of the state Building Code Council.

We ask that you let that process advance this year before requiring a delay that could have significant negative ramifications for the state that are outlined in our testimony. Thank you.

Thank you. Anyone else in person or online wishing to testify?

Any questions? Rep Shimizu.

Thank you, Chair. I'm just really surprised that there's no government sees here that justifying. So I guess I'll ask the question to Gina. You seem to be kind of well versed on this. You know, going from a two year to a six year cycle.

Problems when you hit the six year that you got to catch up now and there's going to be a. Wealth. Of information that now you guys are. Trying to catch up to.

No, in fact, I think the opposite will happen. Because currently what's happening is when we say the building code, we're actually talking about seven different codes. And as of right now, all seven codes are kind of being reviewed and adopted at the same time.

Really what this does is this Bill would go back to what the original intent of the law that was written before says. Because if you look at the law, it says adopt on a staggered basis.

And what that enables us to do is it enables us to focus more clearly and more closely on the codes that we're considering in each cycle. So as an example, four of the seven codes are written by a body called ICC that incidentally makes $100 million a year out of selling code books.

And we can focus on the ICC codes in one cycle. And then three years from that time we can focus on the other three codes. And so we'll be looking at them much more in depth in terms of the catch up process. I sit on a lot of committees. Where we review each code and we.

Actually have side by side comparisons. And there's a lot of resources to be able to do that. So no, I think if HB 1722 advances and becomes long, I think it will help clarify that process and make it go more smoothly.

So what I'm hearing is there's more time to track it as it, as it comes on cycle.

Yes, but also because they're split, they're staggered, you're only focusing on four at one time instead of seven and three at one time instead of seven. So it enables a lot more clarity.

Sure. Can I have a follow up question, please? Do you have any sense of what. The DPP would, how they would handle. It or how it would.

I can tell you this that if you look at public testimony from the Director of Dpp, she has been on the record as saying that the code adoption cycle is problematic for them, especially when it comes to training.

I think that there's a reluctance to testify in favor of a Bill that delays a code adoption cycle on their behalf because there's contention within the staff as to whether or not that's the widest thing to do.

So I'm guessing as to that part, but I know for a fact that that Director of Puna has been on the record stating that the COD adoption cycle is a problem.

Thank you, Ms. Gina. Appreciate that. Thank you. Chair.

Thank you, Rep. Members, further questions. Rep Cochran.

So I think for the. For you. Yeah. Sorry, forgot your name. It's okay. Yeah, I. Sorry. But I beg to differ that we need to. To push this back from council waiting for state to approve the updated, you know, IRCS and what have you.

It set us back so at this point, and I see that this is proposing an added bodies strictly to take care of the. This, the building code. So I would think that that's what that, you know, the job of that person would be to expedite, not sort of extend, you know, on when things can get approved updated.

And I've been getting calls constantly because as we're revealed h. From the. The co Council, you know, and everyone saying that the state is. Is hindering progress. So I'm here trying to figure out where is that. Where's that happening? And it's kind of feeling like this is part of it.

So I'm just trying to figure out what the justification is. I mean, I'm reading all the comments and statements and reasons, but it's not still answering. It's not an answer for me.

So I guess the best explanation I can offer is that the way the process works is that the state adopts the code and then the counties have two years to then adopt that code, either as the state adopted it or with amendments.

And so what we tend to end up have happening is there's a lot of confusion because there's actually two codes depending on the jurisdiction. You could have a state code that's different and usually is different from a county code.

My guess is, and I don't know the nature of the complaints you're receiving, but the State adopted the 2021 Codes by statute without any amendments, which is very problematic because. Because as an example, one of the beneficial amendments that we have locally is termite treatment of lumber. Right.

We don't want to build with untreated lumber here in Hawaii. So, you know, that process of what's happened at the state, I think is probably confounding the county to some degree.

I would argue though that, excuse me, by separating the codes and staggering them, what you're going to do is you're going to create a longer period of time where there's stability both in the knowledge of the people that are checking the plans, approving permits, that are designing the buildings, that are building the buildings, and the inspectors that are making sure they're built to code.

What is happening now is that change is happening so quickly and it's so fluid that there's a lot of confusion as to which code applies in each circumstance. I don't know if that answers your question, but that's my best bet.

Sort of. Yeah, I want to follow up. And so that was part of the me wondering in the six year cycle what the sequencing would be. And I think you just sort of explained the different sections and codes, you know, being adopted and different whatever in sequence of from one to the next.

Yeah, yeah. I think that the way that it would work, the way that if I had the magic wand, is that all the ICC codes, four codes, would be in one cycle and they would wait six years.

But three years after that, the plumbing, fire and electrical codes would all be reviewed because they're written by different bodies and so they don't reference each other.

Okay. All right, well, thank you for your work you're doing.

Thank you. Chair. Thank you. Members, further questions on HB 1725 seeing none. Next item on the agenda is HB 1726 relating to housing. This requires OPSD to create a data and infrastructure platform to inform agency decision making. Vice Chair for the testimony.

OPSD with comments.

Good morning Chairs, Vice Chairs, Members of the Committees Lauren Premiano with the State Office of Planning, State Office of Planning and Sustainable Development, Special Plans Branch. We support. We sent on a written testimony in support of the intent of the Bill. I just wanted to flag a couple of quick comments. This is really timely.

We have been through a DBED internal working group coordinating across agencies, looking at existing data and processes and need for coordination moving forward forward. So this will really help to build on that work but also to really institutionalize it.

