Tuesday, May 5, 2015

Musings: Not Rocket Science

Though there's been quite a bit of hysteria about the Kauai County planning department's crackdown on illegal visitor accommodations, the numbers tell the real story.

The department began by reviewing records in the county's Real Property Division, where it identified approximately 320 properties that were assessed and paying taxes for a self-declared transient accommodation, without having the proper permits.

The planning department’s enforcement division then investigated the sites to determine if they were in fact operating without the required zoning permits. As of last Thursday, it had completed its investigation into approximately 160 of these properties, and issued approximately 93 “cease and desist orders.”

According to an email from Planning Director Mike Dahilig:

The vast majority of these operations are illegal TVRs. The Department is reviewing each case to determine the specific type of operation, but of the 93 cease and desist orders, a handful of these operations (we anticipate approximately 10 to 15) are homestays where the actual owner occupies the dwelling.

Besides the homestay/bed and breakfast operations, the Department is seeing many TVR operators (owners not living within the dwellings) attempting to apply under the CZO’s current definition of Homestay. Because of a loophole within the CZO’s definition of Homestays, we do have to process these applications; however, the Department is taking a firm stance against these types of applications before the Commission.

So the reality is exactly as suspected: Some 90% of the cease and desist orders have been properly issued to illegal TVR owners who can no longer get permits, but are trying to game the system.

Do they deserve mercy? Pity? Special treatment? A blanket grandfathering of each and every operation? Should they be allowed to bring down the legitimate homestay/B&B operations by slipping in on their coattails?

After my last two blog posts on the the issue, where I identified a number of questionable operations in Kilauea, I got some emails from owners who wanted to meet so I could explain the law to them, which is definitely not my kuleana. Others wanted to plead their case and have me visit their operations.

One of them was Hilary Ferris-Chandler, who operates the Kauai Retreat Center, which I characterized as a hotel because it has six bedrooms, each with “private outside keyed entrances.” It's on an ag CPR in Waipake, next to the ginger/tumeric farm operated by Hilary's brother, Ben Ferris.

Though it is listed on BedandBreakfast.com, it began life as an unpermitted TVR. Or as Hilary described it:

My father bought the secluded property and then built the house in year 2000 because his wife was an artist who wanted to have art groups accommodated for on the north shore and there was no art retreat accommodations around at that time.

I am the manager/owner and directly went to the planning commission for a permit for this use in 2001. I was told by Ian Costa the then planning director that there was no permit for this use available at that time and people “just did it”.  So we built specifically for this purpose and since it is very secluded with only family as neighbor and not bothering anybody we have offered it as a “retreat center” to many groups seeking seclusion with a venue to have group activities.

When the “grandfathering” permit for TVR became available, we were among the very first to apply. Our application was deemed complete. Then the planning commission added another condition that on Ag land 75% of CPR owners needed to sign.

They were unable to get 75 percent of their co-owners to sign, and so were unable to secure a TVR use permit. While appealing that decision in court, they have continued to operate.

Hilary then went on to say:

I believe that if our house was under ANY other use it would impact … the neighborhood far more. Again, please know that we try our utmost to be extremely sensitive PONO neighbors and believe that we do not bother anyone at all.

In my reply to her, I wrote:

I am glad to hear your story. But still, it troubles me, because you were essentially told you are not eligible for a TVR, since you couldn't get 75% of your CPR to agree (for whatever reason) but you have continued to operate it, knowing it does not have a permit, and are now treating it like a homestay/B&B, which it isn't, because you aren't there living under the same roof.

It does seem like you got bad advice from Ian Costa, who certainly should have known better, and I think it's great that your brother is farming. But it seems there is no denying that it is an unpermitted TVR on ag land. And given that it has six bedrooms, all with private outside keyed entrances, it does seem to function as a small hotel.

I'm not sure how all this will ultimately be resolved, but certainly you can see the problems that would start to arise, and the impact on agricultural land values, if everyone were allowed to open their own 6-bedroom resort-type accommodation.

I'd be interested to hear your thoughts on how you think this type of activity could be nipped in the bud in a fair way. Or do you think that there should be no restrictions on this kind of use?

Though she thanked me for my reply and “mana’o,” she did not answer my questions.

And this is where Kauai County now stands. It has 455 approved and active TVR certificates, hundreds of illegal TVRs and perhaps a few dozen unlicensed homestays/B&Bs.

