Steps we could take to help Lahaina rebuild more quickly

by Grassroot Institute of Hawaii, "Hawaii Together" August 31, 2023

Finding temporary shelter for Maui residents displaced by last month’s massive wildfires remains an urgent need, but Ray Michaels, president of Maui Plumbing Inc., is worried about the capacity of homebuilders to meet that demand quickly.

Speaking with host Keli‘i Akina on this week’s “Hawaii Together” program on ThinkTech Hawaii, Michaels said he grew up in Lahaina, and though no one in his family died in the fires there, “I don’t think I’ve ever felt this heartbroken, because not only are you seeing the loss — you know, of our family home where we grew up, and my father losing his home — but [because] our entire community … suffered such a great loss.” 

Michaels said there are many regulations that could be reformed to help provide new homes in both the short and long term, including licensure laws that constrain the supply of skilled trades workers, building codes that complicate and disincentivize adding accessory dwelling units, and laws prohibiting prefabricated homes. 

He applauded Gov. Josh Green’s announcement that prefabricated homes will play a part in the temporary housing.

“You know, the construction industry was going to have to move towards the industrialization … or prefabrication of its processes [anyway], because we have such a deep skills trades deficit. And this was going to happen out of necessity, rather than being by policy.”

Michaels said that Hawaii’s low levels of personal and economic freedom play a big part in its lack of skilled workers. 

“Say you’re a skilled craft worker, and you can go to a state that maybe has less regulation on things, so the cost of living is cheaper. That’s a pretty easy decision to make,” he said, “especially if you’re someone from Lahaina, whose house just burned.”

Michaels said in the short run, a ”good example of what can be done” is the ‘Ohana Hope Village he has been working on with the Maui Family Life Center.

The Center, he said, was given some Continest pods from Hungary that were flown in on C-17s, “and these are flat-packed, 20-by-10 containers that fold up into, basically, a livable unit.” He said they didn’t come with kitchen or bath facilities, but “modular kitchen and bath pods” are being added. 

TRANSCRIPT

8-29-23 Keli‘i Akina hosts “Hawaii Together”

Keli‘i Akina: Aloha, everyone, and welcome to “Hawaii Together” on the ThinkTech Hawaii broadcast network. I’m Keli‘i Akina, your host and president of the Grassroot Institute of Hawaii.

Whether you live in Hawaii or anywhere else in the world, you’re aware of the tragic wildfires that have taken place on the island of Maui recently, and the devastation of the town of Lahaina.

In our office at the Grassroot Institute, we are still reeling from what has taken place, as we have many friends and colleagues who live on the island of Maui, where we do more work than any other island than on Oahu. 

Please know our hearts go out to all of you on Maui who were affected by this, and all who have friends and relatives who have been impacted.

We’re at a time now where much is taking place. There are plans underway to restore Maui, to rebuild Maui. That’s the big discussion now. 

There are many stakeholders and voices in that, and at the Grassroot Institute, we are in a posture of listening. We want to hear from those who have Maui and Lahaina in their heart, and we also want to hear from experts who can offer solutions as we move forward into the future. 

Rebuilding will definitely not be an easy task, nor can it be completed quickly. The area, we know, must be cleaned of toxic debris, and the community must have the time to go through the human cycle of grief and coming to terms with what has taken place, and being a part in determining what happens next. 

There’s steps definitely that state and county lawmakers can take right now to support Maui residents. And one of the important and urgent tasks is to find temporary shelter and prepare for rebuilding efforts. 

To talk about that, I have the gentleman joining me who spent his youth in Lahaina and is now a permanent resident on the island of Maui. More than that, he has been involved in bringing solutions to Hawaii with regard to housing. His name is Ray Michaels, and he’s the president of Maui Plumbing. Very knowledgeable about the skilled trades and the building industry. 

I’d like to welcome him to the show now. Ray, thank you for joining us today. I appreciate that you were willing to spend time with us during this difficult crisis. 

Ray Michaels: Well, thank you, Dr. Akina. It’s a pleasure to be here and talk with you. And you know, before we begin, I just have to say thank you for all the work that Grassroot Institute has done bringing accountability and transparency to our local government and for all of the learning seminars that you put on, you know, on Maui, on Oahu. Every time I go, I always learn a lot of new things. So I really appreciate what you guys are doing for our community. 

Akina: Ray, I don’t want to catch you off guard, but I do want our viewers to know that you’re very personally connected to what has happened on Maui, and your family has actually suffered during the recent tragedy. Would you mind just sharing a little bit about your background with the town of Lahaina as you grew up, and how, perhaps, your family was impacted recently? 

