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HomeMy WebLinkAboutMIN LAAC 2026/01/22 2024-2026 DRAFTROLL CALL: Present: Committee on Legislative Approvals and Acquisitions 18tb Session West Hawaii Civic Center 74-5044 Ane Keohokalole Highway, Building A Kailua-Kona, Hawai `i January 22, 2026 The regular meeting of the Committee on Legis e was called to order at 10:43 a.m., in the Cou Ms. Heather L. Kimball, Chair. Ms. Heather L. Kimball, Chair Mr. Dennis "Fresh" Onishi, ice Ms. Michelle Galimba, Member Mr. James E. Hustace, Member Mr. Holeka Goro Ina ;Member Ms. Jenn Kagiwada, ember Ms. Ashley L. Kierkiewicz, Member (videoc Ms. Rebecca Villegas, Member Approvals and Acquisitions ers, Kailua-Kona, by from Hilo) Absent & Excused: Mr. `l ember STATEMENTS hair dILmi to proceed to the next order of business, FROM THE Sta is on A a Items. PUBLIC ON folio indivi Wered to speak and came forward when called by Deric umoto. Bill 119 (Comm. 687), in support. BILLS FOR The Cha irected the Committee to proceed to the next order of business, ORDNINACE Bills for dinances. LAAC-18 January 22, 2026 Bill 119: AMENDS ORDINANCE NO. 02-93, WHICH AMENDED SECTION 25-8-7 (NORTH AND SOUTH KOHALA DISTRICTS ZONE MAP), ARTICLE 8, CHAPTER 25 (ZONING CODE) OF THE HAWAI`I COUNTY CODE 1983 (2016 EDITION, AS AMENDED), BY CHANGING THE DISTRICT CLASSIFICATION FROM AGRICULTURAL (A-5a) TO RESIDENTIAL AND AGRICULTURAL (RA-2a) AT `OULI, SOUTH KOHALA, HAWAI`I, COVERED BY TAX MAP KEY: 6-2-007:002 (Applicant: Clemson and Janet Lam Area: 5 acre The Leeward Planning Commission forwards its fa rable recommendation for the requested amendment to Condition D, which prohibits construction of a second dwelling unit on the property. The prope s located at 62-2039 Kawaihae Road. Reference: .687 Intr. by: Council Member Ki 1(B/R) and Comm. 687.1: From Planning Director Jeffrey Da a a ry 6, 2026, t nsmitting a PowerPoint presentation for Bill 119. Motion to Approve: Mr. Hustace recommend pa of Bill 119 on first reading. S Ms. Galimba. CHR. KIMBALL: We wi start sentation by Director Darrow. Im Jh this time, PI ing Director Jeffrey Darrow came forward and PowerPoint tation to the members of the Committee. f the subje resentation, see the DVD copy of the meeting Clerk's Office, or online at aiicoun v. ranicus.com. A copy of the PowerPoint preseiiiiift is made a part of the record, see Comm. 687.1.) CHR KIMBALL: ank you, Director. I will now pass it over to the applicant and a familiar loo ing representative, former Council Member Margaret Wille, as the appli is representative. You're welcome to add a few remarks. (Note: At this time, the applicant's representative Margaret Wille came forward to address the Committee.) MS. WILLE: Thank you very much, Council Members. And thank you to Director Darrow for his support in this case. I think there's been a major policy change state wide and as I see it, we're sort of working out the wrinkles to get all of the rules and flaws all put together so they're not confusing and contradictory. So just two things. I think that the County until November had interpreted the state law to be that the accessory dwelling units (ADU) are required to be allowed Page 2 LAAC-18 January 22, 2026 by the counties in all urban districts and doesn't prohibit their doing so in residential districts and therefor the County's Bill 123 would be consistent. I think there's also, in November, the County sort of switched interpretations and felt, well maybe we ought to go to more conservative view that there are ADUs actually permitted under state law. The County of Maui does go with the liberal interpretation that it is allowed under state law. But getting down to currently what is proposed righ we're grateful that it does say that they will be allowed on this prope think e one question that I have is if you look at the proposed new ordina er provision D that's on page two, the Planning Commission recommended e new state be read as the construction of no more than one additional single- y dwelling shall be allowed on each lot covered by this a ded ordinance unless and until state law allows the development of accesso welling units in the state 1 d use rural district. You know, I'm a przat ent that la should be writte ublic can understand them easily. I thi I'm not s that this wordin ds to have that last clause. The department had recom e long the lin of what I submitted and didn't say and wasn't until slate law in it. We're good with this. I' st saying it wou referrable to put a period after ordinance. You know exact y what that last phr ns is a little bit uncertain. So I agree that I believe that the state -law should ead according to how the governor said in a liberal way and it wjr this accessory dwelling, but it also under the County's auth46-4-6 that says that the co e authority to How up residences on half acre lots. This is a five acre pa that's being divided, and the lands parcel is 2.99 or avoroxlmateiy ee acres. Again, es j erms of fire, the applicants have gone through Of th rent requi ents, have agreed to those. Whether it's in terms of t ge, i s of the water and doing catchment, and in terms of showing drai reas, 1 comply with all of those provisions when they submit their b g per So I ask you, and they are here if you would like to speak to them, m an Janet Lam, and their son Carl, and I ask that you approve this. And whe r you do it exactly with the wording that the commission offered or whateve milar language the Council chooses, but yes, we accept however you d ' long as it is favorable. Thank you. C . KIMBALL: Thank you very much. Alright. With that I will open it up to the floor for discussion. Just to make a minor note initially though, there are kind of two matters here, one is the specific matter of this particular property. As mentioned by the director and the applicant's representative, there is also discussion of what the state law meant. We do not necessarily have to have that discussion today since the applicant is comfortable moving forward as is, but it's something that we are expecting an attorney general opinion on. I did want to Page 3 LAAC-18 January 22, 2026 make that clear. But if folks would like more information particularly about that, I have spoken at length with the author of that particular statute and basically the interpretation presented by the applicant's representative contrary to what has been presented by the Planning Department is the intention of the author of that language. But I can go into that more should the body desire. It is somewhat relevant to this matter but not entirely necessary to cover today. With that, I'll open it up to the floor. Mr. Hustace. MR. HUSTACE: Thank you, Chair. Thank you ector