HomeMy WebLinkAboutCOM 0660.000 2020-2022 Mitchell D. Roth �M<v of„�� Deanna S. Sako
Mayor ° ° Director
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Steven A. Hunt
Deputy Director
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County of Hawaii
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Finance Department
25 Aupuni Street,Suite 2103 • Hilo,Hawaii 96720 CD
(808)961-8234 Fax(808)961-8569 CCYIJ
February 17, 2022 :r j
Maile Medeiros David, Council Chair and
Members of the Hawaii County Council
Hawaii County Council a
25 Aupuni Street
Hilo, Hawaii 96720
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Re: Bill for an Ordinance Authorizing the Issuance of Special Tax Revenue Bonds
On October 6, 2021, the Council passed Ordinance 21-67 authorizing the formation of
the CFD, designated as Hawaii County Community Facilities District No. 1-2021
(Kaloko Heights Project) and the levy of a Special Tax on properties within such district.
Attached for your consideration is a bill authorizing the issuance of up to $22 million in
special tax revenue bonds of the County of Hawaii. These funds will be used for
payment of the costs of acquiring and constructing the sewer improvements and for
payment of incidental expenses incurred with respect to the Kaloko Heights Project.
We respectfully request that this bill be waived from the Finance Committee end be
placed on the March 9, 2022 Council agenda in order to expedite this process. If there
are any questions, please do not hesitate to contact me at 961-8092.
Deanna S. Sako
Director of Finance
Enc.
c: Treasury
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Comm. No.
Ref. To: a
Hawaii County is an Equal Opportunity Employer and Provide ef. Date 2Q
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PROJECT FUNDING AND ACQUISITION AGREEMENT
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This PROJECT FUNDING AND ACQUISITION AGREEMENT (this "Agreement"),
dated this day of , 2022, is made and entered into by and
between RCFC KALOKO HEIGHTS, LLC, a Delaware limited liability company, whose
mailing address is 10100 Santa Monica Blvd, Suite 1000, Los Angeles, CA 90067 (hereinafter
referred to as "RCFC"); KALOKO HEIGHTS BlA HOLDINGS, LLC, a Delaware limited
liability company, whose mailing address is 10100 Santa Monica Boulevard, Los Angeles,
California 90067 (hereinafter referred to as "B1A"); KALOKO HEIGHTS INVESTORS,
LLC, a Delaware limited liability company, whose mailing address is 10100 Santa Monica Blvd,
Suite 1000, Los Angeles, CA 90067 (hereinafter referred to as "KHI"); and the COUNTY OF
HAWATI, a municipal corporation and political subdivision of the State of Hawaii whose
mailing address is 25 Aupuni Street, Hilo, Hawai'i 96720 (hereinafter refe],red to as "the
County"), acting by and through its Department of Environmental Management ("DEM") and its
Department of Finance (the "Finance Department");
RECITALS:
A. RCFC is the owner of certain real property located at Kaloko and Kohanaiki,
District of North Kona, Island, County and State of Hawaii, identified as TMK (3) 7-3-009:057,
058, 060, 061, 062, 070 and 071, and B1A is the owner of that certain parcel of real property
designated as TMK (3) 7-3-009:059, all of which parcels are located on the north side of Hina
Lani Street ("Kaloko Heights, Phase I") and KHI is the owner of that certain parcel of real
property located in the same area on the south side of Hina Lani Street, designated as TMK (3)
7-3-009:019 ("Kaloko Heights, Phase II"). These areas are collectively identified as the "Project
Area," and RCFC, KHI and BIA are collectively referred to as the "Developer
B. By Memorandum of Agreement dated January 15, 2019, the Developer and the
County of Hawaii agreed (together with the Hawaii Island Community Development
Corporation) to cooperate in Developer's efforts to construct and install certain public sewerline
improvements (the "Improvements") to accommodate anticipated wastewater ftotnl the Kaloko
Heights Project, Phases I and II, an affordable housing project for lands owned by the Hawaii
Island Community Development Corporation and other lands, said Improvements to carry
wastewater to the County's Kealakehe Wastewater Treatment Plant (the "NVWTP"). The
Memorandum of Agreement identified the County's Improvement District procedures as the
manner in which the County would assist with funding the Improvements.
C. On March 28, 2019, the Council of the County of Hawaii (the "Council") adopted
Resolution 86-19, which authorized the extension of the Improvements from the Project Area to
the existing terminus at the West Hawaii Civic Center to allow for treatment of wastewater at the
WWTP. Thereafter, the Developer and the County agreed that the County's assistance in
funding the Improvements by the Community Facilities District process set fort-i in Chapter 32
of the Hawaii County Code 1983 (2016 Edition, as Amended) ("HCC") wound be more
appropriate.
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D. On July 7, 2021, in response to a Petition filed by the Developer, the Council
adopted Resolution No. 158-21 (the "Resolution of Intention") to authorize the initiation of
proceedings for the establishment of the District, designated as the "Hawaii County Community
Facilities District No. 1-2021 (Kaloko Heights Project)," comprised of the lands owned by the
Developer within the Project Area (the "District"), the funding of the cost of the Improvements
and incidental expenses pertaining to the District ("Incidental Expenses") and the levy of a
special tax on properties within the District (the "Special Tax") to fund such costs and Incidental
Expenses, including debt service on up to $22,000,000 of bonds to be issued by the County and
secured by the Special Tax(the"Bonds"), all in accordance with HCC Chapter 32.
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E. On July 30, 2021, DEM submitted a report to the Council (the "CFD Report") as
provided in HCC Section 32-21, concluding, among other things, that the Improvements are in
the public interest and meet the needs of the District. The CFD Report was filed with the
Council and accepted by the Council at its meeting held on August 8, 2021.
F. Pursuant to Ordinance No. 21-67, as approved by the Council on September 22,
2021 and approved by the Mayor on October 6, 2021 (the "Ordinance of Formation"), the
County has established the District and authorized the levy of the Special Tax to fund the costs
of the Improvements and Incidental Expenses, including debt service on the Bonds, if issued.
The Special Tax will be levied annually in accordance with the final Rate and Method of
Apportionment of Special Tax(the "RMA") approved in the Ordinance of Forma--Jon.
G. The Ordinance of Formation further determined that funds to pay the costs of the
Improvements shall be disbursed in accordance with a "Project Funding Agreement' to be
entered into between the County and the Developer or their authorized representatives in a form
approved by the Council.
H. Pursuant to Ordinance No. , as approved by the Council on , 2021 and
approved by the Mayor on , 2021 (the "Bond Ordinance"), the County has auChorized the
issuance of the Bonds, in one or more series, in an aggregate principal amount not to exceed
$22,000,000, subject to adoption by the Council, with respect to each series of Bonds, of a
resolution (each, a "Series Resolution") authorizing the issuance of such series of Bands and
approving the principal bond financing documents in substantially the forms to be executed.
I. Pursuant to the Bond Ordinance, the Council also approved the form of this
Agreement, which is being entered into as the Project Funding Agreement: required by the
Ordinance of Formation for the purpose of setting forth the terms and conditions .ruder which the
Improvements are to be constructed by the Developer and dedicated to and acquired by the
County and the costs of the Improvements and Incidental Expenses are to be paid for and
disbursed by the County.