Michaels: Sure. So I’m 38 years old. I was born in ‘85. I’ve been on Maui since ‘86. My father originally lived on Oahu prior to then. And, so, Lahaina is home. 

Spent my youth in, you know, living in the town of Lahaina. And, you know, it’s hard to put into words. One of the things I tell people is, like, I don’t think I’ve ever felt this heartbroken, because not only are you seeing the loss, you know, of our family home where we grew up, and my father losing his home, but it transcends our entire community that suffered such a great loss. 

And my family has been fortunate enough not to suffer any loss of life. We feel very blessed in that. And, you know, my father was able to leave Lahaina about an hour before his neighborhood was engulfed in flames.

And, you know, I feel so thankful he made that right choice. And but, you know, speaking to that, it’s just affected so many friends and family and loved ones in such a tragic way that because of that, I think, you know, again, this is kind of the most saddened I can remember being in a long time. 

But I do take solace in how much support Lahaina has received and how much the community has come together. And, you know, I’ve reconnected with old friends and even made some new ones during this process.

So, you know, I just want to say thank you to everybody, on Maui, in Hawaii, and even the world and the support that’s been received. I think everybody feels grateful and blessed in that.

Akina: Thank you, Ray, our hearts go out to you and your family and as well as to all the residents on the island of Maui who suffered in this tragic event. 

As we talk now, though, we want to look toward the future, and you’re playing a part in the rebuilding of Maui. You’ve got some ideas as to what the state and the county could do to aid in Maui’s recovery efforts.

First, let’s talk a bit about providing housing for Maui residents who’ve been displaced by the fire. I would think that that would be first and foremost of the concerns, trying to meet that immediate need. What are your ideas here? 

Michaels: Well, I’m working with a couple of different organizations right now. I’m helping the Maui Family Life Center here on Maui. They were being given or donated some Continest pods from Hungary that were flown in on C-17s. And these are flat-packed, 20-by-10 containers that fold up into, basically, a livable unit. And you can actually add multiple of these together to create larger [housing units]. 

While they don’t come with, you know, kitchens and baths, we find that it’s going to be very important so that people feel comfortable in this facility that we’re calling [ʻOhana] Hope Village, you know, that they have their own private kitchen and bath facilities, because what this is really aimed towards is families, or displaced with children under 5.

And then, after that group is taken care of, we’re going to move to kupuna and then after that, it’s going to be families with children over 5. 

And what we are working on right now is what we call modular kitchen and bath pods and add that to these units. So it gives families their own kitchen and bathroom space on that unit, so that, you know, when, you know, your child wakes up in the middle of the night for the bathroom, they don’t have to go to a community bathroom. They have their own private bathroom. People feel safe. 

So, that’s what we call our intermediate goal, right?, is making sure that we get people out of communal shelters and into their own private accommodations, and, you know, the hotels have been gracious, and I know the government’s working with hotels to provide that kind of short-term housing. But we know that those funds aren’t going to last forever. 

So it’s important that we figure out some intermediate housing goals, and if Hope Village is going to be a good example of what can be done in a short period of time. 

Akina: So, Ray, Gov. [Josh] Green recently announced that prefabricated, manufactured homes will play a part in the temporary housing. What do you know of his intentions here? And what is your reaction to his announcement? 

Michaels: I’m not completely clear on his intentions, but I really applaud this announcement. You know, the construction industry was going to have to move towards the industrialization, we call it, or prefabrication of its processes, because we have such a deep skills trades deficit. And this was going to happen out of necessity, rather than being by policy. 

But, you know, it’s interesting if you look at places like the U.K. or Singapore, even Germany, where there’s a ton of support for refabrication, they’ve been able to mitigate housing crises similar to the one that we’re seeing here in Hawaii and in many parts of the country.

And, you know, looking at studies from these countries, they’ve been able to increase productivity in construction by about 20%, whereas, in the U.S., productivity in construction has remained flat and even decreased in some sectors. 

And, you know, I think it’s important here to clarify what we mean by prefab. It sometimes has a negative connotation attached to it. People think of it as sort of, like, generic gentrified buildings. But prefabrication is just one element of what’s known as DFMA. And DFMA stands for “design for manufacture and assembly.” 

And this is a design that starts with designers, like architects and engineers, that involves designing homes for the ease of manufacturing off-site and assembly on-site. And so what DFMA is concerned with is promoting standardization in what’s called “productization” of elements in a building, reducing cost, minimizing complexity and leveraging repeatable processes.

