鈥淗ow much is enough?鈥 I asked in my column last week.
But the question was mostly rhetorical. Look around. I think that we all know the answer.
For 50 years we have relied on the growth of tourism to fuel our economy. It鈥檚 made us richer (62 percent growth in income since 1960), it鈥檚 bought us houses (40 percent increase in home ownership), and it鈥檚 provided our local governments with a steady supply of cash.
But we鈥檝e always known that there was a limit. And today, we are reaching the end of the line.
The problem is, nobody knows how to put the brakes on nor what will take its place.
Our Limits
Tourism is limited by three major factors鈥 our roads, our houses and our atmosphere.
As I鈥檝e written about many times before, the clearly states that Kauai doesn鈥檛 have the infrastructure for more than 25,000 tourists per day鈥 yet, recently we鈥檝e been reaching above 29,000 per day. Every time we sit in gridlocked traffic, we are experiencing the joy of life on an over-capacity island. And, there is no real traffic solution in sight.
While the Department of Transportation has identified $3.1 billion in priority traffic projects on Kauai, over the next 20 years there will be less than $500 million available for the entire state. With the majority of Kauai鈥檚 funding going toward maintenance, in the words of the Tourism Strategic Plan, 鈥渋t is unlikely Kaua鈥檌鈥檚 road system will be expanded over the next 20 years.鈥
But while traffic is just an inconvenience (albeit ), our lack of housing is a crisis. The County of Kauai projects that we could face a 5,000 home deficit by 2035.听Every time we say goodbye to another friend forced to move off-island, we鈥檝e lost another battle in the war for housing.
And tourism isn鈥檛 helping. As the Tourism Strategic Plan Update outlines, 12.6 percent of Kauai鈥檚 housing is being used for visitors instead of residents and the county estimates that up to 25 percent of houses on island are vacant or seasonal.
But these impacts aren鈥檛 occurring proportionately around the island.
In Hanalei, where more than one in three houses are being used for visitor accommodations, we can get a good glimpse into a dystopian future of unimpeded tourism. The profusion of vacation rentals have not only transformed the character of the once-quiet beachside community, but they have ensured that the cost of housing there is far out of reach for local residents. The in Hanalei (two bedroom, one bath, quarter acre of land) is $1.4 million.
And, the final blow to the unimpeded growth of tourism is climate change. In order to stay under two degrees of temperature change鈥 we need drastic emissions cuts, starting immediately. Yet, even if Hawaii could completely electrify its ground transportation and convert entirely to renewable energy over the next 30 years (), air travel at current levels makes our necessary carbon reduction goals impossible to meet.
So, that鈥檚 it鈥 let鈥檚 put a cap on tourism and start farming or something, right?
Not exactly.
Legal Barriers
There are many places around the world that have begun instituting tourist caps. But they don鈥檛 have to comply with the U.S. Constitution.
The 14th Amendment guarantees the freedom to travel. If you are a U.S. citizen, you have an uninfringeable right to travel anywhere within the country. And, as I wrote last week, Hawaiian Airlines isn鈥檛 about to start limiting their flights.
So there are at least 318 million people who have the constitutional right to travel to Hawaii鈥 and the airlines will continue to be more than willing to drag them across the Pacific.
Many foreign countries add hefty airport taxes to both reduce the visitor count and help pay for their impact. For example, in an an effort to mitigate climate change, the United Kingdom taxes air travelers based on the distance they are flying — with fees as high as $200.
Part of what makes Hawaii so attractive to visitors is that all of our best attractions are completely free.
Here in the U.S., while there is a small international departure tax which goes to the federal government, local airports can鈥檛 tax more than $4.50. So at least for now, high departure taxes are off the table.
But enough of what we can鈥檛 do.
Our dual state and local land use law ensures that our county governments can control where development occurs. This is probably the most powerful tool available in limiting the growth of tourism.
Here on Kauai, there have been 4,693 resort units permitted since 2000 (notably, only the Coco Palms Hotel has been permitted since the economy crashed in 2007). Yet only about half of them have been built. And, with no expiration date on the remaining entitled projects, we have a loaded gun of new resort units that could be built at any time.
But the takings clause of the 5th Amendment to the U.S. Constitution made applicable to the states through the 14th Amendment makes it difficult to change the zoning on those entitled parcels without providing just compensation for the tremendous loss in value.
Because, as described in a on growth management in Hawaii, 鈥渁 regulation that prohibits a previously permitted use of property may constitute a taking if it results in too great a reduction in the value of the property.鈥
While it would ultimately be up to a court to decide, the near certainty of a divisive and protracted legal battle (see my earlier piece on Nukolii) would likely prevent any prudent county government from going down this road.
But there are still 352 acres of vacant land on Kauai which have General Plan resort designation but no existing entitlements. In this case, because no permits have been issued or exactions given, the land use designation can still be changed.
According to the Hastings journal article, 鈥渞egulations that merely diminish the value of certain pieces of property do not constitute 鈥榯akings鈥 for which compensation is required鈥 if the 鈥渘et benefits to the public鈥 outweigh the burden imposed by the regulation.
But reducing the availability of land for resort development is just a starting point.
The Cost Of Nature
Part of what makes Hawaii so attractive to visitors is that all of our best attractions are completely free. If you go skiing, or to Disneyland, or even to a National Park鈥 you have to pay to play. But, it doesn鈥檛 cost any money to set up a towel at Poipu Beach or to step out on the boardwalk at the meticulously maintained Alakai Swamp Trail.
Taking the examples of Diamond Head, Hanauma Bay, and Akaka Falls State Park, we need to start charging for entrance to more of our state parks. Here on Kauai, plans for charging entry fees to non-residents at and are already under way. And as more state parks begin to charge entrance fees, the counties will have more leverage in the fight to receive a higher portion of the transient accommodations tax.
As the Hawaii Tourism Authority explains, our “visitor market is price sensitive, and any increase could drive a traveler to a competing destination.” So, while I know this sounds crass, increasing prices not only reduces total visitor arrivals, but it also helps ensure that the visitors who are coming are ones that will spend lots of money.
Continued enforcement against illegal vacation rentals, higher property taxes on visitor accommodations, and increased user fees on resort developments are all important county tools as well.
It Just Keeps Getting Harder
While limiting the growth of tourism will be challenging鈥听 even more difficult is what to replace it with. As I鈥檝e written before, if you want your children to have the same opportunities that you have, then we need economic growth.
But, as 鈥渁mong all the islands, Kauai is most dependent on the visitor sector.鈥
And it鈥檚 this disproportionate reliance on tourism that has consistently squelched any realistic conversation on the necessity of economic diversification.
Add more industrial zoning? Tourists don鈥檛 want to see manufacturing facilities.
A dairy on agricultural land in Mahaulepu? But there鈥檚 a Hyatt nearby.
Farming on your agricultural homestead? Just rent out a room on Airbnb instead.
With an economy predicated on the unlimited growth of tourism, we will never be able to take the hard steps necessary for economic diversification. But there are limits, we are reaching them, and closing our eyes to reality won鈥檛 solve this intractable problem.
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