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HomeMy WebLinkAbout02/08/2012 HOUSING/TRANSPORTATION/ENERGY CONSERVATION & EFFICIENCY Committee Meeting MINUTES HOUSING / TRANSPORTATION/ ENERGY CONSERVATION & EFFICIENCY COMMITTEE February 8, 2012 A meeting of the Housing / Transportation / Energy Conservation & Efficiency Committee of the Council of the County of Kaua`i, State of Hawai`i, was called to order by JoAnn A. Yukimura, Chair, at the Council Chambers, 4396 Rice Street, Suite 201, Lihu`e, Kauai, on Wednesday, February 8, 2012, at 8:49 a.m., after which the following members answered the call of the roll: Honorable KipuKai Kuali`i Honorable Dickie Chang Honorable Nadine K. Nakamura Honorable Mel Rapozo Honorable JoAnn A. Yukimura Honorable Tim Bynum, Ex-Officio Member Honorable Jay Furfaro, Ex-Officio Member The Committee proceeded on its agenda item as follows and as shown in the following Committee Report which is incorporated herein by reference: HTE 2012-06 Communication (1/27/2012) from the Housing Director, requesting agenda time for Mr. James E. Dannemiller, Executive Vice President of SMS Research and Marketing Services, Inc. (SMS), to present data from the Hawai`i Housing Planning Study 2011 for the County of Kaua`i. The study serves as a tool for planning and developing new housing opportunities for Kaua`i's people. [This item was deferred.] Ms. Yukimura: Thank you. If Mr. Dannemiller would take the seat or Mr: Mackler would you like to introduce the consultant? Thank you. There being no objections, the rules were suspended. GARY MACKLER, DEVELOPMENT COORDINATOR, HOUSING AGENCY: Good morning Chair Furfaro, Vice Chair Yukimura, Councilmembers. Thank you very much for allowing us the time to make this presentation. I'm Gary Mackler for the record. I'm with the Housing Agency Development Coordinator. Just some brief background information before the presentation starts. SMS Research & Marketing is a company you may know of. They've been at the forefront of doing housing research in the State of Hawaii for some time now. They're actually the oldest survey research firm in the State. In 1992 SMS Research Committee Meeting 2 February 8, 2012 prepared the first of their housing study reports as it was through a consortium of both public and private participants. The study has now become a major source of housing data in the State. Since the original study there have been a number of updates made to it. The first was in 1997, followed by another study in 2003, 2006, and now here the most recent study in 2011. Just to let you know that SMS Research was selected through a Request For Proposals procurement. This was a cooperative procurement led by the State of Hawai`i through the Hawai`i Housing Finance and Development Corporation. The County of Kaua`i participated with the counties of Honolulu, Maui, and Hawai`i, as well as the Hawai`i Department of Public Services, as well as the Department of Hawaiian Home Lands to have the study prepared. It is a statewide study but it is also a Kaua`i specific study, and Jim will be here to talk about the Kaua`i data. And so, today we do have Jim Dannemiller here, he is the Executive Vice President of SMS Research & Marketing. Jim has been involved with the housing studies from inception and has over thirty (30) years of research experience in this field. As a principal in charge of this study he has been the hands-on person who works with the survey instrument, the sampling design, the report preparation, and as well as the interpretation of the report. So, Jim is here to do a brief PowerPoint and then open it up for questions. So at this time I'd like to ask Jim to come up and start with his presentation. Thank you. Ms. Yukimura: Thank you Gary. Welcome Mr. Dannemiller. JIM DANNEMILLER, EXECUTIVE VICE PRESIDENT, SMS RESEARCH & MARKETING: Thank you. Chair Furfaro: Mr. Dannemiller, before you start, can a few us have some time to re-arrange our seating? Ms. Yukimura: Yes, of course. Chair Furfaro: Thank you. Ms. Yukimura: And, also before you begin I just want to say that we've waited eagerly to hear the results of the study because good data is really the basis of good planning and strategy. And so, although the Housing Committee wanted to start its work right away, we have sort of waited for this, so thanks very much for being here. Mr. Dannemiller: You're very welcome. I'm very pleased to be here this morning. A large number of people have spent a lot of time and effort to put this together and I certainly hope it is of use to you. Committee Meeting 3 February 8, 2012 I have about thirty-five (35) to forty-five (45) minutes of material depending upon how eloquent I might (inaudible) but it's okay with me to just open it to questions at any point. I think it's more important that we get your questions answered than I deliver my presentation, so however you like it. Ms. Yukimura: Well thank you. You know we're on a very tight schedule because we have three (3) guests from off-island from Honolulu in Housing Transportation and Finance. If you could go through your presentation and then as quickly as possible, and then we'll open it up for questions. I don't know how much time we will have for public comment. It's my intention to say that the main purpose of this committee session is to understand the housing report and survey. I intend to have this matter deferred to the next meeting so that we can take more input after people have been able to absorb the information. So, there will be other chances for public comment as well. So, please proceed and then we'll open it up for questions I think it can be more organized and hopefully more efficient that way. Mr. Dannemiller: Okay. Thank you. Ms. Yukimura: Thank you. Mr. Dannemiller: Just to introduce the study and Gary has already done that, he mentioned for instance that it's a cooperative project with many contributors. There's been six (6) studies since 1992. It has, this year, six (6) components. There's a housing inventory which we actually go through and count all the housing units in the State. Housing demand survey which is a sample of about 5,000 or 6,000 people - about 1,200 of those households were on Kaua`i. There was a study of rents which this year was notably more comprehensive than it has been in the past trying to find out exactly how we should pay rents. Stakeholder interviews is kind of a...set of interviews in which we focused on people who have some knowledge of the housing markets and housing industry in the State of Hawai`i and to find out how they felt about policy. This year a brand new piece was the special needs housing groups, which is an attempt to study housing needs among people with special needs and health problems and those are some things. And finally, we updated the housing model this year which is a way of forecasting what housing might be needed. There's a series of reports including one (1) for the State, one (1) for each of the County's housing agencies, one (1) for the Department of Hawaiian Home Lands, one (1) for the Department of Human Services. There's an inventory report, a tactical report, and there's a few other things lying around. So it's a rather large study. The intent is always, as always, to produce a data set to produce a comprehensive set of data upon which all elements who are interested in housing in Hawai`i might depend on over the next three (3) to five (5) years. Let me begin with parts of, I've selected things that I think might be of interest to people. Obviously it's difficult to run through a study of this size and Committee Meeting 4 February 8, 2012 cover everything, but some elements in the housing situation have caused some conversation after the report was written. One (1) of the things to look at is household income on Kaua`i and this is a 2010 income as measured in 2011 from all sources. A household income and the numbers that you see up there, the number of, the percentage of households in each one (1) of those income categories you'll notice that with the exception of the last category it's almost a sort of a normal distribution. The last category being 100,000 or more, there's a fair number of people in that category now. That's kind of what it looks like. Not too much difference across the top that I would make anything out of right now. One of the problems with income, household income, when we're dealing with it is that each one (1) of those households are very different. So when we switch to the HUD income levels, this is what the Department of Housing and Urban Development produces as an income level. These are now adjusted for household size. In this case this is the distribution for HUD. The HUD distribution is different from the County distribution. The HUD median income is higher for one thing, and the distribution is a little bit more skewed to the left. It also tends to take into account household size, whereas the survey median income does not take into account household size. This is perhaps more important with respect to developing housing or planning for housing. This is the number; this is the shelter-to-income ratio. Essentially, the percentage of people who pay in the first one, the darker column, is essentially those who pay no shelter cost at all; either they own their own homes, or they are renting, or they're living rent free. The