Maui County Council Advances Contentious Bill to Phase Out Thousands of Short-Term Rentals

The Maui County Council, in a decisive step toward addressing the island’s severe housing crisis, has advanced a measure aiming to phase out approximately 7,000 short-term vacation rentals (STRs) operating in apartment-zoned districts across the county. This move, encapsulated in Bill Nine, marks a critical juncture in the long-running debate over balancing the economic engine of tourism with the fundamental need for long-term, resident housing, particularly in the aftermath of the devastating August 2023 wildfires that displaced thousands. The measure passed its first official reading on December 1, 2025, by a narrow five-to-three margin, setting the stage for a final determination later in the month.

The core purpose of Bill Nine, introduced by Mayor Richard Bissen, is to reclaim units that qualify as lawful nonconforming uses under historical interpretations—often tied to the 1989 zoning ordinance or the subsequent Minatoya opinion—and return them to the long-term residential housing pool.

The Mechanics of Transition: Amortization Timelines

To navigate state statutes that permit the phasing out of nonconforming uses only over a “reasonable period of time,” Bill Nine establishes a structured amortization schedule. This timeline is engineered to serve as a legislative bridge, attempting to reconcile the urgent requirement for housing relief with the property rights concerns of owners who made capital investments based on prior legal allowances.

Initial Proposal Deadlines and Geographic Differentiation

The initial framework presented by the Mayor recognized varied local conditions by proposing different phase-out deadlines across the island. In the earliest iterations of the bill, there was a clear geographic distinction: properties situated in West Maui were targeted for a more immediate cessation, with a goal of having the phase-out complete around the middle of two thousand twenty-eight. The remaining affected areas throughout the rest of the county were granted a slightly extended period, aiming for a target date extending into two thousand thirty.

Reflecting the extreme urgency felt in the community following the 2023 disaster, even earlier proposals were discussed that suggested deadlines as aggressive as the middle of two thousand twenty-five for West Maui and the beginning of two thousand twenty-six for other locales, underscoring the initial impulse for rapid change.

Legislative Amendments to the Phase-Out Schedule

As Bill Nine progressed through the crucible of legislative deliberation, amendments were actively debated and adopted, showcasing the Council’s deep engagement with the specific logistics of implementation. A key adjustment passed by the Council involved modifying the date by which county officials are mandated to issue formal written notices to the affected property owners. This date was successfully moved from an earlier point in the year to the first of March in two thousand twenty-six.

This adjustment was strategically framed as granting necessary lead time to both the Department of Finance and the Department of Planning, ensuring they had adequate opportunity to perform the complex administrative tasks associated with such a large-scale notification process.

Furthermore, during debates, the Council entertained amendments that would have offered even lengthier phase-out periods—some suggestions extended up to three to five additional years specifically for certain property owners in South Maui. However, these proposals were ultimately dropped from the final version considered on first reading, largely due to concerns from proponents that such concessions would undermine the immediacy and overall political standing of the bill in addressing the housing need. [cite: prompt text]

The current progression of the bill indicates that the amortization period is moving toward a final reading scheduled later in the month, which will set the official conclusion date for the phase-out period.

The Legislative Process Unfolds: Council Deliberations

The advancement of Bill Nine was anything but a routine procedural step; it required navigating a politically charged legislative environment characterized by multiple readings, highly contentious debates, and the rigorous consideration of numerous proposed modifications. The intensity of this deliberation process served as a clear reflection of the deep fissures within the Maui community and among its elected officials concerning the correct equilibrium between established property rights and the undeniable economic contributions of the tourism sector.

Committee Approval and Narrow First Reading Votes

The bill first cleared a significant procedural hurdle when the Housing and Land Use Committee voted to recommend the measure for passage to the full Council, securing that endorsement by a six-to-three margin. This early committee endorsement signaled substantial initial momentum, which is often significant given that all members of the full Council sit on this key panel.

However, the measure encountered its tightest political margin during the first official reading before the entire Council. The resulting vote tally was a close five-to-three decision in favor. This tight vote underscored a fundamental reality: while a clear majority supported the bill’s core premise, a significant and vocal minority harbored deep reservations regarding the policy’s potential ramifications.

