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Jul 04

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Archive: June 2016 Newsletter

Aloha!

In this edition:

  1. Governor Ige Vetoes HB 1850
  2. New Regulations Effective January 1, 2016
  3. Specific regulations for each County
  4. Funding and Membership Drive

 


  1.    Governor Ige Vetoes HB 1850

This bill was put forward by AirBnB and the State of Hawaii Department of Tax in an attempt to crack down on tax cheats by allowing advertising platforms to collect and remit taxes directly to the State.   As you know, one of the main criticisms of vacation rentals, whether true or not, is that we do not collect and remit taxes.  The hotel industry uses that argument across the nation to support increased regulation of vacation rentals.   RBOAA initially supported this bill in order to quiet that accusation, but right from the very beginning, we had concerns about the level of confidentiality the advertising platforms were allowed to afford their owner/advertisers.  While we supported the bill, we asked for the veil of secrecy to be lifted.  The legislators did not agree and so, in later rounds of hearings on this bill, RBOAA opposed the measure.

During the legislative process, the bill took on additional burdens – namely the requirement for advertising platforms to ensure owners complied with county zoning regulations.  While RBOAA fully agrees that owners need to comply with County zoning, it is absurd to ask a third party for-profit organization to enforce the law.  Not only have the counties been largely unwilling or unable to enforce their own laws, RBOAA has long opposed any non-governmental authority being put into a regulatory authority role – most notably, property managers and real estate agents.

Ultimately, while the legislators did not heed RBOAA’s concerns, the Governor did, and this week, he announced he would veto the bill, saying that more work needed to be done to ensure county regulations were complied with, in addition to ensuring taxes were collected.  He also stated that transient vacation rentals are the responsibility of the counties.  This last statement is disturbing as the counties are generally very opposed to vacation rentals.  For example, The City and County of Honolulu has not issued a vacation rental permit for almost 30 years and, for example, in Maui new rules require an owner of a property with a value of less than $1 million to have owned the property for 5 years before turning into a vacation rental.

Looking forward, we will need to address issues not only at the state level but also at each of the counties.  This will make our work much harder in the coming years -  much harder unfortunately as we don’t have experience or resources at those levels of government.   One last note.  This bill attracted lots of passionate correspondence, in the RBOAA email inbox, in the media and letters to the editor, in social media and in the testimony to the legislators.  For many, this bill became a referendum on vacation rentals as a whole, with the argument being that we should not be allowed to rent out our properties to tourists at all.  Various property owners (especially in high value neighborhoods), social welfare groups, unions and even some RBOAA members took this position.  Some other RBOAA members opposed the bill because of a hate-on for AirBnB (even though no one ever explained the origin of that anger).  While everyone is entitled to their opinion and has the right to express it, there were some pretty vile emails in the RBOAA inbox.


2.    Act 204 Took Effect January 1, 2016.  Make sure you are in compliance today.

The full details of Act 204 are available on our website.  The key summary points are:

  • If you don’t live on the same island as your vacation rental, you need to name a Local Contact and you must identify your Local Contact by name, phone number and email address to your guests before they check in and within the rental property.  Your local contact does not need to be a real estate agent unless he/she is performing tasks for which a real estate license is required (e.g. collecting rent on your behalf).

You must post your Hawaii Tax ID number (your TAT ID number) conspicuously in all advertisements and in your rental

We are still waiting for the detailed rules from the DoT as to how they will enforce and interpret Act 204.  We will send that along to you when we get it.


   3.    Specific Regulations for each County

RBOAA’s mandate is focused at the State of Hawaii level, and to consider certain issues which bridge the County level and the State level.  Given the Governor’s comments, your executive committee will be discussing if and how we can be active at the County level, but it is very important for you to know that each county in Hawaii has its own regulations (or lack thereof) for zoning and permitting of vacation rentals.  For up to date information, please visit the County Regulations page on the RBOAA website, http://www.rboaa.org/county-regulations/ to check for regulations and upcoming potential regulations.

The onus is on you, as owner, to ensure you are in compliance with all regulations – state, county and HOA. On the County Regulations page is a listing of the rules for each of the counties along with the links to find each county’s regulations regarding Transient Vacation Rentals.  We will do our best to keep this page up to date, but it is advisable for you visit the planning department and planning commission web pages for each county to keep up to date with potential new rules and regulations that are in the works.  If you have specific questions about county regulations which you can’t answer from our website, please contact the county.  RBOAA simply does not have the volunteer resources to answer questions on specific county regulations.  Remember all counties have different property tax rates if you are renting out your property.   


    4.    Funding and Membership - RBOAA

We have worked with our lobbyists to contain the fees this year and we spent far less money this year than we did last year.    “Mahalo” to all of you who renewed your membership and/or made a donation to RBOAA this year.  We would not be able to do what we do without your support.

In a recent study of some of the more popular owner rental web sites, there appears to be more than five thousand owner-managed vacation rental properties in Hawaii.  That number dwarfs our membership numbers so we know there are a lot of owners out there who might not be aware of RBOAA, not aware of all the good work we have done, and all of the good we will continue to do on your behalf.   We need to grow our membership in order to continue on as we have in the past.  Please ask anyone you know who owns a vacation rental property to visit our web site www.rboaa.org and become a member or make a donation today.  We all have neighbors, friends, or maybe even family who would benefit.  Please don't assume they are aware of RBOAA.  We are all in this together and all of you can act as a small army of recruiters.  Please do your part and help us spread the word.     Help us make sure everyone who self manages a vacation rental property in Hawaii is aware of the opposition we all face and that RBOAA is here to help.     So please, right now, please renew your membership at www.rboaa.org and click on the “Donate — Click Here” button.   Remember, none of your executive committee members are paid – we are all volunteers.

Thank you for your continued support. 

Mahalo, Neal www.rboaa.org info@rboaa.org

Permanent link to this article: http://www.rboaa.org/june-2016-newsletter/

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