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HomeMy WebLinkAbout2019-02-27 BDHRA Minutes BANYAN DRIVE HAWAII REDEVELOPMENT AGENCY COUNTY OF HAWAII MINUTES February 27, 2019 The meeting of the Banyan Drive Hawaii Redevelopment Agency was called to order at 2:03 p.m. in the County of Hawaii, Aupuni Center Conference Room, 101 Pauahi Street, Hilo, Hawaii, with Chairperson Brian DeLima presiding. MEMBERS PRESENT: Brian DeLima(Chairperson), Nathan Gaddis, K.T. Cannon-Eger MEMBERS ABSENT & EXCUSED: Elmer Gorospe and Barry Taniguchi ALSO PRESENT: Michael Yee (Planning Director), Amy Self(Deputy Corporation Counsel for the Agency), Jeffrey Darrow (Planning Division Manager), Alex Roy (Planner), Kim Tanaka (Secretary), Gordon Heit (DLNR Representative), Sue Lee Loy (Councilwoman) A quorum was present with three members in attendance. STATEMENTS FROM THE PUBLIC There were approximately 6 members of the public in attendance. At 2:03 p.m. Chairman DeLima opened the floor to take statements from the public. DELIMA: Aloha everyone. We're here on, for the Banyan Drive Hawaii Redevelopment Agency meeting. It is 2:03. We'll call the meeting to order. We have the, I don't know if we have a, do we have a supplemental addendum or anything? No. Okay, so we'll proceed to statements from the public. Is there any statements from the public? We'd like to call on Jon Bockrath to testify. Good afternoon Mr. Bockrath. BOCKRATH: Good afternoon. Good afternoon, I'm Jon Bockrath, owner of 21 Banyan Drive, Alii Ice Company. My written testimony, I believe you all have a copy of it. You'll note the date on there is October 31, 2018, that is when I had intended to give this testimony. The reason that's significant is because it was two years previous to that, almost to the day, that this body, this committee voted to move forward with this conceptual plan. There are some new members here that weren't here at the time. I've attended all but one of the board meetings since the board voted on October 26, 2016, to adopt the conceptual land use master plan, scenario 2. I reviewed the minutes of the meeting I missed. The total cumulative time spent discussing the fee-simple properties within the master plan area is less than five minutes. The adoption and implementation of the conceptual land use master plan allows the conversion of property held, private property held land from open zone to commercial zoning, thereby allowing the restrictions currently held to be reduced which will encourage growth and expansion of business. With business comes employment, and products, and services for our community. Employment generates income taxes, personal self-esteem, and independence; and business sales generate excise tax. All of which benefit the community. Page 1 of 15 Banyan Drive Hawaii Redevelopment Agency February 27,2019 Minutes I'd like to tell you a little story about an ice cream parlor. On June 11, 2014, I met with my attorney to discuss the possibility of opening a small ice cream parlor at Alii Ice Company on Banyan Drive. My attorney looked into it and was told by the Planning Department at that time it should not be a problem, it stays within the footprint of the existing building. The process began. I received a notice of conditional approval with restrictions on January 28, 2016, 13 months later. On February 8, 2017, I received a final plan approval, which we received. I'd like to touch, I'd like to touch on the conditions and restrictions stated in the conditional approval of January 28, 2016, and I'm quoting from that document. "(P)rohibited sales, any food, meals, or drink products that can be sold at in a restaurant or store. The non-conforming use of the Ice House does not permit expansion and prohibits any restaurant or store, conveniences, services, and goods." This is an ice cream parlor we're talking about. On March 14, 2018, a building permit was issued. That was seven months after the previous statement. On October 13, I had completed construction and received an occupancy permit for the ice cream parlor. That was another seven months. The point is it took 56 months to put in an ice cream parlor; it took 7 months to build it. Well, the reason I'm here is, can you please move forward with the zoning issues concerning the fee simple properties? We're asking for no financial assistance. The service we provide has no negative impact on Banyan Drive peninsula or the surrounding area. On the contrary, can you imagine the east side of Hawaii island without an ice house then throw in a natural disaster? In summary, could we possibly place on the agenda of the next meeting some discussion regarding the private properties on the peninsula? Thank you for my three minutes. DELIMA: Any questions? Thank you, Mr. Bockrath. BOCKRATH: Thank you. DELIMA: Is there any further testimony? We do have testimony that was circulated. Mr. Inouye submitted some testimony dated February 27, 2019, and which attached the—with attachments. We'll include that as part of the record. And I guess we have Mr. Heit's circulated—I guess Mr. Inouye provided us that too. BUSINESS OF AGENCY The Agency took this item up at 2:10 p.m. with approximately 7 members of the public in attendance. 