arrow. And I appreciate Ms. Wille and the Lam's being her They're in our Waimea Office. Thank you for your words, Ms. Wi on e rything here. In full support, you know, this is a family. I gr w with Carl and the Lam's in the Waimea community and they're tryin -nd method and a reason to continue to live in Waimea considering the st of the west side of the isl d and housing impacts in the community. So s a prim xample of buil U, or a second dwelling as we have it ro ector, heir property so family can stay in community. So this is a prim o at. Director Darrow, ju e question for yo ow we can have that conversation in the future about th and all that, bu the question I have is, and I know you can't speak rtment of Wa ply necessarily, but if you could speak broadly abo wat cture in s area? Because up and down this stretch along Kawaih oa e have 9ed development, development movin rd, and really of the li ' ions that it's putting on residents in thi kind of a bro level if po ible. RRO Sure. Thank ouncil Member Hustace. You know, we have so e larger developm s or anticipated large developments coming up in Ouli o is particular area has transitioned over the years o agric al five acre residential agricultural two acres, being able to sub e these s into two properties. That can only happen with County wate d so County4ater has been available to these applicants to allow them to at le o the two lot subdivision. In my discussions with the applicant, we've been tol at that's the amount of water available for each of these properties at this time. y hing about ADUs is it doesn't restrict an applicant or a second dwelling gable to pull those with that requirement of having to have County ey can put a catchment; they can drill a well. They may find themselves where they're in a dryer area where they may have to truck in water if needed. But that's what we have to live with to be able to increase these opportunities for people to be able to stay here. MR. HUSTACE: Thank you, Director. So with all the proposal and, you know, we look at the General Plan as kind of a guiding force in this area too with Page 4 LAAC-18 January 22, 2026 proposed developmental on this stretch and the growth of communities like Waimea particularly on the leeward side there but we're seeing this limitation on water and through your departments, you know, engage with the Department of Water Supply. But we need to meet some of these needs in community for sure. And if we're seeing this development moving forward but we're not seeing some of this other infrastructure keep up, what is that sort of level of engagement that you have with the Department of Water Supply say? T is is the General plan; we're pushing these directions. Why aren't we mat t that same speed or same rate? MR. DARROW: That's a big question. MR. HUSTACE: Yes. 'N 1% 4^ MR. DARROW: You know, I know that for is particular area for asong as I can remember, they were supposed to be for is keral wells right in this particular area. The Ouli wells. I don'tknowthe status oftiffise are, but those wells were intended to promote development not only for Oula area but also, they were loo ' N t bridge Aina Le`a and Aina Le`a as tapping into those sources of water as w ain, I don't know the current status of those wells, but that's my understain the past of what the ere looking at to provide water infrastructure to articular area. MR. S CE: You know, because here we have a case where a family is able to p the' family on the property, they Ant to move forward with an ADU, second dwel ing, but there are these limitations in community where people are leaving because t;ey can't get ty er, they can't get water meters. They have to do something ent than apped into that meter system. And in the Waimea commu rvoir that has not been repaired for some time you know, would so ing like that and that infrastructure be able to snppo the expansion that we need? I don't know. That's a discussion we have to keep aving with D artment of Water Supply and yourself. But there are these pieces, these ged infrastructure that we have not kept up with. And so we have to put the se ondary burden on homeowners where they want to keep family on prope that, you know, we haven't done our due diligence in our efforts to upport m and keep residents here. So I appreciate your thoughts on this. I w speaking very broadly, but as we talk about the generality of growth in munity and the demand for housing in these areas, we definitely need to ch the infrastructure. So thank you, Director. MR. DARROW: Thank you. MR. HUSTACE: Thank you, Chair. I'll yield for now. CHR. KIMBALL: Thank you. Council Member Inaba. Page 5 LAAC-18 January 22, 2026 MR. INABA: Thank you, Council Member Kimball. You know, I confirmed with the Planning Director prior to starting the meeting and I just wanted to point out and thank the applicants because this is a specific request amending the conditions that restricted the additional dwellings. I was really nice to see that all of the other conditions from the original ordinance had been complied with. So when we're looking at timing elements at the end and asking for time extensions and those sorts, we could see that those were removed ' the bill before us. So I just wanted to make that note because a lot of times seeing extensions with potential option for future extensions being that the 's con itions yet to have been completed. But that isn't the case here. So in full support. Thank you. Chair, I yield. CHR. KIMBALL: Thank you, Coun b r. Check with Hilo; Council Member Kierkiewicz? Nope, you' ood. Way, Council er Kagiwada. MS. KAGIWADA: Just a quick question for thedirector here mo e for verification and just assurance to the public. This w dwelling 1t will not be used for a short-term vacation rental; is that correct? MR. DARROW: Sh vacation rental of permitted in this particular zoning district. MS. KAGIWADA: Okay. just wanted to clarify that for the public. I'm in full 2suppo ks. MKIMB : Council ber Villegas. MS. LEG ah. I just t to comment to the property owners and thank them for of the land, which is reflected in the testimony Nauthrelatio n made hereto a y both neighbors but also people in positions of wi community, and that goes a long way. When we all have nd have witnessed how a family has malama that land and tic co fitment to community and to continue to steward that land. So I just nt to ompliment you on that and thank you for being that kind of member in our community because it's really wonderful and I think it makes our ob a lot e sier when community can stand and have a voice in support of a yd coming from someone else in their community as it comes to land ship. So thank you for being those kinds of