by Nick Grube, Honolulu Civil Beat
This article was produced for ProPublica’s Regional Investigating Network in partnership with Honolulu Civil Beat. Sign up for Letters to receive stories like this as soon as they are published.
A year ago, after a fatal fire displaced thousands of residents of Lahaina, Hawaii’s governor and lieutenant governor invoked a state law blocking most foreclosures and prohibiting price gouging. The urgent get quickly developed into a tool to stop all Maui residents from fleeing, including those who were struggling to pay rent because they had lost their jobs as a result of the fire.
Despite that purchase, some Maui home users have capitalized on the issue by pushing out residents and housing fire survivors for more money. A couple and their two young children were among those who were displaced, according to court documents, so that their owner’s child may live there while renting his own home to the Federal Emergency Management Agency’s housing plan for$ 8, 000 a month.
Some property owners have brought in more than half the going rate for a long-term hire by signing up with FEMA or another support system. They have benefited from lucrative property tax breaks for storing wildfire survivors, some of whom have earned more than$ 10,000 annually.
Another landowners have forced out residents and sought people who will pay more. One tenant tried to remove his tenants for various reasons over the course of several months, even claiming that Maui’s governor needed to “use the house as a command center to recover Lahaina.” ( A spokesperson for the mayor said that claim was false. ) Two of the tenants who had recently moved out noticed that their ocean-view apartment was listed online for$ 6,800 per month rather than the$ 4,200 they had already paid. Asked about the higher amount, the landlord told Civil Beat and ProPublica that the house has been cleaned up and is now furnished.
For decades, concerns about foreclosures and rent increases have been in print. Cover activists say Gov. The Hawaii attorney general has ignored abuses, and Joseph Green’s leadership has n’t taken the necessary steps to strengthen the laws.
Even before the flames swept across Maui, rented accommodation on the island was among the most costly in the country. The destruction of so many houses was bound to cause prices to rise. But tenants, cover advocates, federal officials and yet landlords say great prices offered by FEMA, the state and private help organizations have encouraged house owners to hunt the cash. Angus McKelvey, a state senator who lost his own house in Lahaina, referred to it as “FEMA fever.”
Jo Wessel, a Colorado employer, said she tried to sign up with FEMA after her tenants fell behind on their rent and electricity bills. She claimed that a property management firm employed by FEMA offered her$ 6,500 per month, which was more than double what she had to pay for the Kahului two-bedroom property. Although the governor’s get bars evictions for payment of fee or utilities, Wessel told Lea and David Vitello and their two children on Jan. 6 that they had five days to give up or leave, according to documents reviewed by Civil Beat and ProPublica. FEMA inspectors checked the Vitellos ‘ home to see if their house was acceptable for wildfire victims two weeks later. ” We did n’t see it coming”, Lea Vitello said.
When their contract expired at the end of January, the Vitellos refused to resign, and Wessel later sued them. It took until April for the Vitellos to find a new place and walk away. Wessel claimed that the lag prevented her from signing up for the FEMA deal, but she was able to get a job with a nonprofit housing organization that would charge her about$ 400 more per month than what she was asking the Vitellos. Wessel said she thought the Vitellos had taken advantage of the president’s attempt and that they still owe her money. Wessel’s court case against them continued until this year, when a judge dismissed it despite the Vitellos leaving a few months ago.
Those who have been forced out are contending with a housing market where the median rent has jumped 44 % since before the fires, according to an Argonne National Laboratory study released last week. Some of the people who have been forced to leave since the fires have complained to Civil Beat and ProPublica that they have n’t yet found a permanent home.
Peter Sunday, whose family was evicted so their owner’s boy could walk in, said he paid merely$ 1, 900 a month for their three-bedroom house and that the cheapest place he has found since is twice as much. He, his wife, and their two young children have relocated from place to place while searching for stability.
Adrienne Sunday and her husband, Peter Sunday, move a container in the storage unit that holds most of their belongings in Kula, Hawaii, in July. ( Civil Beat/Kevin Fujii )
Malcolm Vincent, the landlord’s son, said in a court filing that he lived in a garage on family property after he rented his home to FEMA and while he was waiting for the Sundays to leave. Vincent claimed to be busy and hung up when Civil Beat and ProPublica called him. In response to a text message, he wrote,” Stop”. Former landlord of the Sundays, Ann Siciak, did not respond to interview requests.
