SB66 HD1

SECTION 1. The legislature finds that the State is facing a housing shortage. A 2019 study commissioned by the department of business, economic development, and tourism found that, using high scenario projections, the State will require an additional 46,573 homes by the year 2030, with the city and county of Honolulu requiring 21,392 new units; Hawaii county requiring 13,527 new units; Maui county requiring 8,515 new units; and Kauai county requiring 3,138 new units.

The legislature further finds that some of the largest obstacles for developers to construct more housing in the State are:

(1) A lack of areas with proper zoning to allow for the construction of residential dwellings;

(2) A lack of infrastructure to support newly developed residential dwellings; and

(3) Delays in the issuance of building permits for single‑family and multi-family projects.

The building permit processing times for single-family and multi-family projects vary tremendously across the United States. However, the counties in Hawaii seem to have some of the longest processing times for residential building permits. An April 2022 study prepared by the university of Hawaii economic research organization found that, on average, Hawaii homebuilders wait three times longer for permits than those in other states, which drives up costs significantly and creates uncertainty, serving as a disincentive to build new projects. Furthermore, the study found that compared to the most regulated markets in the country, Hawaii's permit delays are almost two times longer, meaning it can take from one year to one and a half years for a permit to be approved.

The legislature also finds that lengthy processing times to obtain a building permit raises the question: What information is necessary for counties when processing building permit applications? The basic responsibilities of the counties are to ensure compliance with various building codes and ensure adequate infrastructure capacity to support the proposed project or development. Although the counties are responsible to monitor for compliance with various building codes, if the construction plans do not satisfy the code and are not corrected before construction, the designer (a licensed professional who stamped the plans) and the contractor are ultimately responsible. A county is also not typically involved in litigation as the building permit process is ministerial, mainly to check for code compliance.

In other municipalities around the country, building plans are not scrutinized to the extent that they are in Hawaii counties. In Hawaii, the plan review is to ensure that the design meets all applicable codes. However, in other municipalities, the plans are used as a guide while code compliance verification is completed upon inspection of the project during construction. Inspectors who find that construction does not satisfy the code either have the correction made in the field or stop construction until proper corrective actions have been taken to ensure that new construction meets the code. Ultimately, the design professional and contractor are responsible to ensure new construction meets all applicable codes.

Accordingly, the purpose of this Act is to require permits to be issued within sixty days for certain single-family and multi-family projects if certain conditions are satisfied.

SECTION 2. Chapter 46, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§46- Single-family and multi-family permit applications; review time limit. (a) For single-family and multi-family projects in each county, a permit shall be issued within sixty days of a complete application being filed containing plans and specifications that are in compliance with all relevant codes and standards for the respective county. The completed application shall include a statement from the relevant permitting agency that adequate infrastructure capacity is available to service the project site. During the sixty-day period after the permit application has been submitted, the respective county shall ensure that the project is in compliance with chapter 6E and applicable ordinances regarding land use, set‑back, height, and site development requirements for the project site; provided that noncompliance with any state or county regulations may delay the county's issuance of the permit. If a permit submitted under this section is not approved by the applicable permitting agency within sixty days of a complete application being filed, it shall be deemed approved; provided that approval has not been delayed due to noncompliance of the permit with applicable state law or county ordinances. Nothing in this section shall be construed to allow any violation of federal, state, or county laws, rules, or ordinances.

(b) A county shall not consider an application complete until:

(1) Either:

(A) Qualified county professionals who meet state historic preservation division rules governing professional qualifications for architecture, archaeology, architectural history, or physical anthropology, have made a reasonable and good‑faith determination that the project does not have the potential to affect historic properties, archaeological resources, or burial sites; or

(B) The project has been submitted to the state historic preservation division of the department of land and natural resources and the chapter 6E process has been completed; and

(2) The developer submits documentation evidencing that the proposed development does not encroach in special flood hazard areas identified as "A" or "V" zones on the Federal Emergency Management Agency's Flood Insurance Rate Maps, or the applicable county official has reviewed the proposed development for floodplain management compliance and has issued a development permit for construction.

SECTION 3. New statutory material is underscored.

SECTION 4. This Act shall take effect on April 23, 2057.

THE SENATE	S.B. NO.	66
THIRTY-THIRD LEGISLATURE, 2025		S.D. 2
STATE OF HAWAII		H.D. 1