participants in your city and the way that you steward that `aina. So mahalo to you. CHR. KIMBALL: Thank you, Council Member Villegas. Council Member Onishi. MR. ONISHI: Thank you, Madam Chair. I just wanted to say hi, Magaret. Good to see you. It's been a while. I yield. Page 6 LAAC-18 January 22, 2026 CHR. KIMBALL: Alright. Any further discussion? Alright, seeing none. I actually had one sort of semantic question, and this may be very much too much into the weeds. But reading the language in the amendment, if in these properties they were to develop personal CC&Rs (Covenants, Conditions, and Restrictions) or create a homeowner's association (HOA) and then have a homeowner's rules, right, with the way that the language of this clause is written prohibit that entity, the HOA, and again, this is probably more than we nee to discus, from actually developing rules that would prohibit ADUs. Do yo hat I'm saying? Because traditionally we haven't messed with HOA ings or CC&Rs or anything like that. Is there any concern about that here or am I just being way too emo? MR. DARROW: I think there would be o rn if the nal condition remained. Because we're taking out t angu e regar tricted convenance, this really is just a condition in the ordinance. t meant to be a part of a restricted covenant. I ean, the co ittee can consider th uest by the applicant to remove half at last senten You know, theXthe re pros and cons to this. The pro is that the dwelling unit that's being allowe single- family dwelling isn't limited by the restrictions of the ADU, mainly size, right? But it's limited to o welling, right. If the law changes or if we decide the law has changed, then the ove forward an4build additional dwelling units. But there are those lima he ADUs. Bdowas your original question, 'Thank 7ouncil r that. And let's have a taring in with regard to that last section the AG (Attorney General) opinion by then. Alriglff.qWithout any further discussion, all those in favor of and forwarding to Council with a favorable recommendation, iotio'i to recommend passage of Bill 119 on first g was carried by the following voice vote: Committee Members Galimba, Hustace, Inaba, Kagiwada, Kierkiewicz, Onishi, Villegas, and Chair Kimball — 8. Noes: None. Absent: Committee Member Kaneali `i-Kleinfelder — 1. Excused: None. Page 7 LAAC-18 January 22, 2026 Bill 120: AMENDS ORDINANCE NO. 04-149, AS AMENDED, WHICH RECLASSIFIED LANDS FROM AGRICULTURAL — FIVE ACRES (A-5a) TO SINGLE-FAMILY RESIDENTIAL — 20,000 SQUARE FEET (RS-20) AT KALAOA 1ST AND 2ND, NORTH KONA, HAWAI`I, COVERED BY TAX MAP KEY: 7-3-011:068 (Applicant: Ernest and Elizabeth Young) (Area: 1.86 acres) The Leeward Planning Commission forwards its favorable recommendation for the requested deletion of Condition H, which prohibits co truction of a second dwelling unit on the property, and to amend Conditi r a five-year time extension to secure final subdivision approval. T rope rty is located at the southwest corner of the intersection of Mahila ' and Mamalahoa Highway. Reference: o .688 Intr. by: c Membe ball (B/R) and Comm. 688.1: From Planning Director Jeffrey Darro , date uary 6, 2026, tr smitting a PowerPoint presentation for Bill 120. Motion to Approve: Mr. Inaba m d to recommend p of Bill 120 on first reading. Seco Mr. Hustace. CHR. KIMBALL: Dire r, ca ice again us off on this one? N is time, mg Dire effrey Darrow came forward and owerPoi resento o the members of the Committee. of the subjj t presentation, see the DVD copy of the meeting on file in th k's Office, or online at oun . ov. r us.com. A copy of the PowerPoint a rt of the record, see Comm. 688.1.) L"flRWIMBIthe f a. Thank you, Director. At this time, I'd like to invite the app cif thing that you'd like to add before we begin discussion. Nope, re goo Alright, great, wonderful. The applicant is here if there are question om th body. I will pass it to Council Member Inaba to start us off. R. IN A: Thank you, Chair. If the applicants could please come forward. I'm Velling anting to confirm in looking at the current mapping, it seems there's one there but then the proposed subdivision map shows —well, I can't r y tell. I know there looks to be one dwelling and there might a couple other structures on the parcel. So if you can just activate your mic, introduce yourself for the record and then kind of explain what structure exists on the southern boundary of the property currently. (Note: At this time, applicants Ernest and Elizabeth Young came forward to address the members of the Committee.) Page 8 LAAC-18 January 22, 2026 MR. YOUNG: Okay. There's an existing structure that we live in. MR. INABA: Please introduce yourself for the record. MR. YOUNG: My name is Ernest Young. There's an existing structure on the property that's a four -bedroom, two -bath, and there's also another existing `ohana on the property when we moved on. MR. INABA: Okay. So that `ohana unit, which.is^theuthern parcel, is that intended to be one of the or perhaps the main dwelling unit for one of those lots that are created via the subdivision?'qqllt MS. YOUNG: Hi. I'm Elizabeth Yo can mo and and subdivide it, our goal would be to have that MR. INABA: Got it. Okay. Wti currently is undeveloped, so that right? MR. YOUNG: Yes. MR. INABA: Alright, p ec had some concerns when i how much)-s fit. But so what kindready there that it is a lot, it is a st, safety wassed. But I d map and wlr d built. you folks the main dwellinNftne of the ADUs. the no gm portion of th perto tentially a fir dwelling, in my distoff for those on the Council. I gAhr commission just in terms of those co s are alleviated understanding th the dwe ng unit. I guess the concern comes usy intersection. So I just wanted to make sure i e those concerns having looked now at the i m in support of the extension. I do ask that then. I know this wasn't your original ordinance, Pot? You folks purchase e property afterwards. So yes, just please work with our departmbnts to get things done quickly. 