next one is a percentage of people in each one of those areas who is currently paying less than thirty percent (30%) of their income for shelter, which is a position which is probably a favorable one, one that we should seek after, one that banks use for qualifying loans, for instance, that sort of thing. The next bar is those between thirty and forty percent (30-40%) which would put some strain on these households in terms of managing the rest of their affairs after they pay for rent. By the time you get to the last one which is those who pay over forty percent (40%) of their monthly income for shelter, that's a fairly difficult life. You'll see that Kaua`i County as a whole that that number reaches somewhere between twenty-five and thirty percent (25-30%) over the top. So a quarter of the households are paying more than forty percent (40%) of their current income for shelter. In certain places like Hanalei for instance, it gets to be (inaudible) thirty-five percent (35%) there. So this is our income situation one which we say clearly we're going to have some problems with people who don't have sufficient income to take care of their housing issues. It might be a good idea to take a look at prices and I probably won't tell anything you don't know in the next two (2) slides. These slides, we'll go over them rather quickly. In the first place, this is the housing prices in Hawai`i. I don't have the same thing for Kaua`i County but believe me it follows pretty much the same pattern with Committee Meeting 5 February 8, 2012 the exception that you have fewer condominium units. But the single-family price, for instance, notice it has a big run-up in the late 80's and it has another big run-up in the early 2000, last decade. I'm sure you remember it because it was a very notable event and the prices tend to drop off a little bit after the run-ups and that's what you were seeing now all the way up to 2010. This pattern, we used to talk about this pattern as being unique to the State of Hawai`i, it's not. There are many other markets in the Country that behave very much like this with a single exception...this is a comparison. This bunch of ugly lines is a comparison of same sorts of figures the median housing prices in six (6) high priced housing markets across the Country that include ones that we are familiar with, like San Diego, Los Angeles, and San Francisco, and also Boston, and New York. If you look at the top line for instance, that's the San Francisco line, and it shows the price is essentially somewhat higher than what they are in Hawai`i. The San Francisco market is a particularly high priced market. The interesting thing is not so much that there are numbers that are higher and lower than the State of Hawai`i's, but rather, if you look at that big line on top, that San Francisco line, you'll see it run right up and then drop-off and come almost down to where it was before. There's a little light green line that is San Diego and you see it run right up and then drop-off. The same is true with Los Angeles, it runs right up and drops off. The others are less likely. Hawai`i's runs right up and stays there. We're going to come back to that issue and that by the way I have not found another market in the Country that runs that way. Hawai`i is the only one that does that and you'll see what happens by looking back in 1990. The first run-up it runs up and it stays flat almost for the rest of the decade and then begins to drop-off to some extent, but never gets down to the point where the others dropped off to. So just by the way, it's important when somebody asks — how much longer will this last? This, by the way, is rents and it's a shorter time period, it runs from 2003 to 2010. You'll see the redline is the County of Kauai and the prices...the rents ran up to 2007 just like the prices of housing did, and then fell off pretty notably through 2008-2009 when the economy came apart. Then it leveled off after 2009. We think if we had good numbers for 2011 and we don't have those yet. When we get them in the middle of this year, but it's probably going to go back up again to some extent. So that's the rent situation. It tends to even lead the sales market by a little bit. What's the impact on the households of all that? This is the percentage in each one of the five (5) districts of Kauai that are crowded. By the census definition, "crowding" means the household contains more than one (1) person, 1.1 person per household...per room in the household, and rooms don't include foyers and lanais, and they don't include service rooms and that sort of thing. So just the living room, dining room, kitchen, bedroom kind of thing right. You can see it runs about twenty percent (20%) of the population, and it's a little higher in Lihu`e than it is in Kawaihau that sort of thing. Committee Meeting 6 February 8, 2012 This is the number of units that have "doubled up." "Doubled up" units are places where there's two (2) families living together, and I know first thing you're going to say is — but in Hawai`i we like to live together. This is two (2) families living together and they told us in the survey they don't like to live together, so lest we begin that conversation, that's where we are. It's not too high, it's about twelve percent (12%), but that's higher than we would probably want to have it. This then is the number that we're either or both so the doubling u p and the crowding are slightly different definitions and some households are both so thus the number that are essentially both runs to just under twenty percent (20%) for the County as a whole, fairly high in Waimea and high in Lihu`e, relatively low in Hanalei. That is the number of people who are at risk of homelessness. That definition changed this year. It used to be the number of people who were three (3) paychecks away from homelessness. Now it is we ask people, because we got criticized for that, because they said, if I was three (3) paychecks away from losing my house I wouldn't be homeless, I'd go to live with my brother; so they wouldn't be homeless and fall on the State, fall on the County as a responsibility. In this case we asked people, what would you do if that happened? And if they said I would be forced to go to a shelter, or I don't know what I was going to do, or I would be forced to go to a public agency for assistance, that's that. In Waimea that's 50%, that's probably a little high, that could be a survey anomaly. But notice that on Kauai County as a whole which is not, we're about thirty-six percent (36%) of the people who are at risk of homelessness. And there's the hidden homeless. Hidden homeless people are very similar to those people who are doubled up except it only has to be for financial reasons only and they're not...it doesn't include people who are related by one (1) more or less than one (1), less than two (2) generations. So that's the kind of impact that an expensive or high priced market has. If you could look at that over time you'd see that it does go up and down with the price line right. I'm going to switch now and talk about preferences of people who need housing so we could say, well, once we've identified them we can then see what kind of units they would like to have. The first thing I need to do is to tell you about movers or how we're going to measure demand here. So this, for each one (1) of the areas on Kaua`i County essentially the number of people that we estimate are people who say...when I ask, so when is the next time you're going to move, they say I'm not moving, I'm where I'm going to be, I'm not going any place else. It's about close...sixty-five to seventy percent (65-70%) of the population who's saying I'm not going anywhere, at least not for the forseeable future, I'm not planning to go anywhere. And you see it's higher in some districts than others and overall it's about twenty-five thousand (25,000) people living on Kauai today and of those Committee Meeting 7 February 8, 2012 fifteen thousand (15,000) that...the households I should say right okay. And then most of the ones that say, yes, I'm going to move. And they were going to qualify them later so that number is going to come down a little bit but that's essentially the kind of people that we're talking about in the beginning. And there's one more group, and that's this yellow. That's the group of people that say, yes, I'm going to move and when I leave, I'm out of here, I'm going to live someplace else. We get them back because there's people on Kauai or people on Maui who want to come to live on Kauai. So it doesn't all balance out, but essentially it will come back to approximately that number. Ms. Yukimura: So can you just help us with the acronym OOS? Is that the... Mr. Dannemiller: Out-of-State, I'm sorry. Yes, I do acronyms all the time, please stop me when I do. Ms. Yukimura: Okay. So that's the group you're talking about right now? Mr. Dannemiller: Yes. They're going to leave. Ms. Yukimura: They're leaving Hawaii or leaving their island? Mr. Dannemiller: No, actually I misspoke, they are leaving Hawaii, these are leaving Hawaii. (?): I beg your pardon? Mr. Dannemiller: These are leaving Hawaii, the State, go out of State, but it doesn't include the ones that are going to leave here and go to another island because those balance out. I