You know, construction is interesting because we’re really manufacturing, but we only manufacture the prototype one time.

So, we don’t really take advantage of, like, economies of scale, as manufacturing does. So I’m really, you know, relieved and glad to see that leaders in government are taking a look at prefabrication and seeing it as a solution to our housing problem and to this crisis. 

Akina: Now, what are some of the steps, Ray, that you feel the state or county need to take in order to facilitate bringing in prefab homes? There have been some challenges to that. And, at this time, we definitely need to be able to overcome them.

Michaels: I think more encouragement and support for our local industry. You know, what we don’t want is, we don’t want those jobs leaving our state, right? We don’t want to bring in prefabricated homes from, you know, the mainland or another country. We want to retain that workforce here. 

So, you know, countries like Singapore and the U. K., Germany that kind of predicted that our construction is going to be aging, and that young people will be reluctant to join the industry, created government housing regulatory boards that helped educate their construction industry and encourage the use of DFMA in the construction process, by providing studies and the means and methods for prefabricated volumetric construction. 

You know, we’re really going to need to revamp and retool our entire industry in a very short, compressed period of time, in terms of both the means and methods of how we build things and the tools involved to do so.

I mean, we’re talking about building out factories, to do things like prefabricated wall panels, so providing grants or incentives to companies that utilize DFMA for building efforts would be a big help to jumpstart this transition because it’s going to be costly for the private sector to basically change the way we’ve been building for the last 50 years.

So, you know, any resources government can provide to us would be a big help in easing the pain of that transition and getting it done fast. 

Akina: You mentioned not wanting to lose jobs to the mainland and, when it comes to actually building and installing prefab work, we need to have a trained workforce. None of it can take place unless there are the workers to put up the houses. Can you tell us, Ray, what’s the state of the skilled trades workforce on Maui and in Hawaii in general?

Michaels: Well, I can speak to the skilled trades workforce in general, and a bit in Hawaii specifically. 

You know, the construction industry has some of the worst demographics. You know, there’s been a lack of vocational training in high school. There’s not any universally available and standardized trade programs. And there’s been an emphasis, you know, over the last three generations, [on] a college education over a skilled trade, which compounded the workforce shortage issue we’re seeing across all industry, as baby boomers move into retirement. 

You know, looking at Hawaii’s demographic from the [state] Department of Labor, 25% of our workforce in construction are baby boomers and their median age is 68, but the average age for retirement and construction is actually 61. And Forbes did a report about three years ago and found that 40% of the construction workforce is due to retire this decade.

And on top of that, there is a group called [the ACE Mentor Program] — ACE Mentoring is architecture ,construction, engineering — and they provide mentoring for those entering the field of construction. And they did a study and found that for every seven people retiring in the industry, only one is coming in. And so that’s a huge deficit in an industry that has to actually build more homes than ever in a shorter period.

Akina: What are some state laws, or changes in our state law, that could actually help ease the shortage we have in terms of workers? 

I know that other states do things a little bit differently. For example, recently I learned that North Dakota allows as many as three apprentices per a journeyman. And when we look at these kinds of practices elsewhere, what could be important to Hawaii and how could we change our laws to help increase the supply of workers?

Michaels: Ratio laws are a big one. You know, many trades are subject to ratio laws, and I can speak specifically to plumbers and electricians. We have a 1 to 1 ratio or we’re only allowed one apprentice for every one journeyworker. And it’s counterproductive to growing the industry when you have, you know, seven people retiring and only one coming in.

We won’t be able to keep up with, you know, the retirement acceleration. So changing those laws is going to be necessary. 

You know, I’m conflicted about ratio laws. I get the intent, you know; it’s to protect, especially with plumbers and electricians, to protect the health of the community. You don’t want, you know, subpar work being installed. 

However, you know, that’s the contractor’s liability. All our work does get inspected by county inspectors. So I kind of find it a bit of a [moot] point to have ratio laws. 

And I can’t emphasize enough, you know, vocational training in high school, starting there, because, you know, and using those hours earned in those classes towards your apprenticeship, because most apprentices in Hawaii, before they become licensed, it’s a 10,000-hour experience verification. And some of those hours can come from classwork. 

So if the state could help waive ratio laws, or adjust them drastically, and help to provide vocational training in high schools that are accredited with the Department of Labor, so that those hours that those students spend in that classroom goes towards their apprenticeship.

And we can start with just basically a core curriculum, which is what all apprentices start with, no matter what trade you’re in. And it’s the basics of how to read a tape measure;, how to cut materials; how to use power tools and hand tools safely; why it’s important to, you know, wear your protective equipment. And that gives, you know, our younger kids a good start in the trade program and will help jumpstart their career in skilled trades. 