01 MR. YOUNG: Absolutely. MR. INABA: I ask for my colleagues' support as well. Thank you. MS. YOUNG: Thank you. YOUNG: Thank you. CHR. KIMBALL: Thank you, Council Member. Council Member Hustace. MR. HUSTACE: Thank you, Chair. Just going back to the site plan just for a second. I can't see it with great clarity, but on the third parcel, the southern most parcel, which Chair Inaba was speaking about, there seems to be some sort of Page 9 LAAC-18 January 22, 2026 geometric shape coming off of Mamalahoa Highway. That's not an access point, is it? MS. YOUNG: Yes. So it is currently an existing driveway. And then if we do move forward with finalizing the subdivisions, one of the conditions from the Department of Transportation is to have that driveway removed and be only accessed off of Mahilani. MR. HUSTACE: Off of Mahilani. MR. YOUNG: Yeah. MR. HUSTACE: Okay, perfect. I j then. But that's the current accessfi MS. YOUNG: Yeah. MR. YOUNG: Yes. MR. HUSTACE: An MR. YOUNG: Yes. Y Yes. Tom HUSTAM Okay as hot kind of house at the mo acce n both sides highways is , yeah. that access there. izing the subdivision. ou very much. Thank you, Chair. there CH;ope u're welc e. Anyone else? Checking in Hilo, all good? WoA''r daughter that you brought with us today? LUNNouwant to say hi. CHR.BALLthat your first experience with government has been a positive and ou will consider interacting with us in the future. With that I think w e all ready to proceed. All those in favor of approving Bill 120 and forward i to Council with a favorable recommendation, please say "aye." Page 10 LAAC-18 Vote on Bill 120 (Approved) January 22, 2026 The motion to recommend passage of Bill 120 on first reading was carried by the following voice vote: Ayes: Committee Members Galimba, Hustace, Inaba, Kagiwada, Kierkiewicz, Onishi, Villegas, and Chair Kimball — 8. Noes: None. Absent: Committee Member Kaneali `i- er — 1. Excused: None. CHR. KIMBALL: So for you folks, this w' ome full Council in the beginning of February. So February 0, 't' me to full Council for the first of two readings. So we'll make sure to ut nd let you know about that. Alright. Thank you. I*y MR. YOUNG: Okay. )h4*.. MS. YOUNG: Thank you. CHR. KIMBALL: erk next item. Bill 121: AMENDS ORDINANC O. 09-159, AS AME D, WHICH RECLASSIFIED LANDS FROM AGRIC U A A-5a) TO MULTIPLE -FAMILY ilic'ant: L-30,000 E FEET -30) AT KEAUHOU, NORTH `I, COVER BY TAX AP KEY: 7-8-010:101 Count Cl Inc. Area: 51.058 acres Vea g Commis rwards its favorable recommendation for the requme extensio Condition D (complete construction). The ropau a`M th amalahoa Highway Bypass, between the a Co Club mauka golf course. Reference: Comm.689 Intr. by: Council Member Kimball (B/R) and rom Pl ing Director Jeffrey Darrow, dated January 6, 2026, transmitting a Comm. 689.1: we nt presentation for Bill 121. ( te: Comm. 689.2, from Planning Consultant Sidney Fuke, dated January 15, 2026, transmitting additional information regarding Bill 121; Comm. 689.3, from Planning Director Jeffrey Darrow, dated January 20, 2026, transmitting Affordable Housing Credits for Kona Country Club, Inc.; and Comm. 689.4, from Council Member Holeka Goro Inaba, dated January 22, 2026, transmitting proposed amendments to Bill 121, was circulated.) Page 11 LAAC-18 Motion to Approve January 22, 2026 Ms. Galimba moved to recommend passage of Bill 121 on first reading. Seconded by Mr. Onishi. CHR. KIMBALL: Again, we will start off with Director Darrow to present the Department and Planning Commission's findings. (Note: At this time, Planning Director Jeffrey arrow came forward and provided a PowerPoint presentation to them of the Committee. For viewing of the subject presentation, see e DV copy of the meeting proceedings on file in the Clerk's Office, or online at h ://hawaiicoun ov. ranicus.co A copy of the PowerPoint presentation is made apart of the ec d, see Comm. 689.1.) CHR. KIMBALL: Thank you, Di or. Moving on, we'll inv* the applicant's representative to come up and a y additi al comments. (Note: At this time, PlanninSney Fuke ca forward to address the members of the Co e.) MR. FUKE: Good m g, Madam Chair, ers of the Committee. My name is Sidney Fuke. 'm a Wing Consultan ere assisting the applicant, Kona Country Club I ). from i ception. With me today is Peggy Sirayaku. She's th ene e Kona Golf Course operation, repres lso the applic well. Mr. Darrow' sentation is 0 oint as always. However, I'd like to just use this opportuni o kind of brie e certain points. First of all, I think that this time extension req t is significantly different from other time extension requests I think the Council has en ed in years past. First of all, short of the actual ruction of the projec , ey've addressed almost all of the conditions in spite 0 008-201�ecession and COVID (Coronavirus Disease). It's current on its wate mitm completed and secured approval for the drainage plan, the sol ste m gement plan, and they've spent an excess of $2.5 million to complete of th archaeological requirements for the subject site, and as Mr. Darro had indicated the last letter from SHPD (State Historic Preservation ivision)_ They also constructed at a cost of $2.5 million a new access road to the Vwee The other distinguishing factor is really like providing some justification over and beyond for the extension, over and beyond just saying that the economy wasn't good and so we couldn't do much. And I think I credit that to Chair Inaba .They paid its fair share back in 2012 in the amount of $334,000. They their affordable housing obligation that again, they did not based on a received last week Wednesday, but more on that a little bit later. So today, not withstanding the land cost, they have kind of like expanded in both hard and soft costs in an excess of $7 million for the project. Page 12 LAAC-18 January 22, 2026 because when we had a meeting he was really asking me very pointed questions about like do they really need ten years, and I said "yes." And so it forced me to kind of go back again and to find out what really would be their construction time table. And so we had consulted with the engineer that did the overall water master plan, Okahara and Associates and we also conferred with Wally Aoki and Associates who was responsible for bringing all of the electrical services to he property and we provided evidence to the Chair and th members of the Committee that it would take at least five years to b 'ng basic infrastructure to the property. And from that point then they can n realistically to do the vertical. So realistically, you really need to h ears to complete it. But tiding with that is if you only have a iv ear tim sion, I think it's very difficult for any lending institution to i y give yo required financing knowing that there's a possibility t your project may not be able to be completed because of the time c nstraints. Aid so that's why I.think ten years is a realistic one and I really c dit the Chair for kind of asking m e very pointed questions and perhaps questions that may this CouncilZuld consider moving forward on all time extension requests, you know, to see what can be done realistically an, give us some justification in terms of how you intend to complete wig.condarily, roject with an x period of time. In the area of the afforda ho ain as I n e r rlier, was kind of disappointing last week th we f ?pite of having an executed agree 'th Office of and ha at agreement recorded with the Bu yances, we re