SB1133 would authorize certain counties to adopt a rental unit price ceiling ordinance if more than 1% of the county’s housing stock was destroyed or rendered uninhabitable by a disaster. In those counties, landlords could not raise the rental price of a dwelling unit faster than a county-published annual cap tied to changes in the Consumer Price Index for rent of primary residences, and if the index is flat or negative, the allowable increase would be zero. The bill also defines “rental price” broadly to include certain landlord-controlled charges such as utilities, parking, storage, yard services, furniture, and furnishings.
The bill further creates a nonrefundable long-term residential lease tax credit for taxpayers who own and lease dwelling units as principal residences in counties that adopt the price-ceiling ordinance, so long as the lease term is at least one year and the tenant is not an immediate family member. The credit may be carried forward for up to three taxable years, and the Department of Taxation would administer the credit through forms, verification, and rulemaking. The measure is framed as a response to housing affordability pressures and post-disaster displacement, especially after the 2023 Maui wildfires.
SB1133 would add a new county-level housing authority in chapter 46, Hawaii Revised Statutes, allowing qualifying counties to regulate rent increases by ordinance using a CPI-based cap. It would also add a new income tax credit in chapter 235 for landlords who offer long-term residential leases in counties that adopt such rent-ceiling ordinances. The bill would affect landlords, tenants, county governments, and the Department of Taxation, while leaving implementation details such as the credit amount and county ordinance adoption to future action. Although the bill text states an effective date of July 1, 2050, the tax credit provision would apply to taxable years beginning after December 31, 2025.
The available voting history suggests strong support in committee, with unanimous or near-unanimous passage at each recorded stage: Senate Housing, Senate Commerce and Consumer Protection, and Senate Ways and Means all passed the bill with amendments and no recorded opposition. The bill’s findings and structure indicate a policy approach aimed at balancing tenant protections with landlord incentives, rather than imposing rent control alone. Overall, the sentiment reflected in the legislative history is favorable, with members advancing the measure through committee.
The main policy tension is between tenant protection and landlord flexibility. Supporters emphasize affordability, displacement prevention, and disaster recovery, while the bill’s design tries to offset rent limits with a tax credit for owners who provide longer-term leases. Potential points of contention include whether counties should have authority to impose rent ceilings, whether tying increases to CPI is sufficient or too restrictive, and whether the tax credit is an effective or necessary incentive. The bill also raises administrative and definitional issues, such as how counties will calculate the cap, what counts as rental price, and how the credit amount will be set.