misspoke. Ms. Yukimura: Thank you. Mr. Dannemiller: My apologies. Over time that's the way the demand is going. We go out and we talk to people. In 1992 38.5% of the people said, yes, I'm going to move. It's been coming down each time we do one (1) of these surveys. In 2006 it was about thirty-one percent (31%) and in 2011 it's 27.3%. I've been asked and I don't know exactly why that is so. We do know that it is an important question and we have been asking some questions about why that seems to be true. So, we asked this time, how come Committee Meeting 8 February 8, 2012 you wouldn't be buying a home at least? And the answer to that was, and this is pretty important because it's gone around and people are saying they disagree in terms of which one of these are most important. On Kaua`i, of all the people we asked, seventy percent (70%) said it's because of the price of housing, it is too expensive, I cannot afford to buy a unit because it costs too much. Family finance is something slightly different, it looks at it from the other side and they said, I'm not g g Y Y ready, I don't have enough, I haven't been able to put together a down payment, I couldn't afford to move now, if I had to I don't have the resources. Consumer confidence is and people are saying a lot about the fact that consumer confidence is what's keeping people out of the market. That is, I'm not certain what will happen to the market, I can buy-in right now and end up over my head or under water. So that's what...but only four percent (4%) told us that. The last one, there were five percent (5%) that said, I'm not moving, I'm not going to buy because I prefer to rent, I'm a renter, I'm not going to buy again ever. Ms. Yukimura: Okay, I just want to point out a question that arises here and then we can come back when we have questions. Not buying a home is different than wanting to move. Mr. Dannemiller: Yes. Ms. Yukimura: So it's sort of mixing apples and oranges. Mr. Dannemiller: Yes. I have some other information on that too. Ms. Yukimura: Okay. Mr. Dannemiller: But we didn't...your question I think was asking why people are not going to move and the only thing I know about that is what they've told us is that I'm happy where I am. Ms. Yukimura: Okay. Mr. Dannemiller: Why they're going to move I assume is the other side of that but I don't know. So here's some preferences and I'll try to do these faster even though they're horribly complicated to grasp. This is the way we did this so you notice up here I have the question asked to people: are you going to buy or rent. And in the first one (1) if you look at the Kaua`i County one you'll see it runs up there to about thirty percent (30%), thirty-five percent (35%). That's the number of people that said, yes, I'm going to buy. And then we said well you know in today's market it's kind of tight and all that kind of things, prices are up there, do you think, are you pretty certain 1 Committee Meeting 9 February 8, 2012 that you're going to buy your next unit or do you think something might happen that you might have to rent again? And then they backed off to this and saying that's how people are going to rent. And so, everybody backs down to a certain extent that when I talk about (inaudible) I'm talking about the second one, this adjusted demand right. Notice that in Hanalei they're pretty close to each other, in Lihu`e that adjustment seems to be much higher. From the rest of these I'm talking about, we did the same sort of thing so when we ask about the number of bedrooms, the number of bathrooms, they would tell and we'd say well, what if you couldn't find a unit at the price that you want to pay like that, what do you think you really need? And that's when they said about unit types, single family, multi-family, or other. On the lefthand side will always be we're going to be looking at those who want to buy a unit, and on the righthand side we're going to look at those who rent a unit, and of course we have for each of the districts and then for Kauai County as a whole. We thought these were already backed off so you see the renters are a little more likely to accept multi-family than single-family and when you're looking at buyers, relatively few are willing to accept a multi-family unit. This by the way is distinctive of Kauai, it's not quite this serious on the other islands and particularly not on O`ahu right where multi-family are a much more prevalent and much more understood and more acceptable solution. This is the number of bedrooms that people want to have and you'll see that when people are buying they're expecting to get at least two (2) or three (3) bedrooms. But when they're renting, a pretty substantial number are expecting one (1) or two (2) and no more than three (3). So, that pretty much tells us what size they want to have and this is the number of bathrooms and you can see it goes, that drops even more significantly from whether you're going to build buyer units or renter units. This is location, very difficult to understand by the way. Red lines are again buyers; red lines are those who want to live in the same district. So when we're looking at Koloa and Lihu`e those big ones for the buyers for instance say well people who said they're going to buy want their unit to be there, would prefer to live. Whereas people in Waimea, they seem to be more willing to live other places. The green bars, I think that's green, are people (inaudible) any place either some specific other place on Kauai or any place on Kauai no...right. The grayish color, I think that's grey, I'm color blind so I have a tough time with that, the people who say look I don't care where it is, you give me a house, I'll take it. And the last one (1) is people who say I prefer to live...I want to live in another County. The other thing is, these are not (inaudible: neutrally or mutually) exclusive so this is the percentage of their choices, some people have one, two, or three (1, 2, or 3) choices, so this is the percentage of all the choices. Difficult to interpret without taking some time okay. Committee Meeting 10 February 8, 2012 Qualifications...because we asked a lot of questions about qualifications to buy at (inaudible). This is important in terms of what people are able to pay. Looking at all these districts this is the number...percentage of people who can pay those rates. So in Waimea we find that the current mortgage level, the mean mortgage level for Waimea is about $1,400.00 or $1,450.00 or something like that. In Koloa it's a little higher and Hanalei it's a little higher. That's what they're paying now. When we ask them if you're going to move, where are you going to move? The buyer said this, so you see in general they can afford more than what they're paying now, except in Koloa where it's pretty close, and Lihu`e is (inaudible) much bigger way, bigger difference right. This is the current rents. So the rents are lower than the mortgage payments as you might have figured and when we asked them how much can you afford? It looks like this. So on Kauai district, Kaua`i County as a whole, if you look on the right just a little more and in some districts it's actually lower than what they're paying now. So the renters are having a greater problem, would have a greater problem with this move than buyers would. Here's a few more things. That's the number of people who tell us they can afford a down pa ment or they have enough resources of some kind or another to make a down payment greater than $40,000.00, $40,000.00 isn't much of a down payment plus the number that we have; we sort of stopped counting after that. This is the number who say they have less than $20,000.00 in savings and in some places that gets up to well over half the population. And then this is the number we ask them do you own any other real estate that you might be able to use, and not very many said they did. The percentage of that group said yes, I could explain I don't think the Koloa thing is reliable I think that probably is another anomaly. Where you get down to is this, if you read across the bottom it's going to talk about qualification which means the household had a down payment or a significant equity in a current unit or savings in the amount of a down payment, had the household income to support a commercial loan at forty percent (40%) of the household income or less, had the ability to pay the associated monthly payment and reported no significant debt. For renters, households reported the ability to pay rent at forty percent (40%) of the monthly and were paying at least eighty percent (80%) of that rent required now. So it's a fairly complicated process and I'd be willing to run it any way that anybody wants, that sort of thing. We have a lot of data and so there are other ways to do it and this is the way we did it. According to that way overall about 17.7% of the people who want...who described a unit to us that they would want to move to even after we sort of backed them down on it, are actually qualified to buy that right now, or to get that right now, for buyers it's seventeen percent (17%), total is almost eighteen percent (18%). For renters it's Committee Meeting 11 February 8, 2012 18.1%, pretty much the same. But if you look at, we then broke it down and said well, we can do that for renting a single-family, or owning a