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HomeMy WebLinkAboutMIN LAAC 2023/02/07 (2022-2024)Committee on Legislative Approvals and Acquisitions 3`'d Session Hawaii County Building 25 Aupuni Street Hilo, Hawaii February 7, 2023 CALL TO The regular meeting of the Committee on Legislative Approvals and Acquisitions ORDER: was called to order at 4:05 p.m. in the Council Chambers, Hilo, by Mr. Holeka Goro Inaba, Chair. ROLL CALL: Present: Mr. Holeka Goro Inaba, Chair Ms. Michelle M. Galimba, Vice Chair Ms. Cindy Evans, Member Ms. Jenn Kagiwada, Member (came in later) Mr. Matt Kaneali`i-Kleinfelder, Member (came in later) Ms. Ashley L. Kierkiewicz, Member Ms. Heather L. Kimball, Member Ms. Susan L. K. Lee Loy, Member Ms. Rebecca Villegas, Member STATEMENTS The Chair directed the Committee to proceed to the next order of business, FROM THE Statements from the Public on Agenda Items. PUBLIC ON AGENDA ITEMS: The following individuals registered to speak and came forward when called by the Chair: Cindy Freitas: Bill 7 (Comm. 28), in opposition. Claire Loprinzi: Bill 7 (Comm. 28), in opposition. Patricia L. L. Greene: Bill 7 (Comm. 28), in opposition. CHR. INABA: Mr. Clerk, Bill 7, please. Change Order As directed by the Chair and with no objection from the Council Members, the of Business: following item was taken out of order: BILLS FOR The Chair directed the Committee to proceed to the next order of business, ORDINANCES: Bills for Ordinances. LAAC-3 February 7, 2023 Bill 7: AMENDS ORDINANCE NO. 98-91, WHICH RECLASSIFIED LANDS FROM AGRICULTURAL — 20 ACRES (A-20a) TO AGRICULTURAL — 5 ACRES (A-5a) AT KALOKO, NORTH KONA, HAWAI`I, COVERED BY TAX MAP KEY: 7-3-025 :012 (Applicant: Sunshine Holdings_ LLC) (Area: 21.353 acres) The Leeward Planning Commission forwards its favorable recommendation for the applicant's request for a five-year time extension to Condition D (Final Subdivision Approval) for the development of a four -lot subdivision. The property is located along Kaloko Drive, approximately 720 feet southeast of its intersection with Kaloko Loa Place, Kaloko Mauka Subdivision, North Kona. Reference: Comm.28 Intr. by: Mr. Inaba (B/R) Motion to Approve: Ms. Kimball moved to recommend passage of Bill 7 on first reading. Seconded by Ms. Kierkiewicz. CHR. INABA: Good afternoon. We have our applicant and the representative here. You can go ahead and introduce yourself for the record, and give the Council an explanation, an introduction to this request. (Note: At this time, Planning Consultant Sidney Fuke and Applicant Micah Christensen came forward to address the members of the Committee.) MR. FUKE: Sure. Good afternoon and aloha, members of the Council this Committee, Mr. Chair. My name is Sidney Fuke, I'm a Planning Consultant, and I'm here assisting the applicant, Mr. Micah Christensen, who is seated to my left. MR. CHRISTENSEN: Okay, thank you for having me. MR. FUKE: Okay, I'd like to just kind of provide some overall background and a framework, and partially in response to the comments that have been submitted to this body, both verbally as well as written. First of all, the property is located in the Kaloko mauka subdivision. It was rezoned a number of years ago, back in 1998, from Ag-20 down to Ag-5, so it's been quite stale in terms of the time. However, Mr. Christensen purchased the property out of foreclosure. So if there is any delay, it's not really his fault, I mean, the previous owner had an opportunity, but for some reason, he didn't really was aggressive enough to consummate the subdivision, so the property went into foreclosure, and Mr. Christensen picked up the property. His intention is to proceed with what was originally envisioned for the property, based on the five acres, which is essentially to create a five -acre lot subdivision. Page 2 LAAC-3 February 7, 2023 He is fully aware of the Planning Director as well as the Planning Commission's recommendations in terms of the time extension, and also the current policy on the part of the County Council, that he has essentially a five-year window within which to complete the project, and you can confirm if he wants to. It's something that he really wants to do. He wants to finish up the project, retain one lot for himself and his family, and sell the remaining lots to help underwrite the cost of developing the project. The comments made by the public, I think are very germane, and I'd like to kind of address them. First of all, in terms of the archaeological report, one was prepared. It was very fresh; it was dated December 22nd of last year, 2022. The report essentially concluded —made the same conclusion as one, which was done —which was offered by the State Historic Preservation Division (SHPD) back in 2005, which was, that there would be no historic properties affected. That report has been sent to SHPD. We are now kind of waiting for confirmation from SHPD regarding the acceptance or non -acceptance of that report. There is this concern, I think based on the public comment, about the need to protect endangered species, whether they're listed or not. Notwithstanding that condition, I kind of would want to note the following. I think that one of the testifiers noted that in terms of the endangered species, you know, if you looked at the 3,000-foot elevation line, this property is about like 2,500 feet, but I would personally readily concede that, yes, even if it's whether 2,500 or even 1,000 feet, you can observe the Hawaiian hawk or the Hawaiian owl because I live at a 1,000 elevation and I've seen them here in Hilo, in the Kaumana area. I think that whether it's 3,000, 2,500, they're all kind of like arbitrary. The point is like whether there is a mechanism for its preservation or for its protection I think there is one condition; I think that was Condition N, which calls for the protection of the listed or endangered species. You'll have an opportunity to have that. Tied in with that, there is also another condition, which specifically talks about forest management of this area. Condition H specifically requires that 67 percent, in other words, two-thirds of the property be satisfied and kept in open space in the forest, as a forestry. So what this does, I think it does two things, three things maybe. One, is it kind of helps address the potential for any endangered species over there; secondly, in terms of the concern about the potential for having native vegetation, and I can go into that a little bit more, but that also kind of helps address that; and thirdly and maybe equally important, is the fact that by having 67 or maybe even more percentage of the property be kept in its natural state, it helps kind of foster this watershed concept. The whole idea, if you look at the zone change map for this area, it talked about smaller lots on the lower side of Kaloko, like one to three acres in size, and just beyond that, like five acres, and beyond that is pretty much like ten or twenty acres in size. That line was a relatively arbitrary line, but nevertheless, that line Page 3 LAAC-3 February 7, 2023 was drawn back in the early 90s to essentially address the whole notion of watershed. So that combined with the fact that you have a condition that assures 67 percent of the property, will be kept pretty much in its natural state. I think it kind of helps address the concerns that were raised by members of the public. CHR. INABA: Thank you, Mr. Fuke. Can you summarize, please? I would like to hear from the applicant if he has any other thoughts. MR. FUKE: Sure. CHR. INABA: Thank you. MR. FUKE: That's pretty much all. I wanted to address the public's comment, and I think I did. CHR. INABA: Thank you, Mr. Fuke. Mr. Christensen, do you want to address this body at all? MR. CHRISTENSEN: Yeah, I appreciate the comments that have been made. I recognize the beauty of this land and how that needs to be preserved and protected, and that is the plan. I appreciate all of its history and feel it should be a beautiful place forever, I believe so. CHR. INABA: Thank you. We have our Planning Director here. Director Kern, do you want to make any further comments on this application? (Note: At this time, Planning Director Zendo Kern came forward to address the members of the Committee.) MR. KERN: Good afternoon, Mr. Chair and members of the Committee. Zendo Kern, Planning Director. No, I have no further —nothing really to add. There's a comprehensive background report recommendation as well as the conditions in the proposed ordinance right now. I'm happy to answer any questions if there is a need for that. CHR. INABA: Thank you, Director Kern. Opening it up then to the Committee, any questions or comments? Council Member Evans. MS. EVANS: Thank you. This is for the Planning Director, and it has to do with Fair Share. So the comment here isoh, I'm looking on page 9. It says, "the Fair Share contribution will be for road impacts," and it will be applied to improving the Kaloko Drive, Mamalahoa Highway intersection. However, it looks like the Fair —but then it goes on to say, "the Fair Share Contribution gets adjusted annually." So, when exactly do we get the Fair Share payment? Page 4 LAAC-3 February 7, 2023 MR. KERN: The Fair Share has to be paid prior to the subdivision approval getting done. The subdivision approval is the final element of this rezoning ordinance. In order to fully effectuate the rezoning ordinance, it has to have a subdivision. Prior to finalizing the subdivision approval, all conditions have to be met. They would get a tentative approval letter. One of those conditions would be that the Fair Share is paid. So, prior to final subdivision approval. MS. EVANS: Okay, all right. For the benefit of the people that live in Kaloko, which I'm very familiar with, Ag-5, it says in here they agreed to do a deed restriction on condominium property regimes, and I think not even allowing a second —what, an ADU (Accessory Dwelling Units) or an `ohana ? MR. FUKE: No dwelling. Just one dwelling. MR. KERN: No additional farm dwelling. MS. EVANS: So, they won't be able to do `ohana? MR. FUKE: No. No farm dwelling. MR. KERN: In this