With Maui County planning to set aside millions of dollars to spur the construction of affordable homes on an island where a growing number of families are struggling to get by, some elected leaders and residents have questioned: Who will actually be able to afford this housing?

For a long time, the federal government has been the one in charge of deciding what’s considered “affordable,” which officials have long described as when a family spends no more than 30% of their total income on housing, including utilities. As the costs of building material and land have soared, that means developers wanting to build homes within families’ financial reach often have to rent or sell them at prices lower than what it takes to construct them.

That’s why affordable housing developers usually seek help. Governments can help foot the bill or provide opportunities for developers to save on costs in exchange for promising to rent or sell homes at lower prices set by the government. The concern, however, that some housing advocates and residents have is whether the government’s definition of affordable aligns with what Maui’s working families can truly afford.

“We always ask the question, ‘affordable to whom?’” said Deborah Thrope of the National Housing Law Project, a nonprofit that advocates for housing justice. “So much of the new stock, be it ownership or rental, is not geared toward extremely low-income families.”

The cost of affordable homes on Maui can vary significantly, too, although what families pay can depend on a number of factors, such as their income, size of the house and number of family members. On one end of the spectrum, a three-bedroom apartment at an affordable complex might rent for around $600 to a family earning extremely low incomes — or around $34,000 per year for a family of four.

Rentals usually receive more government subsidies than for-sale homes, though, which means families earning much higher incomes who otherwise wouldn’t qualify for affordable rentals can qualify to purchase homes. For a Maui family earning around $140,000 per year, for example, purchasing a three-bedroom home up to $780,000 is considered affordable under county guidelines, although that can go higher or lower depending on interest rates.

Maui officials for years have had limited control over how those housing prices are calculated. Maui County, like other local governments in Hawaii and across the continental U.S., sets price limits for affordable housing projects based on numbers from the U.S. Department of Housing and Urban Development, the federal agency that oversees and funds affordable housing.

HUD outlines what people should pay for housing based on a measure called “area median family income” — the midpoint in a community’s income spectrum, meaning that half of the families living in the area earn more than that and half earn less. The federal government gets that number from the American Community Survey, which is a survey conducted by the Census Bureau that asks people about things like race, household size, income and where they live.

Since the census takes a couple of years to analyze and finalize all that information, HUD relies on older numbers to come up with its figures. When estimating families’ incomes in 2022, for example, it used survey data from 2019, which it then adjusted based on inflation estimates.

On Maui, HUD says the estimated median family income currently stands at $101,100. When government officials talk about affordable housing, they’re usually talking about housing that’s considered affordable for families earning a certain percentage of that threshold — for example, 30%, 50% or 60% of the median income.

If a community’s estimated median income goes up, so do the prices that governments set for affordable rentals and for-sale homes.

“Area median income is problematic, but it’s probably the best thing that we have,” said Will White, director of the Hawaii Budget and Policy Center. “Because we live in a society that has such extreme income inequality, you’re going to have these very high-income folks and very low-income folks that are just going to skew where that median lies.”

After a surge of out-of-state homebuyers and remote tech workers with high salaries descended on Maui during the pandemic, some housing advocates are concerned that the community’s median income will rise, eventually driving up income limits for affordable housing, too. Some of Maui’s elected officials, including council member Gabe Johnson, chair of the affordable housing committee, have vowed to closely examine what the county deems “affordable” in the months to come.

Andrew Aurand, a researcher for the National Low Income Housing Coalition, said it’s a problem that communities across the U.S. have grappled with any time that the median income rises faster than wages for low-wage workers or anyone relying on a fixed source of income.

“The higher the median income, the higher the income limits and the higher the rent can be,” Aurand said. “But if you’re on a fixed income, like social security or disability, you’re still really struggling to pay that so-called affordable rent.”

Civil Beat’s coverage of Maui County is supported in part by grants from the Nuestro Futuro Foundation and the Fred Baldwin Memorial Foundation.