By amending Section 46-15.1 of the Hawaii Revised Statutes, the bill empowers counties to independently develop and provide low- and moderate-income housing projects while maintaining certain restrictions. It allows counties to develop and construct housing, acquire land, and issue tax exemptions, thereby streamlining processes that have previously hindered effective housing solutions. The bill also incorporates provisions for transferring affordable housing credits, providing a mechanism for counties to incentivize the development of affordable housing units that meet specific income requirements.
House Bill 678 addresses the urgent housing crisis in Hawaii, which necessitates the construction of over 50,000 new homes by 2025 according to a 2019 study by the Department of Business, Economic Development, and Tourism. The bill highlights the significant increases in mortgage and construction loan interest rates which have made existing financing laws, particularly Chapter 201H, ineffective for home builders. This legislation aims to create a new source of interim financing specifically for affordable housing projects, enabling counties to utilize powers similar to those of the Hawaii Housing Finance and Development Corporation to stimulate housing development.
Discussion surrounding HB 678 has been marked by concerns over its implications for local governance and community needs. While proponents argue that it provides much-needed flexibility to county governments to tackle the housing shortage efficiently, critics worry that the expansion of county powers might lead to disparities in how housing needs are addressed across different locales. Additionally, the limited duration of the bill, set to sunset in 2028, raises questions about the long-term sustainability of the measures being introduced.