State and federal officials said they did n’t intend for their housing programs to encourage landlords to kick people out to make room for wildfire survivors, but they had to offer lucrative rates in order to secure housing quickly. FEMA Region 9 Administrator Bob Fenton stated in an interview,” We’re not incentivizing.” ” What we’re doing is being competitive”.
The Green government acknowledged that” some bad actors have not complied” with the governor’s order. Officials urged tenants to report unscrupulous landlords to the state attorney general.
Green claimed in an interview that he too has heard of landlords who have expelled tenants in an effort to increase rents, but that they “represent the extreme minority” as a result. Much more common, he said, are stories of people who did the right thing and provided shelter to thousands of people.
There are a million different forces at play here, Green said, but I was very clear that we did n’t want to displace anyone. ” Every moment, every week, you just had to try to prevent predatory behavior. There is a lot of that. That’s one of the lessons I learned from this crisis”.
Hawaii Governor Josh Green, left, and Maui County Mayor Richard Bissen speak during a tour of wildfire damage in Lahaina a few days after the fire. ( Rick Bowmer/AP )
State officials pointed to a sharp drop in eviction cases filed in court since the fire as evidence that the governor’s order is “doing what it was designed to do: stop unlawful evictions and keep families and survivors housed”.
However, tenants ‘ rights organizations and attorneys claim that court cases, the only public record of evictions, do n’t provide a comprehensive picture. It’s time-consuming and risky for a tenant to fight an eviction in court, if they lose, they’ll have a record that could make it harder to rent another place. Even when they believe their landlord is breaking the law, many tenants simply leave the property after receiving a notice to leave.
” We know this is happening”, said Jade Moreno, a researcher and policy analyst for the Maui Housing Hui, a tenants ‘ rights organization. We constantly hear the stories, they say.
” The Greed Is Sickening”
The state of Hawaii pays comparable rates for its own program, despite the fact that the majority of people refer to FEMA when they criticize the market for their own housing programs. And in November, in an effort to entice property owners, the governor revealed just how much money could be made housing people who were homeless after the fire.
At the time, thousands of wildfire survivors were residing in hotel rooms, which cost the state at least$ 1 million per day, while vacant vacation rental homes sat there waiting for what would have been more affordable. So Green announced that the state would pay a premium to anyone who housed survivors.
The state’s rent rates were incredible for landlords who typically rented to locals:$ 5, 000 per month for a studio or one-bedroom home,$ 7, 000 for a two-bedroom,$ 9, 000 for a three-bedroom, and$ 11, 000 for a four-bedroom.
Early on, FEMA also concluded that it would have to pay vacation rental rates. FEMA claims that the amount paid does n’t change based on property. But contracts reviewed by Civil Beat and ProPublica show the agency has paid$ 5, 000 to$ 9, 050 for a one- or two-bedroom unit. According to two landlords who spoke with Civil Beat and ProPublica, it has cost$ 9, 000 to$ 11,400 for three- and four-bedroom homes.
Contracts for the Federal Emergency Management Agency’s housing program obtained by Civil Beat and ProPublica show that landlords have brought in prices well above the market rate for long-term rentals on Maui. Officials from both the state and the federal government have stated that they had to offer high prices to persuade property owners to shelter wildfire survivors. ( Obtained by Civil Beat and ProPublica. ProPublica shines a spotlight on this.
Once people knew what they could get, Maui-based property manager Claudia Garcia started getting calls. Property owners, many of whom resided on the mainland, contacted Garcia to ask if Garcia could assist them in raising their rents to keep up with FEMA. She said she refused because she did n’t want to help them take advantage of the crisis. Garcia, whose company manages more than 100 rentals on the island, called the situation” sickening.” ” It’s just not right what they’re doing”.
Tenants called the Legal Aid Society of Hawaii, too, but they also received calls. In the first seven months after the fire, the number of Maui residents who sought help with evictions grew by 50 % compared with the seven months before the fire, according to the organization.
