‘Starter homes’ bill, HB1630 HD1, deserves wide support

The following testimony was submitted by the Grassroot Institute of Hawaii for consideration by the House Committees on Housing, Water and Land and Judiciary and Hawaiian Affairs on Feb. 12, 2024.

Feb. 12,  2024, 2:30 p.m.
Hawaii State Capitol
Conference Room 325 and Videoconference

To: House Committee on Housing
      Rep. Luke A. Evslin, Chair
      Rep. Micah P.K. Aiu, Vice-Chair

      House Committee on Water & Land
      Rep. Linda Ichiyama, Chair
      Rep. Mahina Poepoe, Vice-Chair

      House Committee on Judiciary & Hawaiian Affairs
      Rep. David A. Tarnas, Chair
      Rep. Gregg Takayama, Vice-Chair

  From: Grassroot Institute of Hawaii
             Ted Kefalas, Director of Strategic Campaigns


Aloha Chairs Evslin, Ichiyama and Tarnas, Vice-Chairs and Committee Members,

The Grassroot Institute of Hawaii would like to offer its strong support for HB1630 HD1, a far-reaching bill that seeks to increase Hawaii’s housing supply by removing many of the barriers to the construction of smaller and more economical units, commonly known as “starter homes” or “missing middle housing.”

Every element of this bill reflects the growing consensus among housing experts that zoning reform is essential to increasing housing supply.

In a recent Grassroot Institute report, “How to facilitate more homebuilding in Hawaii,” policy researcher Jonathan Helton specifically addressed many of the provisions found in this bill.[1]

Specifically, this bill would permit the construction of more than one home per residential lot in urban districts; remove barriers to accessory dwelling units; provide for the subdivision of lots; and reform impact fees to prevent them from being a barrier to development.

Currently, minimum lot sizes for homes in Hawaii range from 3,500 square feet for a single family-home to 10,000 square feet for a duplex or multi-family unit. These large lot requirements are intended to guarantee a certain amount of yard space. However, they inadvertently incentivize the creation of larger, more expensive homes.

As Helton wrote in the Grassroot brief:

“Faced with having to provide a certain amount of land for each home, it makes logical sense that many homebuilders would build the largest houses allowable to maximize their profitability. If smaller lots were allowed, thus reducing project costs, homebuilders would find it financially feasible to build smaller, less expensive homes”[2]

However, allowing smaller lots would also necessitate adjustments to the rules regarding setbacks and floor area ratios, which this bill includes.

In addition, HB1630 takes a sensible approach to impact fees, which are just one more element that can add to the cost of construction.

Specifically, this bill would allow impact fees to be calculated based on a development’s square footage. In addition, it would minimize additional fees on the conversion of an existing structure and allow for the calculation of water/sewage fees based on the number of fixtures in the development.

In short, this bill has the potential to increase Hawaii’s housing supply and bring down the cost to rent or buy a home. That alone makes it one of the most important pieces of legislation being heard in the Legislature this year.

We strongly urge you to adopt HB1630 HD1.

Thank you for the opportunity to testify.

Ted Kefalas
Director of Strategic Campaigns
Grassroot Institute of Hawaii

[1] Jonathan Helton, “How to facilitate more homebuilding in Hawaii,” Grassroot Institute of Hawaii, December 2023.
[2] Ibid, p. 6.

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