Councilmember Offers Information on $60M Tax Revenue Loss and Vacancy Tax Proposal

Maui County's Housing and Land Use Committee meeting on July 23, 2025, spotlighted a potential vacancy tax as a solution to a staggering $60 million loss in tax revenue. Council members discussed the financial implications of such a tax, with projections indicating that it could generate $19 million in its first year, escalating to $36 million in the second year, and $31 million in the third year. This proposal aims to address the issue of vacant properties and their impact on the local economy.

Councilmember Google Hodgins emphasized the importance of distinguishing between different types of properties, particularly regarding transient vacation rentals (TVRs) in apartment districts. He clarified that the discussion focuses on properties built before 1989, suggesting that the current regulations need to be refined to better manage these older units.

The committee also addressed the timeline for phasing out certain regulations, with discussions on whether to implement changes over one, three, or five years. Director Blystone indicated that the council would need to make policy decisions on which units might need to be removed from the current regulations, suggesting that further adjustments could be made after the initial bill is passed.

Additionally, members expressed the need for clarity on reports related to property assessments for long-term rentals, highlighting the importance of transparency in understanding the financial implications for current and potential property owners.

As the committee continues to navigate these complex issues, the proposed vacancy tax and the ongoing discussions about property regulations could significantly shape Maui County's housing landscape in the coming years.