NOW, THEREFORE, in consideration of the mutual covenants and promises herein
made, and for other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties to this Agreement do hereby agree as follows:
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AGREEMENT
Section 1. Certain Preliminary Matters.
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(a) The foregoing recitals are true and correct, and the parties expressly so acknowledge.
Said recitals are expressly incorporated herein by this reference. I
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(b) Unless the context clearly otherwise requires, terms used in this Agreement shall
have the meanings set forth below:
(i) Terms defined in the foregoing introductory paragraph and recitals shall have #
the meanings set forth in such introductory paragraph and recitals.
(ii) Terms defined in the following Sections of this Agreement shall have the
meanings set forth in such Sections:
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Refined Term: Refined In:
Acquisition Price Section 2(b)
Actual Costs Section 2(b)
Bond Indenture Section 4(a)
Bond Trustee Section 4(a)
Complete Section 5(d)
Construction Contract Section 3(a)
Contract Price Section 2(b)
Contractor Section 3(a)
Developer Advances Section 4(c)
District Property Section 6(i)
Estimated Acquisition Price Section 2(b)
Hazardous Material Section 6(i)
Net Bond Proceeds Section 2(d)
Notice to Proceed Section 3(b)
Payment Request Section 2(b)
Plans Section 3(b)
Project Budget Section 2(b)
Project Construction Fund Section 4(f)
Project Construction Schedule Section 3(b)
Project Contingency Section 2(b)
Project Contingency Fund Section 4(c)
Subcontractors Section 3(a)
Subcontracts Section 3(a)
Substantial Completion Date Section 3(b)
Work Section 3(a)
(iii) All other terms used, but not otherwise defined in this Agreement, shall have
the meanings set forth in the Ordinance of Formation, including the Exhibits attached to such
Ordinance, namely: Exhibit A - Description of Authorized Improvements.; Exhibit B —
Description of Authorized Incidental Expenses; Exhibit C — Rate and Method of
Apportionment of Special Tax; and Exhibit D—Descriptions of Parcels.
Section 2. General Agreement Regarding Construction and Acquisition of
Improvements. Subject to the further terms and conditions specified herein, the Developer and the
County hereby agree as follows with respect to the construction and acquisition of the Improvements:
(a) The Developer hereby agrees to construct the Improvements under DEM's
supervision in accordance with the provisions hereof and to convey the Improvemerts to the County
upon completion. Title to the Improvements shall be conveyed by an appropriate instrument of
dedication to the County, subject to compliance with all applicable County requirements and
procedures and the further provisions set forth herein.
(b) The County hereby agrees to acquire and accept dedication of th-. Improvements
upon completion, subject to compliance as aforesaid with all applicable County requirements and
procedures and the further provisions set forth herein, and to pay to the Developer (or to the
Developer's designated payee, in the case of payments to the Contractor or other third parties
performing work on the Improvements), in one or more installments upon submission and approval
of requests for payment (each, a "Payment Request") in accordance with Section 5 hereof, the
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acquisition price for the Improvements (the "Acquisition Price"), which shall le equal to the
aggregate amount of actual costs incurred by the Developer to design and construct the
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Improvements (the "Actual Costs"), as initially identified and estimated in the project budget
attached as Exhibit "A" hereto (subject to revision as hereinafter provided, the "Project Budget") and s
consisting of:
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(i) the actual cost of constructing the Improvements, including labor,
materials and equipment costs and the costs of insurance policies and surety bonds
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required hereunder, all as included in the contractp rice under the Construction Contract
(the "Contract Price");
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(ii) the actual costs of any and all necessary professional and technical
services rendered which are related to the design and construction of the Lmprovements,
including, but not limited to, accounting, legal, architectural, engineering, inspection,
materials testing, consulting services and similar professional services directly related to
the supervision and enforcement of construction contracts and the performance thereof,
(iii) the amount of the fees actually paid to governmental entities or utilities in
order to obtain permits, licenses or other necessary governmental approvals for the
Improvements;
(iv) the actual cost for necessary professional services. related to the
construction of the Improvements, including engineering, inspection, construction
staking,materials testing and similar professional services; I
(v) actual construction management and supervision fees;
(vi) any administration and oversight charges paid to the County for the
implementation of this Agreement; and
(vii) other actual costs directly related to the construction of the hmprovements,
as are reasonably related to such construction.
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The initial estimates set forth in the Project Budget include a project contingency equal to 15%
of the Contract Price (the "Project Contingency"). As used herein from time to gime, the term
"Estimated Acquisition Price" shall include, at the time in question, the sum of the estimated
Actual Costs and Project Contingency reflected in the then-current Project Budget; it being
understood, however, that the Project Contingency shall be included in the actual Acquisition
Price only to the extent actually expended on Actual Costs in accordance with th-is Agreement.
Actual Costs comprising the Acquisition Price shall be subject to verification by DEM to its
reasonable satisfaction and, except for amounts paid to the County or other governmental entities or
utilities under subparagraphs (iii) and (vi) above, shall be limited to amounts paid under the
Construction Contract and other contracts with third parties not affiliated with or entities controlled
by the Developer, which other contracts or invoices describing the work performed under such
contracts in sufficient detail shall be in writing.
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(c) The Developer and DEM shall act through their authorized representatives in matters
arising under the provisions hereof with respect to the construction of the Project. The Developer
and DEM shall each designate the person(s) serving as its authorized representative(s) and the
specific matters, if less than all, as to which any such person is authorized to act on its behalf. In
addition,the Developer shall cause the Contractor to designate the person(s) serving as its authorized
representative(s) and the specific matters, if less than all, as to which any such person is authorized to
act on its behalf. DEM may delegate responsibility for certain matters hereunder to other County
departments and agencies, including the Department of Public Works, in which case DEM shall
cause the other County department or agency to designate the person(s) serving as its authorized
representative(s), the specific matters, if less than all, as to which any such person is authorized to act
on its behalf and the address to which notice to each such person are to be provided pursuant to
Section 10 hereof. The Developer and DEM shall each advise the other in writing of the foregoing
designations at or prior to the time the Notice to Proceed is given pursuant to Section 3(b) hereof and
shall each give timely notice in writing to the other of changes made to such designations from time
to time.
(d) Any provision hereof to the contrary notwithstanding, it is expressly acknowledged
and agreed that the obligation of the County to pay the Acquisition Price for the Improvements is
strictly Limited to (i) the "Net Bond Proceeds" (i.e., the sum of the Bond proceeds (if any) remaining
after paying all costs of forming the District and issuing the Bonds (including costs previously paid
by the County or the Developer which are reimbursed from Bond proceeds), funding capitalized
interest and funding a reserve fund and any other funds and accounts required to be funded with
Bond proceeds and the earnings (if any) derived from the investment thereof) and (ii) proceeds of
the Special Tax levy expressly designated to be used for such purpose under the applicable
provisions of the Bond Indenture.
(e) In addition to payments of the Acquisition Price, the Developer shall be entitled to
receive, from available Bond proceeds or available Special Tax collections, reimbursement for
Incidental Expenses paid by the Developer, including costs incurred to finance construction of the
Improvements and costs of letters of credit obtained to satisfy the terms of this Agreement, all as
determined by mutual agreement between the County and the Developer.
Section 3. Award of Construction Contract and Construction of Imp rovements.
