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agreement to work with the County on redevelopment a year ago and as far as Uncle Billy's goes,we just had a Land Board meeting in January, a couple of weeks ago,to get an update on both Uncle Billy's and Naniloa, and the Land Board decision was to move ahead with an auction for a three-year lease at Uncle Billy's. So it's a short-term, again, trying to keep the horizon open for redevelopment of whatever kind, give enough of a long-term period that there can be some investments that can be recouped within three years. That's the idea there. Also,the Land Board has asked the Land Division to go through a request for proposal or request for info; some sort of process to solicit interest in a long-term lease at Uncle Billy's that would include teardown or renovation and rebuild. It's gonna cost, it's gonna take several years to go through the permitting cause it's in the shoreline area,permitting for tear down; and also significant expense just to tear down. We want to see if there is a developer interested in a long-term lease that would include every builder or restore on that site, including the cost of—the cost and time of doing the permitting and tear down. So we'll just see. That'll, it'll basically be your first market test on that. So, that's where we are, and again we just came to stay in contact with you all and keep tabs on this process so that we can work collaboratively with you. DELIMA: Thank you, Chair Case, for coming today. Any questions? TANIGUCHI: Thank you. I have a question. In prior years the Department was very adamant about splitting that Naniloa lease. In other words taking out the golf course and selling it separately. I understand that it's because there's an auction, it was an auction lease. Are you still taking that same position? CASE: So it's, it is under long-term lease, along with the Naniloa. So it's not like we can just sever it without negotiation with the lessee. TANIGUCHI: But I think in the past they said you couldn't do that because it was an auction piece. CASE: Oh, that's right. Yeah. TANIGUCHI: But I'm wondering if there's a possibility of negotiating with the lessee to split that off. CASE: Yeah that; let me bring in my expert here. TSUJI: Hi, Russell Tsuji from the Land Division. I think what we were contemplating was possibly the lessee giving it up or giving up the area whether to the State or to the County, but I think in this case it'llhe would only do that if there was some form of, I think,the concept was have a development agreement where we understand what the plan would be or encompass for this area. Because I think,to be fair to the lessee, he's looking for at least some benefit for the hotel as well, as well as the benefit for the general area, and the rest of the Banyan community. I think that'sso we're, that's the idea we're talking about. Again, it's basically myself, and Chair Case, and my staff. We really haven't brought in the legal lawyers yet. TANIGUCHI: Okay,thank you. Page 2 of 18 Banyan Drive Hawaii Redevelopment Agency February 22,2017,Minutes