The County of Hawai‘i’s Disaster Recovery Division has decided to submit the proposed Substantial Amendment for the Voluntary Housing Buyout Program (VHBP) Action Plan to the U.S. Department of Housing and Urban Development (HUD) for review and approval. All proposals from the public comment period were carefully reviewed and considered, but the
County has decided to push forward with the Substantial Amendment to the Action Plan with no additional changes. The Action Plan maps out how the County will spend the $107,561,000 in Community Development Block Grant-Disaster Recovery grant funds from HUD to assist with the recovery from the 2018 Kīlauea eruption.

The changes to the current action plan submitted in the Substantial Amendment for the VHBP were made to ensure Phase 3 of the program remains focused on the primary objective of the program. The sole purpose of the VHBP program is to help as many eligible property owners as possible, with a particular focus on those who are Low- to Moderate-Income (LMI) range, who were impacted by the recent eruption.

The Action Plan Substantial Amendment [Link] being submitted for approval by HUD has four main substantial changes proposed:

• Establishment of a new maximum grant award specifically for undeveloped properties that would be acquired through VHBP;
• Clarification of the program’s policies and procedures including eligibility, exceptions, and duplication of benefits analysis;
• Revision of timeframes for Phase 3 to apply for the VHBP;
• Elimination of the Housing Relocation Services Program with funds being reallocated to the main VHBP fund.

“In April, the County released a draft of the Substantial Amendment to the public for a 30-day comment period,” said Douglas Le, County Disaster Recovery Officer. “We want residents toknow that we carefully reviewed every comment we received, and we responded to those concerns in the Action Plan Substantial Amendment we submitted to HUD.”

The majority of those who participated in the public comment period were primarily concerned that the establishment of the new $22,000 maximum grant award for undeveloped properties was premature, too low, or not based on a thorough review of data. The County wants to assure residents that the new maximum grant award was proposed after data was painstakingly analyzed and reviewed by expert members of the VHBP staff. Extensive data was also given to the public for review on how and why the new maximum grant award was chosen based on the 2017 pre-eruption median values of eligible undeveloped properties. The data showed that if the VHBP continued without the new maximum grant award, fewer residents would benefit from the program as well as limiting the County’s ability to focus its efforts on serving as many LMI residents as possible with the remaining CDBG-DR funds.

To date, the County is processing nearly 500 applications to the VHBP from primary and second homes from Phase 1 & 2 which commits $90.6 million out of the total approximately $107.6 million in CDBG-DR funding. An additional $11 million is committed for grant administration and program delivery costs necessary to fulfill federal grant requirements. This leaves approximately $5.8 million of funds available as the County begins accepting Phase 3 applications in July 2022. The County has already received 160 registrations from property owners of undeveloped properties that are eligible to apply during Phase 3, with 700-800 additional eligible undeveloped properties still able to register. Also, during this time there may be additional primary and second homes that could apply for the first time during the Phase 3 process which would further decrease the remaining funds.

Even though we expect some slight variation with these numbers in the coming months depending on participation, the remaining funds will very likely not be enough to serve the remaining undeveloped properties in Phase 3 at current enrollment rates. The clear choice moving forward was to adjust the maximum grant award for undeveloped properties to ensure the remaining grant funds benefit as many residents as possible, especially those who are LMI.

“We understand that this is a complicated issue and residents, especially those who are LMI, are hoping to get as much help as possible from this program,” said Le. “Ultimately, this Substantial Amendment is going to make sure we help as many residents as possible with the remaining program funds.”

Even though funds will be limited for Phase 3, residents who want to apply can register now by downloading and submitting this form from the Voluntary Housing Buyout Program website. Applicants are still required to submit a formal application when they become available on July 18, 2022. Registrants will be notified by staff when formal applications become available, you must submit a formal application for Phase 3 to be considered for the program.

To view the Substantial Amendment, visit https://recovery.hawaiicounty.gov.