According to Mike:

The Department currently has 14 accepted applications for homestay operations. Of the 14, 10 are owner-occupied and four are not. There are at least 20 more (a number that grows almost daily) that are in pre-application review with the Department. Of these, no applications have been officially accepted; however, the majority of them, it appears, are not owner-occupied operations. The Department is also receiving daily phone calls requesting information regarding the Use Permit process for homestays. The Department can only resolve this matter upon the submittal of an application, and pre-consultation with the applicant.

The department's response has been to submit an ordinance, approved by the Planning Commission and now before the County Council, that defines homestay/B&B as having a live-in homeowner. Mike writes:

This is why the proposed definition before the County Council is so important; it will essentially close the door on non-owner occupied transient accommodations from applying for homestay use permits.

Councilman Ross Kagawa has predicted that passing an ordinance will be a long, painful process. Of course, the longer it's dragged out, the more applications get in the hopper, and the problem just mushrooms.

If the Council just accepts that simple definition — a live-in homeowner — shouldn't it be pretty easy to separate out the real homestays/B&Bs from the TVRs that are masquerading as such?

And then wouldn't it be easy to say no to all those who don't meet the definition, regardless of their pleas and tears?


Anonymous said...

Thanks for clarifying (somewhat) this situation. My neighbors have operated a homestay (they live on the property) for over 20 years and have asked the County several times over the years if they needed a permit. Each time they were told either they did not, or that the County would deal with the B and B issue at a later date and they should just keep operating. No one in our sparsely populated neighborhood has ever had a problem with their "business." Then out of the blue they get the cease and desist letter with threats of $10K a day if they stay in business. They were also compared to drug dealers in the paper by the head of the Planning Department. Although they no longer advertise they still take bookings from prior clients and (along with numerous others in their situation) are talking to lawyers. Seems as though the Council better sort this out very quickly, but it seems that some of them have higher priorities, like getting Syngenta off the island!

Sorry for the anonymous post but I don't want to involve my neighbors.

Anonymous said...

What I don''t get is what's the effective difference between a live-in owner and a live-in manager. I'd think the line-in manager would do more for providing a home and occupation for some retiree doomed to otherwise live on social security and a meager pension, if any. Of course, they could get one of those high-paying jobs at Walmart which certainly would give them enough money to rent somewhere if they could find a place to rent. Both would be charged with maintaining the peace at their residence and providing services to, and control of, their guests. I'd be interested to hear a material argument for live-in owners, but against live-in managers.

BTW - I own a legally permitted TVR which will never become a B&B.

Anonymous said...

The difference between a live in owner and a live in manager is that the live in owner stipulation prevents parties from out of state buying up residential homes, plopping someone in as a live-in 'manager', and essentially making residential neighborhoods too expensive for locals to buy homes. The BnB is the quintessential expression of a Mom and Pop business, or maybe someone who wants to make use of a little extra space without having to deal with long-term roommates. Making it a live-in OWNER will keep BnB's from growing into commercial giants and thoroughly disrupting the atmosphere of our residential communities.

Anonymous said...

Well, Its not rocket science, to determine what the "material argument" is! An owner is just that: an OWNER, that also has HOMEOWNERS EXEMPTIONS that they qualify for yearly and attest to, under penalty of perjury! Oh, and thanks so much for offering us retirees the opportunity to be a "live-in manager". Owner vs manager? Really? If you don't see a difference by now, that train left Nawiliwili station some time ago.

Anonymous said...

on another note Kouchi named senate president, 19-6 vote.

Anonymous said...

Gary is back. Reportedly a huge success. Maybe he can represent Switzerland on the council. Sort of district representation..

Anonymous said...

Sue them. It will not be the first time or the last time.

Mayor, when will you give the county a real planning director with both an education and actual experience?

The time is now before he gets you in an even worst predicament.

Anonymous said...

Mike Dahilig is a good Director and has both law and planning degrees. He has hired good long range planners that are trying to correct long-standing problems. On the other hand, Ian Costa is an architect and at the time of his tenure as Planning Director, had conflicts of interest with his architectural work and planning responsibilities. Mayor Carvalho replaced Ian, but lo and behold, instead of letting him go, he is put in as Deputy Parks Director. The key is if the Mayor will support Planning 100% and get solutions to the problems instead of side-stepping it and leaving it for someone else to resolve. These are the types of legal battles that the County should engage.