single-family, now what if we use the price for a multi-family instead or rented a multi-family. And in the buyers we actually had more people qualified, a higher percentage of people qualified to buy the single-family. Within renters it's really clear that if we wanted to make a difference here that we would be building multi-family rental units because more people will qualify for them. That's even at commercial levels. One of the major things that we look for all the time essentially are the needed units and the calculation of needed units is a very complicated issue. It essentially means we go through and say what are the number of units that would be needed to fulfill all of the demand that we see in this survey at all levels? And, we then say many of those units, when people say I want to move, exist already. Other people would move out and they would move into those units and that kind of stuff, they would swap back and forth. So, to fill that demand we don't necessarily have to build that many housing units, we have to build many many fewer than that. And then when we're looking at new units we're also saying I'm going to take out what the market usually produces anyway; which at the levels we're talking about right now, it hasn't been all that much. Much more of the last five (5) years that was over the previous five (5) years, so we take those all out. And then we say these are the units that we need to build if we're going to fulfill this demand. And that's what we come up with. In this case we're looking at needed units on Kaua`i between 2011 and 2016, using the survey median income as the marker for the level at which we would build these units. So...and down the side we got different types of units. Overall up in the top righthand corner, we say if I had 1,312 more units I would probably be okay in 2016, assuming that I built them all in the right level. If I build all those units say at the level where single-family renters could use them at a hundred...we're making more than $125,000.00 a year, then I probabl wouldn't help much. I've got to be able to spread them around like that. So we actually then looked at demand and what people wanted and what and how much income they had and the (inaudible) goes up and say that's how we would put that...that's how the total needed units would be distributed. Now, that gives you some numbers that look funny in some cases. So if you look up there under less than $30,000.00, people who want to own a unit, a single-family unit, would say we would need to build twenty-nine (29) of those, and the answer is yes we would. If we were to fulfill all of the demand at that level with people who tell me that they're qualified and really want one (1), we would have to build those twenty-nine (29) units. That's an answer to a mathematical question that I worked out, it's not a policy issue. See, policy-wise we could look at that and say that would be a very unwise thing to do. Ms. Yukimura: Correct. Committee Meeting 12 February 8, 2012 Mr. Dannemiller: And so what you do in that case is take those twenty-nine (29) units and push them down where they might be served better, like in single-family rentals perhaps, or even multi-family rentals. So you don't want to "slave-ishly" follow this matrix. That, by the way, we have produced in the survey a Y Y p Y matrix of needed units both cross-tabulated by the actual income of Kaua`i households and also by HUD median income guidelines for HUD programs. The bars are HUD's, if we build for HUD, HUD's income guidelines, that's what we would build. The blue line is income here, they are different, that causes a lot of people a lot of concern. You can also talk for a very long time about how they get to be different; in fact, that's one of the most important things is that the blue line is what's real out there. So if we build units to serve the people of Kaua`i you might want to look at a line like that. But it's hard to ignore the gold bars because that's the way HUD provides money. (Inaudible) know that unit as well. So I can take both of those sets of numbers and develop policy out of them. Some policy issues there's...this issue by the way in 2006 was an issue which was brought to the floor to the rest of the State by the County of Kauai and it's looking at interesting leasehold property, particularly sustainable leases, and basically people tend to say that they really like this issue. They...it will change people's minds as it has already I think (inaudible) people and it is very...a viable policy alternative. I don't expect it to say it's going to solve sixty-eight percent (68%) of our problems, it probably won't, but it's a viable policy alternative. More important than that, the further analysis in the study shows that it may not be used by a lot of people, but the particular people who do like it and who would use it are precisely the people we need to serve. So it's a very useful proposition. By the way there's numbers in there for 2006 and 2011 and they don't change much at all. This then is an issue which is brought up for the first time by the County of Kaua`i. It's looking at small lot sizes; I think pretty much everybody expected it would come out pretty much as it did. If you offer people in this particular County the choice between having a single-family unit on a small lot versus having a multi- family unit for roughly the same price, it's a pretty foregone conclusion, cut the lot size, don't build multi-family. If you're trying to serve owner...build ownership units for...for the people of Kaua`i. So those are useful. There's some housing planning stuff which we summarized. This is the housing planning environment in 2011 and it's put together after a very large amount of research and it's over-simplified, but here it is. Housing in Hawaii on Kaua`i has one of the highest priced housing markets in the United States. It depends on which I look at whether, it's one or two or three, because our land costs are really high. Because we have the second or third highest construction cost in the nation, because our average wages and household incomes are high, and what that means is people actually have more money to pay those prices. Because we have many market advantages, do you know what that means? We have a tourist industry and we tell people all the time we are the best place in the world, you Committee Meeting 13 February 8, 2012 really ought to be here. And so, some of them decide to move here and we get demand from outside. We have the most highly regulated housing market in the Country. That is now not an opinion, it's documented. These factors also produce the lowest home ownership rates in the Country, one of the highest crowding rates in the Nation, and the fourth highest homeless rate among the fifty (50) states and the District of Columbia. So it does have negative impacts that we don't like to deal with. It was either to cope with those issues from a purely planning point of view or because it was something that happened to us. We also tend to have, comparing with other places, many more multi-family units, relatively high rates of leasehold properties are...our housing stock is high quality, by the way, relative to other places, in part because it's newer, but in part because of the last piece - a very low rate of non-standard housing units. We don't allow people to build double wides and prefabricated housing and trailers and that sort of thing. So that's, there's no, I present this without any position on it, just that's where it is, that's the environment in which we have to work. It is the way things are. I don't think we should, it would be difficult to work to change much of it; that's kind of the way it is. This by the way is what Kaua`i's goals are for 2010-2015. I also say, I don't know whether this is good, bad, or indifferent, but it's interesting to look at against what we've been talking about and see if it is where you want to go. We divided...taken all the policy goals that are in the consolidated plan and divided those into efforts to build or create or make new units, efforts that are made to assist people in ownership or renting units and to educate people. And then down the side we have three (3) different types of people: homeownership, low-income rentals, special needs housing. That's what Kaua`i has decided to do. That also, you have to consider the resources that are available to Kaua`i. And I only offer that for your consideration. And I was asked this year, we never did this before, we stumbled onto this and we really want to make this a much bigger part of future housing studies. This is the actual number of public housing, it's not goals, it's actually production. What got produced from 2007 through 2010. If you look there it says we actually built 10,058 housing units in the State during those four years. That's more than we ever produced in a comparable eight (8) year period in the past. So things really went up very high and things we've done...We also look — well Kaua`i didn't produce very many but of course you have a much smaller population (inaudible) than the others do as well. So I don't know how you want to look at 792 and think that's good, bad, or indifferent; I don't have a solution to that. It's important to look what we did do is to produce thirty-three percent (33%) of units