Hawaii counties differ in approach to regulating vacation rentals

New state legislation empowering counties to reduce or phase out short-term vacation rentals has prompted various responses, with no immediate action expected, even on Maui, where reforms were inspired by housing needs following the August 8 wildfires.

Senate Bill 2919, now Act 017, signed by Gov. Josh Green on May 3, allows counties to regulate the “time, place, manner, and duration” of land uses, clarifying that transient accommodations are not residential and may be phased out. Effective January 1, it also expands the transient accommodations tax to include certain shelters and vehicles. Counties need time to develop policies due to public vetting and legal considerations.

Kauai is maintaining its current approach, while Oahu is assessing the law’s implications. Hawaii County Council Chair Heather Kimball stated the Council does not plan to use the new law to phase out vacation rentals but hopes it will ease objections to bills closing rental loopholes.

Mayor Richard Bissen of Maui proposed phasing out 2,200 vacation rentals in West Maui by July 1, 2025, and all 7,000 units in apartment districts across Maui, announced on May 2. This proposal needs to go through planning commissions before reaching the full Maui County Council.

Oahu hasn’t announced actions yet, but changes are expected. The law aims to clarify a pre-statehood 1957 law used in a recent court case against Honolulu. Honolulu is considering administrative rules and rental duration policies.

Kauai continues efforts to address illegal short-term rentals through proactive enforcement and agreements with third-party platforms, significantly reducing illegal rentals.