The main point that I want to emphasize is really the long term value of this work is going to depend on having a landing spot for the work to be received and to be built on.

So you know we hope to see at some point some language that addresses this so that know there can be the work can be carried forward beyond the study and beyond a data platform. Thank you.

Thank you HFDC and support. Thank you. Hawaii Public Housing Authority and support. Thank you. School Facilities Authority and support. Hawaii YIMBY and support. Hawaii Data Collaborative in support. Housing Hawaii's future in support. Hawaii Appleseed Center for Law and Economic justice in support. OHA in support. Maui Chamber of Commerce in support.

Anyone else online or in person wishing to testify on HB 1726?

Members. Any questions? Rep. Shimizu and then Rep. Cochran.

Sorry I took a break. Was OPSD here?

Yes, OPSD was here.

Any current data to build from or are we starting from scratch?

There's a lot of really great work that's been and done the Governor's housing team put together. I think it's holla.

We'll get you the website or it might be in our testimony but there's you know currently a list of housing pipeline projects and it's very detailed so I'd encourage you folks to take a look at that if you haven't already. In addition to that or the TOD Council has been doing work to identify infrastructure needs as well.

So there's a lot of really great data to start with. So we wouldn't be building from scratch.

Can you, can you explore that to my office or.

Absolutely.

Sure. Can I have one follow up question? This seems like a lot of work. It seems like it's very important. I'm just wondering this 150,000 staffing, one full time planner. That seems like a drop in a bucket for what you might be tasked with. That's just my opinion.

Yes. You know one of our comments in our testimony, you know, was if we could I guess the detailed scope so that depending on resources that are appropriated we can approve and also where the progress is of our internal working group that we can develop a scope that is appropriate.

Agree that, you know, I mean, this, this Bill primarily calls for a study to scope out a data platform, not the construction of.

So I think it's a reasonable step to come up with a scope of work before you then try to request funds and, you know, have a better idea of what it would cost to actually build that out.

But yes, I agree that, you know, this one time appropriation in a single position is probably not enough to get to where I think we'd ultimately want to get to.

Also, after this study, there's going to be the next step of, like you say, building it out. And what is that? I'm sorry, Chair, what does that look like?

We don't know yet. I think, you know, the bill would help us to figure that out and to appropriately score it out. I think keeping in mind that, you know, we're not trying to create something that is not sustainable and is kind of over engineering what we actually need.

So that's why, you know, we've already started to look at what existing data are there, what existing systems and processes are there as a starting point.

Okay, thank. Thank you. Thank you, Chair.

Representative Cochran.

Thank you. And thank you for being here. And thank you, Mr. Shimizu, for that was one of my line of question was the amount. Totally support this and just thought. But I see it's. It's just the start. I'm just surprised that we don't already do this, but I see we do it in different parts.

We just want to bring it together. So. Great. Thank you. Also, I'm just wondering just the coordination with all the intergovernmental agencies, departments, divisions, account. I mean, that's a tall order, but I think. Is that what you're gonna just suss out and kind of strategize on how that can be, you know, seamlessly, you know, integrated? Yes.

And you know, again, a lot of that coordination has started to happen, albeit maybe in pockets or tod. Council again is a great example that exists for TOD areas between county and state agencies within dbed. I mentioned our internal working group with DBIT agencies involved with housing.

And I know that there are numerous other efforts, so I think that this would help to create a nucleus for a lot of that activity to continue to happen, but also coordinate across those different.

I think it was just maybe slowing down this process because you need to give us a report by next 20 days before next session. So that's, you know. Yes, but I'm sure you'll do your best to accomplish that and will. So my Chair. Follow up?

Yes, please.

My other question is, I guess overall, do you foresee this helping us to guarantee faster housing production?

I think this is a part to a larger piece and that's why, you know, I would just say that what it really comes down to is a sustained effort for the ongoing collaboration and clear governance structure to shepherd that forward.

This is just providing, I think, direction for the development of a platform that would create a unified picture for data. But you still need to have ongoing coordination to implementation.

Yeah, I think some people think it's another hero, another planning exercise. But. And the other thing is concerns about privacy in this data sharing with projects or I don't know, is there any. Are you taking a look at what could be sensitive materials that should not be on this open, accessible data platform?

I think that's something we would definitely look at. Okay, thank you, Chair.

Thank you. Just curious, AI, do you foresee using that or do folks already use that?

There are certainly interesting AI applications I think that we could take a look at. I haven't necessarily thought about it in this exact context, but I think it's an interesting question. And we're always looking for ways to utilize AI for, for greater efficiency, but in responsible ways.

All right, thank you. Thank you, Chair.

Thank you. Just before we go to the next item of the agenda, just a reminder that we have a very hard 10 o' clock stop here. Because of the scheduling constraints with the two committees, this is our only opportunity to have a joint hearing.

So any bills that we don't get to in decision making will be effectively dead. So my hope is that we can. 25 minutes left. I think we're okay scheduling wise. Just make sure that questions are as concise as we can and hold comments to the end.

Next item on the agenda is HB 1738 related to land use decision making, provides the authority for counties to amend district boundary amendments up to 25 acres for the purposes of residential housing, agricultural workforce housing, long term rental or workforce fee, simple ownership. Vice Chair for the testimony.

Attorney General's Office with comments.

