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HomeMy WebLinkAboutCOM 0341.001 2002-2004Harry Kim Moor September 9, 2003 County of Hawaii Finance Department 25 Aupum Street, Room 118 • Hilo, Hawaii 96720 (808)961-8234 • Fax(808)961-8248 The Honorable Aaron S.Y.Chung, Chairman Committee on Finance Hawai'i County Council 25 Aupuni Street Hilo, Hawai'i 96720 Dear Chairman Chung: William Takaba Director Nancy E. Crawford Deptm, Director This letter is to provide you and the Finance Committee with information and justification for the request for $225,000 from the Council's Contingency account to assist in funding additional preparation work required to sell the County's Hamakua properties. Background Since Resolutions 161-02 and 209-02 authorized the sale of former Hamakua Sugar Company lands in the Hamakua district the Land Management Committee has been actively pursuing the preparation and sale of those properties. The County owns nine parcels in the Paauilo area and eleven parcels in the Kapulena area. Underlying grants allow for a consolidation/resubdivision process that could create fifty-eight individual properties. The parcels constitute a total acreage of approximately 4400 acres. Maps and a descriptive listing of our parcels in both areas are attached. It has been the philosophy of the committee to sell the properties with the minimum work and cost required to realize a reasonable price, and to sell the property in a responsible manner that would minimize any future problems for the County. The result has been a middle path between wholesaling as -is and developing for maximum sales price. We have proceeded slowly, in part due to restricted financial and personnel resources. Current Status We currently have three properties listed for sale with a realtor. Two of those properties are in escrow, with one expected to close in approximately two weeks. We have one additional property in escrow that the County is selling directly. It also is expected to Comm. No. �• Ref. TOP�ese R f. :'ote O rj w On Cn O _ crn CO This letter is to provide you and the Finance Committee with information and justification for the request for $225,000 from the Council's Contingency account to assist in funding additional preparation work required to sell the County's Hamakua properties. Background Since Resolutions 161-02 and 209-02 authorized the sale of former Hamakua Sugar Company lands in the Hamakua district the Land Management Committee has been actively pursuing the preparation and sale of those properties. The County owns nine parcels in the Paauilo area and eleven parcels in the Kapulena area. Underlying grants allow for a consolidation/resubdivision process that could create fifty-eight individual properties. The parcels constitute a total acreage of approximately 4400 acres. Maps and a descriptive listing of our parcels in both areas are attached. It has been the philosophy of the committee to sell the properties with the minimum work and cost required to realize a reasonable price, and to sell the property in a responsible manner that would minimize any future problems for the County. The result has been a middle path between wholesaling as -is and developing for maximum sales price. We have proceeded slowly, in part due to restricted financial and personnel resources. Current Status We currently have three properties listed for sale with a realtor. Two of those properties are in escrow, with one expected to close in approximately two weeks. We have one additional property in escrow that the County is selling directly. It also is expected to Comm. No. �• Ref. TOP�ese R f. :'ote September 9, 2003 The Honorable Aaron S.Y.Chung Page 2 close within two weeks. The properties in escrow will sell for a gross sales price of $1,365,000. Costs incurred to -date are $8,104.15 for title reports on eleven parcels and appraisals on