case, because it's State land use ag, they wouldn't be able to do an `ohana, under the County Code `ohana. Most properties would be allowable for an additional farm dwelling; if they are doing a certain amount of agriculture, then they could qualify for that, for somebody housed there for farming -related activities, and in this case, it's restricted to that. So, they're only allow for one farm dwelling. MS. EVANS: Okay, so they just use it for residential, right? They can use residential. They'll pay real property taxes as a residential, not — MR. KERN: They will pay residential. They will pay real property taxes based on the use. MS. EVANS: The use? MR. KERN: Yeah. MS. EVANS: Okay. All right, that's good to know. Okay, thank you. MR. KERN: Thank you. CHR. INABA: Council Member Villegas. MS. VILLEGAS: Yeah, being familiar with Kaloko, and as Ms. Loprinzi mentioned, "It being a space for gathering native flora and fauna," —I just overall Page 5 LAAC-3 February 7, 2023 concerns with the creation of another subdivision within an already existing —in my mind, Kaloko is sort of a subdivision. This breaking up of properties, are you connecting to a sewer? MR. FUKE: No, this area is not sewered, so the wastewater system will be all through the individual system, which would be essentially septic system. MS. VILLEGAS: Septic, which, you know, we already know doesn't really work as well as wastewater. I just haveI have heartburn over this. It's so indicative. I understand, sir, you go this property in a foreclosure, which seems like a great investment. I have a number of friends that live in Kaloko, and they bought 20-acre parcels, and they've built one home on them, and the forest remains as it was. But the concept of buying acreage like this and then subdividing to sell certain pieces to then afford to build a dream home, it's in alignment with that prospecting once again. We have a history of that kind of creation of gentlemen farms that, you know, don't get farmed. Very few of the lots in Kaloko are used as agriculture. The value of that forest is one of our last cloud forest on the planet. We're already losing the `ie `ie and other species because of the bulldozing of a lot of the trees and the ecosystem there, so I don't know that I can support this. Yeah, so with that, I yield. CHR. INABA: Council Member Evans. MS. EVANS: Thank you. Thank you. Along that line of questioning, was there ever any consideration of just dividing it into two Ag-10? Was there any consideration of why four? And this has to do with density and keeping more forest, yeah? MR. FUKE: Yeah, it was probably because —it was just —you know, Mr. Christensen bought the property under foreclosure, and it was in a zone for Ag-5 at that time. Again, if you look at the zoning map of that area, you have sprinkling of Ag-5 and some Ag-3, and over and beyond that as you travel further mauka, then of course you have like Ag-10 and pretty much Ag-20. I can't really speak for like, you know, the possibility of whether he'll be receptive to Ag-10. But, if I can just segue just a bit? If the property were to be —say if the existing zoning ordinance were repealed, then you have the underlying Ag-20 zoning. With the underlying Ag-20 zoning, whoever owns the property based on today's current law, would be in a position to totally denude the property, that is to say, like the whole 21 acres can be graded. He or she would then be in a position to construct maybe two or possibly three dwellings if the second or third dwelling is considered a farm dwelling. Page 6 LAAC-3 February 7, 2023 So along the way, what happens is that you lose what this, through condition, is designed to achieve. Number one, some amount of protection, basically 67 percent of the property would be satisfied and kept in open space forest. You'll be keeping that. You'll be addressing the watershed issue. You'll be addressing the potential of the endangered species in those kinds of concepts. Because the existing zoning based on Ag-20, fully graded, there are no regulations that specifically address that. With this rezoning, you have an opportunity for controls. MS. EVANS: Okay, Director Kern, so my question would be, is that something because we're still living in an outdated General Plan? I mean, is this something that will get addressed that will address something like this? MR. KERN: No, the General Plan wouldn't address this. This is more of, based on what Mr. Fuke was saying, with that ability, it's more of a grading and grubbing side of things. There are no land use regulations or in the General Plan that would prohibit that. MS. EVANS: Grading and grubbing, okay. MR. KERN: Correct. MS. EVANS: And then lastly, is there a possibility for the owner to meet with the Department of Forest and Wildlife and maybe put a lot of this land in some type of conservation easement that would give him some benefits? I'm just thinking of how we could possibly incentivize to have only two ten -acre lots instead of four or five. MR. FUKE: Yeah, that Forest Reserve area, essentially amounts to like a conservation easement, but it's privately owned, and that's a mandate. So when he comes in for the proposed subdivision, he would have to identify all of your billable area, and the rest would have to be kept in open. So, that would govern like any grading permit activities, stating in there where your building permit is going to come in, and so on and so forth. MS. EVANS: So it could do a conservation easement? MR. FUKE: It's de facto amounts to that, the 67 percent through the CC&Rs (Covenants, Conditions, and Restrictions.) MS. EVANS: So CC&Rs is the Kaloko Homeowner Association? MR. FUKE: No. MS. EVANS: No? Page 7 LAAC-3 February 7, 2023 MR. FUKE: No, there's going to be a separate set of CC&Rs if this rezoning is approved. There will be a separate set of CC&Rs attendant only to these four properties. MS. EVANS: Right, because he's agreed to it here. MR. FUKE: Right. MS. EVANS: But your Kaloko Homeowners Association By-laws don't have anything to do with open space? MR. FUKE: No. MS. EVANS: Okay. All right, thank you. CHR. INABA: Thank you, Council Member Evans. Council Member Villegas. MS. VILLEGAS: Yeah, quick question, how many other properties in Kaloko does Sunshine LLC own? MR. CHRISTENSEN: Sunshine Holdings LLC owns one other property. MS. VILLEGAS: One other property? MR. CHRISTENSEN: Yeah. MS. VILLEGAS: And that's just one lot or is that four lots? MR. CHRISTENSEN: Just one. MS. VILLEGAS: It's just one lot. MR. CHRISTENSEN: Yeah. MS. VILLEGAS: Okay. And what are your intentions where that lot is concerned? MR. CHRISTENSEN: That was a home that was neglected and in total disrepair, and we have repaired it and got it back into good shape, and then we'll be selling that now that it's been brought back to the condition it was supposed to be originally. MS. VILLEGAS: Okay. So you're a business person, right? Page 8 LAAC-3 February 7, 2023 MR. CHRISTENSEN: I do business. MS. VILLEGAS: Well hence, I mean you're not buying this in your name. This is being bought in an LLC (Limited Liability Corporation), correct? MR. CHRISTENSEN: It is being bought in an LLC, but I do have a personal interest in the land. I love the land. MS. VILLEGAS: Yeah, it's such a loveable place, right? MR. CHRISTENSEN: Yeah, it's beautiful. MS. VILLEGAS: It's really a powerful place. Okay, we're in the middle of a housing crisis and shortage, and with real estate prices having gone astronomically through the roof, I just see this as this doesn't provide any solution for that. This provides more of the same because the people who will be able to afford these five -acre lots will not be our kama`aina or our maka`ainana. It will be most predominantly more outside investors. I appreciate the concessions you're putting there. Thank you, Mr. Fuke, for pointing out that based on the way this is written, then at least we have those protections written down, but it doesn't sit right with me to hear like, "Oh, well if this doesn't go, then you could bulldoze the whole 20 acres." That just doesn't —sure you might be able to, but you shouldn't, and that would even be an option, whether legal or illegal, makes my stomach turn. So, yeah. Okay, thank you for that. Someone had mentioned that Sunshine LLC has three lots up in Kaloko, and so I'm just wondering your overall investment in the area and intentionality when it comes to really being a home or being a business opportunity. So, thank you for that. I yield. CHR. INABA: Thank you, Council Member Villegas. Council Member Kierkiewicz. MS. KIERKIEWICZ: Thank you, Chair. Mr. Fuke, you mentioned something earlier about a report being filed with SHPD. I'm looking at their Conditions of Approval here, and it mentioned an Archaeological Field Inspection. Is that what you're referring to, that that's already been completed and submitted? MR. FUKE: That's correct. MS. KIERKIEWICZ: Okay, can you describe that to me because typically we see AISs (Archaeology Inventory Study) as a Condition of Approval? This seems kind of like a baby -step. Page 9 LAAC-3 February 7, 2023 MR. FUKE: Yeah, it's largely because an earlier study was done, and also for the property, just immediately makai, you know, Clinton Hincliff, SHPD in that situation concluded that there was really nothing. We had Dr. Alan Haun—did an archaeologic inspection of this site recently, in conjunction with the Hincliff property, and arrived at the same conclusion, which SHPD also concurred, and so that occurred. When this came up, it didn't have any updated archaeological walk-through or whatever have you, so as a result the Planning Department and the commission had made a recommendation that at least you do this Archaeological Field Inspection. So since that was a condition, we said, well —I suggested to him, "Why don't you get it done?" MS. KIERKIEWICZ: Yeah, might as well do it, especially, you know MR. FUKE: Yeah, and so it was done. MS. KIERKIEWICZ: Right, because I read through the background report and the letter from SHPD, you know, nothing was required but the wisdom of the commission and the Planning Department