Short-term rental operators like Airbnb should operate within the law, pay their taxes and be subject to local land-use regulations meant to protect housing for locals.

Gov. David Ige is now trying to resolve the problem, following several failed attempts in the Hawaii Legislature. That’s a good thing.

The problem is, his administration is not telling anyone — such as hotel interests, affordable housing advocates, neighborhood groups and lawmakers — what he and the online network are coming up with. That’s a bad thing.

Instead, the governor should open up the decision-making process to include all stakeholders.

Governor David Ige education interview in his office, interviewed by Suevon and Chad.

Gov. David Ige at a Civil Beat interview in August. His secret negotiations on taxing short-term rentals have upset many stakeholders.

Cory Lum/Civil Beat

The governor’s chief of staff, Mike McCartney, insists that state tax law prohibits him from sharing a draft agreement between the state Department of Taxation and Airbnb.

McCartney offered the weak excuse that he is neither an attorney nor an employee of the tax department.

But Airbnb could — and should — release the agreement itself.

There is also the concern that an agreement probably violates the Hawaii Administrative Procedure Act that agencies have to follow when administrative rules are adopted. It’s a requirement to include notice of a public hearing and allowing public testimony. 

 

And, we are worried that an agreement might legitimize illegal short-term rentals. While Oahu’s land-use ordinance heavily restricts transient vacation rentals on the island, the shear number of such rentals — more than 4,400 units — makes clear that violations likely exist.

Then there is the stark fact that about 85 percent of Airbnb’s revenue on Oahu comes from the rental of homes, according to the American Hotel and Lodging Association. These renters are far more likely to be financial investors rather than people trying to make a few extra bucks by renting out a room.

A screen shot of an Airbnb posting. The proliferation of short-term rental units demands regulation but also transparency.

That’s not going to help Honolulu with its dire need for more than 24,000 housing units to address its housing and homeless crises. Need we remind the governor of his own position on the matter — to “build homes that people can afford, including rentals” and to transition the homeless from the streets into permanent housing?

We understand the attraction Airbnb offers to consumers. If Turtle Bay Resort charges $332 a night while a short-term rental on Oahu’s North Shore charges $115, which visitor accommodation are tourists likely to go with?

But Airbnb is like Uber: It’s growing, it needs regulation and it’s not going away.

The governor is right to take a leadership role in legitimizing short-term rentals. They constitute a statewide issue, not just a problem for the counties.

As a spokesman for the American Hotel & Lodging Association put it when testifying earlier this year at the Capitol, “This is one of the most important issues facing not just tourism but Hawaii today. This is about the quality of our tourism product, the safety of our visitors, and the residential nature of our neighborhoods.”

By not conducting negotiations with Airbnb in a transparent matter, Ige risks creating his own “unintended consequences” — the very same words he used when he vetoed a tax measure last year that would have allowed Airbnb to collect and remit general excise and hotel taxes.

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