five parcels. An additional amount of approximately $50,000 will be deducted from sales proceeds to pay for surveying. The realtor's commission for the two properties he has in escrow will be about $49,000. Issues The properties currently for sale were those considered to have good, legal access and ready to sell without additional work. While we had not originally anticipated surveying the properties, we found that the buyers could not receive title insurance without modern metes and bounds. We also discovered that one property, 660 -acres in the Kapulena area, which is currently listed for sale is not very marketable because of access problems. There are a number of issues with the remaining county lands that should be solved before they are offered for sale. If they are not, they will definitely surface in escrow and sales will not close if they are not solved at that time. Potential buyers who are familiar with the areas will not even make offers if they know that these issues have not been resolved. The most important issues deal with access. For some of the properties, we do not have legal access over the best road leading to the property, and the roads that constitute the legal access are in very poor condition. Some of the tax map keys consist of several land grants that were put into one tax map parcel by the plantation. These therefore still consist of several existing lots of record. The eleven Kapulena TMK's contain about 28 legal lots, and the six Paauilo TMK's not currently in escrow contain about 25 legal lots. The county can get considerably more per -acre, and can offer parcels that will be much more useful, if it consolidates and resubdivides the existing grants to a better configuration, that is, with good access to existing roads and taking into account the topography and other site conditions. The existing TMK's and grants are not well configured with respect to the roads, particularly in the Kapulena area. Proposal To sell the remaining county properties in a manner other than wholesale will require surveying work and the resolution of access issues. If the properties must be surveyed, the additional cost to subdivide into the available legal lots becomes more reasonable. The revenue advantage to the County also makes the consolidation/resubdivision look September 9, 2003 The Honorable Aaron S.Y.Chung Page 3 attractive. The next parcel we want to sell lies, in part, along a county road and is about 110 acres. It contains six underlying grants. By subdividing into six parcels of about 20 acres each, the property gains value and becomes more marketable as smaller lots. Unlike the surveying done on the properties currently selling, we will not be able to take the survey costs from sales proceeds. The survey work must be done in advance of listing the properties for sale. Surveyors from the Department of Public Works are fully occupied with County projects and would not be able to provide any of the required work. In addition to the surveying consolidation/resubdivision will require considerable on -the -ground planning. The Planning Department does not have the staff at this time to do this as an in-house project. Prior to selling any of the remaining county properties appraisals must be purchased and nine of the properties need preliminary title reports. The cost for the title reports will be a minimum of $10,200 (an old quote). The appraisal costs are estimated at $15,000. Previous quotes for surveying two of the remaining Paauilo area parcels total $75,000. Surveying the rest of the land in Paauilo area is estimated to be about $120,000. The Kapulena parcels will be considerably more. No quotes have been obtained. We would also like to contract a planner to assist with the project and speed the process. A cost summary is attached. The original budget request of $300,000 for this fiscal year