informe ast week Wednesday that, "I'm sorry, ve got to from scratc ' And so I had a discussion with the owner, you ubseq to receipt of er and they're saying that while, you know, there al tions; one perhaps we can litigate the whole thing under the base is nce theory, or the alternative is try to see how we ork out. They e more inclined to try to work things out right now r an o have it litigated. So my mission, should the extension be appr is to diligently with the Office of Housing to see how we can arrive esoluti . And again, that's the path; that's the direction that the owner me to take subsequent to if the extension is granted. That's p much it. I think that what Mr. Darrow noted earlier also is that since the orItings al rezoning to where we stand today, you know, nothing has changed. A lot ofthat the applicant has done. So essentially the project has kind of like c cked all the regulatory boxes required whether it's the initial approval or even for this extension. So given that, we would respectfully request this committee to favorably recommend to the full Council that the request be approved. CHR. KIMBALL: Thank you, Mr. Fuke. Alright, moving forward. Any comments from the body? Starting with you, Mr. Hustace. Page 13 LAAC-18 January 22, 2026 MR. HUSTACE: I just had a question. Is Office of Housing here to kind of speak to affordable housing? Yes. And if you wanted to just come forward. (Note: At this time, Housing and Community Development Specialist Anne Bailey came forward to address the members of the Committee.) MS. BAILEY: Good morning, everyone. Anne Baile with the Office of Housing. MR. HUSTACE: Sorry. Thank you. Just refi from Mr. Fuke, kind of that mention of affordable housing credits and then the s to nt about our quarterly report. And going back to our quarterly report dat e er 2, 2025, it•shows those six credits for Kona Country Club Inc if you could kind of wor through us here. What happened between Dece nd as th plicant's sayin t se credits are no longer valid? MS. BAILEY: Very good. I can do th as you all know, the Office of Housing and Comm Development ( was audited in 2023. So at that time, the auditor pro eport, and it pr d a report of what we thought the balances were; it pr eet of what v' th t the balances were for all developers at that tim For o years we've spent time going through the files in great detail to alid t is a true and accurate number. i Communication 689.2 they've secured the six We fo r time there's a numbe evelopers where we've contested X 'form As you kn there's be a federal prosecution of which s been people indite We've had to adjust balances based on that audit our files again, we came across a agreement at one point with the County and we to Council, we invalidated those credits as well awarded. They were pre -awarded, in fact, before developer here, who we're meeting on, KCC, eloper. So again, we're invalidating those credits. agreement with that developer back from 2012 s that the Office of Housing and Community c, the developer, that they were not able to transfer these credits back in 2009. So as we've moved forward, we continue to audit, we update our balances. We're almost done. So we are looking forward to working with this developer. They have indicated that they will come and meet with us to talk about an affordable housing agreement, which is required by Chapter 11. They have seven options based on how Chapter 11 is currently written, and we understand that they're interested in still pursuing excess credits, and we'll work Page 14 LAAC-18 January 22, 2026 with them to see if that's actually where we end when the agreement is finalized in the next couple of months. MR. HUSTACE: Thank you. I appreciate that background there. So the audit and the ongoing work was not reflected then in the quarterly report that we received in December. MS. BAILEY: Correct. So we continue as we update and validate and authenticate balances, we update our quarterly report. CHR. KIMBALL: Council Member l go to Hilo and go to Council Member disclosure. MS. KIERKIEWICZ: Thank y hair. I j 1 that the Planning Consultant n ke sits oversee. I do want to express that th u conflict and put that on the record. I ha of Counsel Schoen. S not here. Jean Ca me to make the disclo re. So I just wanted hear back from Corporation Counsel before the you, Chair. MS. BAILEY: : Thank a the body, Hustace. S 't think you continue, I want to ke to make a wanted to disclose fQr,4he record the board of the profit that I appearance a possible sted guidance from Corporation 1 is in the room and has advised it out there and hopefully we to betaken. Thank uncil er Kierkiewicz. Unless there are move f and with returning the floor to none, Council Member Hustace, go ahead. Cve any other further questions on that. I just But KCCI did purchase from Suffolk at one were dee M valid and we've gone back and said they are no ly,were not transferable, et cetera, correct? Okay. Okay. Thank you, Chair. Council Member Villegas, go ahead. W. VILLEGAS: Thank you. Thank you for coming here again, Mr. Fuke. Thank you for being here. I know you have had a long relationship and employment with this property and the landowners there, so thank you for your continued service in that capacity. Thank you, Housing, for walking us through what is unfortunately the ramifications of corruption and a scheme I don't particularly care for to begin with, our affordable housing credits. It doesn't historically get us where we need to get to. I often laugh. None of these are Page 15 LAAC-18 Motion to Amend January 22, 2026 naturally an occurring phenomenon. These are things created by humans and unfortunately, humans can often create things in their best interest. I have concerns about this. As I look at Kona, this resides in my district, right. It's actually down the street from my house and I'm currently watching over a hundred units of condos and townhomes being the land bulldozed and preparation for those to go in. This map project was approved deXcignt es ago. So they're just finally pulling the trigger at a time when we have in infrastructure to support it. There are lots of concerns about scho roads, wastewater, all the different things, and it's something that I'm se istrict 7 is projects like this one that were approved decades ago, the ma they have the funding, which I agree, we've had some challenging economic But they finally have the funding to pull the trigger, a o community e with a project and development that doesn't sery r community authenti This project is for 29 high -en uxury homes. we look at Maui an how they are trying to back track and recover from w a ens when you allocate land to high -end luxury homes that utilize