At least one nonprofit that was sheltered by the fire had to bump up its offers to property owners due to the high prices the state and FEMA offered. ” Short-term rental owners did shop us”, said Skye Kolealani Razon-Olds, who oversees the Council for Native Hawaiian Advancement’s emergency housing and recovery programs. They asked if we could match the FEMA rental rates that they gave us.
Razon-Olds said the nonprofit has received 19 complaints from tenants who said they were being forced out of their homes so their landlords could rent to FEMA. She claimed that her organization persuaded FEMA to halt its dealings with those owners.
In February, six months after the fire, FEMA announced that it would reject properties if it learned tenants had been illegally forced out” so landlords could gain higher rents from the FEMA program”. fewer than 10 instances have been found by FEMA where a landlord unintentionally ended a lease in order to participate in the housing program, according to officials. In all those cases, FEMA removed the properties from the program.
Their rates were seen as a compromise between long-term and vacation rental, according to state and federal officials. The rates publicized by the state are maximums, state officials said, in practice, Hawaii is paying significantly less — about$ 228 per night rather than$ 267. Instead of earning$ 8, 000 per month, that is equivalent to about$ 6,800.
After state and local officials raised concerns, FEMA asked the Argonne National Laboratory to study whether housing programs had caused property owners to increase rents or displace residents.
There is n’t enough data to determine how much housing programs had contributed, and researchers came to the conclusion that the loss of housing during the fires was the main cause of the rapid rise in rental prices. However, they noted that the Hawaii Office of Consumer Protection received about 700 housing-related complaints from August 2023 to April, most related to lease terminations or rent increases. According to researchers, those complaints and subsequent investigations show that” the behavior of some landlords may have changed, leading to secondary displacement or cost increases for some renter households outside of the burn area.”
One landlord, however, said it was n’t until she was approached by a property management company working for FEMA that she decided to house wildfire survivors. Mara Lockwood received$ 7, 000 per month from the company, which is roughly$ 2, 300 more than what she had already collected for her two-bedroom condo with a view of Maalaea Bay.
Lockwood took the deal, not just for the extra income, but because she would be exempt from property taxes for at least a year, which she said will save her about$ 12, 000 annually. But she had a point. As the owner of a Maui real estate company, she saw the asking prices for rentals rise, and she kept hearing stories of people getting pushed out of their homes so that their landlords could earn more money.
” It’s horrible to rent someone to FEMA in order to make more money,” said Lockwood. ” But when you’re given an opportunity and money is involved — and you have to follow the money— then some people are going to do that”.
” That’s What The Law Permitted,”
For every case in which it’s clear a tenant is being kicked out so their landlord can make more money, there are many more that are n’t as obvious, said Nick Severson, the lead housing attorney for the Legal Aid Society of Hawaii. ” Sometimes we’ll receive emails or texts or statements from the landlord threatening to rent this place out to FEMA for$ 8, 000 per month,” he said. ” But usually it’s not that lucky. It’s a little bit more secret, which makes it difficult to criticize.
Screenshots of text messages show that four days after Christmas, a landlord informed her tenant that he had to give up his rental unit so her family could rent it to FEMA. After the tenant’s objection, the landlord informed Civil Beat and ProPublica that she did n’t end up renting to the agency. ( Obtained by Civil Beat and ProPublica )
That’s partly because the state law, which forbids price gouging in an emergency, gives landlords some breathing room. Renters can be evicted if a landlord or family member is moving in or if the renter has violated the terms of their lease, as long as it’s not related to nonpayment of rent, utilities or similar charges. Additionally, landlords have the ability to compel tenants out at the end of a fixed-term lease without giving a justification. In several cases reviewed by Civil Beat and ProPublica, landlords have cited those exceptions in evicting tenants and have gone on to rent their properties to wildfire survivors for more money.
Property owners are aware that housing programs are generating more revenue than they did before the fire. According to the Hawaii attorney general, the governor’s emergency proclamation prevents landlords from raising their rent unless it was agreed to before Aug. 9 or the landlord can show their costs have increased.
Yet the attorney general has held property owners accountable in a small number of cases. The office has concluded that landlords violated the governor’s order in just 28 of the 200 complaints of illegal evictions and rent increases it had received as of June 3. ( Thirty-thirty were still the subject of inquiries. ) Fenton, the FEMA administrator, said the attorney general’s office concluded that just one of the cases FEMA referred had violated the proclamation. The attorney general’s office has the authority to impose civil penalties of up to$ 10,000 per day, but it has not.