was, "You know what, why don't we just make sure to do the field inspection and file that report?" So, thank you for taking the initiative to do that. You know, I'm taking a look at this; water commitments are in order. There is no issue with the Department of Transportation or the Department of Health. We gave a lot of weight to things, like the Community Development Plan. We all adopted the Kona one; it is in alignment with that. So that being said, I'm going to be supporting this request before us today. Thank you, Chair. CHR. INABA: Thank you, Council Member Kierkiewicz. Any other comments or questions? Council Member Kimball. MS. KIMBALL: Thank you. I just want to kind of walk us through this for my own clarification. So the original rezone, from 20-acre to 5-acre, was in 1998. Was there an administrative extension already? MR. FUKE: Yes, there was. MS. KIMBALL: Okay, so what was the original timeframe and then what was the administrative extension? MR. FUKE: Up until —it came out to 2011. MS. KIMBALL: 2011. So this has been stalled for 12 years, since 2011? Page 10 LAAC-3 February 7, 2023 MR. FUKE: Since 2011, you know, same owner all the time. Nothing happened, and so it went into foreclosure, and then Mr. Christensen picked it up last year in a foreclosure. MS. KIMBALL: Okay. MR. FUKE: But during that eight, nine-year period, nothing really happened. MS. KIMBALL: Okay. MR. FUKE: You know, since 2011. MS. KIMBALL: Okay. The items in Condition D then, that we're required to Final Subdivision approval proposed by the Agricultural Subdivision shall be secured from the Planning Director within five years of the effective date, all these easements and setbacks, none of that has happened? I mean, has anything happened since that original rezoning? MR. FUKE: No. MR. KERN: There was a MR. FUKE: Submitted application. MR. KERN: There was a submitted application, correct. MR. FUKE: But it's never consummated. MR. KERN: Correct. MS. KIMBALL: Submitted application for a time extension? MR. KERN: No, in the background report, it says that there was a submitted subdivision application in 2005, and a tentative approval granted, and that's where, I guess, things changed with that owner at the time, and we haven't heard anything since then. MS. KIMBALL: Oh, I see, okay. MR. FUKE: And then so when Mr. Christensen bought the property in 2022, he submitted a new application, and then he was informed correctly by the Planning Department, and looked at it, and we can't process it any further until you seek a time extension. Page 11 LAAC-3 February 7, 2023 MS. KIMBALL: I see, okay. This was the bank selling this. Not sure if this question is relevant, but I —was it disclosed to you at the time of sale that this was an outstanding item on the property that could not or presumptively be guaranteed? MR. CHRISTENSEN: I did call and was told by the County that this would have to happen first, the extension of the time period, so I didn't know that this would be the process. MS. KIMBALL: Okay. I mean, there's some nice there are some good protections in here, preservation of land area in its natural state, recognizing that the previous landowner let it lapsed, but that lapsed well before this went into foreclosure. So I don't know, I'm not sure where I am on this yet. Thanks, I'll yield. MR. FUKE: Thanks. CHR. INABA: Any other questions or comments? All right. Mr. Fuke, did the original ordinance expire in 2008, or 2011? Because since I'm doing my math, it would have been 2008. MR. FUKE: Yeah, would be 2008, and then they got a five-year extension, administrative extension. So it was approved in 1998, so ten years would have been 2008, but for some reason, it was extended to 2011, and I don't know how it came out to 2011. CHR. INABA: Now, questionable. Do we know how that happened? MR. KERN: I do not. CHR. INABA: Do we have a record of when that extension was, so we know for sure that some director granted an extra two years? MR. KERN: Yeah, I'm happy to look into that. I don't have it right here available. I have to go back and get the files and look at that. That's not a problem at all. CHR. INABA: Mr. Christensen, do you reside in Kona? Can you come to the mic, please? MR. CHRISTENSEN: I'm here very often and not full-time in Kona. CHR. INABA: Okay, unrelated maybe to this specific property, Director Kern, how does, and you might not be the right person to answer this, how does homeowner class work for property tax, for LLCs? If Mr. Christensen doesn't Page 12 LAAC-3 February 7, 2023 reside here but other properties under Sunshine LLC, I believe, have homeowner property class rates, how is that happening? MR. KERN: I'm not the guy who has the final word in that. MR. FUKE: From what little I understand, Mr. Chairman, if he lives on the property, and that can be verified, and that's his sole residence, then he would be eligible to qualify for homeowner's exemption. I think he just mentioned that he doesn't live here; and the other property that he has, he bought it. There was a dwelling on it, and he fixed it up and it's in the process of having it sold. So the short answer to your question is that neither of his properties in my mind, he would be eligible for homeowner's exemption. CHR. INABA: Okay, Mr. Christensen, can you come to the mic again, please? So you don't reside in Kona or in Hawaii County as a full-time resident? MR. CHRISTENSEN: Correct. CHR. INABA: Do you own other property in Kona besides in Kaloko? MR. CHRISTENSEN: Do I own? CHR. INABA: Sunshine LLC. Does your organization own other property in Kona? MR. CHRISTENSEN: Yes. Are you talking about the one on Ka`iminani Drive? CHR. INABA: Right. MR. CHRISTENSEN: There's one on Ka`iminani Drive that I'm also fixing up and restoring. CHR. INABA: I'm seeing a property in Kona that you are receiving homeowner class rates for, meaning that you are a resident of the County; so you're not a resident, but you're getting tax breaks. MR. CHRISTENSEN: I'm unaware of that. I pay all my property taxes; if there's something that's classified and wrong, then I'm unaware of the CHR. INABA: So your intention for the parcel that we're discussing right now is to subdivide and reside on one of those parcels full-time? MR. CHRISTENSEN: I don't know that I would love to be able to retire there ultimately, but I don't know how soon that would happen to reside full-time. Page 13 LAAC-3 February 7, 2023 CHR. INABA: All right. Based on the representations made today, and this being in my district, I'm not able to support this project right now. I could see it —you know, it's difficult already with subdivisions happening up in Kaloko, and obviously you can appreciate the beauty of Kaloko. But right now, how does this stand to benefit? I think this is always a question I go back to personally, how does it benefit those who already reside here and how might it negatively impact those not just in the immediate subdivision but those in the greater community, whether it's Kona or in the island? MR. CHRISTENSEN: I can appreciate that. As was mentioned, the affordability, and that no one local would be able to afford it. I feel like if there's any chance, locals can afford it, five acres is getting closer to that ability. I mean, 20 acres, yeah, it reaches that dream further off, but I feel like it increases the chances of people who can care, really care, and love the land, instead of just people who have millions of dollars that can afford a big 20 acres. CHR. INABA: Thank you. Any other comments or questions regarding this application before us today? Council Member Kimball. MS. KIMBALL: I feel like there are a few unanswered questions, potentially some opportunity. I'm going to make a motion to postpone to the February 21" meeting, to potentially allow for additional discussion between Council Member Inaba and the applicant, about addressing some of the concerns that have been expressed today. I guess I should have waited for a second on that motion. Motion to Postpone: Ms. Kimball moved to postpone Bill 7 to February 21, 2023. Seconded by Ms. Kagiwada. CHR. INABA: Any questions or comments on the postponement? MS. LEE LOY: On the postponement, I'm going to support the postponement because if there is some conversation, I do like some of the safeguards that are in the conditions that I think lend itself to some of the larger issues related to environment and watershed issues. I am very concerned that this really is turning into a slippery slope, where it becomes pay -to -play, and if you have enough votes on the Council, you can get or not get, when really we should get back into a process that's fair and objective rather than emotion and feelings. So, there is where I stand on the postponement. I would love for some conversation to happen. But, I would love to see it come back up and vote either up or down on the merits and not emotion. Thank you. CHR. INABA: Council Member Evans. MS. EVANS: Yeah, thank you. I really support the idea of postponement and continuing the discussion. I'm looking at the map, that currently what's going up Page 14 LAAC-3 February 7, 2023 on Kaloko, and you see some A-20s, A-5s, A-IOs, it sounds like there's just an amazing forest with all these amazing habitats. I really hope that there might be a possibility of going to an A-10 instead of an A-5, and so I just hope that you're open to some further discussion, and we'll see what comes out the next time. MR. CHRISTENSEN: It is my understanding too that it was the former owner who was trying to go to A-3, and it was concession to go to A-5 because it was low enough towards the others. That was by understanding, but— CHR. INABA: Thank you, Council Member Evans. Do you yield? MS. EVANS: I yield, Chair. CHR. INABA: Okay. All right, any other discussion on the postponement? There being none, all those in favor of postponing Bill 7 to the February 21" committee meeting, please say "aye." Vote on Motion The motion to postpone Bill 7 to February 21, 2023, to Postpone: was carried by the following voice vote: (Approved) Ayes: Committee Members Evans, Galimba, Inaba, Kagiwada, Kierkiewicz, Kimball, Villegas, and