Good morning, Chairs. Vice Chairs, I'm Deputy Attorney General Miranda Steed. Just very briefly, we did provide a technical clarification to prevent ambiguity. The bill does provide for greater authority to counties to do district boundary amendments for 25 acres or less in certain circumstances. This does not change the county's current authority for 15 acres or less.

So we just want to make sure that it's Clear. This applies to 15 to 25 and. Not just 25 or less. I'm here for comment for questions. Thank you. Thank you.

Thank you. OPSD and support. Thank you. Department of Agriculture and Biosecurity and comments.

Department stands on his written testimony. Comments and offers amendment.

Thank you, Hawaii Realtors and support.

Thank you. We stand on our testimony.

Thank you. Hawaii Farmers Union with comments. Grassroots Institute of Hawaii in support. Stand on our written testimony and support. Thank you. Maui Chamber of Commerce in support. One individual in support and one in opposition. Anyone else online or in person wishing to testify on HB 1738 Members, any questions here?

Rep. Grandinetti.

In their testimony, the farmers union raised concerns about. Using the Land Study Bureau classification system because it's outdated. Can you speak to some of those concerns or address?

Yeah, we before my time at DAU, back at the planning office, we did do a study to take a look at the lsp. We came back the next year to try to get funding for the next phase to try to update it. And it would be through CCAR and also with the Department of Agriculture. That was not.

That didn't move forward. So right now, yes, you do have pretty much outdated. But then that's part of the criteria that's in law for Land Use Commission and for even the counties to look at when they do classification.

Do you. Do you echo those concerns or do you think?

I do from a planning standpoint that it should be updated. But we're talking something that was done 60 years ago, probably even more than that, for a certain purpose. And then it was adopted as criteria. Right. For any kind. Because it was still protection of ag land was the main thing back then.

Right.

Things have changed. And so, you know, that effort probably needs to be done. It would take some resources to do. But in General. Yeah. I mean. Right. You have outdated data. But then you also have a law that says you need to take a look at what the classification.

Okay. Thank you so much.

Thank you Members for the questions.

Sure.

Representative Shimizu.

Sorry. The person who made that statement. The counties have authority 15 acres or less. I'm sorry, I didn't touch your position and where you're from.

I am a deputy attorney General with. The Department of the Attorney General.

Okay. Thank you. That's all I need. Thank you. Thank you.

Representative Cochran.

Is Department of AG here today?

Yes.

Good morning. Aloha. I was taking a look at your. I see. It's Sharon heard. But is she speaking on behalf of the AG Department? She's meant you folks are mentioning that you want to remove C. Yes. And. And the reasoning. Because it's just as productive.

It can be just as productive as B rated lands. Yes.

You add water to it.

Irrigation.

Right. And so perhaps this other question for me could be answered through you. From being with the county, I know we always were trying to get that final IAL mapping statewide. Has that occurred? Are you aware. Have you folks complete. I don't know if that was your department's charge to do, but do you know final ials? Final.

Yeah. Ials across the state? I.

Well, there's two processes at the county level and the individual voluntary process. But there's no state driven process. There's no, there's no mapping and self designation by the state.

Yeah, I'm just wondering. I mean we were. Sorry, Chair, we were trying to see what the state has come up with the overall statewide IAL like mapping and designation such as, you know, where your. The different soil classifications are, you know, delineated and things. So this I. IAL designations. We never got a clear like mapping or.

No, there's no state, there's no state driven mapping. It's either the county provision or the, the voluntary individual landowner provision.

Okay. All right. Okay. Thank you.

Thank you. Members. Further questions seeing none. Next item on the agenda is HB 1799 relating to the counties. This expands on accounting's experimental and demonstration project authority to include the development of commercial projects. Vice Chair for the testimony.

Of Housing and Land Management, county of Honolulu in support. Hawaii County Department of Water in opposition Board of Water Supply with comments.

Thank you, Chair. And I know I have two minutes only so I'll try to be quick. You know, we have some recommendations on amending it so that it addresses our concerns. The number one, the need to preserve Chapter 54 authority. Chapter 54 is the authorizing chapter for the county boards of water supply.

So this exemption could actually inadvertently exempt these types of projects from BWS or other water Department requirements. And that's a concern. Number two, the Attorney General guidance confirms the need for express language.

We did a little research, got something from the former Attorney General from the 1990s basically reiterating the need to actually explicitly include Chapter 54 in this proposal. Number three, the proposed amendment. We suggest using some of the language from hrs 201h 38a 1b.

Basically add on provided that the experimental and demonstration housing projects or commercial projects shall not affect the safety standards or tariffs approved by the Public Utilities Commission for public utilities or the safety. And this is the addition or the safety standards Tariffs, rates and fees of the various boards of water supply authorized under Chapter 54.

We are not regulated by the PUC so we really need that addition there Number four illustrate some example of high risk is a high demand commercial customers like a data center would have a tremendous impact on our water system.

And I just want to thank you to include a reference to Chapter 54 authorities and maintain the cost causation principles that we operate by. Thank you. Thank you. Thank you.

We got one individual in support, one individual in opposition. Anyone else online or in person wishing. To testify on this matter?

Members, any questions? Seeing none. The last item on Our agenda is HB 1700 related to housing. Vice Chair for the testimony.

Council on Developmental Disabilities and support. Thank you. Hawaii Realtors in support. Navi and hawaii in support. Housing Hawaii's future in support and three individuals in support. Anyone else online or in person to testify on this matter?

