PD BACKGROUND REPORT (PL-PDI-2022-000004)

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Rules. 2. Reasons for the Request: The preceding entitlements were secured by the original applicant, Japan -based Kealakekua Development Corporation (KDC) to facilitate the development of a master planned agricultural community consisting of approximately 500 agricultural lots, an 18-hole golf course and clubhouse, a 4-acre private recreational center, a 200-acre agricultural park, a 255-acre equestrian center, a wastewater treatment plant, a County dedicable water system, and a 8,455-acre forest reserve. In the late 1990's, KDC was forced to forgo its development plans and sell the project area due to the collapse of the Japanese asset price bubble in the early 1990s which resulted in the company's inability to develop the project. As a result, the project area was sold in 2002 and again in 2004 to Kealakekua Heritage Ranch (KHR). Since acquiring the project area, KHR has abandoned the intensive development plans originally proposed by KDC to shift the focus to forest conservation, restoration, and stewardship, in addition to pursuing low -impact agricultural opportunities and activities. To that end, KHR worked with State and Federal government entities through the State and U.S. Forest Legacy Programs to encumber a 9,107.97-acre portion of the 11,185-acre proj ect area with a conservation easement which was recorded in 2011 (discussed in more detail below). In 2013 the Planning Department approved a parcel consolidation/resubdivision that rearranged property lines in large part to accommodate the conservation easement area mentioned above. The project area underwent a second parcel consolidation/ resubdivision in 2017 to rearrange property lines to create a 224.99-acre parcel (TMK 8-2-012:014), which was similarly encumbered by two perpetual conservation easements in 2017 and granted to the Hawaiian Islands Land Trust (discussed in more detail below). Based on the preceding, the landowners are requesting that the Planning Director repeal both of the ordinances covering the project area pursuant to Condition Z (Substantial Non -Compliance), as they are in technical non-compliance with Condition B, which states (in part): "The effective date ofthe change ofzone shall be: when the applicant provides assurance satisfactory to the Departments of Water Supply and Planning, upon consultation with the State Department of Health and the Department of Land and Natural Resources, that a water sources) ofsufficient quality and quantity has/have been