Akina: Well, Ray, at the Grassroot Institute, we understand the value of occupational licensing laws, but are also concerned — and our research has shown this — that in Hawaii, they often interfere with the supply of workers in many fields. When it comes to getting a license as a plumber or as a carpenter, how long does it take? 

Michaels: So, you know, from beginning [to] the end, it’s about a five-year program. Now, once you’ve completed that five-year program, you can apply for a license. 

You know, I think what would really help is reciprocal licensure. And Hawaii’s not a true reciprocal state. Where what they say is for plumbers, for example, you know, Hawaii follows the Uniform Plumbing Code. There are a few different variations of this code, and some states elect to adopt their own version of it, sometimes more stringent, but Hawaii won’t allow for that experience to count unless they’ve worked under that same code, which I don’t really see a good reason for, because there’s not huge variations in the code that would affect the health of our community.

If you had somebody, let’s say, from Wisconsin who had three years of experience as an apprentice and moved here, and, you know, those hours should count. But Wisconsin works under the Wisconsin Plumbing Code, which is similar to UPC. 

But there will be no instance where somebody who worked under a different code comes here will install subpar work or work that is, you know, that will affect the health of our community. It simply won’t. It’s very minute differences in the code as far as plumbing goes and, you know, that’s why you have inspectors and supervisors to make sure that things are being done to the Uniform Plumbing Code. 

So, I think providing true reciprocity in terms of experience work and, you know, under the different types of codes, whether that’s the International Plumbing Code that 13 states observe or the Uniform Plumbing Code or each state’s individual plumbing code.

And that’s true for all different skilled trades. Electricians, you know, are another one that had different code variations throughout. But, you know, none of those variations would have a huge effect on the quality of workmanship, you know, that gets put in.

Akina: During this past legislative session, Grassroot joined with many other parties to work on interstate licensure for doctors and bringing Hawaii into the compact that exists for over 40 states. 

Now that that has been passed into law, we will be able to see an increase in the supply of doctors because of the recognition of mainland licenses. Do you think a similar kind of law or reciprocal arrangement will increase the supply of plumbers and building industry tradesmen as well as — well, basically, will it increase the supply? 

Michaels: Yeah, I think it will definitely help. You know, we’re kind of, you know, we’re between a rock and a hard place, right? We do need additional skilled craft workers, but we don’t have the housing to house them. 

What we really need is supervisors, people with, you know, over five years experience, 10 years experience, that can supervise a crew of apprentices, and those apprentices, you know, come from our local schools. They’re our local residents. 

So if, you know, I feel like it’s, we need both, right? We need license reciprocity, but we need vocational training so that we can bring in, you know, people with good amounts of experience for our rebuilding efforts and our housing building efforts that can help train and supervise, you know, our workforce here in the island.

Akina: Are there any lessons —I don’t know how closely you were following the medical licensure act — but are there any lessons we can learn from that and apply to the trades we’ve been talking about today? 

Michaels: You know, I wish I could comment on that. I didn’t follow it too closely. But when I heard about it, I’m like, “That’s exactly what we need for our construction workforce. We need something very similar.”

Akina: As you mentioned, the economy itself is a huge factor in being able to attract and retain workers here in Hawaii. They need places to live, of course, themselves. They need to be able to live off this economy, and so forth. Do you think that’s a big part in our not being able to see a growing interest of young people in going into the building trades?

Michaels: I’m not totally sure. I mean, as far as the economy is concerned … Maybe you can help rephrase the question a little bit? 

Akina: Well, it’s difficult for anyone to make a living here in Hawaii today. And housing is one of the biggest barriers, being able to afford not only to buy, but even to rent and so forth. So, a lot of young people and mid-career people have decided to move away from Hawaii. 

Do you encounter this a lot in terms of our supply of people in the building industry?

Michaels: Absolutely. You know, we’ve had a number of people have, you know, left our company, you know, and this is, I’m just speaking personally, but I know other companies experienced the same thing, is, this people leaving or not being able to make it here does certainly affect the supply of skilled workers.

I mean, if you’re a licensed plumber, you know, you can make the same money, you know, somewhere like, let’s say Las Vegas or Washington or Oregon, where it’s a lot cheaper to live. And so you have a better quality of life. 

So, you know, certainly that plays into an overall role. And I just think Hawaii’s level of personal and economic freedom, you know, really affects people’s decisions to stay here. 