Members, any questions? Okay, we will have a brief recess.

Reconvening our joint committees on housing and Waterland for the purposes of decision making on our 845 agenda. The first item on the agenda is AP 1719. My recommendation is that we move out in HD1 with tech amendments for clarity, consistency and style and a detected date. Housing Committee Members, any questions, comments or concerns? Seeing none Vice Chair for the vote.

Voting on HB 1719. The recommendation is to pass with amendments. Chair and Vice Chair vote aye. [Voting] Aye Recommendation adopted.

Thank you very much. Thank you. Our next item is HB 1742 related to housing. I recommend that we move on HD1 that for consistency and clarity we change all references of short term rental to transient accommodation.

That we adopt the Department of Health's proposed amendment from their testimony saying that they may promulgate rules technical amendments as needed and affect the date. Housing Committee Members, any questions, comments or concerns? Seeing none. Vice Chair for the vote.

Moving on HB 1742. The recommendation is to pass with amendments. All Members present. Any Members voting with reservation? Any no votes? Seeing none. Chair recommendation is adopted. Thank you.

Waterland. Same recommendation. Comments, concerns?

I just want to state a quick comment. Anytime I vote with reservations, it's only because of the home rule dance that is being done that's it but it's support with reservations.

I just had a comment I wasn't able to attend because I was in a previous commission this is and I signed on to this bill but it's a great idea.

I'm just wondering because it's such a monumental ship that maybe we should introduce it as a pilot program just to kind of test the water and just throw that out there. But I will be voting for reservations..

Okay okay. We're voting on HB 1742 recognition passive amendments Know the excuse absence of Rep. Ichiyama and Rep Woodson. Reservations for Rep. Shimizu. Any other reservations? Any noes? See none. Your recommendation is adopted.

Thank you Waterland Members thank you.

Next item is HB 1737 relating to farmer employee housing I recommend that we move on to HD1 that we adopt the proposed amendments from OPSD in their testimony that we remove the savings clause from the bill tech amendments for clarity, consistency, style and that we defect the date Housing Committee Members questions, comments or concerns? Seeing none. Vice Chair for the vote.

Voting on HB 1737 the recommendation is to pass with amendments Any reservations? Any no votes? Seeing none. Chair the recommendation is about thank you.

No comments, or concerns? Okay good.

Voting and HB 1737 recommendation pass this amendments no need Excuse absence of Rep. Ichiyama and Rep. Woodson. Are there any reservations? Any noes? Seeing none. Recommendation adopted.

Thank you Members.

Thank you.

Next item is HB 2449 relating to housing.

I recommend that we move out into HD1 and that we blank out all of the rate class all of the rates in all three rate classes and allow finance to do further determination on those rates and that we take amendments for fairly consistent style and that we defect the date Members any questions, comments or concerns?

Comment Chair I just want to thank you for the work that you put into drafting this measure over the interim working with the Department when we talk about legislation that supersedes our time this is one of those things if I can there's no secret I am a proponent of DHHL and I can understand in the same nexus of wanting them to do better that we could do better As a Legislature I represent communities that are oldest 1930 and those same families are still there today today.

And that's what DHHL is. It's our codified way preferential housing keeping native ha to Hawaii and for me I'm very thankful that we live in a time that we consider measures like this.

So thank you thank you thank you. Doctor that appreciate your passion and advocacy on the subject. Other housing Committee Members questions, comments or concerns? Seeing none. Vice Chair for the vote.

Voting on HB 2049. The recommendation is passed with amendments. Any reservations? Reservations for Rep. Cochran and Rep. Moroka. Any no votes? No vote for Rep. Peric. The recommendation is adopted.

Thank you. Okay, Waterland, same recommendations. No comments are concerns?

I have a comment. I just want to add my.

Go ahead.

I just want to add my thanks. To both Chairs for working on this measure. I think it's a really important measure. And focuses on so many issues from the DHHL issue, but also looking at restructuring a conveyance tax which we long struggled with. So I really, really appreciate the work. Thank you.

Good job. Any other comments?

Creative and out of the box thinking. Really, really addressing. I have concerns, but I will pick it up in JHA as it moves there and I'm going to work with the reservations. Anybody else saying that?

Okay, we're voting on HB 2049 recommendation pass with amendments noting the excuse absence of Woodson. Are there any reservations? Any notes? Reservations? I'm sorry, I got Shimizu reservations. Any others? Okay. Recommendation.

Thank you very much, Members.

Thank you. The next item on the agenda is HB 1725 related to building codes. I recommend that we move on to HD1 and then we delete paragraph one on page two. That we refer to 107B in Section seven that we defect the date and tech amendments for clarity, consistency and style. Members, any questions, comments or concerns? None.

Vice Chair for the votes voting on HB 1725. The recommendation is to pass with amendments. Any reservations? Reservations for Rep. Cochran. Any no votes?? The recommendation is adopted.

All right. Waterland, Same recommendations. Any comments or concerns? Della, no comments?

No comments.

Okay, thank you. Vice Chair for the vote.

Voting on HB 1725 recommendation pass with amendments noting the excuse absence absence of Rep. Are there any reservations? Reservations? Reservations? Any nos. See? None. Recommendation adopted.

Thank you very much. Member. Members, next item is HB 1726 related to housing. I recommend that we move on HD1 with a defective date and that we bling out the blank out the appropriations in the bill. Members, questions, comments or concerns? None.

