Kudos to U.S. Sen. Schatz for zoning reform initiative

by Jonathan Helton, Grassroot Institute, March 7, 2023

A new federal “Yes In My Backyard” grant program, spearheaded by Hawaii’s U.S. Sen. Brian Schatz, deserves kudos for targeting barriers to new housing.

The purpose of the program, enacted in December as a part of last year’s federal spending package, is to incentivize local governments to streamline permitting, increase housing density and allow more multifamily homes by-right, according to a committee report on the bill.

“We need to legalize housing and abandon the exclusionary zoning that originated during Jim Crow and continues today,” Schatz said in a December news release announcing the program. “Government needs to change its mentality from intentionally constraining the supply of housing to incentivizing it.”

That hits the nail on the head when it comes to zoning, permitting and land-use restrictions — especially in Hawaii. Everyone familiar with homebuilding in Hawaii knows that state and county permitting processes are complex, with delays sometimes stretching for as long as a year.

Our zoning codes also are complex — unduly so. By micromanaging what can be built, and where, local zoning codes increase homebuilding costs, constrain housing innovation, contribute to urban sprawl, promote segregation along economic lines, and lead to either homelessness or people leaving Hawaii entirely to find less expensive housing.

In Hawaii, the last thing residents need is more expensive housing, so this new “Yes In My Backyard” program focusing on zoning reform is welcome.

The U.S. Department of Housing and Urban Development is still finalizing program rules, but expects to start awarding funds later this year. The grants will be awarded on a competitive basis to state and local governments and regional planning organizations that show a strong need for affordable housing and a willingness to prioritize removing barriers to building such homes.

Last year, the Hawaii Legislature and governor enacted a bill with a similar intent — House Bill 1837, called the Yes In My Backyard Act — that mandates Hawaii’s four counties submit biennial reports on how they are reducing regulatory barriers to homebuilding. Because of that, Hawaii might already be ahead of the game in applying for the federal grants.

Meanwhile, there are numerous bills in the current legislative session that state lawmakers could approve to help Hawaii better qualify for the grants.

Simple changes — such as allowing duplexes and triplexes on all parcels zoned for single-family homes; eliminating or reducing parking minimums; and expanding the use of by-right approvals, which bypass mandatory political hearings on projects that already comply with zoning and permitting laws — would help Hawaii become competitive for the funding.

More important, such reforms would make it less expensive and faster for homebuilders to break ground, which would help lower Hawaii’s astronomical housing prices.

According to research from UCLA’s Lewis Center for Regional Policy Studies, new housing — even new market-rate housing — can help lower rental rates. Imagine what allowing more high-density housing targeted at lower price points could do.

But such housing cannot be built overnight, no matter how much lawmakers streamline the process. Obtaining financing, acquiring the building materials and hiring construction crews all take time, so the sooner lawmakers act, the better.

Even if Hawaii’s counties fail to receive the federal grant funding, they at least will have lowered their barriers to housing and taken steps to help ensure that Hawaii residents can afford to stay in the state they call home.

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This commentary was published originally in the Honolulu Star-Advertiser on March 7, 2023.