The voting dynamics were further complicated by the recent passing of a committee chair, which resulted in an unexpected vacancy on the Council. This vacancy introduced an additional layer of uncertainty into the voting alignment until a replacement could be officially appointed, though the council proceeded with the first reading.

Council Member Positions and Role of Amendments

The alignment of votes during the first reading clearly delineated the opposing sides of the debate among the representatives. Council Members who voted in favor often framed the bill as an essential, long-overdue corrective measure to combat the crippling housing crisis.

Conversely, those who registered opposition, which included the Council Chair and Vice Chair on the first reading, articulated substantial concerns centered on the projected economic consequences and the perceived haste in handling such complex legislation.

Efforts to introduce substantive amendments aimed at creating exceptions largely failed. For example, a notable proposal sought to delay implementation based on specific recommendations put forth by a Temporary Investigative Group (TIG). This amendment ultimately failed due to a four-to-four tie vote.

County legal counsel had advised the Council that carving out such exceptions, as recommended by the TIG, could potentially introduce legal vulnerabilities and weaken the bill’s overall standing against anticipated legal challenges based on state law regarding amortization periods.

Despite the failure of exception-based amendments, one successful modification did pass. This amendment requires the Department of Finance to issue detailed annual reports cataloging the property tax classification of all affected parcels through the year two thousand thirty, thereby ensuring continued, transparent oversight of the converted properties as they transition away from commercial STR use.

Economic Ramifications: Projected Financial Impacts

Any municipal policy seeking to fundamentally transform seven thousand income-producing units from a high-yield commercial endeavor back into residential use is destined to carry substantial economic weight. These implications span both the intended positive impact for residents and the potentially negative fiscal consequences for county revenues and the vast tourism-dependent supply chain. Financial analysts and economists have dedicated considerable resources to quantifying these dual effects as of late 2025.

Potential Gains in Residential Housing Inventory

The most celebrated economic projection directly supports the primary goal of the legislation: the dramatic increase in locally available housing. Studies analyzing the phase-out scenario indicate that it could effectively place more than six thousand potential units back into the long-term rental and ownership pool.

The University of Hawaiʻi Economic Research Organization (UHERO) specifically projected this move as representing a thirteen percent enhancement to the county’s overall housing stock. Theoretically, this significant injection of supply should exert considerable downward pressure on both housing sale prices and ongoing long-term rental rates, leading to tangible improvements in affordability for the island’s permanent population.

This projected inventory increase is consistently framed by proponents as a critical, non-construction intervention necessary to stabilize housing costs for the essential local workforce, many of whom are currently being priced out of the very communities they serve.

Concerns Over Tax Revenue and Hospitality Sector Strain

In a stark contrast to the housing supply projections, opponents of Bill Nine, supported by some economic modeling, point toward considerable negative fiscal impacts for the county government and its related service industries. The same comprehensive analysis that forecasted the housing gains also estimated that the policy shift could immediately result in a combined annual loss approaching seventy-five million dollars in both property and business tax revenues for the county.

Furthermore, a powerful argument is consistently made that eliminating this volume of transient accommodations will inevitably cascade disruptive effects throughout the entire tourism-dependent economy. This impact extends beyond the property owners themselves to affect the extensive network of support services: housekeepers, maintenance personnel, local tour operators, and countless small businesses that rely directly on visitor spending.

Council heard extensive testimony suggesting that such a regulatory change could precipitate measurable business closures and subsequent job losses within the hospitality sector, which remains a cornerstone of Maui’s employment base.

Conversely, supporters of the measure counter this fiscal argument by noting that a significant percentage of the income generated by these STRs, given that many owners do not reside on Maui, already flows off the island, thereby mitigating the severity of the predicted local economic loss.

Stakeholder Perspectives: Advocacy and Opposition

The public phase of the legislative journey for Bill Nine has been characterized by hours-long testimony sessions, often deeply emotional, reflecting the intensely personal nature of the issue for both residents fighting for affordable shelter and investors whose business models now face obsolescence. The debate has crystallized into a clear demarcation line between advocates for community preservation and stability and those focused intently on preserving property investment returns.