(a) The County hereby consents to the Developer's selection of Goodfellow Brothers,
Inc., as contractor for the Improvements (in such capacity, the "Contractor"). In consideration of
the terms and conditions provided in this Agreement, the Developer will enter into a construction
contract for the Improvements with the Contractor (the "Construction Contract"), pursuant to
which the Developer will hire and pay the Contractor for its Work to construct the Improvements
(the "Work") in accordance with the terms thereof and hereof. The Contractor and the
Construction Contract, and any subcontractors and subcontracts (the "Subcontractors" and
"Subcontracts,"respectively), shall be subject to the following provisions, as applicable:
(i) Prior to execution thereof, the Construction Contract shall be subject to
approval by DEM, which approval shall not be unreasonably withheld or delayed, and to
the further provisions set forth below. Immediately upon execution of fie Construction
Contract, the Developer shall provide a fully-executed copy thereof, with all exhibits and
schedules attached, to DEM.
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(ii) The Contractor and the Subcontractors shall be duly licensed to perform
all areas of Work being performed by them.
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(iii) The Contract shall name the County as a third-party beneficiary
thereunder, with the understanding that, upon issuance of the initial series of Bonds, the
County may pledge and assign its interest in the Contract to the Bond Trustee as security
for the Bonds. As third-party beneficiary, the County or the Bond Trustee (as applicable)
shall have the right, but not the obligation, to act in the place of the Developer with
respect to the Work under the Contract in the event that the Developer is in default under
this Agreement.
(iv) The Contract and the Subcontracts shall comply with the requirements of
Chapter 104, Hawaii Revised Statutes. Without limiting the generality of the foregoing,
the Contract and Subcontracts shall require the Contractor and Subcontractors to submit
certified payroll data verifying compliance with the prevailing wage requirements of such r
Chapter to DEM's reasonable satisfaction in connection with each applicable Payment a
Request.
(v) The Developer shall require the Contractor to post and provide
performance and payment bonds assuring that the Contract shall be fully and faithfully
performed in accordance with its terms, and that all material suppliers, Subcontractors
and the Contractor's employees will be paid. Such bonds shall be issued by sureties
qualified to issue bonds in the State of Hawaii, shall be issued in an amount equal to
100% of the contract price for the Work under the Contract, and shall otherwise be in
form and substance satisfactory to DEM.
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(vi) The Developer shall also require the Contractor to warrant that the
Improvements shall be free of defects and faults in materials, workmanship and design
for a one-year period commencing upon the County's acceptance of dedication of the
Improvements. The Developer shall assign such warranty to the County and shall also 3
require the Contractor to post and provide a maintenance bond with respect thereto,
which shall be issued by a surety licensed to issue bonds in the State of Hawaii, be issued
in an amount not less than 10% of the contract price for the Work under the Contract, and
shall otherwise be in form and substance satisfactory to DEM.
(vii) The Developer shall also require the Contractor to obtain and maintain the a
following insurance coverages, in form and substance satisfactory to DEM: (A) Builder's
Risk 1 Installation Floater, naming the County as an additional insured and loss payee,
covering contractor's labor, materials and equipment to be used for completion of the
Work against all risks of direct physical loss, excluding earthquake .and flood, for an
amount equal to the full insurable replacement cost of the Improvements;
(B) Commercial General Liability Insurance policy, naming the County and its officials a
and employees as additional insureds, providing coverage on an occurrence basis in an
amount not less than $1,000,000 (bodily injury and property damage, each occurrence)
and $2,000,000 (general aggregate on a Per Project basis), $2,000,000
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Products/Completed Operations Aggregate, and $1,000,000 Personal and Advertising
Injury; (C) Umbrella or Excess Liability Insurance policy with minimum limits of
[$10,000,000 (each occurrence) and $10,000,000 (aggregate)l; (D) comprehensive
automobile liability insurance policy, naming the County and its officials and employees
as additional insureds, with limits of not less than $1,000,000 for bodily injury and
property damage, in combined or equivalent split limits, for each sing?e accident; (E)
workers compensation (statutory limits) and employers' liability insurance (with
minimum limits of $1,000,000 for Each Accident; $1,000,000 By Disease — Each
Employee; and $1,000,000 By Disease — Policy Limit); (F) Professional Liability
Insurance (Errors and Omissions Insurance), which may be on a claims-made basis if
coverage retroactive to commencement of Work, with minimum coverages of$1,000,000
Each Loss/$2,000,000 Policy Aggregate Limit of Insurance; and (G) Contractor's
Pollution Liability (CPL) insurance, naming the County and its officials and employees
as additional insureds, covering the Work on an occurrence basis with a limit not less
than $5,000,000. All policies of insurance providing such coverages shall be issued by
an insurer or insurers licensed to provide such coverages in the State of Hawaii and
having an AM Best rating of A- or better; except that workers compensation insurance
may be provided by an insurer that is not rated by AM Best, provided that the insurer is
domiciled in the State of Hawaii, is certified or authorized as a workers compensation
insurer by the appropriate agency of such State has been accepted to provide workers
compensation insurance for similar projects by the State within the last 12 months.
Additional details regarding policy requirements may be obtained upon-request to DEM.
(viii) Not later than three (3) business days after the Notice to Proceed is given
pursuant to Subsection (b)(i) below, and in any event prior to the commencement of the
Work, the Developer shall provide or cause the Contractor to provide to DEM copies of
the payment and performance bonds required under Subsection (a)(v) above and all
insurance policies (or certificates of insurance with respect thereto) required under
Subsection (a)(vii) above. In addition, not later than three (3) business days after the
Substantial Completion date under Subsection (b)(ii) below, the Developer shall provide
or cause the Contractor to provide to DEM a copy of the maintenance, bond required
under Subsection(a)(vi) above.
(b) The Developer represents and agrees to construct or direct the construction of the
Improvements in accordance with the following:
(i) The Developer shall issue its notice to proceed with the Work (the "Notice
to Proceed") to the Contractor not later than five (5) business days after the adoption by
the Council of the initial Series Resolution pursuant to Section 4 hereof At or prior to
the time of issuance of the Notice to Proceed, the Developer shall (A) obtain all
governmental permits and approvals required for the construction of the Improvements
and provide satisfactory evidence to DEM with respect thereto, and (B) provide to DEM
the then-current construction schedule for the Improvements (subject to revision as
hereinafter provided,the "Project Construction Schedule").
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(ii) Following the issuance of the Notice to Proceed, the Developer shall
require the Contractor to proceed with the Work with due diligence until completion of
the Improvements. The Developer shall cause the Work to be substantially completed
under the Contract no later than the last day of the fifteenth (15t") calendar month
following the issuance of the Notice to Proceed (subject to revision as hereinafter
provided, the "Substantial Completion Date"). The Developer acknowledges that time is
of the essence in the completion of the Work and agrees that the Substantial Completion
Date is reasonable. The Developer warrants and represents that the Project Construction
Schedule properly reflects the scheduling of all Work to achieve substantial completion
by the Substantial Completion Date, with appropriate contingencies for time lost due to
anticipated adverse weather conditions, differing site conditions, environmental matters
relating to hazardous materials and other factors which could be reasonably anticipated;
provided that the Substantial Completion Date may be extended in the event of a delay
due to conditions of force majeure (i.e., conditions not caused by or within the control of
the Developer), including severe and unavoidable natural catastrophes such as fires, 3
floods, epidemics, earthquakes and acts of war or terrorism. If the Work is not 3
substantially completed on time, the Developer acknowledges that the County is likely to
suffer substantial damages. As a result, if the Developer does not achieve substantial
completion in a timely manner, then the Developer shall pay to the County as liquidated
damages, and not as a penalty, the sum of $500 per calendar day for each and every
calendar day until substantial completion. The County may, at its discretion, withhold
the total sum of liquidated damages from amounts otherwise due the Developer.