Vice Chair for the vote voting on HB 1726. The recommendation is to pass with amendments. Any Members voting with reservations? Any no votes? Seeing none, Chair. The recommendation is adopted.

Waterland, same recommendation. Any comments or concerns? Vice Chair.

Voting on HB1726 recognition pass with amendments. No. The excuse absence of Rep. Woodson. Any reservations? Any noes? Recommendation adopted.

Thank you. Members, next item is HB 1738 leading to land use decision making. I recommend that we move on HD1 That we adopt the amendment proposed by the Attorney General and their testimony. Thank you, Attorney General for picking that up. Tech amendments as needed.

That we defect the date and that we mentioned in the Committee report that the Agricultural Committee should consider the Testimony from the Department of AG on whether Class C LANs should be removed. And just for some clarity, the reason that we didn't remove Class C LANs is that this.

Currently you can build solar on A, B and C. And so we were trying to mirror that. But if Department of AG thinks it's prudent to remove it, I'll defer to them. Members, questions, comments or concerns?

Chair WR Just based on farmer's utilization. Yes.

Thank you. Vice Chair for the vote.

Voting on HB 1738. The recommendation is to pass with amendments. Any reservations? Reservations for Rep. Cochran. Any no votes? None Chair, the recommendation is adopted.

Okay. Waterland, Same recommendations. Any comments or concerns? None. Vice Chair for the vote.

I'm voting with reservations. I think that comment by OPSD to add affordable should be amended in the language so that it's targeting. That's just.

Okay, Vice Chair.

Voting on HB 1738 recommends to pass with amendments. Voting records and excused reservations by Rashid. Any other reservations? Reservations. Okay. Any noes? Seeing none.

Thank you. And just for clarity, sir, I misspoke. You can build solar on C but not A and B. So it mirrors the determinations in this bill. HB. Next item on the agenda is HB 1799 related to the counties. I recommend that we move on HD1.

That we adopt the amendment provided by the Board of Water Supply in their testimony. Thank you. That testimony that we defect the date and second amendments as needed. Members, any questions, comments or concerns? Seeing none. Vice Chair for the vote.

Voting on HB 1799. The recommendation is to pass with amendments. Any reservations? Any no votes? Seeing none. Chair, the recommendation is adopted.

Thank you.

Waterland Committee, same recommendation. Any comments, concerns?

Thank you. I'm just clarifying that you're adopting all of the recommendations. The board by Board of Water Supply bring it out.

The recommendations in their proposed amendment. So they. They. They provided language. We'll adopt that language in their amendment.

Okay. We're voting on HB 1799 to pass with amendments noting all Members present. Are there any reservations? Reservations? No reservations. Any others? Any noes? Seeing none. Your recommendation was adopted.

Last item on the agenda is HB 1700 relating to housing. I recommend that we move out of HD1 with a defected date. Members, questions, comments or concerns? Seeing none. Vice Chair for the vote.

Voting on HB 1700. The recommendation is to pass with amendments. Any reservations Any no votes? Seeing none. Chair the recommendation is adopted.

Okay, Waterland, same recommendations, comments, concern. I'm going to be voting with reservation just because I need to understand this bill better and I'm gonna pick it up. Thank you.

Okay, we're voting on HB 1700 condition pass with amendments present any reservations, besides Shimizu? Any noes?

All right, thank you. Members, 10 o'clock on the dot. Amazing job committing.

Good morning.

I'd like to call to order our House Housing Committee hearing for Friday, February 6th. We are on our 9:30am agenda. We are a little bit late because our previous Committee went long and it's currently 10:05 Members. Just some quick housekeeping. Please give your testimony to two minutes when possible.

We do not have the same crazy time constraint as we had in our previous Committee. So we get a little more flexible here and we don't have that many bills here. But we still got to be done by 11:30 at the latest, which we will be fine.

If you're on Zoom, please keep yourself muted and your video off a way to testify. The Zoom chat function will allow you to chat with technical staff only. Please use the chat only for technical issues. Please avoid using any trademarked or copyrighted images. Please refrain from profanity or unstable behavior.

Just urge everybody, Members of the public, Committee Members, we're all passionate. Let's make sure to keep it respectful at all times while communicating our passion. All right, first item on the agenda is HB2476 proposing amendments to Article 7, Sections 12 and 13 of the Hawaii State Constitution. Vice Chair for the testimony.

HHFTC and support. Thank you Public Housing Authority and support. Thank you, OPSD and support, Fiscal Planning Center. Thank you Pacific Resource Partnership and support.

Vice Chair. Just like to add real quick to written testimony, Andrew Pereira with PRP. PRP was briefed by the financial advising company Stifel a few weeks back.

They're experts in this type of value capture financing throughout the country and they said it's not only a great tool for developing districts like Aloha Stadium, but you can do it down to the building level or to the city block level.

So just wanted to add that that this will be a great tool in the quiver for the counties and the state to develop the housing that we desperately need. Thank you. Thank you.

Hawaii Regional Council of Carpenters in support.

Mark Clemente, Political Director for the Hawaii Regional Council of Carpenters. Stand on my written testimony and strong support. Thank you. Thank you.

Hawaii Realtors in support.

Thank you. We stand in our testimony.

Thank you. D.R. Horton Hawaii in support.

Good morning Chair, Vice Chairs and Members of the Committee and Tracy Tanaki with the air Horton, Hawaii. Thank you for the time to stand in strong support of HB2, 2476 and 2478. If I could share a little bit about how we are building out Ho'opili, which is a large master plan community on the west side.

