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HomeMy WebLinkAboutCOM 0896.123 2022-2024 p /council bill10 MICHAEL J. MATSUKAWA ATTORNEY AT LAW TERRITORIAL CENTRE. SUITE 201 75-5751 KUAKINI HIGHWAY KAILUA-KONA. HI 96740 TELEPHONE NO. 18081 329-1385 FAX NO. (8081 329-0512 E-MAIL kapulu®msn.com July 5, 20243 co Hon. Heather Kimball cp s - --1 - Chair and Members of the Hawaii County Council co 25 Aupuni Street ww j�yr: Hilo, Hawaii 96720 Re: Bill 169 for a Time Extension "Royal Vista" at Holualoa, North Kona Kona Three, LLC (Landowner) Aloha all: I am writing on behalf of Kona Three, LLC, whose members are Robert Williams, Richard Wheelock and Roland Higashi, to provide you with the context within which you are considering the matter now before you. As you know, voters adopted Article IX, Section 5 of the State Constitution to direct the State and counties to provide housing opportunities for Hawaii's residents. In turn, the Legislature enacted the State Planning Act, Chapter 226, HRS, that requires all levels of government to work toward this end. Past events show how the State Land Use Commission and the County of Hawaii have worked to satisfy these constitutional and statutory man- dates to provide housing opportunities for residents in North Kona, specifically on the approximately 174-acre parcel located at Holualoa that lies mauka of Queen Kaahumanu Highway and north of Lako Street and that is the subject of Bill 169. • Housing Opportunities in North Kona In the mid-1980s, the State Land Use Commission amended the land use district boundary for the 174-acre parcel to the Urban land use district. That land had been earlier set apart by the circuit court for ranching in the Holualoa Hui �I Comm. N.. , r Ref. To: NM Ref. Date 1 0 2024 Page Two July 5, 2024 Partition case that ended in the 1920s (Equity 932). The housing project that the Land Use Commission approved for the new Urban land use district is comprised of twin developments — (1) a combined single-family and multi-family develop- ment (called Increment One) and (2) a separate single-family development (called Increment Two). The Land Use Commission did not set an outside completion date for the twin developments. To effectuate the Land Use Commission's decision, the county council enacted Ordinance 84-23 and did not impose an outside completion date for the multi-family development. Instead, the county council established dates when the first phase of the multi-family development is to be permitted, started and com- pleted; the second phase would then follow. Over the years, the county council extended those deadlines. • LUC Condition A To execute the State's housing policies, the Land Use Commission imposed Condition A on the 174-acre parcel to ensure that the landowner, which includes the developer, lot purchasers and other transferees, will take steps to cause "affordable" units to be built for the benefit of low- and medium-income earners, using a ten percent (10%) formula. As of today, the Land Use Commis- sion has not released any portion of the 174-acre parcel or any subdivided lot therein from Condition A that is recorded against,the title of each subdivided lot in the 174-acre parcel. • Project Development and Sales The original landowner-developer (Gamlon/Gamrex) together with the development entity (Kona Vistas, LLC) built and sold 215 lots on the single- 2IPage Page Three July 5, 2024 family zoned portions of the 174-acre parcel, which today is known as the "Kona Vistas" subdivision. 1 However, the landowner-developer did not build the "affordable" units that are associated with the 215 single-family lots (which are calculated to be twenty-two "affordable"units). • Enforcement Responsibilities At all times relevant, the government official who was authorized and who is still authorized to enforce the Land Use Commission's decision and Condi- tion A is the county planning director. The same county official also enforces the county council's rezoning ordinance. • Sale of the Remainder In the early 2000s, the landowner-developer (Kona Vistas, LLC) • obtained plan approval for the first phase of the multi-family development, but the development did not progress and the 68-acre RM zoned parcel was left in its "as is" condition. Neither the county planning director nor the county council peti- tioned the Land Use Commission to remove the 68-acre RM zoned parcel from the Urban land use district, to amend Condition A or to take any action based on Kona Vistas, LLC's failure to proceed with the multi-family development. Nor did county officials undertake efforts to change the parcel's multi-family zoning to another county zoning district if that was a desired outcome; In 2015, the landowner-developer (Kona Vistas, LLC) sold the 68- acre RM zoned parcel to Kona Three, LLC, which expected to complete the original multi-family development. To accomplish this objective Kona Three, LLC consulted with various county, state and federal agencies. Kona Three, LLC also The landowner-developer changed the project components by combining the single- family developments in Increment One and in Increment Two, leaving the multi-family development in Increment One as a separate development. 