1. Review and discussion regarding bills of the 2019 legislative session that involve or pertain to properties within the Banyan Drive redevelopment area. At this time, Mr. Alex Roy introduced himself as the new planner assigned to the BDHRA with the Planning Department, and provided an update to the four legislative bills that directly relate to Banyan Drive or have significant impact on the redevelopment of Banyan Drive. ROY: Starting with State Bill 1142. This one's pretty straight forward in that it asks for six million dollars to be put forth to demolish Uncle Billy's. As you may recall, the analysis done for the demolition of Uncle Billy's was estimated at about eight and a half million dollars. The Tower Development was willing to put up a million and a half so the State had to come up with Page 2 of 15 Banyan Drive Hawaii Redevelopment Agency February 27,2019 Minutes the rest, and has put forth the two million this year, fiscal year 2019, and then four million for the following. It's a pretty straight forward bill; there's no other information other than, that's it. It's for the demolition and removal of structures at Uncle Billy's. It has gone through the WTL Committee; Water, Transportation, Land Committee, and they've recommended passing it and the report from the Senators was adopted. Support for this, DLNR supports this. They're looking to move forward,just as we are here at the County, and they stated it's the only viable solution to the situation at this time regarding Uncle Billy's, so, so that's good. And then of course the County Mayor's Office also supports due to health and safety issues; they want to move forward on getting rid of that dilapidated structure. House Bill 1910. This one directs the State Office of Planning to conduct an infrastructure study of Banyan Drive. Now, this is going to include the condition of the infrastructure, for curb repairs, improvements, alterations to all the structures there on Banyan Drive, determine the barriers to timely redevelopment. That's a pretty broad statement. And then they've, they are asking to make recommendations regarding activities to reducing those barriers. So they're really putting a lot on Office of Planning to come up with a kind of an infrastructure study. Now, this kind of goes hand-in-hand with the studies that were done on the existing structures by DLNR previously, but this would include all infrastructure. DLNR has concerns; they believe it's not in the best interest to expend limited funds. They kind of go on to say since 2014 they've spent over half a million dollars from the, was it the, Special Land and Development Fund on consultant services dedicated to Banyan Drive. So they kind of feel that this is not really in the best interest for the BDHRA. OP just has concerns, really, in that they have not been part of this conversation or don't feel that they're a part of this conversation and that they are probably not the agency to take something on like this. The other thing to note is DLNR, and this is gonna come up again, is DLNR feels that this bill's not going to cover the privately owned infrastructure or the County- owned infrastructure. So, it would be only a part of the story if this were to pass. That the study OP would conduct would be on the State's kind of interest only and the County would have to kind of deal with the rest of it on our own. The Mayor's Office supports this because they believe the funds are needed to get the Environmental Assessment done. And then we did get a ILWU Local 142 supported that mainly, because of the construction and the availability of work for them at that, if this were to pass. It's a pretty general statement; they'd said it would hopefully lead to the economic well-being of Banyan Drive. That's understandable. As far as [H.B.] 910 is concerned, finance has recommended the measure be passed un-amended and it's moving forward. GADDIS: Sorry could you repeat that last ROY: That the finance, so FIN has recommended the measure be passed as un-amended. CANNON-EGER: And it's moving forward? ROY: Yeah, and so they're moving forward. This was as of like the 22nd I got, yeah so, yeah, as of a couple days ago this is the last I've seen in the Leg website as far as what's going on. Alright, State Bill number 914. This one requires DLNR to allocate ten percent of the revenues from those leased properties to the BDHRA. It appropriates funds to the BDHRA for conducting Page 3 of 15 Banyan Drive Hawaii Redevelopment Agency February 27,2019 Minutes our Chapter 343 review, which includes the EIS or EA review, most likely EIS. And the kicker with this one is no funds shall be made available until the County also provides matching funds not only for this fiscal year, $250 thousand, but the next also for $250 thousand. So it's a caveat. They're really only going to put forth, allow us to take that ten percent if the County's willing to put up that extra money, the money matching. Although it seems the ten percent might exceed that $250 thousand, although I couldn't find exact numbers. Maybe Gordon could help us with that. The Ways and Means have recommended the measure be passed with amendments, so there's a draft one of this bill that's been put forth. And I could go over, I'll be going over some of the changes from the drafts at the end here. DLNR opposes this; again, they remind us that they've spent a lot of money from the Special Land Development Fund to consultants. The County, they made a pretty bold statement that the County should fund its own portion of the redevelopment