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​Maui housing bill seriously flawed in July, and even more so now
By Grassroot Institute @ 10:13 PM :: 1041 Views :: Maui County, Development, Land Use, Cost of Living

Maui housing bill seriously flawed in July, and even more so now

An amendment seeks to subsidize homebuyers, leaving open whom would qualify and how much taxpayers would be in for

News Release from Grassroot Institute, Sept 15, 2022

An affordable housing bill that was "recommitted" by the Maui County in July is coming back for review on Tuesday, but the bill is still seriously flawed, if not worse than before.

In July, Joe Kent, institute executive vice president, submitted written and oral testimony regarding Bill 107, which at the time sought only to establish “a new method of determining the sales price of an affordable dwelling unit," by including "the total housing costs associated with home ownership such as principal, interest, taxes, homeowner’s insurance, private mortgage insurance and homeowner’s association dues.” 

Kent said at the time that the bill, "though well-intentioned, could cause homebuilders to stop building affordable homes … because [it] would reduce the sale price of a home by approximately 20% to 22%, which would virtually wipe out any profit homebuilders currently enjoy and significantly reduce the financial incentive for homebuilders to invest in projects."

Now the bill is back, more complicated and problematic than ever, stating additionally that it would create a program to "subsidize homebuyers when a developer does not receive direct County subsidies."

In his latest testimony, Kent pointed out that such subsidies would either be "insufficient to cover homebuilders’ losses due to the price cap, or would commit the County to massive spending increases. The latter option is probable, since the subsidy’s design is unclear and the cost of producing housing on Maui continues to increase." 

He concluded: "In light of the uncertainty surrounding the financial aspects of Bill 107, I suggest the Council take the time to study the full potential effects of this ordinance on the local economy and Hawaii’s housing market as a whole. Rushing this bill through would only create heavy-handed and costly regulations — the opposite of what is needed to provide more housing for Maui residents."

Meanwhile, we are reminded of the words of the great French economist Frédéric Bastiat (1801-1850): "We have tried so many things; when shall we try the simplest of all: freedom?"


July 24, 2022: Affordable? Maui Price Fixing Bill 'Recommitted'



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