3IPage Page Four July 5, 2024 engaged professionals to conduct environmental, historical, drainage and traffic studies pertinent to the completion of the multi-family development. However, some expressed sentiments that the 68-acre RM zoned parcel should not be used for the intended multi-family development. Extensive studies and the State Historical Preservation Division's comments notwithstanding, some individuals point to matters that the Land Use Commission, earlier county councils and State Historical Preservation Division allegedly overlooked, such as the RM zoned parcel's physical characteristics, historic and cultural resources. Kona Three, LLC had already obtained substantial information on these subjects and disclosed the same to all interested persons, including the county council. • Bill 169 At Kona Three, LLC's request, Bill 169 was introduced to extend the time for Kona Three, LLC to complete the multi-family development that the Land Use Commission and past county councils have previously approved. The county deputy planning director, as the chief enforcing official for the Land Use Commission and for the county, recommends that the county council enact Bill 169. The deputy planning director evaluated all of the comments on Bill 169, both favorable and unfavorable, and believes that the record supports favorable action on Bill 169. DISCUSSION Bill 169 reflects the State and county's past and current efforts to provide housing opportunities for Hawaii's residents in North Kona. However, the current record reflects a desire on the part of some individuals to treat Bill 169 as being more than a request for a time extension, but as an invitation to redesign the 68-acre RM zoned parcel for new opportunities, but not for housing. Being satisfied that at least one portion of the twin developments (the 215 single-family lots in the Kona Vistas subdivision) has been completed, they Wage Page Five July 5, 2024 contend that the multi-family development on the RM zoned parcel should be eliminated altogether and be replaced with open space. They argue that the 2005 General Plan and 2008 Kona Community Development Plan support only develop- ments that are "authentic" and at the same time promote the downzoning of land in the Urban Area without compensation. Importantly, none explain how these new opportunities can and will be achieved without the Land Use Commission's approval and without funding. In the meanwhile, Kona Three, LLC's entitlements to develop the RM zoned parcel has been and will continue to be subject to a no-build moratorium and the twenty-two "affordable" units that are "owed" will not be built. Further, those who wish to put the RM zoned parcel to a new and better use, but not for housing, have not prepared the studies that the Land Use Commission require to support a different use of the RM zoned parcel. No doubt, some may question why this situation has happened and why past opportunities to address drainage mitigation measures were squandered? Some may also question why the project's original Increments were changed to allow the single-family components to be built first, and without building the "affordable" units? Further, while the 2008 Kona Community Development Plan's transportation strategy calls for the location of"affordable" housing near employ- ment centers ("in-fill") to minimize commuter traffic, the State and the county have yet to establish and fund a State-county master regional roadway plan for North Kona. We must remember that only government at all levels can fund and construct infrastructure that is needed to manage traffic and to safely dispose of drainage and wastewater. Citizens at best can advocate for such measures. As councilors, you are being asked to determine the following questions — (1) whether the multi-family development can be restarted, with appropriate mitigation measures, (2) whether Kona Three, LLC can do so and (3) whether Kona Three, 5IPage Page Six July 5, 2024 LLC will build the "affordable" units that are currently "owed?" The record demonstrates that Kona Three, LLC is prepared and capable of doing so. No doubt, the possibility of redesigning the multi-family development or eliminating it altogether may be attractive to some, but in reality distracts you from the core issues at hand. If that possibility appeals to you, please take time to ask its advocates, "Who will undertake the responsibility to make that possibility a reality, at whose expense and when?" Meanwhile traffic, drainage and wastewater issues will remain. The demand for housing will remain and the obligation to build twenty-two "affordable" units associated with the 215 single-family lots in the Kona Vistas subdivision will remain. If the county council does not approve Bill 169, the county council cannot simply "close the file" on Bill 169 or on the 68-acre RM zoned parcel. A negative vote on Bill 169 will require the county council to take immediate action to amend the Land Use Commission's orders and to take immediate action at the county level to rezone the land in question. A negative vote on Bill 169 will also impose a no-build moratorium on the RM zoned parcel and will be a promise that the county council will assume the responsibility for causing the twenty-two "affordable" units that are still "owed." These are the matters that surround Bill 169. The State constitution, the Legislature's planning act and the Land Use Commission's orders support Bill 169's passage. Your predecessors also supported Bill 169's objectives. Thank you. Ve t 1 yours, Michael J. Matsukawa Attorney for Kona Three, LLC 6IPage