(iii) The Developer shall enforce the Contract, and shall require the Contractor
to enforce the Subcontracts, including the foregoing requirements with respect thereto, so
as to ensure that the Work is conducted and completed in a good, workmanlike and
commercially reasonable manner, with the standard of diligence and care normally employed
by duly qualified persons utilizing their best efforts in the performance of comparable work
and in accordance with generally accepted practices appropriate to the activities undertaken.
The Developer shall notify DEM of any breaches and all actions taken or proposed to be
to remedy the same. The Developer shall comply with reasonable directions by DEM
with respect to such actions.
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(iv) The Improvements shall be constructed in full compliance with the Plans
and Specifications previously approved by DEM (the "Plans"), as the same may be
revised from time to time with the approval of DEM.
(v) Prior to entering into any change order for the Work, the Developer shall
submit proposed change order documentation to DEM and obtain DEM's ,approval of
such change prior to implementing such changes, which shall not be unreasonably
withheld or delayed. However, if time is of the essence, the Developer may proceed with
the change order at its own risk, and potentially forfeit payment for this Work, pending DEM
approval of the changes;provided, however,that in no event shall the Developer be permitted
to submit the change order to DEM for approval more than ten (10 business days following
the Developer's issuance of the written change order to the Contractor. For purposes of the
foregoing, the term "change order" shall not include field orders issued by the consulting
engineer that do not involve an adjustment to the Contract Price or Project Construction
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Schedule, are compatible with the design concept for the Improvements as a whole under the
Construction Contract and related engineering and design documents and conform to
applicable DEM standards for dedication of the Improvements to the County upon
completion. Although prior approval of such field orders will not be required, the Developer
shall notify DEM in writing of such field orders promptly upon the issuance thereof.
(vi) The Developer shall give written notice to DEM in the event of changes to
the Project Construction Schedule or the Project Budget, which notices shall include the
following:
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(A) Notices of changes to the Project Construction Schedule will identify
the item of Work involved and provide relevant information satisfactory to DEM 3
regarding the change, the reasons therefor, the extent of any resulting delays in
construction of the Improvements that are anticipated (including subsequent items of
Work), the measures that will be taken to mitigate any negative impacts on the
Project Construction Schedule and whether the Improvements will be substantially
completed by the Substantial Completion Date. Notice of a delay beyond the
Substantial Completion Date shall not extend the Substantial Completion Date unless
such extension is expressly approved in writing by DEM.
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(B) Notices of changes in the Project Budget will identify the item of
Actual Costs involved and provide relevant information satisfactory to DEM
regarding the extent of the change in the Actual Cost of such item, the reasons for the 3
change, the overall impact on the Project Budget (including use; of the Project
Contingency to cover cost increases), the actions that will be taken to mitigate any
negative impacts on the Project Budget.
The Developer will be responsible for payment of any increases in Actual Costs incurred as a
result of changes in the Project Construction Schedule and the Project Budget; provided that
such increased Actual Costs, if deemed reasonable by DEM, shall be added to the
Acquisition Price. Without limiting the generality of the foregoing, following the issuance of
the initial series of Bonds, the Developer shall deposit cash or a letter of credit with the Bond
Trustee to cover increases in Actual Costs to the extent required under Section 4(f) hereof. i
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(vii) The Developer shall advise DEM in advance of any coordination and
scheduling meetings to be held with the Contractor relating to the construction of the
Improvements that involve changes to the Plans, issues of interpretation of the Plans,
delays in the completion of the Improvements. Meetings for such purposes shall also be
held if requested by DEM. Through its designated representative(s), DEM shall have the
right to be present at such meetings, if deemed advisable by DEM, to resolve disputes
and/or ensure the proper completion of the Improvements.
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(viii) The Developer shall not create, suffer to be created or permit to remain
any mechanics', materialmen's, laborers, tax, statutory or other lien or charge on the
Improvements or any portion or component thereof.
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(ix) The Developer agrees to maintain and to make available for inspection by
the DEM and its representatives, on reasonable notice, all documents relating to the
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construction of the Improvements, including, but not limited to, the Plans, specifications,
permits, surveys, schedules, contracts for the construction of any portion of the
Improvements, and invoices and receipts for payments relating to the construction of the
Improvements.
(x) It is expressly understood and agreed that, in performing this Agreement,
the Developer is an independent contractor and not the agent or employe; of the County,
and that the County shall not be responsible for making any payments directly to the
Contractor or any other contractor, subcontractor, agent, employee or supplier of the
Developer.
(c) During construction of the Improvements, the Work shall be subject to periodic
inspection and approval by DEM as follows:
(i) The Work shall be subject to inspection from time to time during
construction in accordance with applicable DEM inspection procedures and applicable
standards for acceptance of the Improvements for dedication.
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(ii) Upon reasonable notice from the Developer or the Contractor, DEM shall
schedule its inspections of the Work in cooperation with the Developer or the Contractor.
DEM shall use good faith efforts to conduct such inspections in a timely manner so as to
minimize and avoid delays in the performance of the Work and allow, for the timely
completion of the Work. In addition, upon reasonable notice to the Developer and the
Contractor, DEM shall be permitted to inspect the Work at such other times as it deems
reasonably necessary or appropriate in order to monitor progress properly.
Iii In all events, the satisfactory inspection of any component of Work by
DEM shall be a condition precedent to the payment of any portion of the Acquisition
Price for such component pursuant to Section 5 hereof, including all Work to be funded
by Developer Advances prior to the initial payment from Bond proceeds pursuant to
Section 4 hereof.
Section 4. Issuance of Bonds. As provided in the Bond Ordinance, the Bonds may
be issued in one or more series subject in each case to adoption by Council of the applicable
Series Resolution and to the further terms and conditions set forth herein and in HCC Chapter
32. Pending adoption of the initial Series Resolution and satisfaction of such fiirther terms and
conditions, the County has commenced, and will proceed in good faith, with appropriate
preparations and arrangements for the initial series of Bonds as follows:
(a) The County has authorized and directed its legal counsel and consultants to
proceed with preparation of the principal financing documents for the initial series of Bonds,
including (i) the trust indenture pursuant to which the Bonds will be issued (the "Bond
Indenture") with the County's designated bond trustee (the "Bond Trustee"), (ii) the official
statement pursuant to which the initial series of Bonds will be offered to potential investors,
including the appraisal prepared by the County's designated appraiser, (iii) the bond purchase
agreement pursuant to which the initial series of Bonds will be sold to the County's designated
11
underwriter for reoffering to potential investors, and (iv) the forms of continuing disclosure
agreements to be entered into by the Developer and the County with respect to =:heir continuing
disclosure obligations under SEC Rule 15c2-12. The Developer will assist and. cooperate in
providing such documents and information as may be needed for the preparation of such
documents. The County shall proceed in good faith with the preparation of the foregoing
financing documents and shall present such documents to the Council for approval pursuant to
the initial Series Resolution in substantially the forms proposed to be executed and for
authorization to execute the same in substantially such forms, with such further changes as may
be approved by the County officials executing the same.