Chair Inaba — 8. Noes: None. Absent: Committee Member Kaneali`i-Kleinfelder —1. Excused: None. CHR. INABA: Mr. Christensen, Mr. Fuke, we'll touch base offline, thank you. MR. FUKE: Thank you. CHR. INABA: Moving on then to Resolution 51-23. ORDER OF The Chair directed the Committee to proceed to the next order of business, RESOLUTIONS: Resolutions. Page 15 LAAC-3 February 7, 2023 Res. 51-23: AUTHORIZES THE DIRECTOR OF FINANCE TO NEGOTIATE A SIXTY-FIVE YEAR LEASE WITH THE STATE OF HAWAI`I FOR THE PURPOSE OF THE DEVELOPMENT AND CONSTRUCTION OF A PUBLIC LIBRARY BY THE HAWAI`I STATE PUBLIC LIBRARY SYSTEM, SITUATED AT WAIKOLOA, DISTRICT OF SOUTH KOHALA, COUNTY AND STATE OF HAWAI`I, AND IDENTIFIED AS TAX MAP KEY: 6-8-041-020 AT A SET LEASE RENTAL AMOUNT OF $0.00 PER YEAR The property located within the County's Kamakoa Nui Subdivision is approximately 2.567 acres, and would be used for the purposes of developing, building, and operating a public library. Reference: Comm.90 Intr. by: Mr. Inaba (B/R) Motion to Approve: Ms. Evans moved to recommend adoption of Res. 51-23. Seconded by Ms. Kierkiewicz. CHR. INABA: I believe we have OHCD (Office of Housing and Community Development) on Zoom. Good afternoon, oh, almost good evening, Administrator Kunz. Go ahead. (Note: At this time, Housing Administrator Susan Kunz came forward to address the members of the Committee.) MS. KUNZ: Hello, good afternoon. Susan Kunz, Director for the Office of Housing and Community Development. I want to also let you know that I have the State Librarian, Stacy Aldrich, also on Zoom, and she's available to provide any answers to any questions that you might have. Thank you. CHR. INABA: Thank you, Administrator Kunz. Opening it up tooh, perhaps we can hear from our State Librarian regarding this project. Good afternoon. (Note: At this time, Hawaii State Librarian Stacy Aldrich came forward to address the members of the Committee.) MS. ALDRICH: Aloha and good afternoon. Thank you so much for this opportunity to testify in support of this resolution. We're so excited to be able to partner with the County to bring a library to a community that has been wanting a library for more than 10 years. The closest library is 20 miles away, and we know from our recent patron survey that we did, that our public libraries are so important to people to have a place to get access to information, and ideas, connect to the internet and connect with one another. So thank you so much for considering this opportunity to partner with us to bring this important hub to the community. Mahalo. Page 16 LAAC-3 February 7, 2023 CHR. INABA: Thank you so much. Opening it up then to Committee Members, discussion? Council Member Evans. MS. EVANS: You know with the time of day it is; I could tell you the whole story, but this community has been committed to this for at least 14 years, and it started in my living room about 14 years ago when the community said, "Please, we have to bring a library to the community," and then I was the State Representative for Waikoloa. Over the years we have moved methodically towards this, where we are at today. I won't give you all the details of the different sites and the different efforts that had been put into it. This community really wants this library, and I really appreciate your support for this. Thank you. CHR. INABA: Thank you, Council Member Evans. Council Member Lee Loy. MS. LEE LOY: Yeah, I'm just lending my support. I think I sat next to Senator Richards for a long time and heard this story over and over again. So, happy to lend my support, and look forward to providing such a wonderful resource for that community. I yield. CHR. INABA: All right, there being no further discussion. Just for the record, I do see that the resolution is authorizing the negotiation, but it's for there's no cost to the County, is that correct Administrator Kunz? MS. KUNZ: That is correct. CHR. INABA: Okay, thank you so much. Look forward to seeing this come to fruition. There is a motion on theoh, Administrator Kunz? MS. KUNZ: I'm sorry, one item. It looks like I need to make a correction, if it's possible, to the name of the State Public Library that's listed on this resolution. So in the last Be It Finally Resolved, it is stating that the resolution would be transmitted to the "Office of the Mayor, Department of Finance, the Office of the Office of Housing, and the State of Hawaii Department of Education Library," that is incorrect. Okay, so I wanted to change that to the Hawaii State Public Library System. Is that correct, Stacy? Okay. Could we make that correction? CHR. INABA: Mr. Clerk, does that require an amendment at first reading? MR. BROWN: Yes, we would prefer that in writing, please, to make sure we get it totally correct. MS. KUNZ: Okay. CHR. INABA: Thank you. Administrator Kunz, would you be able to provide that amendment by first reading? Page 17 LAAC-3 February 7, 2023 MS. KUNZ: Yes, we can. CHR. INABA: Okay, thank you so much. With that, there's a motion on the floor to forward Resolution 51-23 to Council with a favorable recommendation. All those in favor? Vote on Res. 51-23: The motion to recommend adoption of Res. 51-23 was (Approved) carried by the following voice vote: Ayes: Committee Members Evans, Galimba, Inaba, Kagiwada, Kaneali`i-Kleinfelder, Kierkiewicz, Kimball, Villegas, and Chair Inaba — 9. Noes: None. Absent: None. Excused: None. CHR. INABA: We'll go to the last agenda item of the day, Communication 66. Return to Order The Chair directed the Committee to return to the order of business. of Business: COMMUNI- The Chair directed the Committee to proceed to the next order of business, CATIONS: Communications. Comm. 66: REQUESTS FORMATION OF AN AD HOC COMMITTEE FOR THE PURPOSE OF: (1) REVIEWING BIANNUAL PROGRESS REPORTS FOR RECIPIENTS OF FISCAL YEAR 2022-23 NONPROFIT GRANTS-IN-AID AWARDS; AND (2) DEVELOPING RECOMMENDATIONS FOR FISCAL YEAR 2023-24 NONPROFIT GRANTS-IN-AID AWARDS From Council Member Susan L. K. Lee Loy, dated January 6, 2023. Motion to Close File: Ms. Lee Loy moved to close file on Comm. 66. Seconded by Ms. Kierkiewicz. CHR. INABA: Council Member Lee Loy. MS. LEE LOY: Thank you, Mr. Inaba. I think at our last committee meeting we had a robust discussion about some of the measures and the metrics, and basically it all starts with a scope of work and that's what's contained in Communication 66. For the rest of my colleagues, I think this is also the time we would also go ahead and identify no? I think we're going to all score this time around. I'll entertain any questions my colleagues may have, but the next step after this is to postpone this communication while we go ahead and get all the scoring done, at a future date. Correct, Mr. Clerk? Page 18 LAAC-3 February 7, 2023 MR. BROWN: So if you guys are interested in creating the ad hoc, we would need to make sure the scope is clearly defined. Also, between two and four members of this Council can make up an ad hoc. The Chair needs to clearly identify who those people are. We would postpone the communication here. The ad hoc then would get to work, and then they would create a report which would be submitted to Council, then it would be given to Council at that meeting when it comes up, no action can be taken at that time. It would be postponed again, and then heard at a subsequent meeting, where then the Council could vote on taking action based on those recommendations that were submitted. MS. LEE LOY: Thank you, Mr. Clerk. With that said, I yield. CHR. INABA: Council Member Kierkiewicz. MS. KIERKIEWICZ: Chair, I think we're getting a little ahead of ourselves here. Unless I'm reading the wrong communication, my understanding, Council Member Lee Loy, was that for this particular ad hoc, the scope of work is related to evaluating six-month progress reports for grants that were already issued. I've had my share of opportunity serving in this capacity, so do welcome newer colleagues on the Council to serve in this role. But I recall in our in-depth conversations with folks in the Finance Department that this was something that we should be exercising and taking a hard look at, is making sure that our grantees are submitting their six-month progress report and that they are meeting the articulated measurable outcomes that they had specified in their applications. So I just want to make sure we're all on the same page around what we're activating today. Thank you, Chair. MS. LEE LOY: Thank you, Ms. Kierkiewicz. I have two things going on in my head, but you're absolutely correct; and what happened, for the rest of my colleagues, is oftentimes the way this nonprofit is scheduled, within our Code, there are moving pieces of applications that are currently in the pipe and having to be reviewed. You have to submit the reports before they can become eligible for the next round of funding. So at our last meeting, we talked about everybody scoring what's currently going to be coming into the pipe, but what this communication does is evaluate what's in the pipe and the six-month reporting, and some of the measures and/or their contractual obligations for the last round of funding. Thank you for clearing all that up for us, Ms. Kierkiewicz. I yield. CHR. INABA: Okay, before we go on, what was said was correct. The second bullet in this communication also puts into the scope of this ad hoc committee, the finalization of the rubric in getting things out to the entire Council for scoring; when all the scores come back to the ad hoc, those final recommendations for exact funding are done in the ad hoc. So all of that, what Council Member Page 19 LAAC-3 February 7, 2023 Kierkiewicz said and the 2023-2024 applications are within the scope of the ad hoc being discussed in Communication 66. So I want to make sure we're all on the same page there. Corporation Counsel? (Note: At this time, Corporation Counsel Elizabeth Strance came forward to address the members of the Committee.) MS. STRANCE: Good afternoon. Elizabeth Strance, Corporation Counsel, and this goes to Mr. Brown's comment about clarity. So the second piece of the committee says, "and