was intended to fund required appraisal, title reports and survey work to keep the property sales project moving forward. At this time we are requesting $225,000 to meet the immediate needs for survey and appraisal of properties that are next in line to be sold, and to complete the purchase of title reports for all properties. Thank you for your consideration and support. If you have any questions, please contact Nancy Crawford at x8092. Sincerely, fr _ William Taka a Director of Finance Approved: 4� Harry Kim Mayor Paauilo Area Properties Dividable Assessed TMK Acres Lots Title Information Original Grants Access Value Sales Price Status Triangulation Survey Station "Koholalele" Not for sale this Alternate Easement Royal Patent Grant time. Lease 1 00 4-2-5-1 1040.00 1 agreement (1983) Mahele Award $ 1,994,100 acres Fire contains (12') easement ;USDAA;; Station; Highways for 4-2-8-18 Baseyard Lease -USPS (1989) Need survey, 4-3-7-1 57.00 1 2 dirt roadways Royal Patent Grant Field road to UH $ 211,400 negotiate access, includes easement Research Station appraisal and HWY across 4-3-1-3 roadwork Right of Entry -DWS (1981) Closing is anticipated 4-3-7-4 148.00 3 Land Patent Grants Manienie county road $ 335,000 $ 500,000 in approximately two Easement Grant- HELCO & GTE (1986) weeks. 4-3-9-2 51.10 1 includes easement Land Patent Grants 4wd "Flag" road from $ 289,300 $ 350,000 Survey pending across 4-3-8-1 paved road In escrow Easements for 4-3-9-21 Paved road for three of Need survey, & 4-3-9-22 for access 4-3-9-19 110.90 6 and utility Land Patent Grants the lots $ 449,300 negotiate access, includes easement Other three access from appraisal and HWY across 4-3-1-3 plantation road roadwork Hamakua Forest Reserve - Ag Need survey, 4-3-9-24 169.50 5 roadways attached to Royal Patent Grants & Some frontage on $ 437,700 negotiate access, RPG 2441 & 2442 Land Patent Grants Plantation Road, rest is ? appraisal and HWY Land Patent Grant 4229 roadwork 7 acre Hamakua Forest Field road to UH Need to negotiate 4-3-11-1 56.73 1 Reserve - Conservation Land Court Application Research Station $ 273,500 access, appraise, survey Hamakua Forest Reserve - Ag County road to some roadways attached to portions. Field road to UH Need to negotiate 4-3-11-2 306.25 11 RPG 2441 & 2442 Land Patent Grants Research Station gives $ 775,700 access, appraise, Land Patent Grant 4229 partial access survey 7 acre Closing in 4-3-12-06 77.40 1 Grant-COH (1984) Land Patent Grant Manienie county road $ 361,100 $ 515,000 approximately two weeks. Kapulena Area Properties Dividable Assessed ruv A-- I M. Titin Infnrmnfinn Orininal Grants Access Value Sales Price Status Report not ordered. Kapulena Road (non- $ 11419,600 4-7-5-1 777.94 11 Estimated cost $1200 County) - no easement 4-7-5-2 38.57 1 Report not ordered. Unclear $ 212,900 Estimated cost $1200 4-7-5-3 1.43 1 Report not ordered. Unclear $ 300 Estimated cost $1000 Report not ordered. Blocked from Kapulena $ 588,000 4-7-6-1 214.00 1 Estimated cost $800 Road by front property Report not ordered. Blocked from Kapulena $ 321,600 4-7-6-5 81.40 1 Estimated cost $1000 Road by front property Report not ordered. Blocked from Kapulena $ 480,500 4-7-6-6 167.70 2 Estimated cost $1000 Road by front property Report not ordered. Kapulena Road (non- $ 269,300 4-7-6-7 61.25 1 Estimated cost $1000 County) - no easement Report not ordered. Kapulena Road (non- $ 466,100 4-7-6-10 164.85 6 Estimated cost $1500 County) - no easement Report not ordered. Kapulena Road (non- $ 507,000 4-7-6-18 227.84 1 Estimated cost $1500 County) - no easement Hamakua Forest Reserve Plantation Ditch 4-7-6-20 5.38 1 Easement for runoff, Land Patent Grant Kapulena Road (non- $ 88,400 etc.rights in deeds 1983 County) - no easement & 1984 Easement for roadway 1995 Hamakua Forest Reserve Existing roads, trails, Kapulena Road (non - easements, ROW, Land