State cuts deal for low-cost rentals

By Jaymes Song
Associated Press

Some senior citizens may remember when rent for a new one-bedroom apartment in Waikiki was $368 a month, or $310 in Kihei, Maui.

Six developers were awarded $4.1 million in federal and state tax credits and $13 million in low-interest loans to provide 323 affordable housing rentals across Hawai'i, including properties in Waikiki and Kihei, state officials announced yesterday.

Five new affordable housing units are being built on Maui, O'ahu and the Big Island. Another agreement keeps the Lihu'e Gardens Elderly Apartments on Kaua'i as an affordable housing project for another 50 years, according to the Housing and Community Development Corp. of Hawai'i.

"There is a critical need for more affordable housing rentals throughout the state, and these partnerships with private developers will increase the housing inventory to help meet this long-overdue need," said Gov. Linda Lingle.

Five of the six affordable housing projects are for senior citizens, and one is designated for low-income families. Unlike public housing, the six projects will be built and operated by private companies.

Rent will be $700 and $800, but seven of the two-bedroom units will be offered for $363 a month for families making no more than 30 percent of the area median gross income (AMGI), which the federal government considers extremely low income.

The only project for families will be Palehua Terrace Phase 2 in Makakilo.

To qualify for Palehua Terrace, families must earn no more than 60 percent of the AMGI, or about $40,000 for a family of four, said Marvin Awaya of the Pacific Housing Assistance Corp., which will oversee the project.

Awaya said many families who cannot afford decent housing in Hawai'i are "doubling up" in homes, taking second or third jobs or "hanging on barely."

"When the median sales price of a home is in the neighborhood of half a million dollars, and when the rental price for a one-bedroom unit on O'ahu is over $900 per month, those kinds of rates make it difficult not only for elderly, but also working families," he said. "I'm afraid that will affect our economy in some point in time."

Without adequate affordable housing, low-income wage earners, such as those in the service industry, will move away or stay away from Hawai'i, Awaya said.

"And with the low unemployment rate now, we have the perfect storm brewing."

Jean Brooks of the nonprofit Hale Mahaolu Ekiku LP said the new project in Kihei would alleviate some of the demand for affordable housing in the area.

"We have 11 developments on three different islands, yet we have never been able to get into the community of Kihei," she said. "We had many requests from citizens of Kihei to help with elder services, and with the cooperation and reception of these tax credits,we think we can finally get in there and do what the community of Kihei is requesting."

Lingle said the projects announced are not enough.

"We're going to have to repeat today's events many times over in the years ahead in order to make a dent in the demand for affordable housing," she said.