HomeMy WebLinkAboutCOM 0452.010 2008-2010
William P. Kenoi
Mayor
County of Hawaii
Finance Department
25 Aupuni Street, Room 118 . Hila, Hawaii 96720
(808) 961-8234 . Fax (808) 961-8248
October 19, 2009
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J Yoshimoto, Council Chair and
Members of the Hawai'i County Council
Hawai'j County Council
25 Aupuni Street
Hilo, Hawai'i 96720
Nancy E. Crawford
Director
Deanna.S. Sako
Deputy Director
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Re: Finance Committee Communication 452.1 - Proposed Amendment to Resolution
216-09, Authorizing the Sale of Certain Hamakua Lands
This letter is provided in opposition to the proposed amendment referenced above,
which is to be considered at the Council Finance Committee on October 20,2009. It
seeks to clarify several areas of potential misunderstanding.
The amendment to Resolution 216-09 adds additional WHEREAS clauses. The first
new clause identifies the sale of the sixteen properties included in this Resolution as the
"largest and most significant county owned land sale transaction...". This clause may
be confusing in referring to the sale of these properties as a single transaction, implying
that the land will be sold in bulk. It will not. It will be sixteen separate land sale
transactions.
The second of the new clauses references one property sold by the County in 2005.
This clause is of questionable relevance and misleading. If the information is deemed
relevant, then it should be more complete. The property sold at appraised value. The
current owners of the property have subdivided the land into six parcels and made
significant access improvements. Also, the owners have not sold any of this property in
over four years it has been listed for sale. The list price could just as well be $25
million. Listing price is not an indication of value.
The third WHEREAS clause asserts the public's right to provide input into the
disposition of County property. That is the intent behind the County Code's requirement
for this resolution now under consideration. The public is provided this opportunity for
input. The County Code also requires that the property be appraised and disposed of
only through authorized methods designed to insure the fairness of the sale and to
achieve the maximum price. Comm. No. 45 2.10
Ref. ToPr'Z-r:.C!1fOd f(..
'Ref. Date OCT 2 0 7009
Hawai'i County is an Equal Opportunity Provider and Employer
County Council- Resolution 216-09 Amendment
October 19, 2009
Page 2 of 2
The following WHEREAS appears to provide an argument for not selling the property
being authorized for sale by Resolution 216-09, which is confusing. Additionally, the
focus on including these properties in the Hamakua Community Development Plan
ignores the fact that the land was acquired in lieu of property tax revenue for supporting
the operations of the entire County of Hawai'i.
The fifth additional WHEREAS refers to executing a "deal" with a prospective buyer(s).
The term "deal" could be construed to include some amount of negotiation between
parties. The sale of land by auction or sealed bid, as authorized in this resolution, is
designed to be fair, open and competitive. The bidder providing the highest bid above
upset price, and subsequently completing payment through escrow acquires the land. It
is a very public process.
The final additional WHEREAS and two additional BE IT FURTHER RESOLVED
clauses require the administration to return to County Council after sale by auction or
sealed bid to provide information on the intended use of the land and the bid price. An
additional Resolution would be necessary to approve the sale. In a bid sale, the
winning bidder is required to provide a deposit of up to 10% of the purchase price at the
time of bidding and to then complete the sale within 60 to 90 days. That is a large
commitment on the part of the prospective buyer. Many prospective bidders would not
choose to participate in this process knowing that the winning bidder must wait for
additional approvals of the price they bid and their intended use of the land by the
County Council.
The effect of the proposed amendments to Resolution 216-09 would be to reduce
interest, competition, and ultimately the sales price for the subject properties when they
are offered for sale.
Thank you for the opportunity to provide input on this important Resolution.
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Nancy Crawford
Director of Finance