efforts. They think that diverting lease revenue to BDHRA would supposedly negatively impact DLNR operations and would not be a fair allocation of resources between the County and State. So they came up pretty far hard against 914. Mayor's Office of course supports that, but states that the current County budget is strapped, we all know due to a number of issues. And that they hope that, the Mayor hopes that the State will fund the EIS because that's really the sticking point where we're at right now we need in order to move forward, and he's kind of just said that it'd be difficult right now for the County to match those things. The Oahu County Committee on legislative priorities for the Democratic Party came in support of this measure. They had no comments. This is the big one, House Bill 1219. This is related to public lands and essentially designates a redevelopment district for any area of public lands, not just Banyan Drive, but any area across the state. And also does name the Waiakea Peninsula as the Waiakea Peninsula Redevelopment District. They put that in not only as a general idea, but then Waiakea specifically so it's been stated though this bill. It seems to be the, one of the primary focus, but not the entire focus of this bill. So it's to include all public lands to allow redevelopment districts to be established. They want to make sure that they implement and establish guidelines for redevelopment. Then I've just put forth a couple important ones: modernize policies; update policies, which we are always trying to do; establish a plan for the redevelopment area, again a no-brainer; and then implement the property management concepts that optimize income, and that's something that DLNRs been struggling with for a few years. DLNR opposes the bill because they say that it creates an additional layer of bureaucracy in our government. A new layer of redevelopment process in addition to the task force and the BDHRA might overwhelm the system and nothing may get done, is kind of how they framed it. A redevelopment district designated by the Leg does not include the County's infrastructure improvements, the County's interests. They feel that that would get left out and so would be in the same place where DLNR and the County would have to kind of fund their own sections. You can kind of take that as what, but instead the district would be confined to just DNLR like I said previously, DLNRs own lands. And they remind us again that the DLNR relies on revenues from the leases to operate. The Attorney General's Office actually asked to amend or recommend amend or defer their comments related to the lease section of this bill. Now, note right off the bat that that section was taken out in the second draft, or the first draft of this bill, so they followed the State Attorney General's recommendation to kind of remove the lease language out of this bill and keep it as it is for State lands. So they, you know, kind of talk about the renewal and renegotiation of existing leases could kind of not really be in line with the laws in place, but it appears that that whole section was just completely removed during that first draft so they followed the AG's opinion. Budget and Finance, they Page 4 of 15 Banyan Drive Hawaii Redevelopment Agency February 27,2019 Minutes have concerns. They don't support the creation of any revolving fund which doesn't meet the requirements of HRS Chapter 37-52.4. It seems that the Budget and Finance, they support this but they just want to make sure that revolving funds are, have oversight. That's pretty much the bases. The Mayor's Office supports, because they support any measure that helps the BDHRA and Banyan Drive in particular. The League of Women Voters actually wrote in to oppose this. They feel that the bill would encourage commercial lessees of public lands to, as they said, "play politics" to gain unfair special treatment. There was limited information in that statement so I don't know if they have an example or previous situation, but that's pretty much what they said. They support public planning, but when it's transparent and a competitive process for everybody to kind of follow. So they seem to not be wanting to—they want to make sure that it's just a transparent process especially when it regards the leases, development, redevelopment, so. OHA, they sent in testimony late and they had some concerns about the leases also. They feel that it may authorize leases that violate the State's obligations under the public land, which is to provide money to OHA. The language wasn't clear that OHA would still be able to get the money that they're required to get from the lease of public lands. That was their main focus that they had concerns about. Also, that extremely long leases could, essentially, overburden the County or could essentially negate the public lands and seeded land trust because the leases go on and on from family generation to generation. They wanted maybe a provision or something in that. They seemed to just not like that open-endedness of the lease. But again, the lease portion was taken out so I'm not sure if they got to review that first draft. They proposed a revolving fund, but it goes against what the Budget and Finance, so that the revolving fund deposits must account for native Hawaiians, the pro-rata share. Again, they're concerned and they're focusing to making