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January 3, 2005 Page 2 understand too that others would be significantly affected in various ways were Draft 1 to be adopted in its current forni. h is disturbing to our clients that significant changes, which will affect them and others, might be made without full and inclusive discussion and consideration of the implications of the proposed action. In short, this hurried approach irons the risk of being divisive and disniptive Lo the reasonable expectations of many, creating significant risks of liability to the County. On behalf' of our clients, we write this letter to object to the adoption of Draft 1 of the General Plan that would re-designate a substantial portion of Hokuli'a project lands as "Important Agricultural Land." Under the temis of the proposed General Ylan, the County would adopt a policy that any development of such lands must be primarily for agricultural use. The Hokuli~a Lot Owners arc concerned that the previously approved uses, on the basis of which they made their significant investments, might not be consistent with this new policy. They also believe that adoption of the proposed General Plan would be inconsistent wish the Development Agreement and, under the circumstances, would constitute a punitive action inflicting additional potential harm on people who desire to build a home in Kona and to become contributing members of the community. In com~ection with the Hokuli'a Lot Owners' purchase of their County-approved lots, they reviewed the entitlements applicable to Hokuli'a. Uniformly, prior to their purchase, it was disclosed that the property and project was subject to the Development Agreement. Not surprisingly, the Development Agreement was critical to the Hokuli'a Lot Owners in making their purchase because it represented an explicit, reliable and enforceable assurance that the project entitlements were vested and not subject to change for an extended period. By way of example: • Section 7 of the Development Agreement provides "Permitted uses of the Property shall be all uses permitted under the Land Use Regulations and Approvals, including, without limitation, the permitted uses in Chapter 205, HRS, the Zoning Code section 25-5-72, and all supplemental uses allowed under Zoning Code sections 25-4-1 through 25-4-14." • Section 20 of the Development Agreement provides that: "Oceanside shall have the right to develop the Project, the Bypass Highway, and the Coastline Park in accordance with the terms and conditions of this Agreement and the Approvals, and the parties shall have the right to enforce the provisions of this Agreement." There are a number of provisions in the Development Agreement, in addition to information presented to the County in connection with its adoption and approval of the project entitlements, that demonstrate that the Hokuli'a Lot Owners were express and intended third party beneficiaries of the Development Agreement, were of the class of persons that were to be specifically benefited by the Development Agreement, and were of the class of persons to whom the promises made by the County in the Development Agreement were directed. As a purchasers of Hokuli'a Tots, the existence of the Development Agreerent was of great comfort because it would ensure that the project could be developed in the manner planned, including [he construction of project infrash'ucture, such as sewer connections, water service, electricity, telephone, and cable for the property. vr~.~~s~~o~ 633 West Fifth Street, 54"'Floor, Los Angeles, California 90071-2005 Telephone: 213. 2d1. 0J00 Facsimile: 213. 241. 0990 www.bknlawyers.com