(b) Any provision hereof to the contrary notwithstanding, the aggregate principal
amount of Bonds that may be issued shall not exceed the least of the following: (i) 522,000,000
as provided in the Bond Ordinance; (ii) one-third (1/3) of the "value of the real property" (as
defined in HCC Section 32-57(c)) subject to the Special Tax; (iii) one-half(112) of the value of
the real property subject to the Special Tax in Tax Zone 1 (as identified in the FMA); or (iv) the
amount needed to produce Net Bond Proceeds sufficient to pay the full Acquisition Price for the
Improvements.
(c) Pending issuance of the initial series of Bonds, the Developer shall proceed with
construction of the Improvements and shall advance funds other than Bond proceeds to pay the
Actual Costs thereof on a timely basis (the "Developer Advances"). All Developer Advances,
including funds advanced prior to the execution and delivery of this Agreement, shall be subject
to the procedures and requirements for Payment Requests set forth in Section 5 hereof to the
same extent as would apply to payments from Net Bond Proceeds; provided that, except as
provided in Subsection (f) below, payments to the Developer on account of ,such Developer
Advances shall be deferred until completion and dedication of the Improvements, at which time
such payments shall be considered part of the final Payment Request pursuant to Section 5
hereof.
(d) At the request of the Developer, the County shall proceed expeditiously and in
good faith with the offer and sale of the initial series of Bonds at such time as: (i) the Council
shall have adopted the initial Series Resolution authorizing the issuance of such Bonds; (ii) the
sum of the Developer Advances previously made and the Net Bond Proceeds expected to be
produced is at least equal to the full amount of the Estimated Acquisition Price reflected in the
then-current Project Budget (but excluding, for purposes of this calculation only, the amount of
the Project Contingency); and (iii)the County shall have received satisfactory assurances that the
further conditions specified in Section 4(e) below have been or shall be satisfied as of the date of
issuance and delivery of such Bonds.
(e) The issuance of the initial series of Bonds shall be subject to the following
conditions:
(i) the aggregate principal amount of the initial series of Bends does not
exceed the limitations set forth in Subsection (b) above; and
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(ii) the Developer shall have provided to the Bond Trustee, for deposit into a
project contingency fund (the "Project Contingency Fund") to be established under the
Bond Indenture, either cash or an irrevocable letter of credit from a bank or other
financial institution acceptable to the County and the Bond Trustee, in an amount equal to
the unexpended balance of the Project Contingency or such other amount as the County
determines to be reasonably necessary to assure the availability of sufficient funds to
complete the Improvements, taking into account the nature and extent of increases to the
estimated Actual Costs previously charged to the Project Contingency and the status of
construction and the remaining Work required to complete the Improvements; provided
that the foregoing deposit into the Project Contingency Fund may be :made from Net
Bond Proceeds if the total amount of Developer Advances previously made for Actual
Costs, when added to the total amount of Net Bond Proceeds, is sufficent to fund the
Estimated Acquisition Price in full.
(f) Net Bond Proceeds of the initial series of Bonds, less any portion thereof
deposited into the Project Contingency Fund under Subsection (e)(ii) above (if a_olicable}� shall
be deposited by the Bond Trustee into a project construction fund (the "Project Construction
Fund") and used, together with funds drawn from the Project Contingency Fund (as needed) to
pay Actual Costs on account of the Acquisition Price pursuant to Payment Requests submitted to a
and approved by DEM after the issuance of such Bonds. Subject to DEM's receipt and approval
of Payment Requests therefor, Net Bond Proceeds may be used to repay the Developer for 3
Developer Advances made prior to the issuance of such Bonds, but only if and to the extent that
the amount of such prior Developer Advances, less the amount of any Developer Advances taken
into account with respect to the funding of the Project Contingency Fund under Subsection (e)(ii)
above, exceeds the minimum amount which, when added to the total amount of Net Bond
Proceeds deposited into the Project Construction Fund, is required to fund the Acquisition Price
in full. If, at any time after the issuance of the initial series of Bonds, the estimated Actual Costs
in the Project Budget are increased by an amount greater than the remaining balance in the
Project Contingency Fund, the Developer shall immediately deposit cash or a letter of credit
(meeting the above requirements) into the Project Contingency Fund in an amount at least equal
to the difference, and the County may withhold payment of amounts otherwise due to the
Developer in the event that the Developer fails to make such deposit. Upon completion of the
Improvements and dedication thereof to the County, unexpended moneys in the Project j
Contingency Fund, if initially provided by the Developer, shall be returned to the Developer and,
if initially provided from Net Bond Proceeds, shall be applied toward the final Payment Request
for Developer Advances.
(g) If any portion of the Developer Advances remains outstanding after payment of
the final Payment Request pursuant to Section 5 hereof, the Developer may again request that the
County proceed with the offering and sale of one or more subsequent series of Bonds to repay
outstanding Developer Advances; subject to the adoption of the applicable Series Resolution by
the Council and to compliance with the limitations set forth in Subsection (b) above and with all
applicable conditions specified in the Bond Indenture.
(h) The County shall use good faith efforts to proceed with the offer and sale of each
series of Bonds expeditiously in accordance with the foregoing. However, it is expressly
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understood and agreed that the amount and timing of the sale of each series of Bonds shall be
subject in all respects to the sole discretion and approval of the County. The County shall not be
obligated to issue any series of Bonds unless it deems such issuance to be in the best interests of
the County. The Bonds may be issued on a taxable or tax-exempt basis as determined by the
County upon consultation with its bond counsel, financial advisors and bond underwriters.
Section 5. Payments of Actual Costs on Account of Acquisition Price:. All payments
of Actual Costs on account of the Acquisition Price shall be made in accordance with the
following:
(a) All such payments shall be made upon submission by the Developer, and
approval by DEM, of Payment Requests therefor, provided that the Developer is :in compliance
with its obligations hereunder. Each Payment Request shall, be submitted in substantially the
form attached as Exhibit "B" hereto, and shall: (i) identify the Actual Costs incurred by the
Developer and the amount required to be disbursed, the purpose for which the disbursement is to
be made and the person or entity to which the disbursement is to be paid; (ii) verify that the
Actual Costs were properly incurred and are due and unpaid, and that payment thereof is within
the budget for the Work involved; (iii) contain or be accompanied by (A) reasonable and
customary back-up documentation substantiating the basis for and amount of the requested
payment or disbursement, including applications for payment and supporting documentation
submitted by the Contractor or other third party contractors with respect to amounts included in
the Payment Request, (B) evidence of payment for all related invoices, and (C) certified payroll
data verifying compliance with the prevailing wage requirements of Chapter 104, Hawaii
Revises Statutes; (iv) include a certification by the Developer's project engineer that the
requested disbursement is for Work performed by the Contractor in accordance with the Plans
and the schedule of values agreed upon in the Construction Contract; and (v) provide such I
additional documentation as may be reasonably requested by DEM to substantiate the propriety
of the Payment Request.
