Last month, Hawai‘i County asked the state Land Use Commission (LUC) to rule that transient vacation rentals aren’t allowed in farm dwellings within the state Agricultural District.
In November 2018, the county adopted Bill 108, which regulates short-term vacation rentals on the island. The bill defined where they would be allowed, how they would be regulated, and established a process for owners of existing rentals outside the permitted zoning district to apply for a nonconforming use certificate that would allow them to continue that use.
In the flood of applications for nonconforming use certificates that followed, the county discovered that a number of the rentals were on lots in the Conservation District, where such use is prohibited. It’s referred those cases to the Department of Land and Natural Resources’ Office of Conservation and Coastal Lands, which has successfully pursued significant penalties in recent months for the illegal operations. (See our related Board Talk column.)
The county has also denied outright dozens of applications from those whose properties lie in the Agricultural District, but many of the applicants have asked the Board of Appeals for a contested case hearing.
So on February 13, the county filed a petition with the LUC for a declaratory order that “farm dwellings” — which, since 1976, are the only kind of dwellings allowed in the Agricultural District — may not be used as short-term vacation rentals under state law.
The appeals board has consolidated the contested case requests for 19 of the properties — which are mainly scattered throughout Kailua-Kona, Kamuela, and Captain Cook — but the case has been stayed pending a declaratory order from the LUC.
The properties range in size from one acre to more than 18, and in tax assessed value range from about $400,000 to more than $3.4 million. Most have pools; some have jacuzzis, game courts and/or saunas, as well. Only one of them actually received a county tax exemption last year for farming.
The county stated in its petition that Bill 108 and the Planning Department’s implementing rules prohibit the issuance of nonconforming use certificates to rentals on lots created after June 4, 1976, in the Agricultural District. That’s because any existing short-term vacation rentals of farm dwellings were illegal under the state land use law, Hawai‘i Revised Statutes Ch. 205, the county argued.
HRS Ch. 205 requires a farm dwelling to be exclusively occupied by a single family that gets its income from agricultural activities on a farm that the same family holds in fee or leasehold, the petition stated.
Bill 108, however, defines a short-term vacation rental as a “dwelling unit of which the owner or operator does not reside on the building site, that has no more than five bedrooms for rent on the building site, and is rented for a period of 30 consecutive days or less. This definition does not include the short-term use of an owner’s primary residence as defined under section 121 of the Internal Revenue Code.”
“Under any circumstances, the purpose of a farm dwelling is to be used in connection with a farm: to support and be accessory to agricultural activities which provide income to the exclusive occupants of the farm dwelling who are also the owners or leaseholders of a farm,” the petition stated.
Bill 108’s definition of a short-term vacation rental “irreconcilably conflicts with a farm dwelling. … [T]hose short-term renters do not obtain income from agricultural activity,” the petition continued.
The county conceded that the state land use law allows short-term overnight accommodations (21 days or less) within the Agricultural District if they are part of an agricultural tourism activity “which coexist with a bona fide agricultural activity.” However, they are only allowed in Maui County.
“The provision of these types of agricultural tourism short-term overnight accommodations further demonstrates that the Legislature did not intend to allow for the short-term vacation rentals at issue in farm dwellings,” the petition stated.
Finally, the petition pointed out that a Hawai‘i court ruled that allowing cellular towers to be considered “utility lines” in the Agricultural District unreasonably expanded the intended scope of the term and frustrates the state land use law’s basic objectives of protection and rational development. The same rationale, the county argued, should be applied to short-term vacation rentals and farm dwellings.
—Teresa Dawson
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