then recommending appropriation amount to the Council for funding in the fiscal year beginning July 12023 through June 30, 2024," and so in my mind that is a little unclear as to whether it's the recommendation of the rubric or the appropriation amounts which would come during budget consideration. The second reason that language is catching my attention is that, so long as the committee is doing its work, nothing related to the two items that are the subject of the committee can then come before the Council. So for example, as a result of reviewing the six-month report, some sort of reporting to the general Council needed to be made, there might be an issue with that. This Council, under the Code, has some authority around non -compliant contracts, and I'm a little worried if you merge these two pieces that you might hamper yourself in some other pieces, so I would just ask that you clarified what you really want this committee to do, and when. If the timeframes are different for part one and part two, they should be separated. I think that was all I was thinking. So anyway, just a thought. I guess when I heard, Mr. Inaba, you talked about this is just —and, Council Member Lee Loy, this is just sort of the teeing up piece, I'm not sure that it is, unless what you mean by "recommending appropriation amounts," it's the recommending the total appropriation for budget or something else. But if it is for the actual amounts, having anticipated a complete review of the application, then the Council may not get the benefit of your the wisdom learned from the review of the prior year's reports. CHR. INABA: Okay, so I think maybe I'm going to ask permission, just so we can have free conversation as weI know I'm chairing this right now. Is the concern you're expressing specifically related to potentially having Bullet 1 and Bullet 2's scopes intermingling during the same time period? MS. STRANCE: Possibly and then based upon the discussions that you've had previously, as to what the role of the entire Council is going to be in reviewing the applications, whether they're recommending appropriation amounts, I would just ask that be clarified because there may be a misunderstanding of what's intended. Page 20 LAAC-3 February 7, 2023 CHR. INABA: Okay, so perhaps we can take the first bullet first, is that we are not able to allocate out the second path of this current fiscal year's funding until the six-month progress report has been reviewed; so in cases where organizations haven't met their goals for the six months or they're not on track to meeting their goal for their program or their activity, they wouldn't be getting the second half of their 2022-2023 funding. That's bullet one. MS. STRANCE: That's correct, and then beyond that, my recollection of the Council's discussion last year, when you moved into the Waiwai program with an emphasis on measurables, that presumes in some way a more in-depth review of the reports that have been made and then deciding whether you want to tweak the process this next time around when you are evaluating the applications. So you might want to separate them into two or clarify what the recommended appropriation amounts is. CHR. INABA: So I think the intention here is that, like I said, the rubric is vetted and finalized by this ad hoc committee, then all of the applications are scored by all Council Members. When they come back with all the little scores come back to the ad hoc committee, they're able to —we assume that there will be more requests than there is funding available. The ad hoc committee is responsible for making those last adjustments and giving the recommendation to the Council. MS. STRANCE: Oh, I see. Is there an expectation that the investigation part in Bullet 1 needs to be reported back to this body? Because you can do that, you can have an interim report. I just want to make sure that you folks are clear on the timing so that you don't get tripped up. CHR. INABA: I would say the intention of the 2022-2023 report is just to know whether or not the second part of the year's funding can be given to the organizations, and that's the first kuleana of the ad hoc. So, they don't intermingle year-to-year, it's just whether or not you completed your six-month goals and you're on track; if you did, you get the second -half funding for the current fiscal year, then Bullet 1 is done. It doesn't intermingle with the 2023-2024 applications. MS. STRANCE: Except if it's not submitted, the organization may become ineligible for consideration for the next year's round. MS. LEE LOY: Thank you. For the rest of my colleagues, this is what change looks like in progress, because we are augmenting this entire program. So to answer your question, they would have had to submit their six-month report, which would then open the portal for them to apply for the next set of funding. What we have not done is evaluate those six-month reports to see if they're on Page 21 LAAC-3 February 7, 2023 track for that second set of —or tranche of money during the 2022-2023 award, yeah. MS. STRANCE: I can envision that you want to assign primary responsibility for the investigation and review to a group, and what I didn't understand until it was just explained was that in between Bullet 1 and Bullet 2, you all are going to evaluate the applications and then the committee will then tabulate them. MS. LEE LOY: Correct, so it was the will of the body at our last discussion that we would all score, so the applications that have come in for the 2023 to 2024 cycle would be evaluated by all the colleagues. We would establish a matrix. We would then, as an ad hoc, take that back with the assumption we're not going to be able to award everybody because the asks or requests will be beyond the $2.5 million that we have, and then that smaller Permitted Interaction Group, or ad hoc committee, would then have to make the business decision on who gets funding and report that out to the entire body. MS. STRANCE: That would work then, so long as there's no expected interim reporting on Bullet 1 unless you do it under there's a provision within the rule that would allow you to do that, but I just had misunderstood the second piece on how you folks were going to review and tally. So long as that's clear in terms of the process, then I think that the two pieces work together. CHR. INABA: I would say, "Yeah, for Bullet 1 there is no reporting coming back. It's just when the ad hoc committee reviews and either agrees or disagrees that an organization is on track. They either do or don't get their second part of the award for the current fiscal year, that's done, and then Bullet 2 is applications for the next fiscal year, taking care of that. I think perhaps the question, just legally, what would you recommend the process to be for the ad hoc committee to send out the applications to all the Council Members? MS. STRANCE: I don't know if that needs to be decided as part of this because you folks have already decided that you're going to all review. The process isn't mentioned at all in this, so I think you folks are probably you're okay. CHR. INABA: Okay. Does anyone have questions? Council Member Evans. MS. EVANS: I'm just looking at how it goes one, two, three, and I think the thing that's missing is we haven't done the rubric, and you're asking us all collectively to put together the rubric and then we score them, and then anybody that scores above 60 percent, or maybe so many there that it's way above the $2.5 million, and you want this ad hoc committee to then look at that, and then come back with the recommendation? Page 22 LAAC-3 February 7, 2023 CHR. INABA: The rubric draft exists, so the ad hoc committee will finalize the rubric before sending it out to the Council to be used for scoring, that's why we are here. Yeah. MS. EVANS: Okay. MS. LEE LOY: Yeah. Thank you, Chair, if I may? I think what I hear my colleagues are saying is, "We should articulate the finalization of the the Permitted Interaction Group, the ad hoc committee will finalize the rubric, provide the rubric along with all of the applications for everyone to score. They come back, and then the ad hoc will then further evaluate. I could probably put in another bullet point for that clarity if that's what my colleagues are asking for. CHR. INABA: Okay. MS. LEE LOY: Yeah. I'm looking at my clerk who's going back and forth, and really is about articulating the scope for that ad hoc because we're beyond three, and we just don't want to step outside any Sunshine Law issues, and so if we stick to the bullet points, we'll be okay. MR. BROWN: Just a point for thoughts in discussion, in talking with our Clerk, and I think if in this process of clarifying the scope, we want to make sure it's real clear. If there are clarifications that you guys want to add to this, it would be cleanest to have a new communication, yeah. MS. KIMBALL: Chair? CHR. INABA: Go ahead. MS. KIMBALL: Were you not going to recognize me for a minute there? (Laughter). I just want to throw a little, teeny, tiny wrench into this, which is, maybe in the interest of protecting ourselves in a certain level of protecting integrity of decision -making, we actually don't want to have the decision about the rubric, and then this further analysis based on the outcome of the rubric in the same ad hoc. Since you, Council Member Inaba, and Council Member Lee Loy have actually had the deepest discussions about the rubric, what about you guys putting a communication about your proposed rubric to the Council for discussion, leaving this as is, which is the two -pieces? CHR. INABA: I'm glad I recognized you because you read my mind. (Laughter). You know, we did have discussions about the rubric and improvements that we could make to it, so if that isif this body is comfortable with the final touches and tweaks to the rubric being made by Council Member Lee Loy and I, then the current communication stands; and when the ad hoc is formed today, that rubric is then provided in its final form to be used by the ad hoc and the entire body. Page 23 LAAC-3 February 7, 2023 MS. STRANCE: So what