Start With Permit Delays To Trim Homebuilding Red Tape

by Keli‘i Akina

If you need proof that Hawaii’s housing shortage is related at some level to bureaucratic incompetence, look no further than the many examples of long permit delays.

For years, auditors, researchers and members of the public have pointed out that inefficiencies and delays in the permitting process make it difficult to complete building and renovation projects in a timely manner.

Honolulu County Council member Andria Tupola recently noticed that questions about permit delays come up frequently at her public events, so she decided to investigate. At her request, the Honolulu Department of Planning and Permitting reported on its current permit backlog. The results, Tupola said, were “discouraging.”

According to the department, more than 8,000 permit applications were mired in the swamp of DPP’s review process as of Aug. 11, 2022. Nearly half of those, 3,499, were in the pre-screening phase, while 4,780 were under review by DPP examiners. Only 1,113 permits had been approved and were waiting to be picked up.

Dean Uchida, who served as director of the department until he resigned not long after that information was made public, acknowledged that the wait time for commercial or residential permits can now be as long as two years.

Those permit delays are more than just an annoyance. Uncertainty and lost time caused by the permit backlog translate into higher costs for homebuilders. As the University of Hawaii Economic Research Organization noted in its recent study on regulatory burdens to housing, the average approval and permitting delay in Hawaii is more than three times the national mean. That excessive delay not only raises the price of building homes, it also disincentivizes homebuilding.

To their credit, Hawaii policymakers recognize that the permit delays are a problem. However, the solutions that many of them have offered are merely attempts to solve bureaucracy with yet more bureaucracy.

Some have suggested hiring more workers, but that would only add more people to the departments that caused the permitting delays in the first place. Likewise, suggestions to buy better software or equipment are Band-Aid solutions that pour more money onto the problem without ever getting to the root cause.

We don’t want or need a nominally more efficient bureaucracy. Rather, we should be looking at ways to dismantle the bureaucracy completely.

Multiple stages of review contribute to the backlog, so why not dispense with the need for review or a permit in certain situations? For example, the county could issue “pre-approved” plans or changes that don’t require DPP approval.

The government also could privatize some permitting functions, thereby allowing departments to reduce their efforts to the most essential and specialized areas.

An even better solution would be to embrace “by right” zoning and building. This approach, which has helped cities like Tokyo meet their housing needs without skyrocketing prices, allows any proposed construction that conforms to existing building and land-use codes to proceed without the need for permits or government permissions.

Research shows that there is a strong correlation between government regulation and high home costs. The permit backlog in Hawaii has contributed to the slow growth of housing in Hawaii, thereby driving prices even higher.

To help make our state affordable, the government needs to start eliminating the red tape and bureaucracy that surround homebuilding — starting with the permit delays.

KELI‘I AKINA is president and CEO of the Grassroot Institute of Hawaii.

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