The Honolulu City Council's failure yesterday to allow more legalized bed-and -breakfast operations on O'ahu won't result in a decline in B&Bs, according to the leader of a group that's been pushing the legislation.

A 1989 moratorium stopped new permits from being issued for B&Bs. There are just over 50 legal B&Bs on the island today. The bill before council members yesterday would have allowed for a total of 1,250 permits.

Yesterday's vote was the closest the council has come to ending the ban, and organizers on both sides of the debate say they don't know when it will come back again.

"The status quo means we just go back to renting and hiding out," said Angie Larson, president of the Hawaii Vacation Rental Owners Association .

Larson said her contracts state her rentals are for 30 days at a time, making her operation within the law. "But other people are desperately needing the extra income, and they're going to continue to do what they need to do."

The council deadlocked yesterday at 4-4, failing to pass out Bill 08-07. The bill would have allowed new B&B permits to be issued by the Department of Planning and Permitting. Because the city Planning Commission had recommended against the bill, six of the nine council members needed to approve the bill for it to be moved to Mayor Mufi Hannemann's desk.

Members Ikaika Anderson, Todd Apo, Nestor Garcia and Rod Tam voted for the measure. Members Donovan Dela Cruz, Charles Djou, Ann Kobayashi and Gary Okino were opposed.

Councilman Romy Cachola was absent.

The measure would have allowed for up to 1,250 B&B permits islandwide, no more than a third of them in any council district.

Only owner-occupants would have been eligible to apply for a special use permit. The permit would have allowed up to three B&B units per property with a maximum of two guests per unit. Off-street parking would have been required.

Anderson, whose Windward district is among those with the highest number of B&Bs, said the draft before the council yesterday that he sponsored offered a reasonable compromise.

"The goal is to reach a middle ground" by allowing limited permitting with stronger enforcement, Anderson said.

COST TO CITY

David Tanoue, the city's director of planning and permitting, estimated it would take up to $300,000 and a new division of five new employees to administer a new permitting process.

Okino said he favors allowing a limited amount of B&B permits to be issued, but the version before the council yesterday allowed for too many.

A former city planner, Okino said he was most worried about the potential for the clustering of bed and breakfast operators in popular neighborhoods.

"I'm not totally opposed to bed and breakfasts. What I'm (concerned about) is maintaining the integrity of our residential zoning," Okino said. "I think it can be compatible if it's very limited."

Okino has tried unsuccessfully to apply a geographical "spacing" clause requiring B&Bs be at least 300 feet from each other.

Forty people testified in favor of the bill, 30 against.

BUSINESS VIEW

Supporters said B&Bs provide a necessary service for the community, help bring business into an area, and allow a source of income for homeowners trying to stay financially afloat.

Kailua businessman Bob Twogood said businesses in the town would suffer greatly if B&Bs did not exist. B&B guests are different from other Hawai'i visitors, he said. "The people who come to stay at these rentals are people who (otherwise) wouldn't come to O'ahu."

Opponents, however, said B&Bs disrupt the fabric of neighborhoods, take away from the existing housing inventory and compete with mainstream hotels and resorts. At least half a dozen neighborhood boards took positions against allowing new B&Bs.

Stu Simmons, head of Keep It Kailua, said the council made the right decision.

"We appreciate that they understand that residential zoning should be for residences," Simmons said. "We appreciate the fact that we have a terrible housing crunch and people can't afford to live in their homes (but) these homes should be used for long-term renters."

The opposition was about more than just noise and parking, he said.

"The issue is we want to keep the residential character of neighborhoods. We want to have neighborhood kids for our kids to play with," he said.