COUNTY OF MAUI Introduction County Profile COUNTY OF MAUI Figure 1-11 POPULATION MEDIAN AGE 166,260 (2017) 40.0 (2017) Median Price Single Family Home AVG FAMILY SIZE MOLOKAI HOUSING UNITS 2.97 $512,450 72,962 (2017) Median Price Single Family Home Median Price Single Family Home LANAI MAUI COUNTY $425,000 $910,923 MEDIAN HOUSEHOLD INCOME $72,762 PER CAPITA INCOME UNEMPLOYMENT RATE $32,379 2.5% Demographic Characteristics (2018, unless marked with * indicating Dec. 2017). Source: U.S. Census Bureau; State of Hawaii Dept. of Labor & Industrial Relations; State of Hawai DBEDT’ Realtors Association of Maui; County Map Source: Arc GIS GEOGRAPHY The County of Maui is the second largest county by land area in the State of Hawai‘i. It consists of four main islands: Maui, Moloka‘i, Lāna‘i, and Kaho‘olawe. The combined area of these islands is 1,171 square miles, including over 9 square miles of inland water; the island of Maui is the largest, with 734.5 square miles, and the islands have a total coastline of 210 statute miles. Kalawao County, a state- managed hospital community (Kalaupapa), is situated on the island of Moloka‘i. The island of Kaho‘olawe is uninhabited and is in the process of being restored from a military practice site to a cultural reserve. The island of Maui, known as the “Valley Isle,” is the second largest in the Hawaiian archipelago. It has a land area of 735 square miles, is 48 miles long and 26 miles wide. It is the economic center and home to most of the County’s residents and businesses. The town of Wailuku is the seat of county government and the contiguous town of Kahului is the primary commercial center. The island of Lana‘i has historically been called the “Pineapple Isle” because for many years most of its 141 square miles were devoted to pineapple production; cultivation of the crop has since been phased out. Larry Ellison, the present owner of approximately 98% of the land on Lanai, is in the process of renovating the 102-room resort, The Four Seasons Resort Lana‘i Lodge at Koele, which is scheduled to FISCAL YEAR 2020 MAYOR’S PROPOSED BUDGET 29 COUNTY OF MAUI Introduction County Profile reopen in early 2020 with a mix of hotel rooms and a spa and wellness concept. The property has been closed since 2015 and began a $75 million dollar makeover in 2017. GOVERNMENT Uniquely, the Counties in the State of Hawaiʻi are legally established by the State Constitution and there are no subordinate or separate municipal entities. The state government administers the school system, airports, harbors, hospitals, judicial system and the state highway system. Most non-federal taxes are administered and collected by the State of Hawai‘i; the major sources of state revenue are corporate and personal income taxes and the General Excise Tax (GET). The County of Maui provides a broad range of services including public safety (including police and fire services), sanitation, social services, culture and recreation, transportation, planning and zoning, and the construction and maintenance of streets and highways. Maui County is governed by the County Charter, originally adopted by the electorate in September 1967 and last amended in 2019. Like the other counties in Hawaiʻi, the County of Maui operates under the Mayor-County Council form of government. All elections for county office are non-partisan. The executive branch of the County is headed by the Mayor who is elected for a four-year term. As the chief executive officer of the County, the Mayor is responsible for appointing the heads of the 11 executive County Departments. The respective Commissions are responsible for appointing the head of the Department of Personnel Services, Fire and Public Safety, Police, and Liquor Control. The Mayor establishes and directs basic management guidelines for the Departments and serves as a liaison between the County Council, Departments, and agencies. The legislative branch -- the County Council -- is comprised of nine members who are elected at-large, to serve two-year terms. As the policy-making body, the County Council appoints the County Clerk, County Auditor, and the staff of the Office of Council Services. Each of the nine council members has residency requirements, one each from the islands of Lana‘i and Moloka‘i, and seven from the various districts on the island of Maui. The Council legislates taxes, rates, fees, assessments, borrowing and appropriations for County purposes (County Budget) by ordinance. Figure 1-12 FISCAL YEAR 2020 MAYOR’S PROPOSED BUDGET 30 COUNTY OF MAUI Introduction County Profile GENERAL ECONOMIC BACKGROUND For more than a century, dating back to the mid-1800s, large-scale plantation agriculture – sugar, together with pineapple from the 1920s – dominated the economy of Maui County. By the 1980s, Maui’s traditional economic driver was in serious decline as falling global prices, the high cost of equipment and