Bill 147: What West Hawaii Vacation Rental Owners Should Watch Now
Vacation rental rules on Hawaii Island are changing again, and if you own a short-term rental in West Hawaii, this is something to pay attention to.
Bill 147 is the latest proposed legislation affecting transient vacation rentals, including both hosted and unhosted short-term vacation rentals. It is not final law yet, but it could bring meaningful changes to how vacation rentals are defined, permitted, operated, and enforced throughout Hawaii County. [1]
For owners in Puako, Waikoloa Beach Resort, Mauna Lani, Kailua-Kona, Keauhou, and South Kona, this is worth watching closely. Vacation rentals are an important part of our local real estate market. They are also part of a broader conversation about housing, tourism, neighborhood character, and tax compliance.
Where We Are Now
Hawaii County’s current short-term vacation rental rules are built mainly on Bill 108, adopted in 2018 as Ordinance 2018-114. That law defined where short-term vacation rentals are allowed, established operating standards, and provided existing rentals outside permitted zoning districts a path to continue operating through a Nonconforming Use Certificate, often called an NUC. [2]
More recently, Hawaii County passed Ordinance 25-50, also known as Bill 47. This created a registration requirement for transient vacation rentals. The deadline was extended to September 1, 2026. The ordinance applies to rentals of 180 days or fewer and includes both hosted and unhosted rentals. The registration fee is $250 for hosted rentals and $500 for unhosted rentals. Failure to register may result in a fine of up to $10,000. [3]
That means the county is already moving into a more formal registration and enforcement system. Bill 147 appears to be the next step.
What Bill 147 Proposes
Bill 147 would repeal and replace existing code sections governing bed-and-breakfast establishments and short-term vacation rentals. In their place, it would create a new framework for transient vacation rentals, including rules for permitted uses, permitting, enforcement, and operational regulations. [1]
In simple terms, Bill 147 aims to bring greater clarity plus control to the vacation rental system. It would better define hosted and unhosted rentals, as well as bed-and-breakfast uses. It would also create more detailed operating standards and stronger enforcement tools.
This is especially important for hosted vacation rentals. Under prior rules, much of the focus was on unhosted short-term vacation rentals. Bill 147 would bring hosted rentals more clearly into the county’s zoning and regulatory structure.
According to Hawaii County, “Bill 147 will be heard at the Leeward Planning Commission on June 30th, 2026. The next hearing of Bill 147 at the Windward Planning Commission will be July 2, 2026. After the planning commissions both review and provide their recommendations on the bill, it will be returned to PCPLUED for amendment and further committee review. Once passed out of committee, it will have a minimum of two hearings in council.”
I also called Heather Kimball, Hawaii County Council member from District 1, and spoke with her about Bill 147. She is working on two bills for introduction on July 22:
1. Will create a grace period to register from Sept 1 to Dec 31, and other editorial changes to ordinance 25-50.
2. Creates a B&B tax class that will allow homeowners to keep their 3% CAP and be taxed at a lower rate. Will not be retroactive for folks who have already paid penalties and fees for operating a B&B in the homeowners’ class.
You can learn more about it on the Hawaii County website here.
Current Rules vs. Bill 147
|
Topic |
Current Rules |
What Bill 147 May Change |
What Owners Should Do |
|
Hosted rentals |
Covered under the new registration system, but historically less regulated than unhosted rentals |
Creates a clearer framework for hosted rentals and bed and breakfast uses |
Confirm if your rental is truly hosted and make sure your property fits the proposed definition |
|
Unhosted rentals |
Governed by Bill 108, zoning rules, and NUC requirements where applicable |
Updates definitions, zoning rules, and operating standards |
Review zoning, NUC status, registration, and listing details |
|
Registration |
Ordinance 25-50 requires registration by July 1, 2026 |
Bill 147 would add another layer of rules beyond registration |
Do not wait to organize paperwork, tax IDs, owner contacts, and property information |
|
Operations |
Existing rules already include standards for legal STVR use |
Adds or clarifies standards around occupancy, parking, quiet hours, and events |
Review guest limits, parking instructions, house rules, and event language in your listing |
|
Enforcement |
Fines already apply for failure to register |
Creates stronger complaint, inspection, and violation procedures |
Operate carefully, respond to complaints quickly, and keep good records |
What This Means for Current Owners
If your West Hawaii vacation rental is already legal and properly registered, Bill 147 does not appear to be a simple ban. That is important. The county’s direction seems to be more concerning documentation, compliance, enforcement, and clearer operating standards.