Patent Grant / County), Mud Lane Listed with realtor, 4-8-3-5 660.80 2 flumes, ditches Land Commission (gov't road, doesn't go $ 1,334,600 $ 1,795,000 no survey done Questionable easement Awards / Royal Patent all the way through) across 4-8-2-5 Land Comm Award 10287 (6.2 ac) to Mahoe County of Hawaii Hamakua Lands Land sale costs to date: 6/3/02 Title Guaranty of Hawaii 7/2/02 Title Guaranty of Hawai'i 7/25/02 Title Guaranty of Hawai'i 9/30/02 Lawrence Appraisal Group 1/28/03 Lawrence Appraisal Group 3/25/03 Lawrence Appraisal Group 4/10/03 Lawrence Appraisal Group 5/9/03 Island Survey 5/16/03 Inaba Engineering ESH Engineering Estimated costs based on quotes: Surveying Surveying Surveying Title reports Title status reports - 7 parcels Title status reports - 1 parcel Title status reports - 3 parcels Appraisals - 3 parcels Paauilo Mauka Appraisal - 1 parcel Paauilo Mauka Appraisal - TMK 4-2-5-1 Additional work - TMK 4-8-3-5 Total cash out TMK 4-3-7-4 TMK 4-3-12-6 TMK 4-3-9-2 (quote) Total paid from proceeds TMK 4-3-9-19 TMK 4-3-9-24 TMK 4-8-3-5 All remaining parcels Estimated costs - projected based on fees for other properties: Surveying remaining Paauilo Mauka parcels ( 3 properties, 13 lots) Surveying remaining Kapulena parcels ( 10 parcels, 26 lots) Appraisals for remaining parcels in both areas $ 1,400.00 250.00 1,750.00 2,812.48 625.00 1,041.67 225.00 $ 8,104.15 $ 15,518.75 14,475.00 18,000.00 $ 47,993.75 $ 35,000.00 40,000.00 50,000.00 10,200.00 $ 135,200.00 $120,000.00 400,000.00 15,000.00 $ 535,000.00 Estimated cost for planning assistance $ 25,000.00 0 1 2 3 4 5 Miles Print Date: 5/3.92 - N W E S :a,� Paaullo• Area 4/26/02 VI This map is provided by the County - of Hawaii, Planning Department. .4 It is intended to identify certain county - owned lands in the Hamakua District. i "Z/ Iv 1. Questions or concerns regarding this map can be addressed with the Planning Director or Deputy Planning Director for the County of Hawaii at 961-8288. WAIP10 BAY - Print Date: 5/3/02' N W E S komaka I r Kulwihaei D, y' _' IKa ulena te r CoA 4/26/02 ed i This map is provided by the County ✓, ! 'x of Hawaii, Planning Department. It is intended to identify certain county - owned lands in the Hamakua District. Questions or concerns regarding this map can be addressed with the Planning Director or Deputy Planning Director �I for the County of Hawaii at 961-8288. Q 1 0 1 2 3 4 5 Miles Print Date: 5/3/02 Nut— A r IT t 4 •tank ,x r GU 7p6 gar f�� ~ r GJ ,-400619 w P1111 WT. IV ^1 11 n - � tarry h �,-, yl ", .�� •� �.l Q yn k- 'tet 'fir" - J '..' • y ' e � U' m 610 l Syp . 1^V 11 N • 8th 762 � i1 K UIC _ _ IA l r ;.'n,�` iw _ i' r a y . '�`/ ~ 1 . . _ _ _ ; - aul4�1 oArea �t s �Ir 'k ..pb ✓ P ,r F Q`_t, ' 343007004 n ,. O! _ b a � ' c 325001 ,,� H I kr. ,� r 4/26/02 if %I E"S., S '' Q> n b tI. • Y r I {�a a _ °g�This map is provided by the County of Hawaii Planning Department. F .I . .A .�y�y ` • ' r. It is intended to identify certain county- . _. it ' 7,, owned lands in the Hamakua District. J IV Iry 411 Ar' ``c ., -�g;Fg , Questions or concerns regarding this - 343 1 �'' hr'1,_ rbc -M �' s b i ma can be addressed with the Planning g .._N �. _. •'.- "', � �' '-` . ' _ . � ..,_ `_e � � �c+,` M ` � t.fi , dig ;x , "Ra.. J , CMrnt ♦�I ._ .` R E S R V E :, �` •, � � JI9, .,4 _. ,� . � , �Q. p Director or Deputy Planning Director w my Hawaii 961-8288. for the County a o t9 , 1 fH I M f 1 u i (nrral Y H A `M A- K .Lr A F b R F S T i w l y J y - y _ 1 0 1 2 3 4 5 Mlles 0 1 2 3 4 5 Miles Print Date : 5/3/02 Kukuihaele to Kapulena Are 4/26/02 This map is provided by the County of Hawaii, Planning Department. It is intended to identify certain county - owned lands in the Hamakua District. Questions or concerns regarding this map can be addressed with the Planning Director or Deputy Planning Director for the County of Hawaii at 961-8288.