large amounts of water and we ourselves are still navigating our r issues, I question the wisdom here. That's infrastructure; this do provide authentic affo able workforce housing. We already have another huge project going vertica area. We also have Kamehameha School has a big project- otentially ost adjacent to this. And what I see happening is we're de tin ces for our authentic kama`aina and inna to build ho uxury h and large properties for the mega Mirectly affec eal estate p ces and continue to price our people eirhs. I caniliftpogfts at this time b#ffuse in another decade from now, my grandson will be a t from high school, and projects like this only it fu nd further s likely that he will ever be able to live in the c ity t was born and raised. So out of principle and concerns for infr ture an rces, I can't support a ten-year extension on this project. And I ask for the s port of my colleagues in this because the only way we're going to change ere we're headed based on prior agreements is by changing the agreements we make here now. And I think Maui is a very poignant example f what happens when you don't do that. And backtracking is way more Ien.46. With that, I yield. Thank you, Council Member Villegas. Anyone else? it Member Inaba, I see you have an amendment. Mr. Inaba moved to amend Bill 121 with the contents of Comm. 689.4. Seconded by Ms. Galimba. CHR. KIMBALL: Go ahead, Council Member Inaba. Page 16 LAAC-18 January 22, 2026 MR. INABA: Thank you. This amendment removes the option for initial time extensions via resolution from the Council. This project originally was given five years. They were able to secure an administrative five-year extension back in the day. Five years ago in 2020, they came through the whole process again and during this last extension, it stated they needed to go through the whole process again. So because they're requesting ten years now, this amendment says they will go through the whole process again should those c nditions not be met. Also important to note, however, the difference this ime is that we do have tolling language in our code. So anytime any government agencies are reviewing applications, time stops. So it's in line bas n what Mr. Fuke's indicated being that they want ten years. It's just that if e on't meet ifthen they need to come through the department and the com a in. And if they don't do anything, it'll automatically revert in accord with t e code. So I ask for my colleagues' support here. And Mr. Fuke di a copy, ell, not a copy bu a the language prior. So Mr. Fuke,,com on the endment? MR. FUKE: Sure. Thank you very m air. I've had a chance to review the proposed amendme nd I had a chance discuss it with the Chair, and we found that to be acce think in large ing we've kind of addressed one of the comments th ember Vill ught up about CHR. KIMBALL: Mr. FtW, I' &g 6n the amendment Mpwotr ikkwht. On the endment. IF It is on the a went. Okay. Just making sure MR. F e ETMink o the comments was that like, you know, in ten she wa to see som mg happen rather than not. And I think that Chair roposal actually would accomplish that because if it doesn't happen then we' . g to have toAll come back before you again. So I think the proposed amen is reasonable and is acceptable. L: Thank you, Mr. Fuke. Go ahead, Mr. Inaba. That's it. Thank you. I yield. I ask for your support on the ent. CHR. KIMBALL: Thank you. Okay. To the amendment, Council Member Villegas. MS. VILLEGAS: Yeah. Thank you, Council Member Inaba. The amendment is an excellent stop gap. In my naivete of language in these ordinances there have been other properties that the language says the Planning Director may revert Page 17 LAAC-18 January 22, 2026 back and what not. This is a shall, which is good. I also want to point out, none of us will be sitting here ten years from now, or maybe Onishi, because he's been back again. Ten years. But I agree with this. And just to clarify, I don't want to see this development happen at all. I don't think this is healthy for our community. I don't think this serves the long-term benefit of anyone other than the prospector and investor in this property and those that will someday get to own these estates, which will only further utilize resou es that are too precious for us to sacrifice for more luxury development. So CHR. KIMBALL: Thank you, Council Mem as. Anyone else? Checking in Hilo. MS. KIERKIEWICZ: Thank you, C ororationNherd and before we move to the vote on this measu wanted to bring st weigh in on my current situation. Yo w, Hilo as very sThere's a lot of overlap in folks that wework with in a ber ofties. And so, Corporation Counsel, I just want your o n ret I can be participating in the discussion and voting on', is particular measure. Thank you. (Note: At thi%fttl Corporation Cou enee Schoen came forward to address the members e Committee.) MS. SCHOEN: Sure. Go mo Moen, Corporation Counsel. So it'esscode.-INVII tanding that make sure earlier. I was not in the room. Bu'snderstanding. nd just rev wing the matter, I don't see any hions in terms fair treatment section or the conflict of interest section, Of cou e, you know,elieve that you can vote on this matter going forward out of an abunda Volf caution, if you want to you could seek an opinion froni-theard of Ethics. But as of right now this morning, I see no issue you participating in the -vote. 11 MS. IEWICIIWthank you very much. Thank you, Chair. CHR KI ALL. Thank you, Corporation Counsel. Thank you, Council Member 'erkiewicz. Council Member Kagiwada, did you want to weigh in? �To, you' good. Council Member Galimba. NQIFALIMBA: Just briefly. You know, I understand Council Member V egas's points. However, to me, this is a property that by all of our planning standards, it meets all of those standards as far as general plan, zoning, Kona CDP (Community Development Plan). MR. FUKE: Right. Page 18 LAAC-18 January 22, 2026 CHR. KIMBALL: Council Member Galimba, we're still on the amendment. I know I should have had Council Member Kierkiewicz weigh in then, but I wanted to make sure that air was cleared. MS. GALIMBA: Sorry. Okay. CHR. KIMBALL: Okay. Anymore discussion on the mendment? Okay. Seeing none, let's dispose of that. All those in favo ending Bill 121 with the contents of Communication 689.4, please say ` e." Vote on Motion The motion to amend Bill 121 with conNtace to Amend: Comm. 689.4 was car4Member f ing (Approved) Ayes: Committeealimba, Inaba, Kagiecz, Villegas, abal 8. Noes: None. Absent: Committeeneali`i-Kleinfelder— 1. Excused: N CHR. KIMBALL: N MS. GALIMBA made ral; poi to Contin m le investor care of my c Alright. yu may go ahead. so W�t see this as the owners having e voting in support. And I'm Kagiwada. MS. 