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The Honorable Chairman Holeka Goro Inaba and Members of the County Council County of Hawaii December 23, 2024 Page 2 The applicant has submitted a request for an 8-year time extension to condition C and amendments to Conditions D, E and F of Change of Zone Ordinance No. 16-85, which rezoned approximately 45,450 square feet of land from a Single -Family Residential — 10,000 square feet (RS-10) to a General Commercial-20,000 square feet (CG-20) zoning district, to specify that required road improvements be constructed prior to occupancy permits for further development of the subject parcels, rather than within a specific timeframe. The non-performance is the result of conditions that could not have been foreseen or are beyond the control of the applicants, successors, or assigns, and that are not the result of their fault or negligence. The applicant originally proposed to develop a production facility, cold storage, and visitor center on the subject properties. However, according to the applicant the delays in meeting the development conditions for Big Island Candies (BIC) are attributed to a variety of external factors impacting their financial and operational capabilities. A significant contributor is the adverse economic environment, including a weakened yen -to -dollar exchange rate that has reduced Japanese tourism, a critical market for BIC. Additionally, inflation has constrained the spending power of mainland tourists, directly affecting BIC's sales and, consequently, its capacity to fund expansions. This challenging economic backdrop has led BIC to seek extensions in zoning and construction deadlines as they navigate these market constraints. Furthermore, BIC has faced operational difficulties, including persistent labor shortages and supply chain issues that have increased the costs of materials and limited production capacity. These issues, exacerbated by the COVID-19 pandemic, have delayed BIC's ability to meet the scheduled development milestones for additional production and storage facilities. Past natural events, such as the 2018 lava flow, also limited visitor traffic to the region, compounding the economic strain on BIC's operations during that period. These factors, along with the pandemic's long-term effects, have hampered the company's plans for expansion and construction. BIC may plan to build a new production and storage facility at a different scale and design than what was originally proposed on Parcels 78 and 79 at Kekuanao`a and Laukapu Streets in the future, however, given the preceding discussion, those plans will not occur in the near term, thus they are requesting the 8-year time extension. Currently, Parcel 66 is used as a residential property and is occupied by two dwellings, which are permitted within the existing Commercial General (CG) zoning. Parcels 78 and 79, located at the corner of Kekuanao`a and Laukapu Streets, are used for temporary employee parking which is an accessory use to the main structure on an adjacent parcel.