Honolulu has reached a settlement with an 83-year-old widow, Sandra May, resolving a nearly $600,000 fine that stemmed from an online rental listing error. May will pay a reduced civil fine of $30,000, which will be recorded as a lien against her home but will not result in foreclosure during her lifetime.
The fines originated from an accidental listing of her rental unit as available for short-term stays. Under Honolulu ordinances, it is illegal to rent or advertise residential properties for periods of less than 30 days outside of designated resort zones. The daily fine for such violations is typically $10,000.
May, a retiree who rents an attached apartment to supplement her income, stated that the listing error occurred on the website platform. Her listing included a daily rate alongside a 30-day minimum to facilitate calculating longer stays, which she considered common sense. The city, however, interpreted this as advertising for short-term rentals.
While May was hospitalized following a car crash, she did not initially see the city's notices, allowing the fines to accumulate to $590,000. The city placed a lien on her home, blocked her driver's license and vehicle registration renewal, and advised her to seek legal counsel. May has lived in her Honolulu home for 56 years.
May filed a federal lawsuit against the city, with attorneys from the Pacific Legal Foundation arguing that the substantial fines violated the Eighth Amendment's prohibition against excessive penalties. Loren Seehase, an attorney with the foundation, stated that fines must be proportionate to the offense and that the city's initial demands would have forced May to sell her home.
Scott Humber, communications director for the City and County of Honolulu, confirmed that the settlement takes into account May's age, medical hardships, long residency, and limited personal involvement in creating the advertisement. He noted that the Department of Planning and Permitting takes short-term rental violations seriously but may adjust fines based on newly learned facts. Following a review and understanding of May's circumstances, the department was able to reach an agreement.
As part of the settlement, May dismissed her federal lawsuit and agreed to withdraw administrative appeals. The fine will be paid through escrow upon the sale of the property or through foreclosure after her death. May's attorneys highlighted that the case addresses a broader issue on Oahu, where the city has issued over $90 million in fines for similar advertising violations, asserting that governments must operate within constitutional limits when imposing financial penalties.