West Maui Sees Future as Prosperous Medical Community

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West Maui would become a medical enterprise zone, making it a magnet for new health-care jobs, under a proposal being considered in the state Legislature.
House Bill 553 would create a seven-year pilot program aimed at turning West Maui into a health-care hub, using business tax credits, tax exemptions and other incentives to attract development of medical and health-research facilities.
The measure cleared the House and has its first hearings in the Senate today.
Meanwhile, the State Health Planning and Development Agency last week approved the development of a long-awaited second hospital on Maui, which will be built on 15 acres in Lahaina.

The $46 million West Maui Hospital & Medical Center — a 25-bed hospital, 40-bed skilled-nursing facility and medical office building — will be federally designated as a critical-access hospital.

State Rep. Angus McKelvey, D-Lahaina-Kaanapali-Kapalua, who introduced House Bill 553, said pairing the new hospital with the creation of a medical enterprise zone is the “perfect marriage.”

“We have the ability to give business and this hospital the tools it needs to flourish, especially in this economic climate, without creating unnecessary drains on the [state] fund,” McKelvey said. “The return on investment from this alone is worthy of further discussion and this could be a shining star in government’s hat because you’re talking about creating high-paying jobs and diversifying the economy.”

Under the proposal, new businesses wanting to set up a medical or research facility in fields such as biotechnology, biomedicine or pharmaceuticals could be eligible for state income and unemployment tax credits every year for up to seven years if they are in the designated medical enterprise zone.
Additional incentives call for Maui County to reduce permit and user fees and real property taxes.
Opponents say the pilot program would be too costly to implement given the state’s budget deficit.
McKelvey said the upfront costs would be minimal when compared to the future revenue that could be gained from the new jobs and businesses.

Mainland developers and medical specialists reportedly are interested in Maui if incentives packaged in a medical enterprise zone were available.

“There are interested parties out there and we feel the timing is absolutely right,” said Brian Hoyle, a hospital developer with California-based Newport Hospital Corp., which is joining with the West Maui Improvement Foundation and the West Maui Taxpayers Association to build the West Maui Hospital. “We’re talking about a real high-caliber medical community with high-paying, noncyclical jobs that aren’t tied to tourism.”

Hoyle has developed dozens of health clinics and nursing facilities in the Midwest. The Maui hospital is his first project in Hawaii.

Dozens of residents from Lahaina and Kaanapali testified in support of the medical enterprise zone designation, saying it would help ensure the success of the new hospital because it creates a network of providers that will finally make high-quality health-care services available to the 69,000 West Maui residents.

Maui’s sole acute-care hospital, the Maui Memorial Medical Center in Wailuku, is 35 miles away and West Maui residents have argued for years that they needed a closer hospital, especially as the population of retirees and second-home vacationers has grown.

“It would be phenomenally wonderful,” said Joe Pluta, president of the West Maui Improvement Foundation and the West Maui Taxpayers Association, who has led the 10-year effort to get the West Maui Hospital built. “Hawaii needs a new economic engine and health care is a recession-proof industry. Instead of fighting to keep private health care out and protecting its antiquated system, the state has to look hard at its health-care system because it needs to be revamped and drastically overhauled.”