sure that OHA was, got the money that they're were entitled to for the lease of State lands. Okay, so this is just based on a couple days ago as far as 1219, as I said, they removed the requisite for choosing committee members, this long kind of drawn out, they just took that out. But they changed the reporting requirements, now it's going to be, they would ask for a yearly annual reporting. And they removed, as I said, the entire section on leases so there's no discussion of lease or lease requirements or lease agreements in that bill now; its been completely removed. The rest of them, the change, really the only change was the effective date to 2050, which I guess is typical to encourage further discussion. H910. They changed the funding amount to undisclosed and then 914 actually added in a funding amount of$250 thousand dollars. Some minor changes. Twelve nineteen (1219) is the one, the largest one that relates to the creation of a new redevelopment district. DELIMA: Any questions? KT, go ahead. CANNON-EGER: The effective date, July 1, 2050? ROY: Yeah, each time they put that in, and I'd actually spoken to my supervisor about that and it was stated that that's a typical to, and those were their words, "encourage further discussion." Because if you look, they'll say the effective date is July 1, 2050, but then the date that the bill is supposed to would be something like 2024. So it really didn't make sense, but as I CANNON-EGER: Thank you. Thank you for clarifying that. Page 5 of 15 Banyan Drive Hawaii Redevelopment Agency February 27,2019 Minutes DELIMA: Nathan, you have any questions now? GADDIS: Just update us to the status of where this lies at the moment. I know it's, I know we have the new drafts but ROY: Oh yeah, 1219 as of the 22nd, the Finance Committee has recommended the measure be passed un-amended. So the House Draft one is the one that passed Finance and they're recommending un-amended, it be passed un-amended. So that's still working through. So all four are still alive at this point. YEE: So I would add that the first two that Alex covered, SB 1142, HB910, you could look at those are like capital requests, appropriation requests. So a lot of times those, you know, could be bills but then they could imbed those later on into a budget and so they may not make their way all the way through as, so just because they may die here in committee doesn't mean they won't show up on a budget, necessarily. In fact, I was told a lot of times appropriation specific capital things, they don't like to pass bills, they tend to want to put those things into a budget. That's why the key is to get to the head of Ways and Means, to the head of Finance to get it into the budget. But every once in a while they do go through, so it doesn't surprise me that they're having a slower go than the other two which are very, you know, legislative driven. I want to remind folks that these two that've gone through, SB914 is Senator Kahele and he, this is basically last year's, and the other one is Representative Onishi which is from two years ago. So there's two bills moving forth, we've seen them before, they're making their second rounds and we really can't have both for the most part. At some point there kind of has to be one or the other. We're kind of waiting to see what plays out with the Leg around some of it. Now whether or not we have a strong feeling over one or the other, we can certainly talk about that but it's complicated too, I would just add. DELIMA: As our agency has been advised, we really have no ability to take further action in regards to the properties located at Banyan Drive until such time that the Environmental Impact Statements and studies associated with that are completed. So in effect, we've become a powerless agency until that component is completed. As I understand it, this legislation would provide some funds to accomplish that task. Now in addition, there is the aspect of dealing with the liability of having a structure on a shoreline between Hilo Hawaiian and the Grand Naniloa that is vacant. That would be the old Uncle Billy's. So I think, I would think the State would be motivated to provide the funds necessary to eliminate that obvious nuisance and liability there. I would hope that some legislation would be passed or the DLNR would utilize resources to get rid of that structure. Now I know that at a previous agency meeting we were advised that DLNR had put out a request for proposal, or for request for interest or something to that effect, and I believe only a company associated with Tower actually showed some interest. That would make sense since they're the major leaseholder of enough land to construct a parking facility to house a new structure at the Uncle Billy's site. So what it really comes right down to is that until all that happens we really, as an agency, have very little that we can do to be frank. Okay, now that doesn't mean, though, that the County through its General Plan process that's—you're in the middle of that right now, right? YEE: Right. Page 6 of 15 Banyan Drive Hawaii Redevelopment Agency February 27,2019 Minutes DELIMA: That the General Plan could not be amended to implement what we have proposed and that would address somewhat Mr. Bockrath's testimony because his fee-simple parcel, as well as the other parcels that have been designated as potential commercial sites