(b) Within fourteen (14) calendar days after receipt of each Paymer.t Request from
the Developer, DEM will complete its review of the Payment Request and either (i) approve the
Payment Request and forward it to the Finance Department for payment, or (ii) notify the
Developer in writing that the Payment Request is not in satisfactory form, in which case the
notice to the Developer shall identify the deficiencies to be corrected, and the Developer shall I
correct the deficiencies and submit the corrected Payment Request to DEM for approval. Within
five (5) business days after receipt of an approved Payment Request from DEVI, the Finance
Department shall submit a requisition to the Bond Trustee for payment of the amount due from
the Net Bond Proceeds or Project Contingency Fund (if applicable).
(c) The initial payment from Bond proceeds shall be made upon the issuance of the
initial series of Bonds pursuant to Section 4 hereof, subject to DEM's receipt and approval of the
applicable Payment Request(s) in accordance with the above procedure. Subsequent payments
shall be made, subject to such receipt and approval, based on a proposed disbursement and a
progress payment schedule and as Contractor completes the stages of Work identified in Exhibit
"C" attached hereto and incorporated herein by this reference. Such schedule shall be subject to
revision as necessary during the course of construction, subject to approval by DEM, which shall
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not be unreasonably withheld. Prior to completion and acceptance of the Improvements by the
County, the amount paid pursuant to each Payment Request shall not exceed 90% of the Actual
Costs reflected therein(except in the case of Actual Costs representing fees paid to governmental
entities or utilities or administrative and oversight charges paid to the County).
(d) When the Work is Complete, the Developer shall deliver to DEM its final
Payment Request and supporting documents for approval, together with (i) documentation
indicating that as built plans have been submitted to the County's Department of Public Works
and Department of Environmental Management, (ii) a Notice of Completion for the
Improvements has been published, and lien releases have been issued by the Contractor and its
Subcontractors, and (iii) proper documentation for dedication of the Improvements to the County
as called for by applicable County procedures. The term"Complete"means that.he construction
of the Improvements is, in the reasonable judgment of DEM, in all respects complete and all
required punchlist items have been completed. Payment of the final Payment Request shall be
subject to DEM's approval of the Payment Request and the County's acceptance of dedication of
the Improvements. If the available amount of Net Bond Proceeds is not sufficient to pay the
Payment Request in full, the remaining amount shall be payable either from the proceeds of a
subsequent series of Bonds or from proceeds of Special Tax collections that are on deposit with
the Bond Trustee and available for such purpose under the Bond Indenture.
6. Representations, Warranties and Covenants of the Developer. The Developer
makes the following representations, warranties and covenants for the benefit of the County:
(a) Concerning the Developer. RCFC, B1A and KHI are acting together as the
Developer. RCFC, B lA and KHI agree that all representations, warranties and covenants on the part
of the "Developer"under this Agreement are, and shall be deemed to be,joint and several obligations
of RCFC, B I A and KHL
(b) Organization. Each of RCFC, B1A and KHI represents and warrants that it is a
limited liability company, duly organized and validly existing under the laws of the State of
Delaware, is qualified to do business in the State of Hawaii, and has full power and authority to own
its properties and assets and to carry on its business as now being conducted and as now
contemplated, including as contemplated by this Agreement.
(c) Authority. Each of RCFC, B1A and KHI represents and warrants that it has the
power and authority to enter into this Agreement, and it has taken all action necessary to cause this
Agreement to be executed and delivered, and this Agreement has been duly and validly executed and
delivered on its behalf.
(d) Binding Obligation. Each of RCFC, B 1 A and KHI represents and warrants that this
Agreement and all obligations of the Developer hereunder are valid and binding joint and several
obligations of RCFC, B I A and KHI, and are enforceable against each such entity in accordance with
their terms.
(e) Completion of Facilities. RCFC, B I A and KHI individually and collectively
covenant that they will use its reasonable and diligent efforts to do all things which may be lawfully
required of the Developer hereunder in order to cause Improvements to be completed in accordance
with this Agreement.
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(f) Compliance with Laws. RCFC, B I A and KHI individually and collectively covenant
that the Developer will not commit, suffer or permit any act to be done in, upon or to the property on
which the Improvements are to be constructed or the Improvements in violation of any law,
ordinance, rule, regulation or order of any governmental authority or any covenant, condition or
restriction now or hereafter affecting such property or the Improvements.
(g) Requests for Payment. RCFC, B I A and KHI individually and collectively represent
and warrant that (i)the Developer will not request payment from the County the acquisition of any
improvements that are not part of the Improvements, (ii) all Improvements for which payment is
requested will have been constructed as if constructed under the direction and supervision, or under
the authority, of the County and (iii)the Developer will diligently follow all procedures set forth in
this Agreement with respect to the applicable Payment Requests.
(h) Financial Records and Construction Documents. Until the County's final acceptance
of the Improvements, RCFC, B I A and KHI individually and collectively covenant that the Developer
shall maintain proper books of record and account for the Improvements and all costs related thereto,
that such accounting books will be maintained in accordance with generally accepted accounting
principles, and will be available for inspection by the County and its agents, at any reasonable time
during regular business hours on reasonable notice. In addition, RCFC, B1A and KHI individually
and collectively agree that the Developer shall maintain and to make available for inspection by the
County and its agents, at any reasonable time during regular business hours on reasonable notice all
documents relating to the construction of the Facilities including, but not limited to, the Plans,
specifications, easements, rights-of-way, licenses, permits, surveys, estimates, schedules, contracts
for the construction of any portion of the Improvements, invoices and receipts for p:3Lyments relating
to the Improvements, insurance policies, payroll records, and any other documents required to be
maintained by any applicable provision of law.
(i) Hazardous Materials. RCFC, B1A and KHI individually and collectively represent
and warrant that, to the best of their knowledge, there is not present upon the properties within the
District (the "District Property") , or any portion thereof, or upon any portion of the Improvements
currently existing, or any portion thereof, any Hazardous Materials (as defined below). RCFC, B I A
and KHI individually and collectively represent and warrant that all operations or activities upon, or
use or occupancy of the District Property and the Improvements, and each portion thereof, by the
Developer, or to the best of their knowledge, by any prior tenant, occupant or owner of the District
Property or any portion thereof, is in all material respects in compliance with all state, federal and
local laws, ordinances, regulations, rules, decisions or policy statements governing or in any way
relating to the generation, handling, manufacturing, treatment, storage, use, transportation, spillage,
leakage, dumping, discharge or disposal (whether accidental or intentional) of any toxic or hazardous
substances, materials, or wastes, including, but not limited to, Hazardous Materials. The Developer
represents and warrants that there is no proceeding or inquiry by any governmental authority body or
agency with respect to the presence of Hazardous Materials on the District Property or the
Improvements or the migration thereof from or to other property. RCFC, B 1 A and KHI individually
and collectively represent and warrant that neither the Developer, nor any subcontractor, agent or
employee thereof will use, generate, manufacture, procure, store, release, discharge or dispose of any
Hazardous Material on, under or about the District Property or the Improvements or transport any
Hazardous Material to or from the District Property or the Improvements in violation of any federal,
state or local law, ordinance, regulation, rule, decision or policy statement regulating Hazardous
Material. "Hazardous Material" means any hazardous or toxic substance, material or waste which is
or becomes regulated by any local governmental authority, the State or the United States Government
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and specifically includes, without limitation, any material or substance which is (a designated as a
"hazardous substance"pursuant to Section 311 of the Federal Water Pollution Control Act, 33 U.S.C.
