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Relief Needed From Costly Government Regulations

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By Lowell L. Kalapa

(Released on 06/10/07)

Observers often wonder why it is so costly to live in Hawaii, from affordable housing to the prices at the pump and those on our store shelves. Everything seems to cost more in Hawaii.

While that high cost is due in great part to the fact that Hawaii has a general excise tax as opposed to a retail sales tax, there are other insidious ways government contributes to that higher cost of living. For example, we know that less than 5% of the total landmass of Hawaii is zoned for urban use. As a result, land that can be developed is limited and, therefore, following the law of supply and demand, the cost of housing as well as retail stores and warehouses, is very costly, all of which, in the latter case, gets passed on to the ultimate consumer.

To a large degree, this has been a mandate of government, first through the land use commission and then through the constitutional convention of 1978 which mandated that important agricultural lands be preserved for agriculture. And there is nothing wrong with that, it is just that our community leaders and planners need to realize that in order to preserve as much of the natural beauty of Hawaii as possible, we may have to damage some of the view planes by going vertical with housing, maximizing what urbanized land there is for housing and development for commercial use. Ah, but government policies stand in the way of creative thinking, thus causing what development there is to become more expensive.

And just getting from raw land to housing or commercial development is an arduous task, if not a costly one. Shuttling from one government agency to another in order to get permits and approvals can take years. In the case of a self-help housing project on Kauai which involved just 17 units, it took more than five years to secure all those permits. If that nonprofit organization that assisted those 17 families was a for profit company, the cost of the five-year wait would have to been built into the final cost of the houses that will be built.

On the other hand, we should not follow the suggestion of the chair of the housing committee who suggested that in order to encourage the building of affordable rental housing, permitting should be waived. Ah, permitting does serve a purpose insofar as health and safety issues. It is just the process to secure those permits and approvals that should be streamlined. But to get to that point, a lot of toes will be stepped on as each agency as part of the greater public bureaucracy has its own turf.

In order to streamline the permitting and approval process, it will take a strong political leader or leaders to overcome the turf battles and bring all the agencies that have oversight together. Why should the inspection of a child care center take months because one has to schedule the various inspections in the right order to make sure the fire inspection follows the electrical inspection that follows the plumbing inspection and so on.

As one developer dreamed, wouldn’t it be wonderful if a developer had to make only one presentation of his plans rather than repeating the same information over and over again as each oversight agency is cajoled into approval. What if the political leaders of our state and counties mandated that every single oversight agency be convened in one room at the Hawaii Convention Center and no one could leave until the project was signed off and approved? Novel idea isn’t it?

As one looks across the Honolulu plain today, what was once a barren wasteland of hot dry marsh now sprouts new growth of concrete and steel. While not everyone will agree that it is a pleasant sight, one has to agree that the most recent construction will provide thousands of units of residential housing albeit somewhat pricey. But what it does underscore is that many of these massive high rises could not have been built had there not been substantial parcels of land under the control of a single owner.

The lesson to be applied here is that Honolulu could increase its inventory of available housing if, in fact, what is now three and four story walk-ups could be redeveloped into multi story structures. Unfortunately, many of the parcels that dot neighborhoods like McCully and Makiki are too small to provide sufficient square footage for a high-rise. What if lawmakers could provide incentives to these landowners to consolidate their properties so that a high rise providing four or five times as many units with lots of green space around could be built?

Controlling the rising cost of living in Hawaii, be it higher prices at the grocery store or more affordable housing, is within reach. We just need a lot more creative thinkers and a lot of political will.

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