for sale, and sixty-seven percent (67%) of the units for rent. Most of the time when we've been through everything we've talked about so far, rental units are in high need. That is by the way higher than what was the average for the State, but not quite as high as what O`ahu did for instance on the rental units. And then the single-family and multi-family and we produced twenty-two percent (22%) of the units were single-family and Committee Meeting 14 February 8, 2012 seventy-eight percent (78%) were multi-family. So that's the pattern that we're producing out of this (inaudible). And I'll just stop there. Ms. Yukimura: Well thank you very much, Mr. Dannemiller. You've run through a huge volume of data in a very short time and I appreciate the way you've framed it. It's very thought provoking and we could go into hours of discussion about it. I'd like to focus our attention to the data today and I want everybody to know that we will be planning a housing workshop, maybe an all day workshop, where we'll be able to take this data apart and use it and talk about how it relates to policy. So, if we could all, both the Council and the public, focus in this short session of half an hour right to clarifying the data and understanding it better. Mr. Dannemiller you said you're willing to answer some questions in writing as well? Mr. Dannemiller: Yes. Ms. Yukimura: And possibly even come back to assist us. Mr. Dannemiller: I'd be pleased to do that. Ms. Yukimura: So, we'll just, if we can just all understand this is just a beginning point. I'm sure the Council has many questions. I just want to point out and if we can give Mr. Dannemiller a copy of this. We put together this two (2) page sheet called Important Findings of the Housing Study just to try to focus on the key findings. I want to ask a couple questions to solidify our understanding of the foundation of the study, and then I'll open it up for questions from the Council. It's mainly on the demand for housing. I'm so thankful that you have looked at the group that wants to move assuming that that's where the demand is coming from, internally from the island. I think in the 2006 survey it was like who wants to live where. A lot of people, will talk off the top of their head — I want to move here; and that's not real demand. So I'm glad you've tried to make that more real. But my question is, what about new forming households as part of demand; the young people who are growing up and forming households internally? And what about demand from the outside; people who are coming in and want to live. Has that been included in your demand factors? Mr. Dannemiller: When I'm talking about demand and we're looking at the survey data and saying what are their preferences, I'm only looking at demand as measured in 2011. But what I... .. Committee Meeting 15 February 8, 2012 Ms. Yukimura: And just of people in the State right? Mr. Dannemiller: That's right. Ms. Yukimura: Okay. j Mr. Dannemiller: That's based on survey data in other words. Ms. Yukimura: Right. Mr. Dannemiller: It's one point in time. Ms. Yukimura: Right. Mr. Dannemiller: When we look at needed units, notice that was not for one point in time that went from 2011 to 2016. That comes out of the housing model. In the housing model we look primarily at the major drivers are the population itself, changes in population which includes person per household, and the changes in housing stock. You look to see how fast those two are moving relative to each other. In that sense your question about household formation is, yes, it's included but in no special...specifically I cannot for instance tell you how many new households will be formed by young people moving up, I don't know that. But we do know how that population changes over time because the assumption is it will continue to change at the same rate. With respect to out-of-state... Ms. Yukimura: Same rate as... Mr. Dannemiller: As it has in the past. So that if between 2006 and 2011 the population grew by a certain amount and we also know that household size changed during that time, so the total number of households that need housing, and that's what needs housing is households, will change at a slightly lower rate than that and so we're going to carry that out into the future and say that's what...(inaudible) not quite straight line (inaudible). Ms. Yukimura: Okay then and I welcome questions from other Councilmembers on this particular question if you want. But, we just came back from a Smart Growth Conference which is projecting that thirty percent (30%) of the population will be sixty-two (62) and over, which is a change in trend. So if you're following straight line past practice, how are you taking into count this change in demographics? Committee Meeting 16 February 8, 2012 Mr. Dannemiller: Actually that's the babyboomer group that's been moving through this. Ms. Yukimura: That's right. Mr. Dannemiller: The babyboomers were in their twenties, so forming households quite a long time ago. So essentially the babyboomers forming households hasn't been an issue for us for quite some time. We're actually looking at a group of young people now that's relatively small and so the growth of new households for net increase... Ms. Yukimura: But they're changing household forms. They're moving out of single-family, they're going into smaller units, they're moving into the cities so they can be close to medical resources. So, there's a change in demand for type of housing and does the demand study track this is the question? Mr. Dannemiller: No. Track it yes, project it no. Ms. Yukimura: That's what I'm asking, projected. Thanks for the distinction. Any questions along the line of how we calculate demand? Okay. If not then I just want...just in terms of total housing units, I believe you said that includes timeshares? Mr. Dannemiller: I think I know... Ms. Yukimura: I mean you say in your thing that we're looking at residential housing, housing for residential purposes. Timeshares are vacation rental purposes mainly, so I'm just wondering how do you include that in your total housing units? Mr. Dannemiller: The survey and the model are based on housing units and the census which is what I'm stuck with defines timeshares as housing units. It defines them as vacant housing units that is not available for use by the market, but it defines them as housing units. The reason I'm using them is I can't get them out. They're currently in one of the categories of the vacant units and I don't know how many of that, I know the total number but I don't know how many of those are timeshares. I also know that those definitions that I'm reporting to you are definitions as reported in census documents. How that works out on the street is an interesting question. So I know in certain cases in the past we have had trouble with that issue. Recently it's been pretty good, I don't know how it's going to prove out for the 2010 census. Ms. Yukimura: Well, when you use the census figures, does that factor in to your demand projections? Ar Committee Meeting 17 February 8, 2012 Mr. Dannemiller: Only in the sense that we take out those units from the total number of housing units and say we're not going to be able to use them. Ms. Yukimura: Okay so you do adjust for it, you take it out and you don't, that's not included in the demand, I mean supply and demand factors. Mr. Dannemiller: Yes. Ms. Yukimura: Okay thank you. Mr. Dannemiller: That's taken out. Ms. Yukimura: And last question, you had in the very back of your study household size and you're showing single-member households are 22.5%. Let me see if we can find that page for those who have a copy of the study. Is it household composition? Yes. Okay so it's on page seventy-five (75). On Kaua`i in 2011 household size single-member 22.5%, married but no children 23.6%, parents and children 14.8%, unrelated roommates 4.4%, and other 32%. I wanted to know what the other is. Mr. Dannemiller: Good question. Complex households is a really simple concept, it's everybody who won't fit into one of the others. By the way it's high, pretty high for Hawai`i anyway, and for Kaua`i you see that's the very highest one which means that I'm more likely here to knock on a door and open up and find out that that's not a nuclear family on the other side of the door. They probably all have more than one generation in there, or I may have people living in there who are more distant relatives, or I may have people in there who are not related. So the houses are just...the household...the household structure is quite complex. Ms. Yukimura: Okay. So if you add the single-member and married with no children that's like 45% and then others 32%, how does this factor into types of housing that we need into the future? Mr. Dannemiller: Directly I think that would be a tough question for me to answer right off the top of my head. Ms. Yukimura: Okay. One of the things we really got sensitized to in a Smart Growth Conference is how different the family household characters are in terms of what type of housing is and the suburban single-family house not being the house of the future actually. And then just to also say related to Committee Meeting 18 February 8, 2012 that is the issue of the interface between transportation and housing. People are sometimes choosing more where they want