Hawaii County could change how it defines “affordable rental,” which could raise the cost of rent for some low-income residents.

Kailua-Kona Councilman Holeka Inaba introduced at Thursday’s meeting of the council’s Finance Committee a measure that would amend the County Code’s definition of “affordable rental rate” in an effort to get more housing units qualified as affordable housing islandwide.

The county currently defines affordable rentals as having monthly rents that don’t exceed 75% of payment standards set by the Office of Housing and Community Development.

But the the amended definition would change that threshold to a wholly different standard, namely “a monthly rent (not exceeding) the most recent affordable rental guidelines for 100% of the area median income of the county,” which would be determined using data from the Hawaii Housing Finance and Development Corporation.

County Housing Specialist Kehaulani Costa told the committee the affordable rental definition is used to determine standards for county housing assistance programs. The 2024 affordable rental housing rates for most of the county ranged from $1,202 for a studio apartment to $3,061 for a six-bedroom home.

“The level that we set the payment standard at directly affects the payment to the landlords … and the rental amounts that our tenants pay,” Costa said.

By amending the definition, Costa said landlords whose properties might not currently qualify as affordable units could become eligible for housing assistance programs.

“No one else, for the most part, is using the payment standard,” Inaba said. “That’s not a number or a system we normally work with. (But) we see our (area median income) charts that are published on an annual basis. … We always talk in AMI, and when we’re able to provide that resource very clearly in a chart that’s always outlined, I think that’s to the benefit not only of the council but more importantly to those who are trying to get into the program.”

But there were some concerns Thursday about unintended consequences caused by the bill.

Wesley Takai, a former administrator for the county’s Real Property Tax Division, testified against the measure, saying that the current definition of affordable rental rates was arrived at deliberately, and that changing it could end up raising rents in some places around the island.

Takai posited that an East Hawaii landlord offering a three-bedroom house could charge no more than $2,134 a month to qualify for the affordable rental housing program under the current definition. But if the definition is changed, the landlord could charge up to $2,845 per month.

“Isn’t there a rule of thumb that mentions not more than 30% of a family’s income should be spent on rent?” Takai wrote in a letter to the council, adding that $2,134 a month is likely already out of reach for many on the island, who would need to make more than $7,000 a month to keep up with the “30% of monthly income” heuristic.

“If the goal of this bill is to increase the inventory of affordable rental units available in the county, how will converting the rates of the rental schedule to 100% do this, as the present rates at 75% seem to already be too high for many of today’s renters?” Takai wrote.

Inaba said Thursday that he does not want to do harm to tenants currently within the affordable rental housing program.

While current Real Property Tax Administrator Lisa Miura said there are still questions about how the proposed change would impact current beneficiaries of the program, she suggested the majority of tenants shouldn’t see their rent increase.

Nonetheless, Inaba elected to postpone any action on the bill Thursday pending further research. He said he may reintroduce the measure in a new form once its impacts become clearer.

Email Michael Brestovansky at mbrestovansky@hawaiitribune-herald.com.