Human Resources: Part II -
Housing in Hawaii: Problems, Needs and Plans
In the last State Voter we began a summary of the important study released by the Department of Planning and Economic Development on Housing in Hawaii. In this issue we shall concern ourselves with the needs and plans of the future.
Given the inability of the existing market to satisfy housing needs, along with continued trends toward higher development costs, the outlook for private housing production in the next five years is not bright. During that period the State will require over 38,000 more housing units merely to stabilize the current shortage. Because of the income distribution of this need, only 16,000 units are expected to be marketed privately without public assistance. The remaining 22,000 units, primarily for households with incomes below ;12,500 will require significant public intervention.
Construction of about 14,000 new public or publicly-subsidized units is now planned for the next five years. This would be a two-thirds increase over the total 1970 inventory of such units. Less than 10,000 publicly-owned or subsidized units were produced in the past ten years. Even the 14,000 units will fall 8,000 units short of the marginal five-year needs of new low and moderate income households. But prospects for filling that gap are rather good in view of Act 105 plans and some possible conversions of private visitor-occupied units to residential use.
Even if public action is able to meet this marginal five-year requirement, this would not make a dent in current housing deficiencies except through a slight increase in vacancies. There would remain
over 26,000 dilapidated units. There would remain at least 40,000 units occupied by more than one person per room. There would remain 120,000 households with incomes under 410,000 - 57,000 with incomes under s7,000 - compared to a total inventory of only 44,000 publicly owned or subsized units. There would be no relief for the roughly 43,000 households who now pay more than 25‘A of their income for rent and an untold number of owner-occupied whose monthly mortgage payments exceed 206 of their income. -
As it is unlikely that both these existing deficits and future needs can be filled in the next five years, existing needs can be stabilized by producing enough housing at appropriate price levels to keep up with the future needs. Therefore, the minimum five-year public objective should be to assure the production of 22,200 units, or 4,440 units per year, for low, moderate and middle income families. This would include roughly 14,500 units on Oahu, 3,500 units on Hawaii, 2,800 units on Maui and 1,400 units on Kauai to be added to expected private market production. In the long term, the State should attempt to translate the national housing goal into local reality. All residents of Hawaii should be able to secure a decent home in a suitable living environment.
Within Hawaii, only the State government could have the necessary resources and area-wide jurisdiction to sustain a comprehensive
attack on housing problems. New housing should be produced expressly for households who cannot now afford housing at the going market rate, rather than simply relying on used housing to be freed up for them.
A combined approach of cost reductions and subsidies should be applied selectively at each level of the housing process land acquisition,
land development, construction, financing and consumption. Some specific recommendations for the State are proposed as follows:
a) To increase the supply and reduce the cost of land for housing:
Consider establishing a State land bank for housing through designation of State lands, transfer of under-utilized military lands, and acquisition of private lands;
Use State funds to write down the cost of strategic urban parcels;
Acquire less than fee .interest in land for low and moderate income housing in heavily built-up areas;
Use the landbank, write-downs, and less than fee acquisition to stimulate planned community developments as well as new towns, both in the inner city and on presently open land.
b) To reduce the burden of land improvement costs on individual households:
Consider legislation to enable local governments to absorb land improvement costs with State financial support;
Consider the use of "tax increment financing" (taxes paid on the
increase in assessed value following land improvements would be
earmarked to offset the costs of these, improvements) for planned
development of State-owned land and/or local redevelopment
Encourage local reappraisal of zoning and subdivision codes;
Coordinate major public capital improvements with local land development efforts.
c) To reduce the cost of construction:
Appraise pre-apprenticeship and apprenticeship requirements for membership in construction trade unions;
Consider developing a public or semi-public building materials bank, which would purchase, store, treat and wholesale building materials shipped from the mainland;
Encourage local governments to consider amending building codes;
Consider promoting some of the techniques demonstrated in Operation Breakthrough which might be applicable to Hawaii.
d) To increase the supply and reduce the cost of financing for Housing:
Use State funds to complement Federal interest subsidy programs by a) subsidizing interest on construction financing, b) subsidizing mortgage interest rates beyond the Federal limits, c) providing the entire subsidy when Federal funds are exhausted and d) providing Subsidies to middle-income families who are now ineligible under the Federal programs.
Consider asking financial institutions to develop a shared mortgage pool and/or make commitments to invest a maximum portion of their resources for housing purposes;
Consider possible use of the State Retirement Fund for interim and/or permanent financing for housing;
Use large cash public time deposits in financial institutions
as leverage to get more private short-term financing for housing.
e) To redistribute income to housing consumers as direct subsidies
such as rent supplements:
Examine the present tax structure's impact on incomes and housing choices; consider channeling State taxes paid by low-income households directly back to them in the form of housing subsidies; consider shifting much of the real property tax to income and corporate taxes;
Consider using proceeds from leased State land for housing subsidies.
Also, to reduce the need for income supplements, reappraise minimum wage laws with a view to increasing purchasing power.
The State would continue to increase its capacity to develop an overall framework, plan and mobilize resources for housing. A functional plan for housing can be developed through a generally sequential problem-solving process like that used for Model Cities programs. The process should involve not just planners but all public and private organizations and individuals having an interest in solving housing problems. Particular projects and programs would be carried out by a variety of departments and agencies, as well as the private sector, according to their authority, responsibility and capacity.
FACT AND FICTION ***** WELFARE ********* ACTION *******
"I've heard that..." people move to the big cities just to get on welfare. Most recipients live in a new community Ito 5 years before
seeking public assistance.
Now is the TIME FOR ACTION to secure passage of Welfare Reform. On
the National level you are urged to write or wire, President Nixon
(details in local Voters).
Hawaii's welfare system is administered by the Department of Social
Services on the State level, therefore the State Board is developing an action program to achieve welfare reform in Hawaii. Starting with a Fact Sheet and evaluation of legislation, going on to a State Time for Action.
BE INFORMED AND REACT
1 Telegram = 10 Letters
Public Opinion Message Telegrams are a bargain-- 25 words to any elected official cost w1.50 + .30 tax to Washington, D.C.