We are doing it with an inordinate amount of investment in infrastructure. And the payback on that infrastructure is one house at a time.

So we invest in water systems, we invest in water tanks, we invest in systems, which is what infrastructure requires up front in the initial start of our project and then we have to wait, get repaid back one house at a time. So it's a very long holding period, which means added interest on that.

The ability to do that has contracted. Right? The financing for infrastructure, outside financing has contracted because it's a high risk. So what this Bill would do was create an opportunity to de risk the investment in infrastructure.

There are many, many master plans that are stalled because infrastructure, there's no monies to invest in the infrastructure it needs to go in up front. So I believe this is a great tool that we should look at to unlock housing that is right now stalled.

On Makaiba Hills, Waialga, Kaloka Heights, Ina Lea, there's a ton of housing that has been entitled but can't get out of the ground because of the cost of infrastructure. Thank you.

Thank you HCDA and support.

Aloha. Mr. Nakamuro apologizes for not being here today and fr we stand on our written testimony in support.

Thank you. NAIOP Hawaii in Support.

Chair Vice Chair Members of the Committee Evan Oy on behalf of NAIOP, we stand in strong support. You have a written comments.

I just wanted to, you know, highlight the importance of this bill which is this will unlock one of the most important financing mechanisms that we have for infrastructure that will create housing communities for our generations to utilize for many years to come. So, you know, we stand in strong support and I feel for any questions.

Thank you. Thank you. Hawaii Housing Housing Hawaii's future and support operating engineers local 3 and support. Yes, thank you. Thank you. Stanford Car Development and support. Tax Foundation of Hawaii with comments.

Good morning Chair, Vice Chair, Members of the Committee, Tom Yamachika from Tax Foundation of Hawaii. We have some concerns from the public finance perspective.

Basically what's happening with this bill is we are writing an exception into our constitutional debt limit safeguards for debt that is supposed to be paid back by property tax revenues incrementally, but from development that hasn't, hasn't occurred yet and will be built in the future.

If the development does not deliver as advertised, government remains on the hook to repay the bonds, which means all of us suffer. Those who are concerned, be happy to answer any questions. Thank you for the opportunity.

Thank you. Kobayashi Group in support. One individual in opposition and one individual with comments. Anyone else online or in person wishing to testify on HB2476 Members any questions?

Just this is introduced by me. Oh, okay. All right thanks Just all right No. I just need to know who I okay.

Any. Any questions? Okay.

Next item on the agenda is HB 2478 related a bond of bonds this conforms county debt limitations law statements law to permit counties to exclude housing infrastructure bonds from the debt limit of the counties if a constitutional amendment authorizing the use of housing infrastructure bonds and excluding housing infrastructure growth bonds from determinations of the county's funded debt is ratified and just for clarity so if the con am is passed this goes into effect essentially authorizing the counties to exclude this from the county dependations Vice Chair for the DESIMO HHFDC in support Stand or testimony Support thank you Hawaii Public Housing Authority in support HPJ stands on testimony thank you DBED Stadium Authority in support OPSD in support thank you Pacific Resource Partnership and support Stand on our written testimony thank you thank you Hawaii Regional Council of Carpenters in support we send.

Our written testimony and strong support thank. You thank you Hawaii Realtors in support.

Send on our testimony and drug Support.

Thank you Dr. Horton in support we.

Stand on our testimony in support thank.

You HCDA in support thank you Maui Chamber of Commerce in support and one individual with comments Anyone online or in person wishing to testify on this matter.

Members Any questions Seeing none next item is HB2362 leading to housing this requires counties to automatically approve permits for hurricane retrofitting under certain conditions Climate Change Mitigation and Adaptation Commission in support Two individuals in support and one with comments Anyone else on online or in person wishing to testify on HB2362 Members any questions next item is HB2385 late into housing this authorizes HHFDC to approve and certify General excise tax exemptions for certain housing development projects located under county Housing Assembly programs thanks to forming amendments Vice Chair for the testimony Department of Taxation with comments.

HHFDC with comments.

Chair Vice Chairman Some clarifying comments with respect to the AMI limits we're fine with the proposal but we would amend our admin roles to match the AMI set forth for the term of affordability.

This was discussed by the companion Bill in the Senator so understanding is that the proposal is to incentivize the counties to set up programs that provide more affordable housing so we don't know there being separate requirements for for county projects and state projects intent of the Bill.

Thank you Grassroots Institute of Hawaiian Support Hawaii Apple Seed center in support Center Urban Real Estate and support Maui Chamber of Commerce and support Tax foundation of Hawaii with comments.

Thank you, Chair, Vice Chair, Members of the Committee Tax Foundation of Hawaii. Tom Yamachika speaking. We have written comments. We were a little bit confused because we thought this Bill was to make HH FDC's authority additive to what's already there. But it looks like the authority's been withdrawn from the counties.

We wanted to make sure that that's what the intent was. And happy to answer any questions.

Thank you. Also one individual with comments. Anyone else online or in person wishing. To testify on this matter? HB2385.

Any question? Dean? So the text foundation called out of their testimony. Although the bill's preamble gives the impression that the Bill gives HJFCC the power to certify county housing projects, which is additive to existing provisions. The Bill language shows that HHFDC's new power is to replace the county's existing power.

Could you clarify if that's the case and what the implications of that are?

