HomeMy WebLinkAboutCOM 0213.001 2000-2002 dtY`OF M~~Y
~~~J 1,
J. CURTIS TYLER 111 ~`tit'~- Bus: (808) 326-5684
6~ice Chair Fax: (808) 326-5697
District 8 (.Forth Mona) ~ ct I~rii inter„ac.nct
~l~Tt~OF Md'~p
HAWA[`I COUNTY COUNCIL
Kona C'ounr•il Offrce •"'-6399 N'alani Street •Surle 10;1 •k'ailuu-l:onu •Hatti~ai'i • IG~-1~1-~491i~
E
VIA FACSIMILE: 961-8912
Pages: 2
May 14, 2001
MEMORANDUM:
TO: The Honorable James Y. Arakaki, Chairman
Hawaii County Council
~ ,
FROM: J. Curtis Tyler III
Vice Chair
Hawaii County Co cil
SUBJECT: Bill 58 - Sewer Connection Loan Program
Please have the attached communication from Keola Childs numbered, circulated
and referred to the May 15th Finance Committee meeting.
The original communication will be forwarded to Hilo by pouch today.
JCT/mm
Attachment (1)
Arakaki-01 MAY 14
Sao ~ ~ ~ ~ 1
ale No.
C
~t,~a,~,Yr 1 ~ ~~-~~i .
Pa~c 1 ot~ 1
Curtis Eyler
From: "Keola Childs" <kchilds@westhawaii.net>
To: "Curtis Tyler, III" <ctyler@interpac.net>
Sent: Saturday, May 12, 2001 9:30 PM
Subject: Bill 58 -Sewer connection loan program
Qear Councilman Tyler -
Having obtained and reviewed copies of Bills 57 and 58, I would like to supplement my earlier concerns about Bill
57 with the following concerns regarding Bill 58.
I encourage the Councilmembers to chart out scenarios of varying percentages of loan recipients defaulting on
their loans; according to the draft language, the County will not be assessing interest on the unpaid amount at
any time, and will merely make aone-time 10% penalty assessment and evidently MAY NOT/SHALL NOT (my
rephrasing) foreclose on an unpaid lien until the owner has died or sold the property (over-simplification). Please
consider how many loan recipients may elect to enjoy such extremely favorable financing terms!!! Please
consider the County's funding of the shortfall from these "wraparound loans" (i.e., wrapping around the State's
loan to the County based on the percentage of loan defaults you foresee as possible under these proposed terms.
I recognize the difficulty in applying business and financial standards to situations where residents truly can't
afford the connection due to either personal incomes or distance from the main line or both; aside from the need
for the Council to recognize the size of collection and cash flow problem is creating under the proposed loan
format, perhaps the conditions might be amended to require the delinquency amount to be satisfied when the
property title is mortgaged (not just when sold) after the date of the loan. While most institutional lenders would
likely require the delinquency satisfied at funding, some may not. It is entirely possible that some owners could let
a delinquency run for thirty years if the property remains in their family, and never make a payment during that
period. This does not seem to be fair to the others.
Finally, it might be wise to define what "default" might mean under the code (not just the loan agreement). For
example, amended wording could provide that a property whose owner is in default under the program
perhaps would lose eligibility for land use permits (building additions, ohana permits, rezoning, etc.) for that
parcel; the current wording in the zoning code, section 25-2-3 (b) addresses only property taxes and fee and
delinquencies thereof. Were that wording a little broader, it would suffice ("delinquencies" there clearly refers to
the taxes and "fees" and not delinquencies of any kind).
Sincerely,
Keola Childs
1-t!01