I'm hearing you say is that the topic rubric is not included at all in this communication, so there won't be any crossover? CHR. INABA: Yes. MS. STRANCE: Okay. CHR. INABA: Mr. Brown. MR. BROWN: I think just one more thing, one more consideration is whatever comes back from the work done by the ad hoc, report and recommendations, there can only be one report based on our rules. You can't give multiple reports. You give one report with the recommendations, then it gets submitted, and there's no action or deliberation taken at that time. Then at the subsequent meeting, you guys can take up those recommendations. So I think it's safer, just make sure just one report. MS. STRANCE: And is the one report, the budget report for the awards to be included in next year's budget? MS. LEE LOY: Yes, and that's the mechanics of the ordinance itself, right? We have to make the recommendations and then the Council has to adopt those recommendations to be made part of the 2023-2024 budget. CHR. INABA: Right. So, I'm going to recap us. We're here to establish an ad hoc today —well, let me stop. Council Member Lee Loy and I will finalize the rubric that we will all use to score the applications that had been submitted, and that are deemed eligible by Finance. Whoever ends up on the ad hoc committee, the first order of business is to review the six-month reports of the current fiscal year and to give Finance the okay or the no-kay to giving out the second portion of the current fiscal year. Once that is concluded, we'll move on to scoring and making sure that all Council Member have the opportunity to score using the rubric that has been finalized by Council Member Lee Loy and L Once those scores come back, the ad hoc committee will finalize specific amounts and report that to Council in one report. Mr. Clerk? MS. LEE LOY: Yeahsorry, we're looking at the timeline, especially with the release of the second tranche of money, right? (Note: At this time, County Clerk Jon Henricks came forward to address the members of the Committee.) MR. HENRICKS: Right, can you explain how that first part would work, and when is that anticipated that —sorry, this is Clerk Henricks. When is it anticipated Page 24 LAAC-3 February 7, 2023 that the funds need to go out from the County, the second half? Are we already in the second half of the fiscal year now? So again, when you make this ad hoc, if you make it for these two purposes, it's really serving one purpose, and you cannot do anything independent of the rest of the Council, including reporting to Finance that they're eligible for things. You're creating the ad hoc for the purpose of doing investigative work on behalf of this committee, which you would come back and write a single report on everything that's within the scope of the ad hoc committee to this committee, sit on that for one meeting, and then come back and then potentially act on those recommendations. So part of this includes approval, or recommendation to Finance, that funds go out, that would have to come back to this group as part of that report, that includes anything that's involved in this communication, as a single element. MS. STRANCE: Historically, this body has not provided the Department of Finance any guidance regarding the second -half distribution, so I'm not sure they're anticipating that. MS. LEE LOY: Yes, thank you for that, Judge Strance. I think that's some of what we've been discussing through this process on how to do better, and if it's an adjustment to the Code. I think it continues to be a challenge because the application comes in, there's a review process, it gets awarded, and there's a six-month report at the same time the next applications are coming into the pipe. I think —and again to my colleagues, this has been the grind for a while now on how to do this better. But I'm in alignment with what our Clerk is saying, because if the ad hoc is recommending the release of a second tranche of money, they're going to have to wait until a date in which the full report is acted upon by this body, which will happen sometime in May, and they're going to have to sit and wait for that money. So instinctually, I think we have to take out that first bullet point if we want them to continue to get their second tranche of money. Those are my thoughts. CHR. INABA: Mr. Kaneali`i-Kleinfelder. MR. KANEALI`I-KLEINFELDER: Thank you, Chair. I sat on this committee when I first came into the Council, and it was a learning experience but I never remember it being this problematic, so I'm trying to figure out what happened between year one and year five and where we sit right now, because if we're trying to make this better, it ain't working because this is getting harder as we've gone on. This was easy, I mean "easy" is not a good word. It was lengthy and very interesting, but it also worked, and we got everything done on the right time Page 25 LAAC-3 February 7, 2023 periods, but right now we're stuck on this communication. I'm trying to figure out what we can and cannot do within the different committees, and the working groups, and the ad hoc committee. So, do we need a new communication to move forward? What exactly is it because I've never seen it get this convoluted. I don't know whom to ask because there were a lot of different hands in the pot. MS. LEE LOY: Yeah, and if I could, Chair? CHR. INABA: Go ahead. MS. LEE LOY: Some of these hiccups were just done behind the scenes, and when Judge Strance came on board we began to find some of these areas of deficiency, which is another thing that Ms. Kimball alluded to, about auditing this program. So to your point, Mr. Kaneali`i-Kleinfelder, these things were occurring in the background and just resolved individually; but through the guidance of Judge Strance, we wanted to bring transparency to this process and have everyone be aware of how these applications are vetted, scored, and how the money is being utilized and how it is being utilized in community, and how to measure that. So, it was a big bite about what we do with the public's money, and providing transparency to the process; but also at the advice of the Corporation Counsel, on how we do bring this out through this communication and other future communications and the reporting of it. So if, Judge Strance, you could please share some of those discussions that we had about this and future edits that may have to be accounted for in this program? MS. STRANCE: My understanding is that this body wanted to take a larger role and oversight to see how the money is being spent. There is a process already in the Code about reporting, but you folks don't have a process to review reports; and so if you want to, you either need to set up just have them all sent to you, and that's it. You set up an ad hoc committee to do it, or by rule, you assign it to a committee. I'm sure there are other options, but those are three that I can think of. That review process has not been teased out, but you're doing more than you used to do. The second bullet is a natural flow from what you did last year, and so I think the second bullet point makes a lot of sense in the context of everything that's happened over the last year and a half. Just the first one I think needs to get worked out a little bit more, and maybe worked out a little bit more with the Department of Finance. CHR. INABA: I would agree, the Code doesn't specify that the six-month report is required, but apparently it was part of the contract that the organizations signed with us. I mean that's where we're getting held up right now, is bullet one, the six -months progress reports; and I would ask Council Member Lee Loy, did we Page 26 LAAC-3 February 7, 2023 who is accepting those reports and who is alternately deciding whether or not the second allocation is given? MS. LEE LOY: Thank you for that question, Mr. Inaba. I believe at our last meeting we did provide a list of everyone who submitted their six-month report. That was the trigger that they would be eligible for this next application round. The second part to you question as to how Department of Finance has been notified to release that second tranche of money, is when they submitted the six-month report. CHR. INABA: So there is no action needed from the Council, because if Finance is aware that a nonprofit submitted the six-month report, then the funds should have already been going out once those reports were submitted January 31 "? MS. LEE LOY: That is correct. What we wanted to do is take a deeper dive into those six-month reports to make sure that they were on track to spend the money, as you mentioned, and further evaluate. But if it is the will of this body to just check the box and move on they've submitted their six-month report, meeting their requirements of what's contained in the Code and what's contained in their contract, and just move into the next phase of awards, open to it. But that's some of the work that's been handled behind the scenes without larger discussion by the entire tribunal, and that's what I'm trying to do, is provide that transparency so that others can see the work. CHR. INABA: Council Member Kierkiewicz. MS. KIERKIEWICZ: Thank you, Chair. I think it would be helpful to maybe have somebody from the Finance Department part of this discussion because they do help us administer this program. My recollection is, in the grant agreements that the County enters into with the selected nonprofits for Waiwai, there is a requirement to submit a six-month report in order for the second phase of funding to be released. I think in conversations that we've have with the folks that handled it, within Finance, not quite sure where those reports go. That's like the $2.5 million question right now, like who is getting those reports, how are they being reviewed, and how is the second tranche of funding being released? Like, that's the honest question. If we're making that a requirement in the grant agreement, those reports should be going somewhere, and someone should be reviewing. The second part of it is we're requiring an annual final report for this grant, and that must be submitted