A Kona community committee on Tuesday unanimously approved submitting testimony to the Leeward Planning Commission calling for revisions to a county bill that would expand short-term vacation rentals.

The Kona Community Development Plan Action Committee approved a document authored by Chair John Pelletier criticizing aspects of Bill 147 — a Hawaii County Council measure aiming to redefine hosted and unhosted short-term vacation rentals, establish working standards and set punitive fines, and expand the list of zoning areas where these rentals are allowed to operate.

The KCDP committee is a nine-member volunteer body appointed by the mayor to work with the Planning Department to guide development in North and South Kona.

Bill 147, which was forwarded to the planning director and planning commissions by a council committee on April 7, would lengthen the rental period considered “short-term” to stays less than 180 consecutive days, as opposed to 30 days under current rules.

It would also set occupancy limits, reduce “quiet hours,” and restrict the types of activities allowed on rental properties.

The bill also calls for the creation of an enforcement fund, leveraging fines ranging from $5,500 for first violations to $10,000 for third violations and beyond. If county enforcers find an unregistered property listed as bookable anywhere online — including on popular sites like Airbnb and VRBO — they could consider that sufficient evidence of illegal operation, with owners then having to prove they’re in compliance.

Under the proposed legislation, all short-term rentals would be divided into two groups: bed and breakfasts and STVRs.

The new rules define B&Bs as hosted rentals where someones lives on the same property as the rental unit during guest stays. Conversely, STVRs are defined as unhosted rentals with no on-site presence by a “host” — specified in the bill as someone “reachable,” whether it be an owner, family member, property manager or tenant.

Registration fees would be set at $250 for new B&Bs with a $100 annual renewal, and $500 for new STVRs with a $250 annual renewal.

Whichever group a particular property falls into determines where it’s allowed to operate and what rules it must follow. B&Bs would be permitted in a large section of zoning categories, including residential, commercial and agricultural without the need for a special use permit. STVRs, on the other hand, would be mostly limited to resort areas, but with two notable exceptions: properties zoned multi-family residential and neighborhood commercial.

This would broaden the areas where unhosted rentals can operate, which is what prompted the KCDP on Tuesday to approve the submission of opposing testimony to the planning commission.

“Bill 147 (should) be amended to remove STVRs as an allowable use in Multiple-Family Residential (RM) and Neighborhood Commercial (CN) districts,” the testimony read.

Justifying their opposition to the bill’s expanded zoning areas, some committee members worried the measure would further reduce Kailua-Kona’s already dwindling supply of long-term resident and workforce housing.

“Kona is by far the place with the most vacation rentals … over a quarter of the vacation rentals on the whole island are located in Kona,” Pelletier said. “Condo prices and multi-family residential prices are really driven up by this. … I do think there is a big contingent of people who are buying condos because they can vacation rent them, and it’s causing housing problems in Kona.”

Pelletier claimed that county officials are naively trying to bolster tourism without understanding conditions on the ground in one of the areas of the island most impacted by tourism.

“I feel that council members not located in Kona want to direct visitors to urban Kona and promote the visitor industry there, without thinking about people who live there,” he said. “People do live here in Kona, and I want people to have housing.”

Committee member Shane Palacat-Nelsen shared this sentiment and offered the perspective of a Native Hawaiian watching his neighborhood be changed by unchecked vacation rental growth.

He said he grew up in Kealakekua Bay and has spent 57 years of his life in an area that’s been called home by many generations of his family dating back “over 700 years.”

“We did an analysis in our village, and less than 1% is remaining generational residents, which means the rest are all vacation rentals,” Palacat-Nelsen said. “And that changed the ability of how our village operates and how it conducts itself. We struggle today to restore our resources on the shoreline. … The state has to spend millions of dollars alongside the community to restore coral because there is no management of the STVRs.”

And it’s not just ecological damage, he said. The behavior of tourists staying at vacation rentals in his neighborhood has irked locals for years.

“All the time when they visit, they think that they in one resort, and so they conduct themselves (like it),” he said. “They party all night long, they do things that are disrespectful to our lifestyle. And so something gotta be put in place to manage them … if the Hawaiians got to be regulated then so do the visitors — that’s how I feel.”

Testifiers at Tuesday’s meeting included Hilo resident Kalei Kailikini, who argued that homeowners should be allowed to rent out rooms in their homes without paying for county approval.

“You will have people that, when the children grow up and leave home, they have this big house, and then they decide, well, you know, should I sell it?” Kailikini said. “But these are local people that say, ‘no, I want to live up my life here on this island.’ So, they decide to rent a room out … but the bigger picture would be that if you take away our ability to earn extra money — that’s the reason why we cannot afford food, gasoline, blah, blah.”

She said she feels that many legitimate B&B operators are being punished with legislation like Bill 147, instead of officials going after what she described as “bad apples,” like landlords who price-gouged displaced residents still reeling from the loss of their homes during the 2023 Lahaina fire on Maui.

“So, all we’re doing as ordinary people, we’re trying to be creative to earn more money,” she said. “So, if you have bad apples go after them, don’t take away the privilege from everybody. Go after the people that charge $6,000 a month for a one-bedroom in Lahaina.”

Another testifier was Jason Masters, chair of the Ka‘u Community Development Plan Action Committee.

“I think its erroneous to believe that short-term vacation rentals don’t have an impact on property values or home prices in either the zoning districts or the entire island even,” Masters said. “I think many studies have indeed shown that people who buy short-term vacation rentals generally don’t live there. They might provide some economic benefit to the community — people cleaning the house, managers, et cetera. But I don’t think that’s outweighed by removing that housing stock from the residents.”

Email Stefan Verbano at stefan.verbano@hawaiitribune-herald.com.