Steering Growth - Extended Version
6 Leaders Discuss Development in Hawaii
Read the shorter, edited version of this forum here
(page 3 of 7)
So it’s partly about having a good plan and then following the plan. And great that Kakaako and especially infill and within Honolulu (are moving ahead), but if at the same time you have growth everywhere else, you can’t focus the tax dollars on that infrastructure and that is why it’s so important to know where you want growth and to have consistent support through generations of politicians so that you can have that consistency. And the other thing is you need to have clear requirements for the developer so that the external costs are not laid on tax, on the people of Hawaii, the cost for affordable housing. I mean if you just have developers provide market housing and not share some of the cost of affordable housing or create environmental problems and not pay for that, then those things are out of balance again.
Burris: You were talking about Nukolii and I’m thinking about Waiawa. Now, I wonder if you think that part of the fatal flaw of that project might have been that it was a hopscotch development. Do you think that is an argument that carries any weight?
Doane: I don’t know if it was a fatal flaw or it is fatal flaw. I think that there are some pretty imposing infrastructure issues that go into crossing a huge gulch, which a lot of people knew about. In a different market environment, it would probably be OK. The world I live in is one of usually having to deal with less than ideal alternatives. I’ve been reading the newspaper a little more in the last couple of weeks than I was before and I’m looking at the state that has the highest marginal tax rate in the U.S., with, in some ways with our GET, one of the highest sales taxes when you compound it. Then I’m looking at a state that has 163 school days. And, you know, we’ve got to have some much deeper thinking here about an economic foundation for this state because growth and homes and development, they really respond to demands instead of creating them, and the demand is created by healthy lifestyles that involve families, that involve jobs, and involves optimism about the future. And I think that right now, we’re in an environment where over the next three to five years, people are going to have to make some tough choices about alternatives that are less than ideal. So I don’t know where the balance goes on the public and the private side with all of that. But I think that you need to step back at this point economically and look at the context of the state and ask yourself what is the state, what are the counties reasonably able to do?
Burris: Andy, you’ve got a small development going up on the North Shore, and you’ve done a lot of development over the years. Wearing a developer’s hat for a moment, do you feel that it’s your responsibility to build affordable housing or is that something that government should do or the market should determine?
Anderson: I don’t see building affordable housing as my responsibility unless it’s a burden on zoning, or if I get some special entitlement that comes with it like it did with Kakaako for a while. But in the 50 years I’ve been around, I’ve seen this affordable housing formula, the attached HCDA (Hawaii Community Development Authority) at 30 percent, 20 percent, went down to zero. I’ve seen that affordable housing percent go up and down from wherever it was to zero. It doesn’t work for lots of reasons. I think you can build affordable housing in Hawaii, but you need the same kind of mentality, money, thinking, land and commitment as he (Micah Kane) did with Hawaiian Homes. It’s a state responsibility with the private sector, of course, but it’s a lot of lip service I mean we go into it for a while and it doesn’t work. The politician amends the statute, ordinance, whatever it is, and takes it away or lessens it. I don’t think we’re ever going to provide the affordable housing in the numbers that somebody wants. The houses that I build in a very small scale but, you know, A& B, Murdoch, Schuler, (DR) Horton, Hawaiian Homes, I mean, where do your people come from? You built 1,000 homes last year. Where do they come from? Living two families in the house.
Kane: They come Mililani to Makaha. They come from either rental communities or multifamily homes.
Anderson: So there is a demand. I mean is it fair to say that I should have my grandkids or my kids living with me forever in my house? I really would like them to have a house, affordable or a co-sign or make the deposit, but he is building basically affordable homes for a Hawaiian community. He has gotten the funding for it. But if he didn’t do that, these poor Hawaiian second families in these homes or moving out a rental, would be deprived for the rest of their life in their own state. Should we not build because of environment? Should we not build in open space for a demand that is pent up? I don’t think we know the demand for housing in this state, affordable and/or market. I mean everything that these people build, it gets sold. They’re not building what – he is got an environmentalist growing a resort group, but the Murdochs creating Mililanis. They’re not building for the tourist. They’re not building for the newcomer. They’re building basically for the Kamaaina. And so do we stop? Am I forever going to have my kid and his wife and three kids living in my house? I hope not.
Burris: Harry, before we started, you and Shara (Hawaii Business writer Shara Enay) were talking about having dreams and how hard it is not to have a dream because of the cost of housing and how difficult it is for a young person. Is the day coming when kids growing up here – average kids with average jobs – are going to be able to afford a house either on your island or anywhere?
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