UPDATED: 8/24/11 5:45 p.m.

A proposal that would require vacation rental operators in Honolulu to include license numbers on any advertising drew a split vote from the city’s Planning Commission on Wednesday.

The bill had been put forward by the Department of Planning and Permitting, which says the step would help it identify illegal rentals.

After hearing nearly four hours of testimony from 58 people, the commission voted 4-3 to move the issue on to the City Council with two absent. But the nine-member panel requires five affirmative votes to advance a measure.

There will be a revote on September 7. If the vote is split a second time, the issue will be considered defeated. They do not plan to take new testimony at that time.

Here’s how the commissioners voted:

  • Rodney Kim, against
  • James Pacopac, against
  • Arthur Tolentino, against

  • Beadie Dawson, in support

  • Karin Holma, in support
  • Gayle Pingree, in support
  • Kaiulani Sodaro, in support

  • Kerry Komatsubara, absent

  • Andrew, Jamila, absent

Thirty-five testified against the proposal Wednesday; 23 supported it. It was a continuation of an Aug. 10 hearing that lasted three hours and featured 42 testifiers.

Mahealani Schneider, whose family operates Buzz’s Original Steakhouse in Kailua, told the commission that her family’s business heavily relies on visitors who stay in short-term rentals in Kailua. She believes the new rule will effectively eliminate rentals and hurt Kailua businesses.

On the opposite end, Bob Rutherford asked the commission to advance the measure: “We need to decide what comes first — is it the wishes of tourists looking for an alternative experience … or is it affordable housing and the quality of life of our local people?”

Rutherford and others speculate that home prices are driven up when investors buy up homes to rent out as bed and breakfast units or vacation rentals.

Maui County has also had a problem with illegal vacation rentals. They tried the same tactics being proposed by Honolulu officials. But Maui’s planning director told Civil Beat that the advertising rules haven’t had much impact.

Honolulu Planning Commission Chair Rodney Kim, who voted against the measure, told Civil Beat he would prefer the planning department come up with a more comprehensive enforcement plan versus the current piecemeal version that addresses only advertising.

“I’d really like to see a comprehensive enforcement plan,” Kim told Civil Beat. “Right now, the enforcement is ineffective and I understand that what was just proposed would help the enforcement, but it really is just a small matter. I would like to see a complete overhaul … so that the department has a more efficient way of enforcing.”

Planning Department Director David Tanoue told commissioners that the proposed rules would help his staff better regulate illegal rentals.

Since 2009, he said the department has received 110 complaints against alleged illegal rentals. Those resulted in 1,400 site investigations, but just 50 citations.

“So it’s very difficult to nail down,” he said. “We need the help, and we’re just asking for the help. Our enforcement branch really wants this to assist them.”

Despite the failed vote, Tanoue was upbeat after the meeting.

“It’s really positive that they understand our situation and their concerns are in line with what we are aiming for,” he said.

Since 1989, the city has banned vacation rentals of fewer than 30 days, making an exception for a privileged few certificate holders. Residents who were granted these so-called “nonconforming use certificates” more than 20 years ago are allowed to renew them, but no new certificates are granted, and lapsed certificates are ineligible for renewal. Illegal short-term rentals on Oahu are classified either as:

  • Bed-and-breakfast or B&B units: In which the property owner stays with the vacationers renting the property.

  • Transient vacation units or TVUs: In which the owner is not present while vacationing tenants stay on the property.

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