REQUESTING A STUDY ON THE IMPACT OF FEDERAL HOUSING ALLOWANCES ON RENTAL MARKET CONDITIONS IN HAWAII.

SR147

THE SENATE

S.R. NO.

147

THIRTY-THIRD LEGISLATURE, 2026

STATE OF HAWAII

SENATE RESOLUTION

REQUESTING A STUDY ON THE IMPACT OF FEDERAL HOUSING
ALLOWANCES ON RENTAL MARKET CONDITIONS IN HAWAII
.

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WHEREAS, the
State of Hawaii is experiencing a prolonged housing affordability crisis, with
rental costs that significantly exceed national averages and place substantial
financial strain on local working families; and

WHEREAS, Hawaii�s chronic
housing undersupply, geographic isolation, and regulatory and infrastructure
constraints limit the market�s ability to respond quickly to demand pressures;
and

WHEREAS, Hawaiʻi
hosts a significant United States military presence, including major
installations such as Joint Base Pearl Harbor�Hickam, Schofield Barracks,
Marine Corps Base Hawaii, and Fort Shafter which are comprised of
approximately 95,466 active-duty military, family members, and adult
dependents; and

WHEREAS, a study
published by the Hawaii Housing Finance and Development Corporation in 2024
found that approximately 60% of these active-duty military
families resided in the off-base or private rental market, accounting
for approximately 14,700 homes; and

WHEREAS, active-duty
service members receive Basic Allowance for Housing (BAH), which is
administered by the United States Department of Defense and is
calculated based on local private-sector rental market data; and

WHEREAS, according to the
US Department of Defense website, the current BAH for an active-duty military
member stationed in Hawaii ranges from $2,598 to $5,040 per month depending on
their rank and experience; and

WHEREAS, in a
supply-constrained rental market such as Hawaii�s, large-scale federally funded
housing allowances may contribute to upward price anchoring, reduced
affordability for non-subsidized local residents, and the potential
segmentation of the rental market; and

WHEREAS, prior statewide
housing studies have examined military housing demand in Hawaii but have not
comprehensively analyzed the specific effect of federal housing allowances on
rental price trends, landlord pricing behavior, or housing availability for
non-military residents; and

WHEREAS, a clearer
understanding of the relationship between federal housing allowances and
Hawaii�s rental market would assist policymakers in evaluating
housing affordability challenges and developing appropriate
housing policies; now, therefore,

BE IT RESOLVED that the Senate
of the Thirty-third Legislature of the State of Hawaii, Regular Session
of 2026, requests the Department of Business, Economic
Development, and Tourism (DBEDT), in collaboration with the University of
Hawaii Economic Research Organization (UHERO) and other appropriate stakeholders,
conduct a study on the impact of federal housing allowances, including Basic
Allowance for Housing, on rental market conditions in Hawaii; and

BE IT FURTHER
RESOLVED that the study examine:

1.

An
econometric analysis of the relationship between federal housing allowance
rates and rental price trends by island and county;

2.

An
evaluation of whether rental prices cluster around housing allowance
levels in communities near military installations;

3.

An
assessment of the degree to which federal housing allowances influence landlord
pricing behavior in high-demand submarkets;

4.

A
comparison of rental price growth in areas with high concentrations of military
households versus comparable areas with lower concentration;

5.

An
examination of whether housing allowances indirectly displace local working
families from certain neighborhoods; and

6.

Policy
options, if any, that may mitigate distortion effects while respecting federal
authority and maintaining cooperative state-federal relations; and

BE IT FURTHER
RESOLVED that the study also evaluate the potential economic benefits
associated with federal housing expenditures in Hawaii, including contributions
to local landlords, property tax revenues, and related economic activity;
and

BE IT FURTHER
RESOLVED that the study also quantify the overall economic impact of
federal housing expenditures in Hawaiʻi to provide a balanced assessment
of both costs and benefits; and

BE IT FURTHER
RESOLVED that DBEDT is requested to submit a report of its findings and
any recommendations to the Legislature no later than twenty days prior to the
convening of the Regular Session of 2027; and

BE IT FURTHER
RESOLVED that certified copies of this Resolution be transmitted
to the Governor, the Director of DBEDT, the Executive Director of UHERO, and
the Hawaii congressional delegation.

OFFERED BY:

_____________________________

Report Title:
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Active-Duty
Military Base Allowance for Housing; Impact Study