Adaniya, a support worker for the nonprofit agency Hawai'i Families As Allies, briefly considered renting a van that her family would be able to park in the back yard of a generous co-worker. For a time, the three moved in with Adaniya's adult daughter, her boyfriend and two kids in their two-bedroom unit.

But she lucked out and became eligible to rent a brand-new, two-bedroom unit in the Palehua Terrace affordable rental complex in Makakilo for $700 a month. At market prices, such a unit would probably rent for $1,200, she said.

Everyone at the State Capitol this year wants to see more affordable homes built to help families like the Adaniyas.

But exactly what an "affordable" house is and how best to get one built are what lawmakers and the Lingle administration are continuing to wrestle with as the Legislature draws to a close in the next three weeks.

The Housing and Community Development Corp. of Hawai'i defines affordable housing as a unit offered for sale or rent to people earning 140 percent or less of their community's median income. The median income for a family of four on O'ahu is about $52,500 a year.

The affordable housing package offered by House leaders focuses on those families making below 80 percent of that, or about $42,000 a year, and provides incentives for providers of affordable housing.

"If you look at the studies, they show that almost half of the needs are for 80 percent of the median family income and below," said Rep. Mike Kahikina, D-44th (Nanakuli, Honokai Hale).

The Senate plan is geared toward helping a broader spectrum of families and offers incentives for providing homes that target families making up to 140 percent of the median, or up to about $92,000 annually.

"The housing package that we have moved ... would provide additional funds to construct housing for various population groups including homeless and transitional housing, as well as housing for senior citizens, low-income residents, the working poor and the middle class, many of whom are unable to afford market-priced housing," said Sen. Ron Menor, D-17th (Mililani, Waipi'o).

The Lingle administration, while not in total agreement with the Senate plan, believes it is preferable to the House version.

STATE RENTAL HOUSING TRUST FUND

The state's Rental Housing Trust Fund provides low-interest loans or grants to qualified landowners and developers who build affordable housing units. It's at the center of much of the affordable housing discussion this year.

To qualify, at least half the units in a project must be set aside for those families making 60 percent of the median and none of the units can be for families making more than 100 percent of the median.

The House proposal calls for giving first priority for the loans and grants to developers who dedicate at least half of their units for those making less than 80 percent of the median, and second priority to "mixed income" projects in which all units are set aside for families making up to 140 percent of the median.

For developers who dedicate at least half of their units for families making less than 80 percent of the median income, the House bill also offers an exemption from general excise taxes.

The Senate version allows for greater flexibility in the types of units. In order to qualify for the fund, all units can be priced for those making up to 140 percent of the median. The Senate plan does not offer any excise-tax exemptions.

Menor said he may be agreeable to an excise-tax exemption.

Kahikina said the Senate proposal offers no guarantee for a developer to provide housing for those making less than 140 percent of the median. "It would be hard to see a trickle down if you just serve the so-called working class," Kahikina said. "We want to address the working class but we sure don't want to take away any safeguards for the very needy."

But Menor argued the opposite view, noting that a developer needs the flexibility to develop higher-priced units for a project to pencil out. "If we adopt limitations in our bill that are too restrictive, the concern I have is that the private sector will not get more involved in developing affordable housing," he said. Menor's view is supported by the Lingle administration.

"The economics of being able to build a project essentially means that you have to build houses that you're selling to people at 140 percent of the median income to help subsidize the housing you're building and selling to people who maybe are at 60 percent or 80 percent, or even 30 percent," said Linda Smith, the governor's senior policy adviser.

CONVEYANCE TAX CONTRIBUTIONS

The state charges a tax whenever a property is transferred, or "conveyed," from one party to another. Currently, 25 percent of conveyance taxes collected go to the Rental Housing Trust Fund, or about $15 million annually.

The House plan aims to increase the conveyance tax rates for all property sold at more than $600,000, or as a second home or investment property regardless of the value. House leaders estimate the increase would add $5 million in revenues, up to $2 million of which would go into the rental fund.

The Senate proposal does not increase the conveyance tax rates, but instead ups the share of conveyance taxes going into the Rental Housing Trust Fund from 25 percent to 50 percent. That plan would also increase the amount going into the rental fund by about $2 million.

House leaders said their proposal, unlike the Senate plan, does not take dollars away from the state general fund but instead would add to it. Just a small segment of the real-estate market would be affected, they said, because only 7 percent of all transactions are in excess of $600,000.

But senators and the administration believe developers who testified that increasing the tax on higher-end homes would have an overall dampening affect on the housing market.

"We're open to looking at that issue as well in conference," Menor said, adding that the $600,000 threshold proposed by the House for the additional tax to kick in may be too low in today's market, where the median sales price of single-family homes is $550,000.

Laura Thielen, executive director for the Affordable Housing and Homeless Alliance, said neither plan provides enough for the Rental House Trust Fund, a key for many affordable projects to take off. Thielen wants lawmakers to impose a sliding scale increase on conveyance taxes paid on homes valued at $600,000 or more. Higher-priced homes, such as those $1 million or more, would pay a higher rate than a home in the $600,000 category. Instead of only $2 million more for the rental fund, such a plan would more than double the net, Thielen said.

Lingle and Republicans in both houses, for the most part, endorse the Senate proposal but want additional provisions.

Lingle wants the bill to include language that bars the Legislature from raiding money out of the eight housing-related funds.

The administration also wants to offer incentives for developers to move quickly. It wants lawmakers to provide a general excise-tax waiver of up to $4,000 to developers on the next 2,500 units geared to families making 140 percent of the median and less.

So far, however, that plan has received little enthusiasm in the House and was nixed by the Ways and Means Committee in the Senate.

NEED FOR BOTH LOW- AND MODERATE-INCOME HOUSING

Marvin Awaya's Pacific Housing Assistance Corp. put up the 64-unit Palehua Terrace Phase 2 where Jonni Adaniya now lives. To do so, Awaya needed tax credits and low-interest loans like the ones being discussed now by lawmakers.

Awaya said that while the House and Senate packages differ in what they do, both address critical housing needs. The Senate package, by looking at the 140 percent of median and below category, is addressing the need to help those in the gap group ready to pay a mortgage but facing sticker shock from rising sales prices, he said. The House package, meanwhile, focuses more on providing rentals for those with the most basic needs.

"It's not one or the other," Awaya said. "They're in two different realms here; one concentrates on for-sale units, the other concentrates on rentals. They're both problem areas right now in housing."

The Rev. Thomas Couch of the House of Angels ministry in Wai'anae said that given the needs of Leeward Coast residents, any affordable housing plan that comes out of the Legislature would help.

There are growing numbers of homeless people at Poka'i Bay, Kea'au Beach Park and other sites along the coast, Couch said. And while a good portion of that population consists of those who choose to live at the beach, "there's more that don't want to be there now. There's the working class, the working houseless," he said. Rising home prices caused by investors have strangled the rental market and forced them to the parks and beaches.

"There's hundreds of them, bruddah, and it gets worse all the time."