Arguments Supporting Housing Reclamation

The voices passionately championing Bill Nine frequently spoke with the urgency of community members fighting for what they view as the very soul of the island. Supporters, which include numerous local community advocates, stressed in their testimony that the current economic structure had become structurally unsustainable, leading directly to the displacement of essential workers. Their core argument posits that the focus must strategically pivot away from an over-reliance on tourism and toward establishing a stable, resident-focused foundation.

Proponents within the Council often adopted this moral stance. One Council Member, for instance, critically likened unchecked capitalism to a “snake that will eat itself if left unchecked,” arguing that reclaiming residential units for local families being priced out of the market is a necessary moral and social imperative for the island’s long-term viability.

For this segment of the community, the measure represents a vital opportunity to re-localize the economy and guarantee that essential community members—such as teachers, nurses, and first responders—can afford to live in the communities where they dedicate their service.

Warnings Regarding Economic Disruption and Property Rights

On the opposing side, a coalition of property owners, investors, and associated business interests voiced profound alarm over the potential for widespread, immediate economic fallout. Their legal and philosophical arguments heavily center on the principle of vested rights, asserting that this governmental action constitutes an unlawful “taking” of an established, legally permitted investment that had been operating in good faith for decades.

Condominium associations and individual owners have publicly signaled their intention to rigorously evaluate all legal avenues available, including filing significant legal challenges, should the bill ultimately be enacted into law.

These opponents contend that the County is systematically failing to appreciate the critical multiplier effect that visitor spending has on the broader local economy. They warn that the measure risks inflicting severe damage upon the very industry that underpins a substantial portion of the county’s tax base and employment figures. This organized opposition strongly suggests that the island community remains far from unified on the perceived severity of the housing crisis versus the perceived severity of the economic threat posed by this significant regulatory change.

Navigating Future Legal and Regulatory Terrain

Given the immense financial interests at stake and the precedent-setting nature of imposing such a broad, island-wide phase-out, the future legal and regulatory pathway for Bill Nine is recognized as being just as critical as the legislative vote itself. Both the Council and the Mayor’s office have demonstrably anticipated significant legal challenges to the ordinance once it is enacted.

Confidence in the Measure’s Legal Defensibility

The legal department representing Maui County has publicly expressed a strong conviction that Bill Nine has been meticulously constructed in a manner designed to withstand rigorous judicial scrutiny. County attorneys have reportedly conducted thorough reviews of the finalized language and maintain that the measure aligns appropriately with both state laws concerning mandatory amortization periods and the federal and state constitutions, firmly placing the authority to enact such nuanced zoning regulations within the Council’s established legislative power.

This expressed confidence is viewed against a cautionary backdrop: the history of similar regulatory attempts in other Hawaiian counties. For instance, Honolulu County’s earlier efforts to enact stricter regulations were notably blocked by a court ruling in a prior year, an event that directly prompted the state legislature to clarify county authority in this domain. [cite: prompt text]

Despite this cautionary history, Maui County’s counsel remains assured in their current legal strategy for Bill Nine, though they are appropriately reserved about revealing specific defense tactics ahead of any potential litigation filing, which is widely expected.

Consideration of Parallel Tourism Infrastructure Policy

The Council’s focused actions on phasing out existing STRs are occurring within a broader, strategic context of reassessing the island’s entire relationship with its tourism economy. The legislative body appears to recognize that an overhaul of this magnitude necessitates complementary policy shifts to ensure other viable facets of the visitor industry can remain sustainable.

For example, running in parallel to the high-stakes debate over Bill Nine, the Council has also scheduled consideration for a separate, distinct measure. This ancillary bill is specifically aimed at establishing new, clearly defined zoning districts dedicated exclusively to high-capacity hotel development.

This dual approach suggests a comprehensive administrative effort: one prong is designed to reclaim residential zones for local housing needs, while the second aims to channel future large-scale visitor accommodation development into designated, appropriate commercial zones. This multi-pronged strategy attempts to mitigate the immediate economic shock by providing alternative, lawful pathways for lodging development that do not conflict with the urgent, mandated need for local housing stock.