in order for the nonprofit to be eligible for future funding. I think those two questions really need to be answered, so maybe even an adjustment to this scope. I don't even know if it's something for the ad hoc to do. If this is something that's administered by Finance, a report to the Council to say, Page 27 LAAC-3 February 7, 2023 "These are all the folks that have submitted their final report, and they're eligible for next round of funding next fiscal year." It's about 5:30 (p.m.). We've got a public hearing in 30 minutes. My suggestion is let's get Finance here at the next committee meeting. I don't know if we have time, Council Member Lee Loy, to do that. I know you need to shape up your ad hoc pretty soon, but if we can just postpone this to the next committee meeting and hear from Finance? I think it would be helpful to everyone to get verification on the process so that we're activating an ad hoc with the correct scope. I yield. MS. LEE LOY: Chair, if I might add to tease that out? Maybe another option is to table this matter after Council tomorrow, where we could make arrangements for Finance to be available, because as Ms. Kierkiewicz mentioned, there are these strict timing requirements, and as we move into the budget, that has continued to be the challenge, is the budget process and some of the hard corners that are just contained within that process. That would be my suggestion, is to table to the end of tomorrow's Council meeting? Well, I'll go ahead and make the motion to (Note: At this time, County Clerk Jon Henricks came forward to address the members of the Committee.) MR. HENRICKS: There's nothing left on the agenda, so if you'd like to recess this meeting to tomorrow. We normally provide a definitive time as opposed to when a Council meeting adjourns because people don't know when that's going to happen, so you'll have to set a time. I don't know when the Council's meeting is going to end, so you'll have to kind of formulate that. You're boxing yourself in at that point, I feel like, though. MS. KIERKIEWICZ: Deanna is coming. MS. LEE LOY: Yeah, if Deanna is on her way down, great, but my second option is to recess. MR. HENRICKS: Yeah, and to that note, the hearing is starting at 6 (p.m.), but we anticipate people arriving early and maybe wanting to register, and there are also other forms they could fill out, so it would be nice to have a little bit of an interim between whatever happens with this meeting, and then the public hearing. CHR. INABA: All right, so we're going to recess this meeting till February 8', at 11:00 a.m., where we can get some answers from Finance, and we'll have some discussion after this. Does that work for scheduling, Mr. Clerk? MR. HENRICKS: I think your comfort level matters more than mine, but that presumes the Council meeting that will adjourn prior to 11:00 a.m. Page 28 LAAC-3 February 7, 2023 CHR. INABA: You know what, let's just have a quick discussion while she's here, real quick. Have you been tuning in to the meeting thus far? (Note: At this time, Finance Director Deanna Sako came forward to address the members of the Committee.) MS. SAKO: Sorry, we were dealing with State legislative matters, not that you guys aren't important but, you know, they're also meeting today. CHR. INABA: Thank you, Director Sako. Questions? Council Member Kierkiewicz. MS. KIERKIEWICZ: Thank you, Chair. Director, we just need a little bit more clarity around the process —our understanding —at least my understanding in being involved in this, and reviewing the grant agreements that the County executes with nonprofits, there is a requirement to submit a six-month report in order for second phase funding to be released, and then an annual report to be filed in order to be eligible for future rounds of funding for this grant's program. MS. SAKO: Correct. MS. KIERKIEWICZ: I think what we're trying to suss out is, who is receiving the reports and verifying that they have been received and filed? MS. SAKO: The Council. MS. KIERKIEWICZ: Okay. Checking my inboxes, guys, don't see it. Okay, so the Council is to receive the six-month report and the annual report? MS. SAKO: Yes. The annual report has been a longtime requirement, and Council, whichever Chair, their staff are usually the ones monitoring that, that they're coming in, and that it's meeting the requirements laid out in the County Code. The six-month is relatively new, and so that was a newer requirement added to the grant agreements. I'm not sure that that says it exactly that way in Code. MS. KIERKIEWICZ: It's not Code. MS. SAKO: Yeah. We are waiting for that approval before we can make the second -half payment. MS. KIERKIEWICZ: Thank you for that. I think now we need to have discussions around where these six-month reports have been going. Page 29 LAAC-3 February 7, 2023 MS. SAKO: I think the agreement says to send it both to Council and to Finance, but I think we're relying on Council to look at that. MS. KIERKIEWICZ: Got it. Thank you, Director. CHR. INABA: All right. MS. LEE LOY: Yeah, I'm trying to pull up the last agenda because that six- month report was on that agenda. So our office received it, Finance received it, and then we placed it on the agenda for everybody to see, and they're all available on Laserfiche. They're big. It's a lot, and all of us can look at it. CHR. INABA: Council Member Kaneali`i-Kleinfelder. MR. KANEALI`I-KLEINFELDER: So we, the Council, according to the contract, not by Code, have to review the six-month program objectives? MS. SAKO: I believe that was something that came out of last year's ad hoc committee. MR. KANEALI`I-KLEINFELDER: This last Waiwai, when we created this whole thing? MS. SAKO: Uh-hmm. MR. KANEALI`I-KLEINFELDER: Okay. And now we, the Council, have to review every agency's six-month? MS. SAKO: Someone does. I don't know if the entire Council does, but at least a staff person should be ensuring, because that was part of like program measures, making sure they're meeting their milestones, and everything, that they're spending the money the way they're supposed to be, that's what we heard Council say. So we just want to clarify that someone at the Council level is looking at it and making sure, "Yeah, it looks like they're doing what they're supposed to be doing. They didn't totally change course and start doing a different program." MR. KANEALI`I-KLEINFELDER: Okay, and was clarified "who," or was it just open, someone at the Council? MS. SAKO: When we talked with staff, and my staff is not here right now, but I believe, yes, it was worked out that Council would take care of that. So Lisa (Tada) is waiting for approval from Council's staff before making the second -half payments. Page 30 LAAC-3 February 7, 2023 MR. KANEALI`I-KLEINFELDER: The Council's staff, someone in Council, which has changed since then, is now to review all 250 applicants. MS. SAKO: 200ish, yeah, reports. MR. KANEALI`I-KLEINFELDER: And then make the decision. This could be anybody in our staff make the decision, whether they get the next half of their funding? MS. SAKO: Well, that's up to you guys, yes. Or you could have them present it to you. MR. KANEALI`I-KLEINFELDER: That's a very interesting process. MS. SAKO: Um-hmm. Normally, I would think it's somebody's looking to say, in general, "They're doing it okay," and only if there's a problem, they would raise it to the Council's attention. But, that's up for you guys to decide. MR. KANEALI`I-KLEINFELDER: Thank you, Deanna. I yield. Council Member Lee Loy. MS. LEE LOY: Thank you. Just to clarify, the six-month review has always been part of the process. MS. SAKO: It is part of the process, but I don't think we relied on that to make the second -half payment, yes. Yes, that's a good clarification, thank you. CHR. INABA: Okay, so with that then, Council Member Lee Loy, do we want to separate out these two duties into two different ad hocs? MS. LEE LOY: You know, based on the discussion that I'm hearing, they might take different tracks because something might have to happen quicker; whereas, this next round of funding will have rubrics and get scored. So yes, my short answer is I would like to divorce the two bullet items and come up with two separate things. I think immediately what we need to do is the six-month review and suss that out, and parallel —stand up the investigation of the next round of funding. MS. STRANCE: It seems like you folks have you're looking at two functions: one is the compliance function, which is the review; and the other is the award function, which is the application of the rubric. CHR. INABA: And just to clarify, what's holding us up here is that we're only allowed one report back to Council, right? Okay. Okay, Ms. Lee Loy. Page 31 LAAC-3 February 7, 2023 MS. LEE LOY: Yeah, what I'd like to consider, Chair, is I'll go ahead and revise Communication 66, and advance up 66.1 and 66.2. If you don't mind, in the essence of time, still recessing this meeting till tomorrow, at some time in which we can advance two more communications which clearly articulate the two goals and the scope of services for each process. Comments from my colleagues? CHR. INABA: Council Member Evans. MS. EVANS: Just for technicality, whatever we recess, to make sure it's not conflicting with another time for another committee, that's all. That's a technical, technically. Thank you. CHR. INABA: Council Member Galimba. MS. GALIMBA: So just to clarify, so it would be two separate committees? Great. Okay, sounds great. MS. KIMBALL: Chair, if I may? CHR. INABA: Thank you, Director Sako. Okay, with that then, we're going to see those point communications tomorrow to split up the two bullet point scopes in Communication 66. I'm going to recess this meeting until 11:15 a.m. tomorrow, which is February 8, 2023. We are in recess. Thank you. Recess: At 5:40 p.m., the Chair called for a recess until 11:15 a.m., on February 8, 2023, at the same location. Reconvene: The meeting reconvened on February 8, 2023, at 11:16 a.m., in the Council Chambers, Hilo, with Mr. Kaneali`i-Kleinfelder absent. CHR. INABA: Good morning, we are calling this meeting