Hawaii County Council - 2026-02-18
Meeting Intelligence Preview
Meeting Summary
The Hawaii County Council approved bill 63 draft three allowing residential dwellings in industrial commercial mixed-use (MCX) zoning districts with use permits and 20% affordable housing requirements. Bill 121 draft two passed 6-1, granting a 10-year time extension for the Kona Country Club's 51-acre multi-family residential development at Keahole. The council also approved bill 128 at first reading, establishing a tier three property tax classification for non-owner occupied properties valued over $4 million, and bill 127 creating a construction code commission to advise on building code adoption.
Key Decisions (10)
Residential Dwellings in MCX Zoning Districts
Bill 63 draft three passed on second and final reading, allowing residential dwellings within industrial commercial mixed-use (MCX) zoning districts through use permits. Planning director confirmed 20% affordable housing requirement applies per chapter 11 for residential use.
Kona Country Club Multi-Family Development Time Extension
Bill 121 draft two passed granting a 10-year time extension to condition d (complete construction) for Kona Country Club Incorporated's 51.058-acre multi-family residential development at Keahole, North Kona (TMK 780101). Property located mauka of Mamalahoa Highway Bypass.
Tier Three Property Tax Classification
Bill 128 passed first reading establishing a new tier three residential property tax classification for non-owner occupied properties with net taxable value exceeding $4 million. Approximately 842 properties fall into this category. Does not affect homeowners, short-term rentals, or long-term rentals.
Construction Code Commission Establishment
Bill 127 passed first reading as amended, establishing a construction code commission to advise the mayor, county council, and director of public works on adoption, updating, amendment, and interpretation of county construction codes. Amendment added licensure consideration, building materials expertise, homeowners insurance expertise, and clerical support provisions.
Young Property Zoning Amendment Time Extension
Bill 120 passed on second and final reading for Ernest and Elizabeth Young's 1.86-acre property at Kalaowa, North Kona (TMK 73011068). Approved deletion of condition h prohibiting second dwelling unit and 5-year time extension to secure final subdivision approval. Property at southwest corner of Mahiolani Drive and Mamalahoa Highway intersection.
Lam Property Rezoning at Ouli
Bill 119 passed on second and final reading rezoning 5 acres at Ouli, South Kohala (TMK 620-0702) from agricultural to residential and agricultural for Clemson and Janet Lam. Property at 62-2039 Kauaihi Road.
State Land Use Boundary Amendment at Waimea
Bill 122 passed first reading changing state land use district classification from agricultural to rural at Waimea, South Kohala (TMK 62009018) for Joseph Gaglione's 6.063-acre property at 62-2239 Konoehoe Place.
Gaglione Property Rezoning at Waimea
Bill 123 passed first reading rezoning 6.063 acres at Waimea, South Kohala (TMK 62009018) from agriculture 5 acres to residential agriculture 2.5 acres for Joseph Gaglione. Property at 62-2239 Konoehoe Place. Allows subdivision into two lots.
Settlement Approval - Freeman v. Peshekol Case
Council approved corporation counsel's settlement recommendation for civil case 3CCV-22-000125 (Jay Allen Freeman versus Darius Peshekol, County of Hawaii et al.). A motion to require Hawaii Police Department to immediately adopt procedures complying with HRS 134-7.3 as part of settlement failed 2-5.
Settlement Approval - Moyha v. Backyard Monkey LLC Case
Council approved corporation counsel's settlement recommendation for civil case 3CCV-25-0000343 (Lawrence and Genevieve Moyha versus Backyard Monkey LLC, County of Hawaii).
Zoning Changes (2)
62-2039 Kauaihi Road, Ouli, South Kohala (TMK 620-0702)
Clemson and Janet Lam
62-2239 Konoehoe Place, Waimea, South Kohala (TMK 62009018)
Joseph Gaglione
Development Activity (3)
Kona Country Club Multi-Family Residential
51.058 acres zoned multiple family residential 30,000 square feet; 10-year time extension granted to complete construction
Young Subdivision
1.86 acres zoned single primary residential 20,000 square feet; 5-year extension for final subdivision approval; second dwelling unit now permitted
Gaglione Subdivision
6.063 acres to be rezoned from agriculture 5 acres to residential agriculture 2.5 acres; subdivision into two lots permitted
Market Signals (5)
Housing Demand
Council member Kagiwada voted against Kona Country Club luxury development extension, stating opposition to county support for luxury homes for nonresidents, indicating political pressure against high-end residential development.
Housing Demand
Bill 63 requiring 20% affordable housing for residential development in MCX zones reflects continued focus on workforce housing tied to employment centers.
Sentiment
Testimony supporting tier three property tax noted 842 non-owner occupied properties valued over $4 million exist in Hawaii County, indicating significant ultra-luxury investment property inventory.
Infrastructure
Discussion of 2018 building code adoption revealed concerns that code changes increased housing construction costs by 20-50%, with ongoing industry efforts to reverse some requirements.
Housing Demand
Council reduced DHHL homelands taxes and is considering further reductions for long-term rental tax class, signaling policy shift toward housing affordability measures.