You know, I read studies from the Cato Institute and from the Fraser Institute, we always rank 49th or 50th in terms of economic and personal freedom. 

You know, you’re a skilled craft worker and you can go to a state that maybe has less regulation on things, so the cost of living is cheaper you know, that’s a pretty easy decision to make, especially if you’re someone from Lahaina, you know, whose house just burned.

So, you know, Hawaii really needs our government leaders need to take a hard look at that, and, you know, why is it that people have such a hard time making it here, and providing more economic freedom, you know, lowering those barriers of entry into the entrepreneurial marketplace. I think [that] is going to be key to retaining our population.

Akina: I think you’ve hit the nail on the head. We can’t treat the shortage of workers in the building trades, and plumbing in particular, simply as an isolated problem. It’s part of the complex of the entire economy here, and we have to be working for solutions to that as well. 

And in particular, as our governor noted in his emergency housing decree recently, regulation by government really needs to be cut down in order to solve this problem of the shortage we have in housing. 

I want to go back to a very particular item. There have got to be solutions that are quick and easy. One I want to ask you about is accessory dwelling units. Could they play a part in providing the needed housing at this time?

Michaels: Absolutely. I think ADUs play an important role in providing housing to those that were displaced because of the fire. You know, a number of companies and foundations are working on prefabricated ADUs that can be placed on existing properties where space is available and say, you know, if you were displaced by the fire and, you know, you have an uncle or a cousin or a friend that has a property that has space on it. So I think people would be much more willing to stay, much more comfortable, if they lived in an ADU on, you know, their friend’s property or their uncle’s or aunt’s property, rather than a, you know, a stranger or in, you know, a shelter village. 

So it’s a solution that I think addresses both the immediate needs for people who have been displaced and also as to the existing permanent housing stock. So it addresses our long-term housing goals as well. So, yeah, ADUs are gonna be key to solving the problem. 

Akina: What are some things we would need to do to give greater access to the building of ADUs? 

Michaels: You know, that’s complicated. I am working with David Sellers from Hawaii Off Grid. And he is very akamai when it comes to, you know, the barriers to building more ADUs. I mean, obviously, there’s the permitting, but, you know, there’s regulation barriers. There’s building setbacks; easements; the existing buildings are maybe not performing, or maybe they were placed improperly; access to the area. If we were going to place a prefabricated ADU, can we get to the back? Is it accessible? 

You know, there’s a parking issue. If you add an ADU, you have to make a parking spot. You know, electrical service to the area. Cesspools are a big one. If you have a property, perhaps you have some room for an ADU, but you’re on a cesspool. Well, that will need to be upgraded to a septic system.

You know, I think the county can help take on existing infrastructure upgrades. You know, a lot of the times when you add an ADU, the county’s requiring you to do a clean-out of your sewer line or put in a backflow preventer for your water service or upgrade your water meter or relocate your water meter or relocate where your water line runs since perhaps it’s on an easement.

A lot of times, there’s no accurate [records] as to where the sewer system is, or perhaps the sewer line in the street needs to be upgraded, the electrical service going to the home is only a hundred amps but really if you have an ADU you need a 200-amp service.

So helping with infrastructure upgrades, you know, if the county could do that, that would be a big help. And, you know, as well as permitting, you know, I think that with these ADUs for this particular situation, you know, the industry should be allowed to proceed without a permit so long as the plans are stamped by an architect and it’s built by licensed contractors.

I think architects are allowed 10 provisional plan-review waivers per year, you know, for certain situations. And I think that certainly needs to be increased to, you know, ADUs that are for people that have been displaced by the fire. 

You know, it shouldn’t need to go through plan review, so long as, you know, the plans are reviewed, stamped by an architect and the work is done by licensed contractors, you know, it kind of mitigates liability. So, yeah, there’s a number of things that can be done with …. 

Akina: Ray, you know, that was a very enlightened response. And we’re gonna have to end there with your suggestion of by-right design, which is a very important way of solving the problems that you raise. 

Thank you so much for sharing your insight today. You’ve got a lot to say that I hope our public officials will listen to. And thanks for your commitment out there at Maui to the rebuilding. Much aloha. Thank you, Ray, for being with us. 

Michaels: Thank you, Dr. Akina. I appreciate being on the show. 

Akina: My guest today, Ray Michaels, is president of Maui Plumbing, and I want to thank him for being on the program and remind you that we do broadcast ThinkTech Hawaii’s “Hawaii Together” every two weeks. And that’s when I’ll see you again. I’m Keli‘i Akina at the Grassroot Institute, on behalf of ThinkTech Hawaii, aloha.