Friday, May 2, 2014
Legislature Passes Measure to Boost Funding to Rental Housing Trust Fund
State lawmakers this week passed SB2542 that will increase funds allocated from the State’s conveyance tax to the Rental Housing Trust Fund from 30 percent to 50 percent starting July 1, 2014. In 2006, the Legislature raised the allocation to 50 percent, but the economic crisis and recession in 2008-10 forced the State to reduce that amount to 30 percent. The measure restores that amount back to 50 percent.
In Fiscal Year 2013, the Rental Housing Trust Fund received $16.4 million from the current 30 percent share of conveyance tax revenues. The proposed increase will add $10.8 million per year and provide a total of about $30 million annually, according to the Hawaii Housing Finance and Development Corporation, administrator for the Rental Housing Trust Fund for the State.
“This bill will help the State provide more affordable rental housing for our families who need assistance in a market that is among the highest in the nation,” said Representative Sylvia Luke (Makiki, Punchbowl, Nuuanu, Dowsett Highlands, Pacific Heights, Pauoa), Chair of the House Finance Committee.
“The high cost of rental housing and the high rate of homeless people and families in Hawaii take a significant toll on the quality of life all of our citizens. While it may not be as much as we’d like to provide for the Rental Housing Trust Fund, it does provide a significant but measured contribution given the State’s current fiscal outlook.”
The State continues to face major challenges related to affordable housing because of a lack of available land, low wages coupled with the high cost of living, the high cost of construction, as well as other factors.
“The need for affordable rental housing has not abated during and since the recession and, in fact, has become more pressing in the intervening years since we were forced to reduce the allocation to the Trust Fund,” said Representative Mark Hashem (Hahaione, Kuliouou, Niu Valley, Aina Haina, Waialae, Kahala) House Chair of the Housing Committee.
“Honolulu ranks as one of the most expensive cities for rentals, and this bill will help our young families and singles, who struggle every day just to make ends meet. It also helps moderate income families, who earn wages too high to qualify for low-income housing programs but too little to afford market priced housing.”