The Vacation Rental Issue

Stage being set for the future of Vacation Rentals on Molokai.
By Léo Azambuja

Transient Vacation Rentals, or TVRs, have a history of finding strong opposition from Molokai’s longtime residents. They have said in past public meetings that TVRs help push real state prices up, robbing the community of affordable housing. On the other hand, realtors who manage TVRs argue that they provide maintenance jobs to the community as well as rental options for visitors.

Last Wednesday the Molokai Planning Commission (MPC) board members welcomed Maui County’s Department of Planning staff in one of the longest and most crowded meetings the MPC has held at Mitchell Pauole Center. Approximately 50 residents attended the eigth-hour-long meeting, either to testify or to hear testimonies

A similar dynamic surrounds timeshare properties, which have also sparked mixed reactions in Hawaiian communities. While timeshares provide a more predictable source of revenue and ensure repeat visits from tourists, critics worry they further diminish the availability of affordable housing and lead to over-commercialization.

Legal experts, such as the Aaronson Law Group, have often been called upon to navigate disputes involving timeshare agreements, emphasizing the importance of informed decision-making for both property owners and potential buyers. The challenges tied to TVRs and timeshares illustrate the broader complexities of integrating tourism-driven models into tight-knit, traditional communities like Molokai.

The Department of Planning is proposing simple but important changes regarding regulation of Bed and Breakfasts (B&B) as well as Transient Vacation Rentals (TVR). Among several minor changes, proposed zoning changes could dramatically change the face of Molokai.

Department of Planning Director Jeffrey Hunt, making a rare appearance at the MPC meeting, explained the differences between TVRs, B&Bs and hybrids.

According to Hunt, TVRs are properties managed by rental company or by an owner who does not live in it ; B&Bs are managed by a live-in owner or manager. There are also hybrid properties. Hunt said this designation includes property with a B&B, plus an ohana dwelling which is used exclusively for short-term rental.

The proposed changes would allow TVRs to operate in business districts, potentially opening the doors to this kind of business in Kaunakakai. The proposal would also allow B&Bs to operate within rural and agricultural districts.

The county’s resolution to crack down on illegal TVRs could diminish their numbers in East Molokai, presumably fostering TVR growth in town. B&Bs, on the other hand, would still be allowed on the East End.

One of the biggest concerns regarding the proposed changes was that TVRs would be allowed to have up to 20 rooms. Vice-chairman Steven Chaikin said the number sounds small, but he mentioned The Lodge in Maunaloa. Hardly a small venue, the hotel has 22 rooms.

The community participation in planning commission meetings can have a great repercussion on the final say. Maui County staff planner Joe Alueta said the proposal is not set in stone. The Department of Planning comes to Molokai to listen to public testimonies and subsequent recommendations from the MPC.

Once public testimony was opened, over 30 speakers came forward, each presenting their point of view on how this kind of hospitality business affects Molokai.

“We received a lot of thoughtful testimony from both sides of the issue,” MPC chairman DeGray Vanderbilt said.

The MPC board has 120 days to make a decision on whether approve the county’s proposed recommendations. DeGray said that in future meetings, when TVR and B&B issues appear on the MPC meetings’ agenda, public testimony regarding the issue can be taken.

DeGray said the MPC board has not seen the agenda for the Oct. 24 meeting at the Mitchell Pauole Center, but expects it will include TVR and B&B issues. “Our commission (MPC) wants to have it in the next agenda,” he said.

In a press release Sept. 30, Mayor Charmaine Tavares said while Maui County has a history of supporting the visitor industry, many residents are against unregulated TVRs within rural and residential communities.

According to Tavares, the number of illegal TVRs in the county are close to 1,100. The official Maui County Web site lists only eight legal TVRs in the whole county. The only licensed TVR on Molokai belongs to MPC board member Kip Dunbar, and is located in Molokai’s East End. There are also only 13 legal B&Bs in the county, all of which are listed on Maui.

The mayor said a proposed bill to legalize TVRs was rejected by the Maui, Lanai and Molokai planning commissions. Respecting the communities’ decision, the County Council considered the bill in early 2007 and filed it rather than trying to adopt it.

According to the mayor’s press release, after the bill was rejected, the planning commissions and the council expressed that the county should enforce the existing law. “We accepted that direction and moved forward,” Tavares said in the press release.

But she also said those who applied under the previous administration hoping to be legalized are being given time to phase out operations. Meanwhile, the Planning Department is seeking approval of the new proposal.

Tavares assured each local planning commission will have a say in the proposed bill in order to meet the needs of the different islands.