Hawaii County Council approves Bill 39 to adjust affordable housing rental rates

A significant shift in Hawaii County's affordable housing strategy was approved during the County Council meeting on May 7, 2025, as members voted to pass Resolution 168-25. This resolution aims to enhance community programming and support for affordable housing initiatives, particularly in South Kona, where a local organization is set to provide diverse educational and cultural programming.

The council's discussions also centered around Bill 39, which proposes changes to rental rates based on the Area Median Income (AMI). The proposed rate for one-bedroom units is set at $1,663, which raised concerns among council members regarding its implications for various ZIP codes across the island. Notably, 22 ZIP codes currently have market rental rates lower than this proposed rate, leading to fears that the new policy could inadvertently benefit landlords charging above-market rates while potentially reducing tax revenue for the county.

Council Member Kaguara expressed apprehension that the bill might not effectively address the disparity between East and West Hawaii, where rental markets differ significantly. The discussion highlighted the need for a more nuanced approach, with suggestions for potentially establishing different rental rates for various regions to better reflect local market conditions.

Housing Administrator Kejal Costa clarified that the intention behind the bill is to decouple the affordable rental housing program from outdated payment standards, allowing for more stable and predictable rental rates. However, concerns remain about whether this change will genuinely increase affordable housing availability or simply shift the burden of higher rents onto East Hawaii residents.

As the council moves forward, members emphasized the importance of continued dialogue and research to ensure that the new policies effectively balance the needs of both sides of the island while fostering a fair and equitable housing market. The resolution and bill will undergo further scrutiny as they progress to the next stages of approval.