The following testimony was submitted by the Grassroot Institute of Hawaii for consideration by the House Committee Housing on March 14, 2025.
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March 14, 2025, 9 a.m.
Hawaii State Capitol
Conference Room 430 and Videoconference
To: House Committee on Housing
Rep. Luke Evslin, Chair
Rep. Tyson Miyake, Vice Chair
From: Grassroot Institute of Hawaii
Ted Kefalas, Director of Strategic Campaigns
RE: SB38 SD2 — RELATING TO HOUSING
Aloha Chair Evslin, Vice-Chair Miyake and other members of the Committee,
The Grassroot Institute of Hawaii supports SB38 SD2, which would prohibit Hawaii’s county councils from adding requirements that increase costs for a 201H affordable housing project approved by the Hawaii Housing Finance and Development Corp.
As we all know, Hawaii’s housing shortage is already acute, and adding requirements that increase homebuilding costs is not going to help.
The Hawaii Department of Business, Economic Development and Tourism pointed out in a March 2024 report that Hawaii needs an average of 3,297 new housing units per year to satisfy demand between 2025 and 2035.[1]
Researchers at The Economic Research Organization at the University of Hawai‘i have identified that Hawaii’s housing regulations are the strictest in the country and a key driver of Hawaii’s housing crisis.[2] Relevant to SB38, they found that Hawaii’s “local political pressure” on housing developments ranks in the top 5% of communities surveyed.[3]
UHERO research has also estimated that regulations comprise 58% of the cost of new condominium construction.[4]
In other words, if reducing the power of Hawaii’s county councils over state-approved affordable housing projects could help lower construction costs, then we should do it.
Thank you for the opportunity to testify.
Ted Kefalas
Director of Strategic Campaigns
Grassroot Institute of Hawaii
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[1] “Hawai‘i Housing Demand: 2025-2035,” Research and Economic Analysis Division, Hawaii Department of Business, Economic Development and Tourism, March 2024, p. 2.
[2] Rachel Inafuku, Justin Tyndall and Carl Bonham, “Measuring the Burden of Housing Regulation in Hawaii,” The Economic Research Organization at the University of Hawai‘i, April 14, 2022, p. 5.
[3] Ibid, p. 6.
[4] Justin Tyndall and Emi Kim, “Why are Condominiums so Expensive in Hawai‘i?” The Economic Research Organization at the University of Hawai‘i, May 2024, p. 11.