Sections 1251 et seq. (33 U.S.C. Section 1321), (b) defined as a "hazardous waste" pursuant to j
Section 1004 of the Federal Resource Conservation and Recovery Act, 42 U.S.C. 'Sections 6901 et I
seq. (42 U.S.C. Section 6903), (c) defined as a "hazardous substance" pursuant to Section 101 of the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42
U.S.C. Sections 9601 et seq., (d)petroleum, or(e) asbestos.
(j} Permits. RCFC, BIA and KHI individually and collectively represent and warrant
that all governmental or other permits required to proceed with the acquisition, construction and
installation of the Improvements have been or will be obtained in a timely manner and all fees
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relating thereto have been or will be paid in a timely manner. RCFC, B 1 A and KHI individually and
collectively represent and warrant further that there is no material impediment to the Developer's
proceeding with and completing the acquisition, construction and installation of the Improvements or
to the development of the District Property as contemplated by the Developer.
7. Indemnification. The Developer agrees to protect, indemnify, defend and hold the
County and its officers, employees and agents, and each of them, harmless from and against any and
all claims, losses, expenses, suits, actions, decrees, judgments, awards, attorney's fees, and court
costs which the County or its respective officers, employees and agents, or any combination thereof,
may suffer or which may be sought against or recovered or obtained from the County or its
respective officers, employees or agents, or any combination, thereof as a result of or-by reason of or
arising out of or in consequence of(a)the acquisition, construction, installation or financing of the
Improvements, (b)the untruth or inaccuracy or any representation or warranty made by the
Developer in this Agreement, (c) any act or omission, negligent or otherwise, of the Developer or any
of its subcontractors, agents or anyone who is directly employed by or acting in connection with the
Developer or any of its subcontractors, or agents, in connection with the Improvements, or (d)this j
Agreement. If the Developer fails to do so, the County shall have the right, but not the obligation, to
defend the same and charge all of the direct or incidental costs of such defense, including any
attorneys fees or court costs, to and recover the same from the Developer. Notwithstanding the
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foregoing, no indemnification is required to be paid by the Developer for any claim, loss or expense j
arising from the willful misconduct or sole negligence of the indemnified party. The provisions of I
this Section shall survive the termination of this Agreement.
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8. Developer Responsibilities. The Developer acknowledges that itis represented by
its own separate legal counsel in regard to the proceedings for the formation of the District, the levy 3
of the Special Tax, the authorization and issuance of the Bonds, the negotiation of this agreement,
and the process of constructing and installing the Improvements. The Developer accepts
responsibility for and shall be responsible for identification of and for compliance with all applicable
laws pertaining to constructing and installing the Improvements and the contract or contracts
pertaining thereto. Notwithstanding the requirements of this Agreement, the County makes no
representation as to the applicability or inapplicability of any such laws. This paragraph shall apply
with respect to any enforcement action, whether public or private, and whether brought by a public
enforcement agency or by private civil litigation, against the Developer or the County or both with
respect to the matters addressed by this paragraph.
9. Special Tax Levy. In order to assure the highest possible level of'accuracy in the
annual levy of the Special Tax, the Developer agrees that it will cooperate with the CFD
Administrator (as defined in the RMA) in determining the proper classifications of the Developer's
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properties within the District for purposes of the RMA. Without limiting the generality of the
foregoing, the Developer will provide information and documentation regarding Expected Land Use
Changes and Expected Uses of its properties within the District that are not Developed Property, as
required by the RMA, and such other information and documentation as the CFD Administrator may
reasonably request regarding the Developer's properties in connection with the Special Tax levy. In
addition, prior to the transfer of any property within the District that is not Developed Property, the
Developer shall disclose in writing to the transferee the requirements set forth in the RMA with
respect to the foregoing information and documentation.
10. Notices. Any notices required to be given pursuant to this agreement shall be given
in writing and shall be mailed or delivered to the parties at the following addresses, or e-mailed to
such parties at the following e-mail addresses:
If to the County generally County of Hawaii
or if specifically to the Department of Finance
Finance Department: 25 Aupuni Street, Suite 2103
Hilo, Hawaii 96720
Attention: Director of Finance
E-Mail: dsako@hawaiicounty.gov
If specifically to DEM: County of Hawaii
Department of Environmental Management
345 Kekuanaoa Street, Suite 41
Hilo, Hawaii 96720
Attention: Director of Environmental Management
E-Mail:
With a copy to the Director of Finance at the Ei.bove address.
If to the Developer: PCCP, LLC
Attn: Legal Notices
10100 Santa Monica Blvd, Ste 1000 Los Angeles, CA 90067
E-Mail: IegaInoticesC6)t)ccPIlc.con-i (310)414-7870
RCFC Kalokc,Heights, LLC
Attn:Phil Russick
100 Pine St, 29th Floor, San Francisco, CA 94111
E-Mail: prussick@bpccpllc.corn
RCFC Kalokc,Heights, LLC
Attn: Mark Meyer
1155 Crane St, Ste 5, Menlo Park, CA 94025
E-Mail• mmeyer@hh1898.com,
In addition, in the event that DEM has delegated responsibility for certain matters hereunder to
another County department or agency pursuant to Section 2(c) hereof, notices otherwise required to
be given to DEM with respect to such matters shall instead be given to such other department or
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agency for such purposes at its designated notice address, with copies to DEM and the Director of
Finance. Any notice recipient may, by notice to the others as provided above, change the notice
information for such recipient or change or add persons as additional notice participants, including
notice recipients on behalf of other County departments or agencies to which responsibilities
hereunder may be delegated.
11. Miscellaneous.
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(a) This Agreement and any dispute arising hereunder shall be governed by and
interpreted in accordance with the laws of the State of Hawaii. Any action at law or in equity arising
under this Agreement brought by any party hereto for the purpose of enforcing, construing or
determining the validity of any provision of this Agreement shall be filed and tried in Circuit Court
of the Third Circuit, State of Hawaii, and the parties hereby waive all provisions of law providing for
the filing, removal or change of venue to any other court.
(b) As provided above, the County is acting through DEM and the Finance Department
with respect to this Agreement and, accordingly, either DEM or the Finance Department is expressly
designated as acting for the County with respect to certain matters arising hereunder. The Finance 3
Department shall act for the County with respect to matters for which no express designation is
made.
(c) As used herein, the singular of any word includes the plural, and terms in the j
masculine gender shall include the feminine and vice versa.
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(d) The parties hereto hereby agree that an implied standard of reasonableness shall '
govern all actions of the parties hereunder, and the parties hereby covenant to one another to act in !
good faith and to deal fairly with one another to effectuate the purposes of this Agreement.
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(e) This is intended to be a fully integrated agreement which contains the entire
agreement between the parties with respect to the matters pertaining to the process of acquisition by
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the County of the Improvements.
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(f) Time is of the essence with respect to this Agreement and each and every provision
hereof.
(g) Except as may be specifically provided herein to the contrary, no third party shall be
the express or implied beneficiary of this Agreement or any of its provisions, and no such third party
may bring any action in law or equity with respect thereto.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the parties hereto have caused this Project Funding and
Agreement to be executed by their authorized representatives as of the effective date stated above.