” We have the emergency proclamation, but it does n’t prevent anyone from evicting tenants and raising rent”, said Anne Barber, a Maui real estate broker who works with Garcia in her property management firm. There is n’t any accountability, they say.
In February, a tenant complained to the Hawaii attorney general that he was being forced out of his home by a landlord whom he said was planning to rent his home to FEMA. The tenant was informed by an attorney general’s office representative that it was okay to just participate in FEMA’s housing program and that the landlord was not required to renew the lease. ( Obtained by Honolulu Civil Beat and ProPublica. ProPublica shines a spotlight on this.
The attorney general’s office said in a written statement that it “provides people with opportunities to do the right thing and correct their actions. The Attorney General has the power and will pursue legal remedies if individuals choose not to comply.
The Green administration said it has revised the emergency proclamation to address the needs of the community, at one point, the governor added language barring unsolicited offers to buy property in areas affected by the fires. However, according to administration officials, the governor has a limited amount of authority. For example, they said he has no authority to force landlords to extend leases. According to Green’s staff, lawmakers must examine the price-gouging law and make the necessary adjustments.
In one case, Maui landlord Gregory Lussier filed an eviction case against six people living in a four-bedroom home in Kahului. He claimed to want the tenants out because some had left and the rest had stopped paying the full rent, which was about$ 4, 000, but he was aware that the governor had a law that forbid him from ejecting them for nonpayment. In his Jan. 5 notice to the tenants and the eviction case he filed in court against them a week and a half later, he cited several violations of the lease, including prohibitions on pets, smoking, illegal activity, expired vehicle registrations, and obscene or loud language. The tenants moved out before the case was brought to trial.
Although Lussier rented the property to FEMA’s housing program for$ 11, 000 a month, he said that’s not why he filed eviction proceedings. In an email, he stated,” There was no premeditated scheme to force the tenant to leave so we could get a FEMA rental agency lease.” However, court records call into question his version of events. According to Lussier, the lease with FEMA’s outside property manager started on February 1 and that he thinks he signed the rental agreement the day before. He said he did n’t explore renting to the housing program until after the property was vacant and that the process of signing up took” several weeks”. However, a hearing video shows that Lussier and three of his tenants made an appearance in court on January 29 to deny his claims that they had broken the lease. Lussier declined to explain the discrepancy to Civil Beat and ProPublica.
Property owners who want to rip off the emergency proclamation to profit from FEMA’s prices have contacted Maui attorney Jack Naiditch, who claims he has received several phone calls from them. He said he’s turned them away:” I’m not going to put my name on the line for somebody who’s fibbing”.
However, he has defended a number of property owners in court, including Sunday’s landlord, and some have since rented out their homes to rehabilitate victims of wildfires. He declined to discuss specifics of their cases.
When Sunday made a plea to the judge that his family could remain in their home when he first appeared in court in April. ” Frankly, this is cold, your honor”, Sunday said. A single man wants to evict a family of four to move into a house he has admitted is for his own financial gain.
” There’s nothing I can do about that”, the judge said. That is what the law permits, they say. So that needs to be taken on with the governor, our mayor or Legislature, because there are people who very likely take advantage of that”.
Green responded to residents ‘ complaints and made it more difficult to claim the exception that Sunday’s landlord had cited four days after the Sundays ‘ eviction order was issued. Now, a landlord or family member who claims they need to move into a property must provide a sworn statement saying they’re not accepting money from an aid program to house survivors.
According to Sunday, his family packed the last of their belongings that day as a process server threatened to call the sheriff if they sat in the waiting room for too long. They put most of their belongings in a storage unit and gave away all of their pets and backyard farm animals — 18 chickens, nine ducks, two dogs and a pair of cats. This week, they have to relocate once more.
Sunday does n’t know what to tell his kids about the constant shuffling and when they’ll see their pets again. Without lying to them, he said,” I ca n’t give them any kind of peace.”
Opal Sunday carries a box of crafts from the Sunday family’s storage unit in Kula, Hawaii, in July. ( Civil Beat/Kevin Fujii )
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