2A , Chair. I'm also having just a little bit of burn. And thank you coming to talk to me, Mr. Fuke, and explain what ing on here. But I am having a little heartburn similar to what Council Me Villegas said - *You know, I did mention to you that the fact that these are all for tioners. None of these are going to be residence. So even high -end, if they're eside ce, helps with our housing needs in some way. These propertie ill not be helping our residents in any way except for, I suppose, #ddition ax potentially from property taxes. And it does put a strain on some of T t being said, I do see that the property falls within the required different zones for the state and the County and the Planning Commission, which I feel is a body that looks at these things on a deeper level than I'm usually able to given time and everything, I feel like they've gone ahead and given their approval for the time extension. I am very thankful for the amendment. It is frustrating to see these time extension requests come time and time again. So at this point I am probably going to be reluctantly supporting the request. But I'll just say, if this was a new Page 19 LAAC-18 January 22, 2026 request, I wouldn't be in favor of it. But because it's already been approved and, in the works, and they have invested quite a bit in this property based on what was allowed already, I guess I'll be reluctantly voting in support. Thank you. I yield. CHR. KIMBALL: Thank you, Council Member Kagiwada. Back to Council Member Villegas. MS. VILLEGAS: Yeah. Just real quick. What po nd to me is some really wise words I heard spoken by Autumn Ness as she' een navigating a lot of the Maui land trust things. And one of the things she said was that the investments of developers are not the responsibility of us as public servants. Our responsibility and accountability is to our constituents. When large landowners and companies, and investors sink large amounts of e to potential cts, that's not our responsibility. That's prospecting is risk, and us elimin risk for them is not our job. My job is to repres y distrXse, e best interest of y constituents seven generations fro now. Sstand the heartburn and I understand the challenge some of my collea and I totally respect that. But I, myself, can't support this at this time because I believe firmly unfortunately that ten years from if or when this gets built, this is not contributing to the long-term authentic bth4tOh f my constituents and my community. It would simply be for the inves rofit margins, not th company that bought this land decades ago. And ,401, Thank IvIluncil M r er. Anyone else? Council Member STA Thank you, Mr. Fuke, could you just elaborate a little bit further? Y It goin ack to he affordable housing credits and that gece and tha co �j changed. What have been the early thoughts and ersations about fulfi those requirements going forward and working with Off i f Housing; what is kind of the early sentiment about it right now? MR. FU : Chai an you very much for bringing up that question. You know, wh they urchased the affordable housing credits, that was in 2012, I think, and that was approved by Housing and eventually got recorded with the Vng Conveyances. So now Housing apparently saying that it was credits veloper was not able to procure way back when, but nonetheless they ey weren't informed way back when that you couldn't do that. But d that, the current condition that's drafted right now requires the applicant to be in full compliance with Chapter 11; that's affordable housing. And so where we stand right now is that basically if you're using the Office of Housing's last letter, we're kind of like at ground zero in terms of whether we've addressed the affordable housing. The question is no. So we would have to go back again, try to work something with the Office of Housing pursuant to Chapter 11. Page 20 LAAC-18 January 22, 2026 So I believe that we would be able to kind of work successfully with the Office of Housing. And so if and when that happens, in my mind I was just doing kind of like a rough calculation that usually the affordable housing requirement is a 20 percent or whatever you propose. So it's going to amount to almost like 40 percent because you're going to redo it again. But not withstanding that sidebar comment, I think that in talking with the owner, he's very determined to try to resolve this thing amicably with the Office of Horsing and I believe that we can. MR. HUSTACE: Is that something that you vicinity? MR. FUKE: No. It would not be MR. HUSTACE MR. FUKE: Yeah. MR. HUSTACE CHR. KIMBALL: Kagiwada. MS. 1WADA: Yeah, X hase its or to burl MR�: h t would be the credits are not available then th( available pursuant to the Chapti be onsite or in the , Council Member I'm just lowing up on that. So is the intent on that they would look at. And if have to look at what other options are A: Okay. I just want to go back to your comment that you'd be of dablehousing credits in double. I just want to say that the first said tt t money went to a developer. That did not go to the County the fi amount that was paid. Correct? Yeah, it did not go to the County. WAGIWADA: Yeah. So I mean, I realize from the developers' end it would b ouble. But just very clearly, the County has not seen any fulfillment of that affordable housing credit. We have not received the benefit that is due based on Chapter 11. MR. FUKE: Correct. You are correct in that. And so the applicant's perspective is that if that were the case then prior to execution, they should have clearly informed the developer that you can't. You know, but that wasn't done. And so, Page 21 LAAC-18 January 22, 2026 I guess, you know, as I mentioned earlier during the presentation, they have the option to try and contest that legally or you can try to just bite the bullet and try to work with the Office of Housing pursuant to the existing code and see how you can address it. And that's the direction that the applicant wishes to take at this point and time. MS. KAGIWADA: Alright. That leaves a lot oe*nnt wigm in my mind. It sounds like they haven't taken it off the table that this time is to look at fulfilling the obligation. But suing the Cther potential backup position. That's what I'm hearing. Is that co MR. FUKE: Well right now their optio is look at ter 11. There's like three different options that they have e, o ite pure e of credits. And so they're going to be exploring all th options and seeing which one works for them financially as well as project wise, I gu s, timing. And if in a eantime, nothing's resolved and there's- an amendment hapter 11, then y have to work with whatever the prevailing code i�. MS. KAGIWADA: ay. I guess this is e a