labor and periodic droughts adversely affected profitability. Shortly after Hawaiʻi became the 50th State in 1959, the first Boeing 707 jet landed in Honolulu, signaling the advent of large-scale tourism and resort development. In the early 1960s, Kaʻanapali in West Maui was developed as the first premier, master- planned resort in the state and tourism began to supplant agriculture as the dominant economic force in the islands. With development and the influx of supporting industries and services, the County’s population grew from 42,000 in 1960 to 70,000 by 1980 and 128,000 by 2000. In the early 1980s, business and community leaders and elected officials recognized the need to diversify the economy in order to minimize the uncertainties of external economic conditions and events. A direct outcome was the founding of the Maui Economic Development Board (MEDB), charged with a mission of broadening the economic base of the County and encouraging a wider spectrum of economic opportunities for residents. In addition, the Maui Research and Technology Park in Kihei was created for the same purpose. ECONOMIC OVERVIEW Maui’s economic outlook remains strong primarily driven by increases in tourist volume, the commencement of new construction projects, and a robust employment environment. In fact, the low unemployment figures could potentially slow Maui’s economic expansion while simultaneously applying pressure on employers to raise wages. Nevertheless, the near-term future of Maui’s economic well- being appears very healthy. Figure 1-13 Principal Private Employers in Maui County Source: Pacific Business News, Book of Lists, 2017-18 FISCAL YEAR 2020 MAYOR’S PROPOSED BUDGET 31 COUNTY OF MAUI Introduction County Profile VISITOR INDUSTRY The tourism sector continued to grow as visitor arrivals reached a record 2.79 million in 2017, a 4.1% increase over the 2016 results; however, total air seats declined slightly (-0.2%). Visitors arriving from the U.S. west coast continued to dominate Maui’s visitor industry with a 49.6% market share followed by those coming from the east coast with 27.3%. All other departure points had less than a 10% share with Canada leading those markets at 9.6%. Noteworthy was the growth in east coast visitors increasing 6.8% versus 3.6% for west coast visitors. Maui’s visitor industry exceeded expectations and continued its robust growth in 2017 despite forecasts indicating slower growth in 2017 due to mid-year statistics indicating lower visitor arrivals than experienced in the first half of 2016. The Hawaii Tourism Authority estimates that visitor spending on Maui Island increased 3.4% in 2017 to $4.68 billion or $212 per visitor per day. The daily expenditure on Maui per visitor exceeded Oahu by $14.00. Maui’s average hotel room rate remained the highest in the state in 2017, increasing 6.2% to $353, while occupancy rates increased to 77.1% from 75.8%. In 2017, Maui’s daily census of visitors grew 3.3% to 66,506 while visitor days increased 2.9% to 22.58 million second only to Oahu. AGRICULTURE While the December 2016 closure of the 36,000-acre HC&S sugar operation added uncertainty to Maui’s economy, the County is optimistic that the repurposing of agricultural lands will enable the expansion of small farms, as well as the expansion of Kula Agricultural Park, and facilitate a variety of uses including energy crops, food crops, and grazing lands to support the local cattle industry. There is consensus that these developments will be important in increasing Maui’s sustainability and resilience. The growth of the seed industry (especially seed corn) has likewise contributed significantly to the existing agricultural economy. CONSTRUCTION After a significant decline in activity in 2016, private (commercial & residential) building authorizations on Maui reached $478 million, an increase of some $92.8 million or 24.1 percent in 2017. The growth in the construction sector was largely due to the expansion of residential construction but also benefitted from improving numbers in the commercial sector. In 2016, 315 or 26.7% of the 1,178 permits issued resulted in 477 residential units. In 2017, 546 permits representing 40.5% of the total permits issued resulted in 863 residential units indicating a shift toward multi-unit dwellings. Continued growth in the construction industry is projected in 2018 as mid 2018 figures show construction authorizations in the first two quarters grew by more than $48 million or 17.8% over the same period in 2017. The visitor industry projects 4,272 planned additional units in all categories. Of this total 200 units were estimated to be completed in 2017, 150 units in 2018, and another 388 units in 2019. The types of units include: 778 Timeshare, 217 Condo, 150 Hotel/Condo, 626 Hotel, 125 Bed and Breakfast, 207 Short- term Rentals, 12 Transient Vacation Rentals, 699 Mixed Use, and 308 Mixed Use/Hotel.