The counties can authorize process GT exemptions on their own through Chapter 46. I'm not aware that that has been amazing.

Okay. Yeah. I am not. Okay. I'm gonna ask. I'm gonna. We'll bring up Tom in a second. But just for clarity. So you've. Your testimony called out the fact that there's two separate. That the state. The state incentives would be different than the county as far as the affordability requirements go. I mean the state. The baseline.

And you're. You applied in your oral testimony that you're fine with two different standards for the AMI limits.

They're actually what we have now is quite close to what's being proposed. We could just amend ours for the admin rules. For the term. We require 30 years for new construction projects. This would be a 15 year term for county projects. The intent of the Bill is to incentivize the counties to develop programs that promote affordable housing.

So that's the case. Case. Then we're okay with it.

And you wouldn't then want to change Your term to 15 years? Also to match it.

We could reduce it to 15. Or you could keep it separate.

Okay.

Okay. Thank you. Question for Tom Yama Cha.

Yes, Chair.

Sorry. Yeah. So could you just clarify where you're saying that this would replace the county's existing power?

This is on the top of page three, line one, where it adds the words initially approved and certified prior to July 12026. That's what we read as cutting off the county's ability to certify projects subsequent to that date.

Okay, thank you. Sorry, Dean. One more follow up. Is that your read on the language?

Okay, thank you.

All right, Members, any further questions? Seeing none, next item on the agenda is HB2625 related to housing. This establishes the vacant invited Residential Property Development Program within HHFDC and appropriates funds. Vice Chair for the decimal.

Attorney General's office with comments.

Morning, Chair, Vice Chair, Members of the Committee, I'm Deputy Attorney General Chase Suzumoto and we've provided our written comments on House Bill 2625.

In our testimony, we suggest first amending Section 201 HC1 to define the authority of HHFTC staff to enter onto the properties the timing of the required notice and then HHFDC's enforcement options should property owners impede the inspections. And then we cited an example in hrs Section 141.3.6.

And then second, inserting appropriate standards for the award of developing grants by hhfdc. And I'm available if you have any questions.

Thank you. HHFDC with comments. Testimony in support.

With comments.

Thank you. One individual with comments and one in opposition. Anyone else online or in person wishing to testify on this matter?

Members, any questions? I have a question for the Attorney General.

Yeah. Thank you.

So page 15 of the Bill says, notwithstanding any other law to the contrary, a portion of real property used for affordable rental housing units in an affordable rental housing project developed under this part shall be exempt from real property taxes for a period of 15 years from the date of initial occupancy.

Does that conflict with Article 8 of the Hawaii State Constitution that prohibits, you know, that gives all real property taxation authority to the counties?

I'll take the question back to the Department and then I can get you an answer on whether there's any conflict there. Could you give us a first read?

So my, my only, I've never seen, you know, mandatory property tax provision in statute before. My, my rate of contribution is that authority is given to the claims and any interference with that would be.

Yeah, I, I'm only hesitant to give. You a first read because that we didn't touch on it or consult with Ledger Division or the Department On, on our position. So I don't want to give you a read that's contrary to the position that they would take.

So I'll, I'll take it back to them and I can get you an answer as soon as I, as soon as I get back and consult with them if that works out for. Yeah, okay, thank you. Okay, thank you.

Members, Further questions on HB2625. Hhhep. Dean, I have a question for you. So I believe this permits somewhere around $25 million to the program and it does not give you additional positions. Gives you $750,000 to administer it. Can you just tell us a little bit how you folks would administer this and if you would need positions.

Specialist and a housing finance specialist helped administer this program. So we would have to adopt admin. Basically this would be similar to what the city is doing for their seven pack projects.

Okay.

And so just so that's two full time positions that you folks would need to administer this. Okay, thank you Members for the questions.

I guess Chair, Representative, you think this type of funding could like the Lahaina, the current condition of Lahaina since the disaster, would that be fall into this program? I mean could some properties fall into this program?

It could depending on the one of the restrictions there or was impeding development. That's the intent of this program is to provide accessibility for affordable housing projects.

Thank you Chair.

Thank you, Dean. Thank you for talking. Members, further questions seeing none. Next item on our agenda is 2444 positivity taxation. This increases the tax credit for low income household renters from $50 to $100 per exception by the taxpayer.

Vice Chair for the testimony Department of Taxation with comments. Thank you. Tax foundation of Hawaii with comments.

Thank you Chair. Vice Chair, Members of the Committee, Tom Yamachika from Tax Foundation will send the written comments and be available for.

Thank you. Catholic Charities Hawaii in support.

Aloha Chair. Vice Chair, Members of the Committee, I'm Betty Lou Larson with Catholic Charities Hawaii. Our renters are really in dire need of support. Over 50, or about 53% are paying more than 50% of their income on rent. And we get over 11,000 calls a year at Catholic Charities from people who want housing or rental help.

So we really need something. This is modest, but it's very meaningful to a family at tax time to get maybe $400 or whatever to pay a bill to have an emergency, maybe even just save a little bit of money. So we really encourage you to support this bill. Thank you very much for the opportunity to testify.

Thank you. Betty Lou Hawaii Children's Action Network speaks in support.

Aloha Chair, Vice Chair, Members of the Committee, I'm Nicole Wu from Hawaii Children's Action Network. We know that many families with children are struggling to afford their housing. According to the National Low Income Housing Coalition.

