2009-02-AU Limited Scope Performance Audit of the Highway Fund

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Chapter 4: CHALLENGES FACING THE DEPARTMENT OF PUBLIC WORKS by the County to a developer. Hawai'i County Real Property Tax Office records show that the Department of Finance sold a parcel consisting of two lots totaling 660.8 acres (Tax Map Key No. 4 -8 -3- 5) abutting Mud Lane for $1,600,000 (about $2,421 /acre) on March 16, 2005. Prior to the sale, the Planning Director wrote a letter dated July 8, 2004 and copied to the Director of Finance, responding to questions from a prospective purchaser. The letter stated: "I have consulted with the Department of Public Works and we would be comfortable with re- graveling of the poorer areas of the existing Mud Lane, and a gravel road approximately 18' wide to the property boundary on the portion that currently exists only as a trail on the ground (approximately .5 miles). We would require covenants in the deeds that the purchasers understand that Mud Lane has not been regularly maintained by the county, and that they do not expect regular maintenance, and that lot owners would maintain the last .5 miles (although it could not be closed to the public.)" "An official with the County Department of Finance said at the time that the price was so low because the land was sold 'as is', with poor access. At the time the County initially listed the property at $4.9 million, sold to Waimea 660 for less than a third of that. Waimea 660 currently has it on the market for $6.9 million. When Waimea 660 made its purchase, Mud Lane was in bad shape. It was designated a substandard 'road in limbo' over which the county claimed it had no jurisdiction..." Additionally, approximately 1.8 miles of Mud Lane were paved by the County shortly after the sale of the property. [Source: Krista Sherer, Waipio Expressway? The fight over Mud Lane, Hawaii Island Journal, December 8 -14, 2007] The determination of which roads are accepted for maintenance and repair appears to be inconsistent. Again, the foregoing letter regarding Mud Lane from the Planning Director stated: "I have consulted with the Department of Public Works and we would be comfortable with re- graveling of the poorer areas of the existing Mud Lane, and a gravel road approximately 18' wide to the property boundary on the portion that currently exists only as a trail on the ground (approximately .5 miles)." However, a letter from the Office of the Corporation Counsel dated July 26, 2007, regarding County Ownership of Homestead Road, North Kona, Hawaii, stated: "Our County surveyors generally agree with this historical background. However, we understand that there is no actual homestead road constructed, but only a rough trail that traverses the general area. Hence, we must regard this not as an actual road for highway use, but no more than a 'paper' road, not in actual existence." Given that historical roads used to access properties by horse - drawn vehicles, early automobiles, and plantation trucks were not built to current County standards, it is important that the County have a plan, policy, and procedure with standardized and objective 21