Maui housing takes another hit

by Keli'i Akina, Ph.D., President / CEO, Grassroot Institute of Hawaii, August 6, 2022

When bureaucracy grows, housing does not. That’s because more bureaucracy nearly always results in more regulation and delays — and I hope someday soon the majority of our policymakers in Hawaii will figure this out.

The latest bureaucratic wrench to be thrown into the gears of homebuilding, especially on Maui, is a June ruling by the state Commission on Water Resource Management — also known as “C worm” — that designated West Maui as a surface water and groundwater management area.

The ruling is intended to protect the environment and Maui’s water supply. But as a practical matter, it heightens the level of bureaucratic scrutiny regarding everything water-related on the island, including new housing.

Maui homebuilders already had to deal with the county Department of Water Supply. The agency not only manages and operates Maui’s existing water systems, it also implements land-use plans and identifies what resources are available for current and future use.

CWRM, on the other hand, administers the state water code and governs permits related to surface water diversions and ground water development. Its expansion into Maui’s affairs was protested by both local politicians and residents as an affront to home rule and for adding another hurdle to homebuilding.

Eva Blumenstein, program manager of the Maui County Department of Water Supply, said Tuesday on my regular “Hawaii Together” program on ThinkTech Hawaii that the CWRM ruling means that every water purveyor on Maui will have to apply for a water-use permit that is subject to special conditions under the state code. 

During the program, hosted by my Grassroot Institute of Hawaii colleague Ted Kefalas, Blumenstein said parties applying for new-use permits, such as for wells not yet in production for housing tracts yet to be built, will be dealt with only after existing uses have been addressed.

“There are, at least, I think … 80 existing wells in West Maui,” Blumenstein said, “so maybe 60 or so of those are production wells that need to be processed.” 

Given that Maui is still waiting for a new state permit requested in 2009 for a water-treatment facility, it’s safe to say, she said, that, “It'll be years, I'm sure,” before any new permits are granted.

Part of the problem, she said, is that every application has to navigate a process wherein anyone can file an objection or comment, which then must be resolved. 

How many applications are slowed down by objections? According to Blumenstein, the answer is “all of them.”

“Every water-use permit application we have filed has been objected to,” she said.

Thus, if an affordable-housing project wants to proceed on Maui and it has already managed to navigate the other land-use and zoning requirements, that is only the beginning.

“[Imagine] an affordable-housing project proposed to develop a new water source to serve a project,” she said. “If your water use in that permit application is contested, then that whole project may be subject to a contested-case hearing. So that could result in appeal and add time and expense to the applicant” — which, of course, the prospective homebuilder might not have.

The most frustrating thing about all this is that CWRM appears to be duplicating the work of the county water department while ignoring the expertise the county agency has to offer.

The county, said Blumenstein, had planned how to meet the needs of the community and even allocate resources in a sustainable manner that could still support new housing. But CWRM’s designation completely ignored the county’s calculations and alleges that West Maui’s water needs exceed the supply. 

Blumenstein explained that the county plan includes sources of water other than groundwater.

The county’s plan, she said, “allocates the most appropriate resource to future demand, considering the county land-use plans, the community's priorities, climate-changing impacts, legal constraints, etc. So future development, for example, will have non-potable irrigation needs. 

“The [county] plan says that should be primarily met with recycled water, not by potable groundwater. The plan may also prescribe that supply for new development should not be served by that underlying aquifer for groundwater.”

This is not to cast aspersions on CWRM officials. Undoubtedly, they think they’re doing the right thing too. Either way, no one is disputing that it is important to act responsibly and preserve our state’s resources. That is as true for our water supplies as for anything else. 

But delay and bureaucracy aren’t “green.” They are just additional barriers that make it harder to live in our state and more expensive to build and buy a home.

Yes, let’s protect our water supplies, on Maui and throughout our beautiful islands. But don’t make it impossible to build affordable homes. We need to reduce the number of bureaucratic hurdles to housing, not increase them with more layers of well-intended but inappropriate regulation.

E hana kākou! (Let’s work together!)