STAND. COM. REP. NO. 1289

Honolulu, Hawaii

RE: H.B. No. 732

H.D. 2

S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Sir:

Your Committees on Water and Land and Housing, to which was referred H.B. No. 732, H.D. 2, entitled:

"A BILL FOR AN ACT RELATING TO SHORELINE MANAGEMENT AREAS,"

beg leave to report as follows:

The purpose and intent of this measure is to:

(1) Allow single-family residences that are less than three thousand five hundred square feet in floor area and not part of a larger development, regardless of development valuation, to be eligible for a special management area minor permit; and

(2) Increase the valuation of development that determines the necessity of a special management area minor permit or special management area use permit to $750,000 and require the amount to be adjusted every five years for inflation.

Your Committees received testimony in support of this measure from the Office of Planning and Sustainable Development, Office of the Mayor of the County of Maui, Department of Planning and Permitting of the City and County of Honolulu, Planning Department of the County of Hawaiʻi, Hawaiʻi Association of REALTORS, Grassroot Institute of Hawaii, Maui Chamber of Commerce, and three individuals.

Your Committees received testimony in opposition to this measure from Earthjustice, Surfrider Foundation Hawaiʻi Region, Keep the North Shore Country, and six individuals.

Your Committees find that the valuation thresholds for special management permits must be increased. Your Committees further find that significant increases in construction costs have caused a disproportionate number of permits to be triggered based solely on valuation, creating undue burdens on both property owners and permitting authorities. Your Committees also find that without an adjustment, the existing process risks overwhelming permitting authorities and delaying recovery efforts, including the reconstruction of Lahaina in the wake of the 2023 Maui wildfires. Accordingly, this measure will facilitate recovery efforts by increasing the valuation thresholds for special management area permits and special management area minor permits.

Your Committees have amended this measure by making a technical, nonsubstantive amendment for the purposes of clarity and consistency.

As affirmed by the records of votes of the members of your Committees on Water and Land and Housing that are attached to this report, your Committees are in accord with the intent and purpose of H.B. No. 732, H.D. 2, as amended herein, and recommend that it pass Second Reading in the form attached hereto as H.B. No. 732, H.D. 2, S.D. 1, and be referred to your Committee on Judiciary.

Respectfully submitted on behalf of the members of the Committees on Water and Land and Housing,

________________________________ STANLEY CHANG, Chair

________________________________ LORRAINE R. INOUYE, Chair