SB66 HD3

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 it is the counties' responsibility 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, who is a licensed professional who stamped the plans, and the contractor are ultimately responsible. The counties are 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 designer and contractor are responsible for ensuring 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 housing 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 housing project permit applications; review time limit. (a) For single-family and multi-family housing projects in each county, a permit shall be issued within sixty days of filing of a complete application, which shall include full and complete plans and 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 filed, the respective county shall ensure that the project is in compliance with chapter 6E and all applicable ordinances regarding land use, set‑back, height, and site development requirements for the project site; provided that noncompliance with any state law or county ordinance may delay the county's issuance of the permit. If the county determines that the application is not complete or if the county requires additional information, corrections, or clarification regarding the permit application, the county shall notify the applicant and specify the information needed to meet the applicable permit requirements and the sixty-day review period shall be paused until a complete application is made to the county. If an applicant does not accept all corrections, changes, or recommendations made by the applicable permitting agency to the plans submitted by the applicant, the sixty-day review period shall be paused until revised full and complete plans are submitted to the applicable permitting agency.

(b) Except as provided in subsection (c), a permit submitted under this section shall be deemed approved if:

(1) The permit has not been approved by the applicable permitting agency within sixty days of filing of a complete application; or

(2) The applicant has submitted a full and complete plan and agrees to all corrections, changes, or recommendations to the plan made by the applicable permitting agency.

(c) A permit that has not been approved by the applicable permitting agency within sixty days of filing a complete application shall not be deemed approved if:

(1) The sixty-day permit review period has been paused to allow the applicant to respond to any additional information, corrections, or clarifications regarding the permit application requested by the applicable permitting agency or to revise any plans in response to any corrections, changes, or recommendations to the plans made by the applicable permitting agency; or

(2) Approval of the permit has been delayed due to noncompliance of the permit with applicable state law or county ordinances.

(d) 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, including for those situations in which the county professional described in subparagraph (A) determines that the project may have the potential to affect historic properties, archaeological resources, or burial sites; and

(2) The applicant submits documentation evidencing that the proposed project does not encroach on 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 project for floodplain management compliance and has issued a development permit for construction.

(e) Each county may adopt rules pursuant to chapter 91 to effectuate the purposes of this section.

(f) Nothing in this section shall be construed to allow any violation of federal, state, or county laws, rules, or ordinances.

(g) For the purposes of this section, "full and complete plans" means a plan submitted to a county that has been stamped by a duly licensed structural, civil, electrical, or mechanical engineer and architect certifying that all plans and specifications are in compliance with the applicable building codes for the respective county."

SECTION 3. New statutory material is underscored.

SECTION 4. This Act shall take effect on July 1, 3000, and shall be repealed on June 30, 2030.

THE SENATE	S.B. NO.	66
THIRTY-THIRD LEGISLATURE, 2025		S.D. 2
STATE OF HAWAII		H.D. 3