Oct. 14, 2026, 8:30 a.m.
Lihue Civic Center
To: Kaua'i County Council
Mel Rapozo, Chair
KipuKai Kuali'i, Vice Chair
From: Grassroot Institute of Hawaii
Jonathan Helton, Senior Policy Analyst
RE: Bill 3009 — RELATING TO THE HOUSING POLICY FOR THE COUNTY OF KAUA'I
Aloha Chair Rapozo, Vice Chair Kuali'i and other members of the Council,
The Grassroot Institute of Hawaii supports Bill 3009, which would exempt additional rental units and guest houses from the county’s workforce housing policy.
Grassroot believes this legislation could encourage the construction of smaller, more affordable housing in areas already served by county infrastructure.
Kauai’s workforce housing policy generally requires that any residential development that contains or could contain more than ten units must provide at least 20% of those units as affordable housing.[1]
Unfortunately, this rule has discouraged all types of housing as homebuilders have found it hard to make a profit on such projects.[2] This rule has even caused issues for small projects.
Kauai’s zoning code typically allows up to four units — a combination of single-family homes, additional rental units and guest houses — per residential lot, so even a project creating three new lots could be subject to the workforce housing policy because those lots could hypothetically hold 12 units at some point in the future, even if the original builder only built six or seven units.
For the homebuilder, the alternative to constructing the required affordable units would be paying an in-lieu fee of between $83,080 and $218,240 per unit.[3]
These steep costs can sink projects before they begin. The bill notes that some homebuilders have resorted to adopting covenants prohibiting the future construction of ARUs or guest houses to avoid triggering the workforce housing rules.
The Council would also do well to review the workforce housing rules in their entirety. Although they were updated in 2020, they have not resulted in the creation of many — if any — affordable units.
Approved by the Legislature and Gov. Josh Green earlier this year, Act 211 (2026) requires all counties whose workforce housing requirements exceed 10% to meet several criteria, including a needs assessment that evaluates the financial feasibility of building a project under a workforce housing program and explains how the required affordable housing units are "substantially related to the needs arising from the development,” among other criteria.[4]
But even on its own, Bill 3009 is a commonsense piece of legislation that would empower homeowners with another tool to help solve the housing crisis: their own backyards.
Thank you again for the opportunity to testify.
Jonathan Helton
Senior Policy Analyst
Grassroot Institute of Hawaii
1050 Bishop St. #508 | Honolulu, HI 96813 | 808-864-1776 | info@grassrootinstitute.org
[1] § 7A-2.1General Requirements., Kauai County Code, accessed Oct. 8, 2026.
[2] Arjuna Heim, “We need to talk about inclusionary zoning,” Hawaii Appleseed Center for Law & Economic Justice, Aug. 13, 2025.
[3] § 7A-3.1Satisfaction Alternatives., Kauai County Code, accessed Oct. 8, 2026.
[4] § 46-143 Impact fee calculation., Hawaii Revised Statutes, accessed Oct. 8, 2026.