to live than what they want to live in based on, because transportation cost is such a big part of the cost of housing. With that I'm going to open it up for questions. Councilmember Bynum. Mr. Bynum: Because we're going to revisit this, I'm not going to ask all the questions I'd like, just a couple. One of the last slides you showed was units we built from 2007 to 2011. Mr. Dannemiller: Yes. Mr. Bynum: And there were 615 multi-family, I would assume that would include multi-family units that were built like at Kaua`i Lagoons, Koloa Landing, these are units that are multi-family, but with sales prices in $2 million or more are unlikely to have any impact on local families. Is my assumption correct that that includes those kind of multi-family units? Mr. Dannemiller: I don't think so. As a matter of fact if I had that across the top, those 615 units are divided by income levels right, and relatively few of the needed units I needed for people who make $120,000.00 a year or more. I think if we're talking about units that are costing $700,000.00 for instance we'd be, I'd have to run my numbers on that but it's going to be at a relatively high income, household income level. Mr. Bynum: It was this slide that I thought was performance... Ms. Yukimura: Page? Mr. Dannemiller: What we've built? Mr. Bynum: Page 35, what we actually built. Mr. Dannemiller: I don't know that off the top of my head. We have...I have those data. Mr. Bynum: Anedoctedly 615 multi-family units from 2007-2011 I think, where are those? Koloa Landing, Kaua`i Lagoons, I don't know where 615 new workforce family housing got built on Kauai. I don't know of virtually any multi-family units that got built in that period for low...well a few from our affordable housing requirements. I'm assuming the 615 includes those big properties that came online in that period like... Mr. Dannemiller: Are those public assisted housing? Committee Meeting 19 February 8, 2012 Mr. Bynum: No. Mr. Dannemiller: Well then they don't... Mr. Bynum: The few multi-family that I know of are publicly assisted or part of our housing policy. Ms. Yukimura: Are those for renters? Mr. Bynum: When I look at 615 multi-family units I'm assuming that includes those high-end units. Mr. Dannemiller: If they were built with public assistance in any way then I would have to say yes but if they're built by the private sector no they're not in there. This is what we built with HUD and State and County money. Mr. Bynum: We built 651 multi-family units... Mr. Dannemiller: Fifteen, 615 yes. Mr. Bynum: Well I'd sure like to hear from Housing where those units are. I know...maybe that's Kalepa? Anyway one other question for now and I'll follow-up in writing. Median income or median house price you said was $470,000.00, is that correct, the Median home value? ICI Mr. Dannemiller: Yes. Survey data. Mr. Bynum: Okay. So for the 12,240 people who have a homeowners exemption on Kaua`i, the median is $391,000.00, so that median is skewed by...that's like all available housing u nits correct? Mr. Dannemiller: Yes. Mr. Bynum: Okay. So, if you just look at the people who have homeowners exemptions or who live in their home and own in the median is quite lower right? I just wanted to, that's the kind of distinction I think we, some of these are difficult for us to interpret because we live in a community where there are these high end homes, there are homes that are second homes that often are high value that kind of skew the median and the average numbers. And so, to the extent possible for us to sort out the housing inventory that's actually obtainable and affordable for people working...workforce housing versus those units that really are intended and primarily used for the visitor industry, it's kind of hard to sort that out in some of these numbers, is that correct? Committee Meeting 20 February 8, 2012 Mr. Dannemiller: They're supposed to be sorted out. So when I say if we take out that one category of vacant units we're supposed to be able to take out all the timeshares. I just have to assume that's true. If we take out the category called units held for occasional use, we should take out any second homes, plus we should take out temporary visitor units. But whether that's actually what happened we don't know, because it's not our numbers, it's the Census's numbers, and we have found that to be not the case in the past. Mr. Bynum: I just gave that one example from actual County tax data 2011. The median home value for people who live and own their home, who live here full time, is $391,000.00 as opposed to $470,000.00, and that's a pretty significant difference. That's just the kind of thing I'm trying to sort out from all of this data, what is our housing inventory, what of the, which percentage of that is actually available realistically to families who live and work here. And so, I'll keep trying to sort that out and ask some more other questions as we return. I appreciate the depth of this study, it has more depth than the previous ones. You mentioned a few times these are new questions we added this time and I appreciate that, thank you. Mr. Dannemiller: You're welcome. Ms. Yukimura: Councilmember Kuali`i. Mr. Kuali`i: Thank you Chair. Aloha and mahalo Mr. Dannemiller, just a couple quick questions of clarification. On slide 12, on page 12, there's the category of hidden homeless. When I saw the description in the larger document here the entire survey, but I'm curious as to how the question is asked of the people because the numbers seem pretty low especially in Lihu`e, it's actually the lowest of all the island. I think if the Lihu`e area includes Hanamd'ulu and Puhi, from what I know and see and have been born and raised and grown up in Puhi, it's really high in those neighbors. Ms. Yukimura: Crowded. Mr. Kuali`i: Crowding. So what's the difference between crowded and hidden homeless? How do you distinguish that? Mr. Dannemiller: The major way is we ask them is there someone living with you now who is here for economic reasons, that is, they wouldn't be here if they could be, if they could afford some other place else to live. That means they're homeless, they're there because of money. So there's a lot of, like I say 32.5% of the population of the households essentially are complicated and they have people living in them other than a nuclear family. That doesn't include Committee Meeting 21 February 8, 2012 roommates, they're taken out on another one. So there's a lot of very complicated households that doesn't necessarily make them hidden homeless per say. Mr. Kuali`i: So, I'm sorry, I'm still not clear. So these neighborhoods like Puhi and Hanamd'ulu, some of them are hidden homeless and some of them crowded even though there's really no difference. What do you mean when you say because of money? Mr. Dannemiller: If... Mr. Kuali`i: They can't afford to get a place of their own? Mr. Dannemiller: Yes. Or, my daughter's boyfriend moved in, or my uncle is here visiting, it's like he's visiting for six (6) months or something like that, so he and his whole family are living with us. It's not I'm going to let them go out and find a place of their own they must, they have to live in my house. Those sorts of things. So it isn't necessarily, I wouldn't call those people homeless they're staying with me. Mr. Kuali`i: So my daughter's boyfriend moved in is crowded, it's not... Mr. Dannemiller: It's crowded, it's not homeless. Mr. Kuali`i: Even if your daughter and her boyfriend wanted to get a place of their own because they want their independence but they can't afford it. Mr. Dannemiller: That's supposed to be covered in the question here, because if they can't afford to live some place else. So if they say yes they want to live some place else then they should've answered that question in the positive. Mr. Kuali`i: I don't know if we're getting good numbers based on how the question is asked. Mr. Dannemiller: I agree because that's a very tough thing to measure. Any suggestions we'll take. Mr. Kuali`i: So then the other thing about along those lines too is there's these specific groupings: Waimea, Koloa, Lihu`e, Kawaihau, Hanalei, but does the data break down further so we would be able to see Hanama`ulu, and Puhi, and Lihu`e? Is that Lihu`e and Lihu`e adjacent is? Because there's two... Committee Meeting 22 February 8, 2012 Mr. Dannemiller: No, it's "adjusted." Mr. Kuali`i: Oh, adjusted, I just took "adj" and made it adjacent because I wanted to...Does that data exist for those different, it's just not presented here but in more detail? Can we look at Lihu`e but actually look at Puhi, Hanama`ulu and Lihu`e because that's pretty much three (3) distinct neighborhoods. Mr. Dannemiller: The real answer to that question is no because it's based on survey data... Mr. Kuali`i: Census data. Mr. Dannemiller: As a result, the sample sizes would be so low, see I already have the anomalies in there, that's what I call them. Essentially that happens because the sample size isn't large enough to sort of wash them out. But, if what you needed to do was to take another area and redefine an area that was large enough, that could be done. I'd take this opportunity to say this is a monstrous, huge, gigantic chunk of data and if it happens like it happened in the past, it'll sit there and nobody will look at it until I collect another one. And we can probably use it to answer a lot of questions that are not in my report. Mr. Kuali`i: Well I definitely appreciate the data and I'm looking forward to the workshop where we can into it more and I believe this Council will work with the Administration to do something to utilize this data and move forward because affordable housing and making it available is really important to us. One more quick question on slide 33, you just made some bullets about the very high rates of multi-family units and relatively high rates of leasehold residential properties. By relatively high rates of leasehold residential properties, is there data on that too then, what the numbers are? Mr. Dannemiller: Yes we have those data. Mr. Kuali`i: And I'm wondering if those numbers might break down between types of leasehold properties. I know personally I'm about to move into my own leasehold property with the Department of Hawaiian Home Lands so that's a very distinct... Mr. Dannemiller: Very distinct. Mr. Kuali`i: Grouping of a statewide type of housing and then the County has some I assume and then private. So it would be interesting to know what the totals are and how they break down between those three (3) different groupings if the data existed. 