18 Months After Wildfires Destroyed Some 2,000 Homes on Maui, Only 3 Have Been Rebuilt

A thicket of red tape has made the island's rebuilding efforts painfully slow.

by Christian Britschgi, Reason, 1-22-2025

As California looks to rebuild from the wildfires that ripped through the Los Angeles area, California Gov. Gavin Newsom has reportedly been in conversations with Hawaii Gov. Josh Green about how to best go about the process.

If California's efforts replicate Hawaii's, the road to recovery will be long indeed.

In August 2023, wildfires devastated the island of Maui, completely destroying the town of Lahaina and dealing severe damage to other communities on the island.

Over 2,000 properties with residential structures were either destroyed or suffered major damage, according to data collected by Maui County's Real Property Assessment Division. Those properties include multifamily buildings, meaning the number of individual units damaged or destroyed is likely higher.

All told, 3 percent of the island's housing stock was destroyed in the fires, according to a housing dashboard published by the University of Hawaii Economic Research Organization.

As of last week, roughly a year and a half since the fires, a total of three of those homes have been rebuilt, according to data shared by the county with Reason. Two of those homes are in Lahaina, and the third one is in the island's Upcountry area.

An additional 228 building permits for wildfire reconstruction have been issued, and 112 homes are under currently under construction.

"Hawaii used to be great at this," says Joe Kent, the executive vice president of the Honolulu-based Grassroot Institute of Hawaii and former Lahaina resident.

After Hurricane Iniki destroyed some 2,000 homes on the island of Kauai in 1992, most of those homes were rebuilt within a year, says Kent.

"Since then, there has been a lot more regulations," Kent explains. "Those regulations have made their way into a bureaucracy that's made it difficult to lift things, even for emergencies."

The Grassroot Institute published a report in July 2024 detailing some of the regulatory hurdles to rebuilding on Maui. Those include high permitting fees and long permitting wait times.

Permit fees can add tens of thousands of dollars to the cost of a rebuild. County permitting data show that some applicants have had to wait over a year for permits to rebuild single-family homes and wait times of six months are not atypical.

A key to speeding up rebuilding efforts after Hurricane Iniki was the opening of a private permitting office to help expedite permits.

Maui has belatedly opened such an office. In April 2024, the county opened a privately run Recovery Permitting Center, which has helped speed things up.

Even before the fires, wait times at the county's permitting office were around 200 days. The Recovery Permitting Center has cut waiting times to around 70 days.

Tightened zoning regulations have also made many structures on Maui "non-conforming" before the fire. County zoning law requires that buildings that have been at least 50 percent destroyed must be rebuilt under newer, more restrictive zoning codes.

Since many of Lahaina's buildings were "non-conforming" structures before the fires, they can't be rebuilt as they once were. The new rules require that some damaged apartments would have to be rebuilt with fewer units, for example.

In February 2024, the county Planning Commission approved a bill that would have allowed non-conforming buildings to be rebuilt generally as they were. The Maui County Council has yet to give final approval to that bill.

The state's Special Management Area law—which places additional permitting and public hearing requirements on new development—has also been a roadblock, given that Lahaina and other damaged communities are near the coast.

That law already generally exempts single-family home construction. Green also waived the Special Management Area law for multifamily construction. The state Health Department has waived rules requiring that new homes be connected to a sewage system.

But the state government has also backtracked on regulatory streamlining that could speed up rebuilding efforts even more.

Shortly before the fires in July 2023, Green issued a sweeping, controversial emergency declaration that suspended most of Hawaii's development rules and set up a state committee to approve housing projects under a liberalized, expedited regulatory framework.

Green's "YIMBY martial law" order attracted a mix of praise and criticism from free market advocates in Hawaii, who argued the governor was right to identify regulations as a constraint on homebuilding but was wrong to trying suspend those regulations unilaterally.

A coalition of more left-wing critics, including the Hawaii branches of the American Civil Liberties Union (ACLU), Sierra Club, and Native Hawaiian cultural organizations, sued Green for abusing his powers. The governor's streamlining order was tantamount to "dictatorship" and "attempted genocide," they claimed.

Under the weight of this criticism, Green quickly backtracked. He issued a new, much more modest order that gave local governments some additional powers to waive fees and hire private, third-party permitters.

Notably, the order excluded Lahaina from many of these more modest regulatory waivers.

The island's elongated rebuilding process has also had severe humanitarian consequences. The federal government's annual homelessness survey found that in January 2024, nearly half a year after the fires, some 5,000 people were still in emergency shelters as a result of the Maui fires.

As slow as the residential rebuilding efforts have been, the situation is even more bleak for rebuilding commercial structures, says Johnathan Helton, a researcher at the Grassroot Institute.

The Special Management Area law still applies in full force to commercial rebuilds. If a destroyed business is within a historic preservation area as well, at least two public hearings (and potentially more) would be required before building permits can be issued.

Helton says that rising building material costs have left many Maui residents effectively underinsured, adding uncovered expenses to any rebuilding project.

"The people who are rebuilding their homes will have to have a place to work, or shop, or go to the doctor. If none of these businesses are allowed to move because the state and county don't change anything, I think it's going to be a lot harder for Lahaina to come back," says Helton.

"Time is a big factor in rebuilding. If it's so difficult to rebuild, then people are just going to give up and leave," says Kent.

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