Anonymous said...

the problem is you all think local people are dumb and u guys are all smart and all local people should be replaced with uber smart mainland people that is the racist truth.

when it suits u and the locals know their place then u like them when they obtain a position and power that just cannot compute in your brains u also do not like mainland or non locals that support locals if they do you hate them with a rabid rabies leel that your typing hands cannot handle

Anonymous said...

3:10 You are incorrect. Mike Dahlig is not a good Planning Director.
He is power hungry and his "administrative directives" are total BS.
As far as ownership of property goes..there are several ways to establish an "owner".
But the fact remains, the County of Kauai feels they are the owner of all properties. They take or give as they please, have a vested interest and lien capability via property taxes and the County also enforces on a selective basis.
Each right the County takes from your brother will eventually be a right taken from you.
And thank God, Ron Kouchi is Senate President. He is smart and has Kauai in his heart. He has strong alliances and will be effective. Unlike Da Hoos who spent years in Honolulu and has Zero support because of his grandstanding and deceitful ways. A man of lies is forever a liar.
Ron is a man of integrity and if he gives his word he will keep it.
I hope Da Hoos had a delightful time in Switzerland. I wonder if he gave any "bite me" comments to Syngenta. Oh God poke my eye out with a fondue fork...Der Schein trügt.

Manuahi said...

I think we should ask "Basel" to be our sister city!

Anonymous said...

MAD did not hire those long range planners. Costa did. Get your facts straight. And try to stop living a delusional bubble where Mike is good at anything.

Anonymous said...

Administrative directives, like the one that the planning department refuses to inform if there are zoning violations on a property?

Poor man has high chair in his office don't poke the baby.

Unknown said...

Hello Joan.

Just read your most recent post about my favorite subject. Clearly Mike Dahilig respects your fair reporting without the embellishments seen elsewhere, which explains why he's shared what you just shared with the rest of us. No matter where we stand on the issue, having clearly stated quality information is so important. At the very least, we know what the Planners are doing and why.

As to the 320 unpermitted cases, this by no stretch of the imagination is all that are out here. As ongoing research continues, they will find many more, both TVRs and BnB/Homestays. When these numbers are known, our community will be shocked.

Mike said of the 93 cease and desist orders most where to illegal TVRs. An estimated 10/15 cases were to actual unpermitted BnBs; which brings us to the ordinance.

Residents understand that putting an ordinance in place as it is currently written as quickly as possible, is imperative. This is why we support its passage. For one thing it will head off the deluge of Illegal TVRs applying for permits disguised as Homestays. Another reason is that it controls the number of applications to no more 10 per year and insures resident participation. We have asked for more controls to be included to strengthen the language. As Joan points out, the fact that there are many , many unpermitted TVRs operating on Kauai some already trying to scam the system; is no longer a matter of conjecture. Even with the 2008 prohibition on TVAs outside the VDA, gobs of folks continued on their merry way running illegal rentals in ever increasing numbers. Also unknown, is the real number of Homestay/BnBs. Eight such operations have permits. Planning has found 10/15 more. Like TVRs, the actual number of BnBs, when counted, will be eye popping. A 2005 Hastert/Gelber report on TVRs and BnBs paid for by the County counted more than 170. Parallel research by an industry group funded by the Board of Realtors found the number to be even higher. So 10 years later, what might the number be? Anybody want to guess?

So when the residents speak of controls on process and limits on numbers, these are just some of the reasons why.

The Council is aware and will vote for the ordinance, hopefully without weakening it.

We are doing our due diligence.

Sincerely, Sam

Anonymous said...

Simple, Direct ?

I't don't work that way in this County. Had the same simple direct approach been taken in 2008, all the illegal TVRs would've been closed down. When the Council starts trying to find a "balance" which historically ends up benefitting the illegals not the community. things get screwed up fast.

Can we hope the Council has learned from past mistakes? The balance you're looking for IS the ORDINANCE. Do us all a favor and pass it just as it reads. Don't fuck up again, PLEASE.

Anonymous said...

So typical. Even after being told to stop, your neighbors continue to take bookings. The County should throw the "book" at these guys. The same mentality that got them started in the first place. Law? What law? Stop? What stop?