1 Committee Meeting 23 February 8, 2012 Mr. Dannemiller: I'll have to check that for you. Mr. Kuali`i: Okay. Thank you so much, that's just for now. Ms. Yukimura: Thank you. Councilmember Nakamura. Ms. Nakamura: Hi James, thank you for being here and for producing this report which is really much more refined than what I've seen in the past and very useful. I like the section on special needs housing and I wanted to especially on the elderly because there are projections about future needs for the elderly population. The interesting finding is that in 2030 according to this report, there will be 18,000 new elderly households on this island. I believe there's going to be just an array of different needs for those households. Mr. Dannemiller: There are now, I think. Ms. Nakamura: There are now? Mr. Dannemiller: Yes. Ms. Nakamura: And I know Y ou break it down into some type, some of those needs, but I think in the future it would be good to see the continuum of needs for the elderl,y including assisted living, long-term health care, etc. Somehow it has to be tied to the health needs so that we can plan. We need to be planning now for that population. It seems like that kind of data would be really helpful. Mr. Dannemiller: We have more in our files, that is what was published there. The other thing is there's some other surveys that are used for collecting that kind of information in Hawaii as well. We're not really short on information on the elderly. Now, if you ask me to predict their needs when those 18,000 units come out, I will have a tough time doing that. Ms. Nakamura: But there are some forecasts here so I think that's really useful. I also found it useful to see the special needs housing table 27 on page 48, but this is a statewide summary of special needs households including elderly, frail elderly, person with severe mental illnesses. It's not broken down by island and I was just wondering whether that data is available. Mr. Dannemiller: We had a (inaudible: tickanese) of a time with this particular piece of the project. Notice that there's a lot of data unavailable in that table itself and when we tried to break it down by island it just, we got practically nothing. The fact of the matter is I think it's kind of explained in here as 5 Committee Meeting 24 February 8, 2012 a State. We're just simply not ready to ask these questions yet, the numbers are not there, and I think they should be, and I think they certainly can be. I don't find people who are necessarily against it in any way, shape, or form, but we don't have that system well and I want you to look at the state of these data, it is not something we should be proud of at any level of the State. I think it's going to get a lot better, but for right now it's really difficult to pull these numbers together. Ms. Nakamura: I'll stop there to let the others... Ms. Yukimura: Okay. Thank you. I just want to say that I'm hoping that our Housing Agency will embark on developing a strategic plan for housing that will include components like special needs housing, interfacing with our elderly affairs group that does plan for elderly, that maybe somewhere we can begin to get that data for our island and begin the planning. Chair Furfaro had some questions. Chair Furfaro: Thank you. I just have one, it's something we raised with our Housing Agency in the past that I also want to thank you for your consistent reporting and constantly making improvements on the information. As we get forward and it looks like the "Feds" are indicating HUD funding could shrink by as much as fifteen percent (15%) and I think Councilwoman Nakamura just mentioned our strategic plan, in your opinion do you think that the County of Kauai should modify the income structure to reflect really Kauai households over using consistently the HUD levels for funding as we go to create our strategic plan? Mr. Dannemiller: I think there's a use for both, as I mentioned in my presentation. Chair Furfaro: Right now we don't have both, we have the HUD piece. Should we adjust the template? Mr. Dannemiller: That could be done. Now, I think we're almost ready to say we can get decent income numbers on an annual basis from the American Community Survey. We should be able to build a model that will track those numbers for us in any case at any level. But I think at that point we need to target planning towards that group of...towards those numbers because that's what we live with, that's what's really out there, and we need to solve those problems. HUD's numbers for all their "warts," if you will, are particularly useful because they define the way that money is available. And even if the money gets cut back by an integral amount, there's still a substantial amount of funding, so I think we have to keep those in the books, in the game. But as far as looking at what our real income numbers are, that's obvious the day we got the plan, I mean that's... Committee Meeting 25 February 8, 2012 Chair Furfaro: And I just ask that because as President of Habitat for nine (9) years here on Kaua`i, when we're serving those fifty percent (50%) and below, it doesn't change who we're servicing, the infrastructure costs are still pretty significant. The pursuit of granting, getting grant money to help with infrastructure and improvements cannot always be reconciled with the income levels for the people who we're trying to serve. And so, I'm a strong believer, I think we need to work on our own level of numbers for our strategic thinking. Thank you very much. Thank you Chairwoman Yukimura. Ms. Yukimura: Yes. Councilmember Rapozo. Mr. Rapozo: Thank you and thanks for being here again. I guess a lot of data but a lot of the stuff is pretty much what we've seen over the years. One of the things I had a question on is the out-of-state ownership. I know in parenthesis here, trend of increasing percentage, it's pretty significant the number of out-of-state owners we have here on Kaua`i. We're well above the State average, or well above the State's number. We're almost double what the State, we're at twelve percent (12%) single family, and 73% almost 74% of condos are owned by out-of-state people. When you look at that compared to, that's almost three times as much as the State in total. So we're obviously in a different boat when it comes to out-of-state ownership from the other Counties and for the State for that matter. What impact, do we know the breakdown of those out-of-state owners or those properties, how many of those properties are affordable or are they high-end? I'm assuming those condos, 73% I don't know, I guess that's timeshare maybe? It's because you have fifty-one (51) owners of a timeshare unit is that why our number is so high that even though it's one unit that because we have 51 owners is that, or is that unit counted as one? Because that's substantially higher than any other County, it's like almost hard to believe that if you add up all of our condos in Princeville, Koloa, Po`ipu, Lihu`e, Puhi, I mean 74% of them are owned by out-of- state people? I just want to make sure that number is the real number because that's quite a bit. Mr. Dannemiller: I was going to say of course it doesn't but you've got me thinking. Those numbers come from the tax system, the TMK data. What we're looking for is a billing address that's outside of the State that has a zip code outside of the State of Hawai`i. So it was my impression that those units are not (inaudible) but I cannot swear that out of there. Mr. Rapozo: I just think that's an extremely high number. First of all we don't really have, I mean we have a lot of condos but I think a lot of the condos are owned by local people but maybe not. I'm just curious, is the timeshare considered one owner or 51? Mr. Dannemiller: There's only one property. Committee Meeting 26 February 8, 2012 Mr. Rapozo: One property but... Mr. Dannemiller: Right, so if they're... Mr. Rapozo: But I believe does each of those partial or those owners get a tax bill? No they don't? So who pays their property... Mr. Dannemiller: I don't think so but... Mr. Rapozo: I don't know who pays the tax b ill on a timeshare? Mr. Dannemiller: I will add that to my list of questions I'm going to have to respond to you in writing. Mr. Rapozo: Okay. I just think it is extremely high, so I guess the real question is what impact does it have on the housing needs. I guess the bigger question is are these out-of-state owners keeping it in the affordable market or is it in the unaffordable market or there's no way of telling I'm assuming. Mr. Dannemiller: We did some research on that on some of the islands several years back and actually did a survey among all those people that have addresses outside. We called them and asked them what they had and how often they visited and how often they came to Hawai`i and what they were going to do with it that sort of thing. And it was a fascinating piece of work. There are people who bought properties a long time ago who were sitting on properties with market values under $200,000.00. But there are most of stuff that's been built recently is, there's nothing that would I think would classify as affordable. I don't know why, timeshares I'm not sure but other than timeshares, that stuff is high end. And so it tends to jack up prices overall and it takes units out of the market because that thing is sitting there most of the time with nobody in it. Mr. Rapozo: Yes. And that was I guess where I was heading is because it's pretty clear that we're the leader of that pack on Kaua`i. So we must be the most attractive island that everyone out of the state wants to buy our property, but then we see the negative impact that it has on our housing market and I think that's troubling. Okay I just, the condo units caught my eye because three-fourths of the condos are owned by out-of-state people, that's interesting. Mr. Dannemiller: I'll double check that. Mr. Rapozo: Okay thank you. That's all I have. Committee Meeting 27 February 8, 2012 Ms. Yukimura: I'm really sorry to say but we've run out of time. The Department of Transportation is here and they can only be here until 11:00 a.m. So we'll just leave this item right now and come back to it later on in the meeting but Mr. Dannemiller won't be here. We can take public testimony later on in the meeting or I will ask for this matter to be deferred to our next committee meeting. Mr. Dannemiller, if you can come back in two weeks that will be great, if not, we will schedule a special time for you to come back but we'll have it still on the agenda next time for public input and discussion. We'll also make it available, public input available at the end of, or wherever we can sometime today in the afternoon. But, we need to move on right now. So I'd like to ask Committee members to send questions to Christiane and we will send that over to Mr. Dannemiller for answers in writing and we will reschedule some time with him as well. With that, thank you so much, this has been a very thought provoking stimulating session and there's a lot more discussion that we will have. Mr. Dannemiller: Thank you. Ms. Yukimura: If there are no objections from the Committee I would like to suspend this issue right now and go on to the next item. Chair with your permission. Mr. Rapozo: No public testimony? Ms. Yukimura: We are going to have testimony later on. Mr. Rapozo: Well but I mean somebody, I'm just saying if somebody might be here that cannot come back later from the public. I'm not talking about the County or are you guys going to be able to come back? Anyone here that wants to testify that may not be here, because we don't know when we'll come back to this. Ms. Yukimura: Some time later today. Mr. Rapozo: I understand that but they all have lives. Chair Furfaro: Hold on, this is a discussion on the body. Chairwoman you can take a few minutes of testimony for those that cannot come back, would you like to do that now? Ms. Yukimura: I just want to ask everybody's cooperation, so maybe if Jeff wants to speak for three (3) minutes. If anybody else, Jeff is from Honolulu and won't be here, and then anybody else please if you could hold off until later today or next week. Thank you, go ahead Jeff. Committee Meeting 28 February 8, 2012 JEFF GILBREATH, EXECUTIVE DIRECTOR, HAWAIIAN COMMUNITY ASSETS: Thank you Chair Furfaro and Vice Chair Yukimura. Ms. Yukimura: Can you speak your name and organization? Mr. Gilbreath: Yes, absolutely. Ms. Yukimura: Thank you. Mr. Gilbreath: My name is Jeff Gilbreath, I'm Executive Director with Hawaiian Community Assets. We're a HUD approved housing counseling agency and financial education provider that provides services across the State to low-income families with a focus on housing. I want to thank SMS for the study that was done and providing you guys the larger set of data about what the County faces and what the State faces. As a HUD approved housing counseling agency I just want to say that you can utilize us as a partner in helping refine some of this in the sense that, yes you have surveys that are going out to families asking them what they want, where they're at. It can be a totally different picture when you get down into the nitty-gritty and you see what's on the credit report, what's on the financial assessment, how much people are able to afford based on existing income and debt. So, some projects that we have across the State we are actually helping refine larger sets of data based on the financial data we are required to maintain as a HUD approved housing counseling agency. The other piece that I want you to consider was the slide regarding the six (6) highest housing markets in the nation and what level non-profit development played in dropping those numbers of housing values in those other markets versus Hawai`i. We do know outside of the. Habitat for Humanities and those limited folks in Hawai`i, the non-profit developer industry is sometimes not as large as you see in the Bay Area of San Francisco, Los Angeles or New York City. The third piece is to consider housing inventory, really something that is targeted. What is out there? What's available? As a housing counseling agency we have an amazing opportunity to sit with families and educate them about all of their opportunities. Not everybody is going to be a home owner. Renting is going to have to be something that is out there and available for folks. But if we have a very detailed list of inventory, we're able to as a HUD approved housing counseling agency assist the County, assist these families in identifying units that are available, that are vacant, minus the timeshares, that we can actually start to get folks in these houses and address these major issues that families are facing. Finally I do want to put one other bug in your ear, is the issues of transitioning youth, foster care youth, kids coming out of juvenile detention, folks coming back from different spots on the island or across the State, or maybe coming back to Kauai wanting to raise a family, to address their needs as well. I know that kupuna absolutely, very important that our next generation we cannot go away from looking at their needs as well. So please, I'd love to come back and speak more 4 Committee Meeting 29 February 8, 2012 with you folks about what is available and what's possible. I'm not so certain what is available with my time being a non-profit organization or our travel budget, but I appreciate you guys taking or allowing me the time to just share those points with you, so thank you. Ms. Yukimura: Thank you very much Jeff. We will keep in touch with you for sure and your organization and we know that Desiree is here on Kaua`i as well. Thank you. Chair Furfaro: Jeff would you give us your contact information before you go out the door? Mr. Gilbreath: Absolutely. • Chair Furfaro: Thank you. Ms. Yukimura: Unless there's anyone else that really needs to speak, we're going to move on to the next item please. Can we? No we're keeping it open (inaudible). Can we have the next item read please? The meeting was called back to order, and there being no objections, the Committee proceeded on THE 2012-07, CR- HTE 2012-03: on HTE 2012-07 Communication (01/03/2012) from Committee Chair Yukimura, requesting agenda time for Mr. Ray McCormick, District Engineer, State Department of Transportation, Kaua`i District, to provide a briefing on the Long Range Transportation Plan. [Received for the record.] There being no objections, the meeting recessed at 11:37 a.m. The meeting, reconvened at 6:31 P and an .m. proceeded as follows: p Ms. Yukimura: We're back now in session and I think we need a motion to receive on the first item of Housing. Mr. Chang: Move to receive. Mr. Kuali`i: Second. Committee Meeting 30 February 8, 2012 Ms. Yukimura: Moved and seconded to receive. Any discussion? Oh wait excuse me we need to defer it, we promised to defer it. I'm sorry. Mr. Chang: I withdraw my motion. Mr. Rapozo: Motion to defer trumps it. Ms. Yukimura: That is true. Upon motion duly made by Councilmember Rapozo, seconded by Councilmember Kuali`i, and unanimously carried, HTE 2012-06 was deferred. There being no further business, the meeting was adjourned at 6:32 p.m. Respectfully submitted, Ihilani C.J. Laureta Secretary APPROVED at the Committee Meeting held on April 4, 2012: • AI JigiNN A. YUKIMt A , ( A IR, HOUSIN ' / TRANSPORTATION / ENERGY CONSERVATION & EFFICIENCY COMMITTEE