County Council Looks to Amend Construction Regulations

By Amanda Kurth

In an effort to mitigate the challenges Hawai‘i faces with permitting construction and regulating unreputable contractors, the Kawakami administration worked with private sector organizations in the construction agency to introduce Bill No. 2873 for first reading in a memo to the County Council dated June 6.

And while the administration was not asked by anyone from a state agency to introduce the measure, they requested that it be reviewed to add a new article to Chapter 15 relating to building and construction regulations.

“The bill is simple,” stated County Managing Director Michael Dahilig via video conference at the July 6 Council meeting, noting the need for the county to absorb a state process of regulation.

Bill No. 2873 would create an awareness and accountability system disclosing a contractor’s license status at the time a building permit application has been submitted. Formerly, the administration has observed real instances of non-licensed entities conducting work on a permitted construction site, sometimes even under the guise of a licensed contractor in good standing.

“It just ensures consumer protection,” Dahilig added.

Both Dahilig and Chris Delaney from Pacific Resource Partnership, or PRP, testified in support of the measure at Wednesday’s meeting, which the council passed on first reading 6-1. Councilmember Billy DeCosta was the lone dissenter, citing its lack of specific language differentiating between residential and commercial building.

“If you got to take out a construction loan, you need a licensed contractor. Any bank won’t give a homeowner a loan to do a dwelling if you don’t have a licensed contractor,” stated DeCosta.

The first requirement for every traditional lender is proof that you’re working with a qualified, experienced builder.

Current state policy under HRS-444 has an exemption for owner-builders who apply for construction permits, however, several sub-chapters require specific jobs to be completed by a licensed contractor.

“…Take, for example, plumbing and electrical,” said Dahilig. “… In those two circumstances, if it was being cleared and suggested that that would be language that needs to be pulled into the text of the bill, then those types of scenarios would not be applicable.”

DeCosta commented he was all for the initiative, adding, “It seems like we have to put quite a bit of language into this bill to get my opinion,” noting the need to see the county reach out to local entities and contractors to weigh the bill evenly.

The County has yet to seek testimony from local contractors.

Matthew Bracken, the County’s attorney, however, spoke about the legality of separating a commercial builder and a residential builder’s rules and regulations.

“In a lot of ways, the County cannot regulate contractors. HRS-444 is regulated by the State,” Bracken stated, adding, “Could we distinguish them in this bill? Yes and no, but it depends on how and why you want to distinguish them.”

Pointing to the lack of manpower with state agencies, one concerned citizen testified that no state agency has ever been fully charged with going to every job site to ensure new projects are carried out to the letter of the law.

When Council Chair Kaneshiro invited those in the audience who wished to testify further, PRP, who represents the Carpenter’s Union and 240 contractors in the state of Hawai’i, affirmed PRP’s support of the drafted bill and emphasized the organization’s ongoing activity to level the playing field for all contractors.

“Paying appropriate wages, payroll taxes, insurance safety, appropriate licensing, and other regulatory requirements,” highlighted Delaney.

PRP has found that dishonest contractors have cut corners to gain a competitive advantage over compliant contractors and supports the county’s ability to verify that all work is licensed.

“We owe it to our law-abiding contractors to hold unscrupulous contractors accountable,” Delaney explained, noting numerous examples of out-of-state labor and uninsured, self-employed contractors.

The next public hearing related to drafted bill no. 2873 is scheduled for Aug. 3.