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The Honolulu Advertiser
Posted on: Monday, December 4, 2006

Probe won't solve transient rental issue

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The state has launched an investigation to learn whether real estate professionals are violating their licenses by promoting illegal transient vacation unit and bed-and-breakfast accommodations. The inquiry by the state Regulated Industries Complaint Office was driven by Keep It Kailua, a group established in one of the communities where the conflict is most acute.

While that probe is well-founded — officials shouldn't condone this activity by property managers under state supervision — it won't untangle this knotty zoning battle.

The solution has so far eluded city officials, but it still rests squarely in their laps.

The central issue is one of property rights. Proponents of vacation rentals say that this option enables them to manage property taxes and other burdens in high-cost Hawai'i. They also rightly point to this form of accommodation as being common in tourist destinations around the world.

But Hawai'i faces particular limitations that aren't so common. Specifically, lot sizes here are so small that the arrival and departure of guests in a residential neighborhood are much more noticeable to the long-term residents than they might be in less densely populated communities.

There ought to be a way to allow more legal short-term rentals on O'ahu, but it's clear the city isn't yet equipped to open the door. First there needs to be enough staffing to enforce the licenses of accommodations already operating when the city stopped issuing licenses in 1989.

A limit on the number of licensed units ought to be established, and strict requirements that owners are on-site or responsive to complaints, paired with stiff fines for violations, should be in place.

Honolulu's not there yet. Meanwhile, grassroots organizations such as Keep It Kailua feel driven to police the situation. Volunteer enforcement with less-than-perfect consistency and effectiveness is not a solution.

But if nothing else, the RICO probe may illuminate how much of the transient vacation industry is a mom-and-pop web of single-family homes, and how much of it is driven by larger economic interests.