A solution to bring housing costs down
WAILUKU – Chairing the County Council’s Temporary Investigative Group (TIG) on Increasing Housing Inventory last year gave me clarity about steps needed toward solving our housing crisis.
The cost of improving offsite infrastructure has been identified as a major contributor to the high cost of housing. The Maui County Code requires developers to bear the full burden of the cost of improving offsite infrastructure. This is a large contributor to why a two-bedroom, one-bath home can cost half-a-million dollars.
A sizeable portion of a project’s budget goes to developing offsite infrastructure like water and sewer improvements, traffic lights, drainage, curbs, gutters, roadways and bike lanes. For example, the 100 percent affordable Kenolio Apartments in Kihei, which was approved in October 2015, is having problems because of offsite infrastructure requirements, according to our county housing administrator. That’s 184 rental units desperately needed by our community that are on hold.
If the county could make a solid commitment to fund the development of its own infrastructure – rather than relying upon private developers to shoulder the entire burden – we would encourage the construction of more units and bring housing costs down.
The Infrastructure and Environmental Management Committee recently discussed the logistics of funding infrastructure projects that would support the development of affordable housing, and it was determined that the council could appropriate funds to pay for these needs during budget session, which is happening now. Based on our TIG recommendations, community input and comments from the Infrastructure and Environmental Management Committee members, I’d like to make this action a priority during budget deliberations.
Currently, 2 percent of Real Property Tax goes to the Affordable Housing Fund, which amounts to about $5 million per year. I’d like to propose that we increase that amount to 4 percent and earmark half of it for infrastructure needs that will support affordable housing projects, with preference to units that will be affordable in perpetuity.
Funding will come in the form of a grant that developers can apply for, with specific criteria and qualification requirements that would be considered and approved by the council. Very recently, a nonprofit affordable housing project in Wailuku was stalled because of the high cost of required offsite waterline improvements. A grant given to the project by the county allowed the 16-unit project to continue moving forward.
This kind of offsite infrastructure grant will achieve a public-private partnership to facilitate quick completion of much-needed housing units. This is just one of many new, out-of-the-box solutions that I will continue to act on in response to the TIG recommendations and input from the community.
Please share your thoughts, questions or support for this matter. The West Maui budget hearing will take place on Monday, April 17, at 6 p.m. at the Lahaina Civic Center, or you can e-mail your thoughts to email@example.com.