STAND. COM. REP. NO. 523

Honolulu, Hawaii

RE: S.B. No. 4

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-First State Legislature

Regular Session of 2021

State of Hawaii

Sir:

Your Committee on Housing, to which was referred S.B. No. 4 entitled:

"A BILL FOR AN ACT RELATING TO INCLUSIONARY ZONING,"

begs leave to report as follows:

The purpose and intent of this measure is to:

(1) Prohibit any law, ordinance, or rule from imposing an inclusionary zoning requirement on housing offered exclusively for sale in perpetuity to certain buyers; and

(2) Require each county to submit a report on inclusionary zoning requirements to the Legislature every year until the Regular Session of 2026.

Your Committee received testimony in support of this measure from the Maui Chamber of Commerce, Faith Action Housing NOW!, and two individuals.

Your Committee finds that inclusionary zoning, which requires developers to sell housing units at below-market rates to low-income households, acts as a tax on developers because it reduces their revenues. A 2010 study by the University of Hawaii analyzed inclusionary zoning policies around the United States and found that inclusionary zoning policies overwhelmingly resulted in both increased market price of housing and decreased housing units available. This measure will help Hawaii families by exempting them from inclusionary zoning policies provided that the housing buyer is a Hawaii resident who will occupy the unit and does not own any other real property.

Your Committee has amended this measure by:

(1) Removing the repeal date; and

(2) Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

As affirmed by the record of votes of the members of your Committee on Housing that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 4, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 4, S.D. 1, and be referred to your Committee on Judiciary.

Respectfully submitted on behalf of the members of the Committee on Housing,

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STANLEY CHANG, Chair