The housing wage to afford a one bedroom apartment in Hawaii last year was over $37 an hour, which is an annual income of over $78,000. You'll see on in my testimony, I think it's page five, there's a chart from Hawaii Appleseed.

A few years ago they took a look at what rent for a one bedroom apartment in 1980 was for a low income wage worker, a low wage worker. And back then, around the time that this tax credit was set at $50, it was about half, 54% of a low wage worker's income.

By 2018, when they did their analysis, rent for a one bedroom apartment for a low wage worker in Hawaii was at 87%. So that just reflects how our rents have gone up so much higher, faster and higher than our income.

Looking at this credit, it was started in 1977, it was increased from $20 to $50 in 1981 and it has not moved how many of us were born in 1981. Adjusting for inflation, it actually would be over $170. Now another part of the renters credit as they is that there's an income cutoff.

And back in 1989 it was set at $30,000 a year, which was about just a little bit above the median household income at that time. Right now a full time full year minimum wage worker will be making too much money to even qualify for this credit.

If we were just to adjust for inflation, the income cutoff would be more than $77,000 a year.

Now on page six of my testimony, there's a chart for the from the Department of Taxation that shows just since the year 2000 how much there's been a drop in both the number of credits, renters credits that have gone out, and accordingly the amount of money that's gone out to our low wage renters.

And that is mostly because of that income eligibility cap that is just, you know, more and more people make more money just because of inflation and they can no longer qualify. So we definitely support the doubling from $50 to $100 for this renter's credit.

But we also suggest raising it just to keep up with inflation, so to at least $170 and then the eligibility cap to $77,000. And that doesn't even recognize how much rents have increased faster than wages since the last time it was adjusted. I hope you find my testimony helpful and please pass this bill. Thank you.

Thank you. We also got two individuals in support. Anyone online or in person wishing to testify on this matter. Members, any questions?

Question for DOX. Thanks for being here. Do you folks happen to have a revenue estimate for what this would cost?

Not at this moment, but I can get that for you.

That'd be great for the next Committee. I think they'd appreciate it. Thank you.

Thank you.

If there's any further questions. Seeing none. Last item on the agenda is HB2606 related to off site construction. Implement certain recommendations. Meet task force. Create a working group within the state political council to develop proposals for an offsite construction program. Vice Chair for the testimony.

OPSD with comments. Written testimony with comments. Thank you. Modular building Institute and support and one individual in support. Anyone online or in person wishing to testify on this matter before us?

Members, any questions?

Sure.

Yeah. Representative Cochran, I think.

Is it going to be. Is this going to be created for.

Sorry, who are you?

I'm trying to think. If it's OPSD, that would be like bringing in all the people for this.

No, I believe this would be to the State Building Code Council.

Oh, first. But they're part of it. So is State Building Code Council here?

No. State Building Code Council is currently disbanded.

Oh, so that has to be created.

Yeah. Gov's Emergency Proclamation has temporarily disbanded the State Building Code Council. They're in the process of mentioning that emergency proc. To bring the Building Code Council back. So I don't think right now there's probably no nobody from the State Building Council to address your question too, unfortunately.

Okay.

But OPSD did submit testimony, so you could see if they.

Yeah, no, I mean.

Okay, sure. Okay. Members, further questions? All right, seeing none.

Brief recess. Reconvening.

Reconvening our House Housing Committee hearing for decision making for our 9:30am agenda. The first item on the agenda is 832476. Proposing amendments to Article 7, Sections 12 and 13 of the Hawaii State Constitution. I recommend that we move out in HD1. That we clarify that the bonds are for infrastructure to support housing and community development.

The intention here is that these could be broadly utilized. So as long as they're supporting housing infrastructure in some capacity, then they would be applicable tech amendments for fair inconsistency and style and to defect the date. Members, any questions, comments or concerns? Seeing none. Vice Chair for the vote.

Voting on HB 2476. The recommendation is to pass with amendments. Chair and Vice Chair vote aye.

Representative Cochran?

Reservations, please.

Representative Grandinetti.

Aye.

Representative Kila. Representative Kitagawa.

Aye.

Representative Kitagawa.

Representative La Chica. Excused. Representative Muraoka.

Aye.

Aye.

Representative.

Sorry. Chair. Sorry, I was looking at my other. Can I? It's an aye for me. Sorry, I didn't mean reservations here. Sorry.

I got it. Thank you. Aye noted for Representative Cochran. The recommendation is adopted.

Thank you Vice Chair. Next item is HB2478 related bonds. I recommend we move this out with an HD one and that we create a new section in Chapter 46 to explicitly authorize counties to implement housing infrastructure growth bonds tech amendments for clarity, consistency, style and that we defect the date.

Members, questions, comments or concerns seeing non vice checker the vote voting on HB 2470 the recommendation is to pass with amendments noting the excuse absence from Rep. La Chica. Any reservations?

Sure.

Reservations for Brett Cochrane. Any no votes?

Recommendation is about. Thank you. Bye Chair, Next item on the agenda is HB2362 in the housing. I recommend that we move on to HD1. That we amend the Bill with tech amendments needed for already consistency and style and that we respect the date if there's any questions, comments or concerns.

Voting on HB2362 the recommendation is to pass with amendments. Any reservations? You know signal directors recommendation is adopted.

Next item is HB2385 relating to housing. I recommend that we move this out with an HD one that we defect the date and that we clarify in the Committee report that the intention is not to remove any county authority to authorize or approve GE exemptions and that we.