question for Corporation Counsel. Do we hav orporation Counsel o ere? Hi, Sylvia. Thank you for being here DCC (Deputy Corporation Coun At what point would any code changes affect this particular eve If this goes through in the next few weeks as far as the time to ey haven't yet done anything to m^betw ble housin o gation, they only have the choices that ard on what t code is no as we would pass this or if things 9how and whe ey actually meet the obligation, would they be ing it undefihew code ty Corporation Counsel Sylvia Wan came members of the Committee.) MS. 4ie Si g to Chapter 11, presently, if you look specifically at Hawaii CnC e 11-17, it clearly states that this policy —so the policy that's present in e today supersedes all previous affordable housing requirements and that goes back in time. So as Chapter 11 gets updated, so will the code and so will the requirements. So basically their requirements are going to need to be met ed n the time in which they're going to be met. So the way that Chapter 11 is cted, it is based on what is the proposed development going forward. So at t point you're talking about a rezoning, but this rezoning is not specifically okay on that particular project. So basically their project could change going forward. Their housing obligations and how they're going to meet it will be locked in once they actually enter in an affordable housing agreement with the County. And as of this moment and time, they have not entered an affordable housing agreement Page 22 LAAC-18 January 22, 2026 with the County, therefor they have not locked in the means of which they're going to meet their affordable housing obligation for a proposed project. MS. KAGIWADA: Thank you. That gives me more information. I appreciate that. Yeah. I'm feeling very undecided here, I'll just let you know that. Yes, Mr. Fuke. MR. FUKE: Based on what the existing condition i have an affording housing agreement pursuant to executed with the Office of Housing and the d earlier. Currently there is none apparently. that before plan approval can be issued and e c 't get rezoning, the time extension is grante th e's ht now, we need to ter 1 that would be , as what was indicated has to be done al until the that need to be done; plans need to be finalized an en submitted. So I w *mendments e that if the agreement is not consumma efore pl approval is wrisorry, let me back up. Any affordable a reeme hat's executeave to be based on the prevailing Chapter 11. it' e ed before and then they secure plan approval, the uld I think that's not set in. On the other hand, if f is amended an e's no agreement, then you need to have an agree n the brevaili at that time. MS. KAGIWADA: Yeah. thi C just said. That's good inf�rTrank you. gain, I' ing very conflicted here. Just Lettthat. Than ou. I yield. Thank you. IQWcil Member Inaba, quickly. on the letter provided in Communication 689.2, it s that a fair share of 3,678 was paid out already. And I just want to c on the record, Director Darrow, that the proposed plan as of now is 29 s family dw gs. So there would be an additional $686,000 approx ely tha ould need to be paid. Is that right? MR. DARROW: So typically, the condition reads that the applicant needs to pay Vsharerior to either plan approval or final subdivision approval. The ubmitted plan approval. So prior to submitting plan approval, they had affordable housing agreement, they had done their fair share. I believe ceived an amendment time extension to the original plan approval. MR. INABA: Does this new bill require or the new process plan require a new plan approval? MR. DARROW: It sounds like the applicant is going to be coming in for a new plan approval. Page 23 LAAC-18 January 22, 2026 MR. INABA: Okay. So in that case, how does the Planning Department plan to address I guess the discrepancy and what was paid and what is to be paid; we would make the difference of the new rates, which would be the $686,000 or do you have a different method at the department? MR. DARROW: Yeah. Give me one sec, Chair. This is very unique in the case that again, most times people don't even do plan appro al or subdivision approval or, you know, complete construction prior to coming in asking for more time, right? They've done these things, but they need more time. Before they could do those things, plan approval in this case, the condition said you have to do this. This is very unique in the sense that the applicant is to come in with a new plan approval. My Condition N in a letter dated August 2 So again, this is a The last plan approval approval is good onl it's zero. So they hav question as far as like two years. So e "aDDly for the new adjustments, you know, to the existing ordinance is not c r Mr. Chaiman, he said, wit rec,pptive to paying the differ Aevailing fair exis ' condil ,or the that they're going they met the fair share in 2022. By code the plan ely right now by operation of law, proval. I know there's some IM#Wffier there would be any the code. Maybe the the letter that I had sent to you, :)n, the applicant would be was pain and what is the And so if it requires an amendment to the we would have no objection. for representing that, Mr. Fuke. I think we need ctly how -Wire going to be approaching this, Planning t. it as kind of the same as how we're looking at our Chapter 11 ts, it at the time of, you know, what your approval is. If ling in a new approval, the rates have changed. And although wha the new rates have to owe. So should this go through, I would e County gets that additional $186,000 to support police, fire, parks, rojects here in North Kona. So I'll leave it at that and then hopefully some clarification if we need to have a clear amendment in the bill or understand if that's going to be approached at the next reading. Last comment. You know, I work with Mr. Fuke on some of these questions and, you know, I do recognize the investment that has gone in. But, you know, hearing from Council Member Villegas today also leaves me a little bit conflicted because again, sometimes we're just looking at what the request is in front of us. But we're not necessarily looking back historically and into the future of what this Page 24 LAAC-18 January 22, 2026 provides. So I'm a bit conflicted myself as well. So thank you, Council Member Villegas, for pointing that out. I yield, Chair. CHR. KIMBALL: Thank you, Council Member. Mr. Fuke, do you have any further comments? I see your light is on. MR. FUKE: No. CHR. KIMBALL: You're good? Alright, thank yo . Alright, any further comments? Seeing none. Mr. Clerk, can we do a roll call please? Votl ADJ ME] E1 Ms. Heather L. Kimball, Chair Legislative Approvals and Acquisitions Committee HI/tk (Date) Page 25