That said, owners should not ignore it.
A property may be legal today but still run into problems if guest counts are too high, parking is unclear, tax information is incomplete, a listing is inaccurate, a registration is missed, or neighbors complain about noise and events.
For owners with NUCs, annual renewal and compliance will remain extremely important. For resort-area condos, the issue may be less about basic zoning and more about registration, advertising accuracy, tax compliance, and operating rules. For hosted rentals, especially on residential or agricultural properties, the details could become more complicated.
Agricultural properties deserve special attention. The Hawaii Supreme Court has held that farm dwellings in the state agricultural district cannot be used as short-term vacation rentals under Hawaii law. Owners with agricultural zoning should get qualified legal guidance before relying on vacation rental income. [4]
Why the County Is Looking at This
The county is trying to balance several competing concerns. Vacation rentals support tourism, local jobs, property owners, cleaners, landscapers, maintenance companies, and many small businesses. At the same time, residents are concerned about housing availability, neighborhood impacts, and unregistered rentals.
A county economic impact study found more than 8,000 active short-term vacation rental listings on Hawaii Island as of March 2025. It also estimated that about $710 million in short-term rental lodging revenue in 2024. The same study found that only 4 percent of owners said they would definitely convert their vacation rental to a long-term rental if short-term rentals were restricted, while 54 percent said they rely on the rental income to cover housing-related costs. [5]
That tells us this is not a simple issue. Many owners are not large investors. They are families, retirees, local residents, and second-home owners using rental income to make ownership possible.
Owner Checklist
If you own a vacation rental in West Hawaii, now is a good time to:
-
Confirm your zoning and state land use district.
-
Check your registration obligations before the July 1, 2026, deadline.
-
Make sure your GET, TAT, and county tax information is organized.
-
Review your guest count, parking instructions, house rules, and quiet-hour language.
-
Remove any event language that could create problems.
-
Confirm your NUC renewal status, if applicable.
-
Keep records of permits, registrations, tax filings, and correspondence.
-
Talk with your property manager, CPA, attorney, and realtor before making big decisions.
My Take
Vacation rental ownership in Hawaii has always required attention to detail, and that is becoming even more true. The best-positioned owners will be the ones who are informed, stay organized, and operate responsibly. For buyers, this also means due diligence matters more than ever. Do not assume that a property can be used as a vacation rental simply because it has been rented in the past. Ask questions. Review zoning. Confirm registration. Understand the difference between hosted and unhosted use. Look at the property’s history and paperwork before you write an offer.
For sellers, strong documentation may become a major selling point. A clean file, legal rental history, current registration, good tax records, and clear operating procedures can give buyers more confidence. Bill 147 is still moving through the process, and changes may be made before anything becomes final. I will continue to watch it closely because this matters to West Hawaii property owners, especially those who own or are considering a vacation rental property. If you have questions about how this may affect your property, let’s talk. This blog is for general information only and is not legal or tax advice.
[1] Bill 147 is described in the public notice as a proposal to repeal existing provisions governing bed-and-breakfasts and short-term vacation rentals, and to create a new framework for transient vacation rentals, including permitted uses, permitting, enforcement, and operational policies.
[2] Hawaii County Planning Department states that Bill 108, adopted as Ordinance 2018-114, defines where STVR use is allowed, establishes standards, and provides the NUC path for existing rentals outside permitted zoning districts.
[3] Hawaiʻi Public Radio reports that Ordinance 25-50 registration was extended to July 1, 2026, applies to rentals of 180 days or fewer, distinguishes hosted and unhosted rentals, and sets fees at $250 and $500, with possible fines up to $10,000.
[4] The Hawaii Attorney General and the Hawaii Supreme Court’s Rosehill decision address the prohibition on using farm dwellings in the agricultural district as short-term vacation rentals.
[5] The county economic impact study found 8,008 active listings, estimated $710 million in 2024 STVR lodging revenue, and reported owner survey findings, including a 4 percent long-term conversion rate and a 54 percent reliance on rental income.
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