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County: COUNT' OF HAWAII
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By:
Director of Finance
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By:
Director of Environmental Management
Approved as to form and legality:
Corporation Counsel {
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Developer: RCFC KALOKO HEIGHTS, LLC
By:
Name: AARON A. GIOVARA
Its: Authorized Signatory
KALOKO HEIGHTS B1A HOLDINGS, LLC
By:
Name: AARON A. GIOVARA
Its: Authorized Signatory
KALOKO HEIGHTS INVESTORS, LLC
By:
Name: AARON A. GIOVARA
Its: Authorized Signatory
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EXHIBIT A
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PROJECT BUDGET
A-1
425547.5
EXHIBIT B
FORM OF PAYMENT REQUEST
County of Hawaii
Community Facilities District No. 1-2021
(Kaloko Heights Project)
The undersigned hereby requests payment of the Actual Costs described in Attachment A
attached hereto. Capitalized undefined terms shall have the meanings ascribed thereto in the Project
Funding and Acquisition Agreement, dated as of , 2021 (the "Project Funding Agreement"),
by and between the County of Hawaii (the "County") and RCFC Kaloko Heights, LLC, Kaloko
Heights B1A Holdings and Kaloko Heights Investors, LLC (collectively, the "Developer"). In
connection with this Payment Request,the undersigned hereby represents and warrants to the County
as follows:
1. He (she) is a duly authorized representative of the Developer, qualified to
execute this request for payment on behalf of the Developer and knowledgeable as to the matters forth
herein.
2. Each item of Work described in Attachment A has been completed in
accordance with the Plans therefor.
3. The true and correct Actual Cost of each item of Work for which payment is
requested is set forth in Attachment A. Such Actual Costs were properly incurred and are currently due
and unpaid. Payment of such Actual Costs is within the budgeted amount for such Work under the
current Project Budget.
4. Attached hereto are invoices, receipts, worksheets and other evidence of costs
(including certified payroll data) which are in sufficient detail to allow the County to verify the Actual
Cost of the Work for which payment is requested and to verify compliance with applicable prevailing
wage requirements.
5. Also attached hereto is a certification by the Developer's project engineer
verifying that the requested payment is for Work performed in accordance with tfie Plans and the
schedule of values agreed upon in the Construction Contract.
6. The Developer is in compliance with the terms and provisions of the Project
Funding Agreement.
[7. There has not been filed with or served upon the Developer notice of any lien,
right to lien or attachment upon, or claim affecting the right to receive the payment requested herein
which has not been released or will not be released simultaneously with the payment of such obligation,
other than materialmen's or mechanics' liens accruing by operation of law. Copies of lien releases for all
Work for which payment is requested hereunder are attached hereto.] jfor frnol payment J
B-I
425547.5
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I hereby declare under penalty of perjury that the above representations and warranties are
true and correct.
Date:
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Developer Representative
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CERTIFICATE OF PROJECT ENGINEER
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The undersigned hereby certifies with respect to the foregoing Payment Recuest: (i) that the
undersigned has approved the Payment Request; (ii)that the amount requested was properly incurred
and is due and unpaid; (iii) insofar as the payment is to be made for work, material, supplies or
equipment, that the work has been performed and the materials, supplies or equipment have been
installed in the Project or have been delivered either at the Project site or at a proper place for
fabrication and are covered by the builders' risk insurance; and (iv) that all work, material, supplies
and equipment for which payment is to be made are, in the opinion of the undersigned, in accordance
with the plans and specifications or duly approved change orders.
Dated: [NAME OF FIRM]
By:
Name:
Title:
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APPROVAL BY COUNTY OF HAWAII DEPARTMENT OF ENVIRONMENTAL
MANAGEMENT
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The Actual Cost of the Work described in Attachment A has been reviewed, verified and
approved by an authorized representative of the County of Hawaii Department of Environmental
Management. Payment of the Actual Cost of such Work complies with the requirements of the
Project Funding Agreement and is hereby approved.
Date:
COUNTY OF HAWAII
Department of Environmental Management
By: _
Name:
Title:
B-3
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ATTACHMENT A 3
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Payment Total Unpaid
Payee Contract Work Covered Requested' O'oligation-' Balance3
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3
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3
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Pursuant to Section 5(c) of the Project Funding Agreement, payments prior to completion of the Improvements and the
County's acceptance of dedication thereof,each payment request is limited to 90%of the Actual Cost of the Work for which the
payment is requested (except for Actual Costs representing fees paid to governmental entities or utilities and County
administrative and oversight charges).
2 Contract amount for applicable portion of Work.
3 Unpaid balance after current payment.
B-4
EXHIBIT C
DISBURSEMENT AND PROJECT PAYMENT SCHEDULE
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425547. 5C-1
4 AARON S.Y. CHUNG
MATT KANEALI`I-KLEINFELDER ° ""' ?� MAILS MEDEIROS DAVID
Chairperson HOLEKA GORO INABA
*; �* ASHLEY L.KIBRKIEWICZ
HEATHER L.KIMBALL SUSAN L.K.LEE LOY
Vice Chair : .� HERBERT M. "TIM"RICHARDS, III
aF wPsz REBECCA VILLEGAS
HAWAII COUNTY COUNCIL
County of Hawai`i
Hawai`i County Building
25 Aupuni Street
Hilo, Hawai`i 96720
February 22, 2022
Maile Medeiros David, Council Chair
Hawaii County Council
25 Aupuni Street
Hilo, Hawaii 96720
RE: BILL NO. 136 : AN ORDINANCE AUTHORIZING THE ISSUANCE OF
SPECIAL TAX REVENUE BONDS OF THE COUNTY OF HAWAII FOR THE PURPOSE OF
FINANCING THE COSTS OF CERTAIN PUBLIC IMPROVEMENTS AND INCIDENTAL
EXPENSES RELATING TO THE COUNTY'S COMMUNITY FACILITIES DISTRICT NO. 1-
2021 (KALOKO HEIGHTS PROJECT); AMENDING CERTAIN PROVISIONS OF THE
ORDINANCE OF FORMATION FOR THE DISTRICT RELATING TO THE LIEN OF THE
SPECIAL TAXES SECURING SUCH BONDS; FIXING OR AUTHORIZING THE FIXING OF
THE FORM,DENOMINATIONS,AND CERTAIN OTHER DETAILS OF SUCH BONDS AND
PROVIDING FOR THE SALE OF SUCH BONDS TO THE PUBLIC
Pursuant to Section 2(g) of Rule 4 of the Rules of Procedure of the Council of the County of
Hawaii, this written request is submitted with my approval that the above-referenced matter be
waived from the Committee on Finance to the full Council for immediate action. In reviewing
this matter, timely approval is crucial. It is therefore advantageous that approval is granted and
the matter be placed onto the next Council agenda for review. However, in the event this request
is denied, for whatever reason, I understand the matter shall be referred to the Committee on
Finance for placement on its future agenda.
incerely,
Matt Kdneali`i-Klein elder, Chairperson
Committee on Finance
Approved ate/Waive to Council: Disapproved/Date/Refer to FC:
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Maile Medeiros avi , ouncil Chair Maile Medeiros David, Council Chair
Hawaii County Council i20.22 Hawaii County Council
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