Yes, the AHJ can waive certain rules, but the problem is, equivalent safety objectives must be met. See 90.4
If there is a requirement for AFCI protection, then I don't see any way it can be waived and still have an equivalent level of safety. Installing a small sub-panel would, to me, be a reasonable request.
Last edited by Tom; 08/28/08 06:01 PM. Reason: Spelling, as usual, it takes a poor imagination to only be able to think of one way to spell a word, but it makes for hard reading