of the Legislative Approvals and Acquisitions Committee out of recess. It is 11:16 (a.m.), February 8, 2023. We are heading back to Communication 66, which is the formation of the ad hoc committee and the review of our progress report. So Council Member Lee Loy, do you want to give us kind of a recap of where we are? MS. LEE LOY: Oh, yeah. So thank you, Mr. Inaba, and again thank you to my colleagues. It has been just eye-opening. Myself and Mr. Inaba, along with Finance Director and Judge Strance, had a conversation about how to utilize this communication. What we have is two parts, allowing the Finance Director to go ahead and issue the checks for the second tranche of money while still doing the work that needs to happen with this new set of applications that have come in. Maybe, Judge Strance, there's some discussion we had, and I know we kind of settled on a pathway for that, I think, satisfies what we as the Council have to do, Page 32 LAAC-3 February 7, 2023 what Deanna needs to do, with our existing applications, and then how to take on the work for the new set of applications. Judge Strance, if you don't mind? (Note: At this time, Corporation Counsel Elizabeth Strance came forward to address the members of the Committee.) MS. STRANCE: Good morning. Elizabeth Strance, Corporation Counsel, quite a morning so far. So the recommendation from Corporation Counsel is to leave the proposed ad hoc committee intact. There was a question yesterday about whether there was action —said we need to take place at different times, and with the ad hoc committee limitation on a single report, that it may inhibit or prevent the intention going forward. So the way that both the County Code is written and the grant agreements are written is that there are these reporting requirements. It doesn't prevent the Finance Department from making the second disbursement; so the way that these grant-in-aid funds are distributed, they go out twice a year. The six-month report allows the check -in. What has been happening is when there are questions about performance raised in those reports, they get flagged or followed up on if there are legal questions. I've been consulted periodically. I think, Council Member Lee Loy, your office has actually looked at the reports as well, and tagged questions. But your reports have really been used, it seems like to check on how organizations are doing. So either you need to get busy, or are you going to finish? If you're not going to finish, do you need to think about returning the funds? Because the time within what you need to perform under the agreement is ticking. So in light of —and I think that process is permitted under the Code, both for Council Members and for the Department of Finance. What the proposal will do is that at the time the report is made on the recommendations for appropriations, it will also be accompanied by a report that will be compiled regarding six-month progress reports, and so if that's acceptable to you, it's acceptable as conforming to the law. MS. LEE LOY: Thank you, Judge Strance. I have Deanna Sako here. Any questions or anything else you want to share, my colleagues are welcome, too. But we have a pathway forward and we know how to report on the two items that are listed within Communication 66. Chair, thank you. I yield. Scope of Ad Hoc: CHR. INABA: Thank you, Council Member Lee Loy. So bringing it back, what we're doing today is establishing one ad hoc committee that has the purpose listed in the communication, those two bullets. Again, first kuleana, evaluating and going through the six-month progress reports. No special report is needed. We'll save that information. Page 33 LAAC-3 February 7, 2023 Then the second kuleana is going through the applications that have been submitted, after all of the Council does get a chance to score and make those final recommendations of funding for the organization. So, that is the scope of this ad hoc committee. With that then, it's who is interested in serving in the ad hoc, knowing the scope of the ad hoc. Council Member Kimball? MS. KIMBALL: Thank you. If I may, I just have one remaining clarifying question, which was around the rubric, for scoring, and how is that going to be addressed. CHR. INABA: The rubric, as we discussed yesterday, Council Member Lee Loy and I, we'll review that last meeting we had and provide the rubric to all Council Members in a finalized version to be used for scoring. MS. KIMBALL: Thank you for that clarification. MS. LEE LOY: Well I'll start, Chair, if that's okay? CHR. INABA: Yes, go ahead. MS. LEE LOY: In times past, love to do this work again, but we'd also like to get a sampling of people from across the island. I know the first time we did it, we had representation from Puna, from Waimea, from Kona, and someone from Hilo. I think what you'll find when you review all of the applications, you'll find applicants from your district and understand them really well. One thing we are doing differently is everybody gets to score this time; and really, the work of the ad hoc committee is just taking all of those scores, combining them, and then reporting out the scores to the rest of the body, and making the recommendations. So, I would love to do that work again. It is a lot of work reviewing, I think this last time was 200-plus applications. But yes, Chair, I would like to be considered as a member of the ad hoc committee. CHR. INABA: Thank you, Council Member Lee Loy. Council Member Galimba. MS. GALIMBA: I'd be willing to be on the ad hoc committee, as well. CHR. INABA: Thank you. MS. EVANS: Question? CHR. INABA: Yes, Council Member Evans. Page 34 LAAC-3 February 7, 2023 MS. EVANS: So, I can do this in Kona. I don't have to come to Hilo because all this stuff will be online, right? CHR. INABA: Correct. MS. EVANS: Okay. So what's the deadline? I'm managing my time here, so what's the deadline? MS. LEE LOY: Absolutely. Excellent question. What normally has happened in the past, is when we form the ad hoc committee, right after our meetings are done we would go ahead and set up those timelines to manage everybody's time. Again, a little bit different because everybody's evaluating the applications. We just need to set the time to get those scores back, and then come up with the decision. So it's a shortened timeline, but all of this work has to get done before May because it needs to be integrated into our budget. MS. EVANS: Oh, well that makes yeah, that's important to know. So it's February now, and the Council Members all have to get their work done, and we get tooh, so we're dependent on them. Okay. All right, I'll be on it. I don't have no problem. Thank you. Membership CHR. INABA: All right. Well, I would like to be on it again, just as we continue of Ad Hoc: to try and improve and pass the torch on, as Council Member Lee Loy is heading out. So if that's good then, let's state for the record, for Communication 66, we're establishing ais this a Permitted Interaction Group, yes. For the purposes listed in Communication 66, this Permitted Action Group will be comprised of Council Members Galimba, Lee Loy, Evans, and myself. With that, we will get working and be sending out information to the Council for evaluating all applications. MR. HENRICKS: Mr. Chair, part of the process is to describe like leadership roles; if nothing else, at least like a Chair of the group or a leader of the group. CHR. INABA: Sure, I'll serve as Chair of the Permitted Interaction Action Group. MR. HENRICKS: Thank you. CHR. INABA: Thank you, Mr. Clerk. Council Member Lee Loy. MS. LEE LOY: Yeah, I believe at this time, now we will have to postpone this communication. if that's correct, Mr. Clerk, and if you could guide us through these next steps? MR. HENRICKS: Right, so what keeps this process alive is the communication itself. Many of you know this already, but for the people newer to this process Page 35 LAAC-3 February 7, 2023 and part of this process, when your work is complete, you'll bring the report back to this committee. If we could pick a date certain, that would be great; if not, you could postpone to the call of the Chair, which would give you more flexibility. Whatever is your preference, and what you see being more effective throughout this process. And then on that day, the report will be presented for public inspection and the rest of the group, but no action. Then at the next immediate meeting, the full committee can discuss the contents of that report, and then take action on that report. So at this point and time, as Ms. Lee Loy said, "This communication will be postponed to either a date certain or to the call of the Chair," with the goal being that the ad hoc would complete its work and then present its report to the full committee. MS. LEE LOY: Chair, based on that advice, I'd like to make a motion to postpone to the call of the Chair, that way we can develop the timelines, and then establish a date certain for this communication to return to this body. Vote on Motion Ms. Lee Loy moved to postpone Communication 66 to Postpone: to the call of the Chair. Seconded by Ms. Galimba and (Approved) carried by the following voice vote: Ayes: Committee Members Evans, Galimba, Inaba, Kagiwada, Kaneali`i-Kleinfelder, Kierkiewicz, Kimball, Villegas, and Chair Inaba — 9. Noes: None. Absent: None. Excused: None. CHR. INABA: Mahalo, everyone. We'll get this information out soon. Thank you, Corporation Counsel and Finance Director, for your support and your guidance here. Motion? ADJOURN- There being no further business, at 11:28 a.m., Ms. Lee Loy moved to adjourn MENT: the meeting. Seconded by Ms. Kagiwada and carried by the following voice vote: Ayes: Committee Members Evans, Galimba, Inaba, Kagiwada, Kaneali`i-Kleinfelder, Kierkiewicz, Kimball, Villegas, and Chair Inaba — 9. Noes: None. Absent: None. Excused: None. Page 36 LAAC-3 Approved: February 7, 2023 CHR. INABA: This meeting is adjourned at 11:28 a.m., and we'll restart our Council meeting at 11:45 a.m. Mahalo. Mr. Holeka Goro Inaba, Chair Legislative Approvals and Acquisitions Committee H I/na 3 /.a I /;, 3 (Date) Page 37