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Gonna have to read this legislation later.
Its not clear to me how and if this would work. Something to keep in mind is that because in Hawaii we don't have the same school board -> city -> county -> state -> federal system that most other states have.
We have 'city-counties', so basically, we don't really have cities in the same sense that other states have cities, which might pass their own individual polices, have their own police, etc.
What this does is put a disproportionate amount of power into county elected officials. And based on the make up of the islands, this law is specifically targeting Oahu county. The other counties have plenty of space to build more houses. We already have some Ohana unit laws on the books, but there are weird counter veiling forces at play in the county. For example, they passed the Ohana unit law, then almost immediately increased the setback requirements to basically make the Ohana unit law irrelevant for the vast majority. With one hand they said "You can put more structures on your property" but with the other they said "but not unless you have a VERY large parcel". The vast majority of sfm in Honolulu county is tiny, like postage stamp tiny.
Add to this the extreme levels of corruption, where its common knowledge among builders that if you don't bribe a clerk, you can expect to wait years to get a permit to build. Its just a very weird situation in general.
So in summary, we have these county governments, which are almost as powerful as the state government, but are subject to some wildly high degrees of corruption, and internally have their own power struggles. Its not clear to me this law will be in anyway meaningful. It kind of reminds me of how the hotel industry lobbied and got one of their own onto the county council to pass an AirBnB ban, which basically resulted in a local recession for the cottage industry of service professionals that had built up around it. Meanwhile, if you've got a couple million dollar mansion by the beach, you are somehow still able to do AirBnB without issue.