would not be affected by what has been discussed here. So I've said this in the past, and I'll say it again for the record that I think it's important that the County move ahead with the General Plan amendments that would implement what the Board has previously proposed and adopted. And perhaps we should put that on the agenda for the next meeting so that it's properly Sunshined for the purposes of further discussion. Does anyone want to add anything else or comment on anything that I've said? Okay. So if not, I would thank you for your—go ahead Mr. Yee. YEE: Since we're graced with the Councilwoman Lee Loy's presence here, and she's been heavily involved at the Leg, I'd love to hear, as we have not had a chance to check in with each other on what you're hearing, what you're seeing, what, what's the whispers on some of this. LEE LOY: Thank you, Director Yee. I think you knocked it out of the park. It's House Bill 1219 and then Senate Bill 914. It is a biennium budget year, so it's really going to boil down to money and how our state representatives at the capitol can squeeze out that money. And the other part of that is really the County, through its budget is going to have to demonstrate some level of commitment. And so the administration is going to have to step up with either some type of matching monies to show the State that we are committed to revitalizing the area. Hence some of the language in that other particular bill that, you know, it would be kind of contingent upon a $250 thousand dollar match totaling $500 thousand over the course of the next two years. And so that's basically where they're at, they're really focused on the resources and the money. DELIMA: Thank you very much for that update. You know, I know that the County is going in for a substantial amount of money for all the disaster relief and I don't know if the last ask was something like $25 million or $30 million, I'm not certain. LEE LOY: Sixty. DELIMA: Huh? LEE LOY: We got sixty. DELIMA: Oh, sixty million? You got sixty million? Okay, maybe you could give $500 thousand to us. 2. Continued open discussion regarding the submittal by Donald T. Inouye for the new lease request to DLNR for the Reeds Bay Resort Hotel. This agenda item is for information and discussion purposes only. The Agency took this item up at 2:34 p.m. with approximately 7 members of the public in attendance. DELIMA: Again, we really have no ability to implement this at all. We don't have the authority, we haven't been delegated this authority because we don't have any of the necessary studies. Page 7 of 15 Banyan Drive Hawaii Redevelopment Agency February 27,2019 Minutes Notice DLNR referred this matter to us. Gordon, could you address? Because there's a process, right, that this is going through? Are you able to; I figure you're here so HEIT: Okay so, thank you. The process is again, working with this agency on developing a master plan and proceeding with it. As you mentioned earlier with the Uncle Billy's property, we're working with Tower Development. They're the ones that, the only ones that submitted a request for interest so we're in discussion with them on the next step on how to proceed with that, which more likely will be a request for proposal to put out for the development of the property which would include demolition and restructure. With regards GADDIS: Do you have an approximate timeline for RFPs from their side? HEIT: No. Simple answer. I'm afraid I don't. With regards with the other properties, there's two other significant properties that are on a month-to-month revocable permit. The former Country Club property which is, actually that was recently canceled and a new RP has been issued under, I believe it's Oceanside 121 Partners, and Reed's Bay Resort Hotel which is Mr. Inouye's property. Mr. Inouye has presented us a proposal to make improvements to the property, requesting a long-term lease. The process for that as it currently stands is to put the property out for bid at public auction with the idea that improvements will be made to the property. So, we're kind of in a holding pattern right now because we want to make sure that where we do proceed with it is in conjunction with the future planning and development of the entire peninsula, which would be the involvement of this agency. So pretty much in a nutshell, that's where we are right now. DELIMA: Any questions? Mr. Yee you want to make any comment? YEE: I had said this before in a previous meeting and so I'm kind of reiterating. We're kind of caught in a circular loop, I feel, with DLNR in terms of we want an EIS. You know, for us to proceed as the BDHRA to have authority to do some work there, we need an EIS. We need money to do the EIS so then we propose ways through legislation for money from the State for the EIS and DLNR will come out against them saying we don't want to. Yet then Mr. Heit sits here and says, you know, we want to go through the BDHRA to kind of do this work. So we're caught in this circular loop. At some point I think we need to ask like if you know, does DLNR agree with doing the EIS in the next step and how are we going to fund that then? I mean, we keep putting forth ideas how to do that and if these aren't the right ideas the question has to go to DLNR; okay, what is, what is something that they're willing to do, then to get it forward. There seems to be at this point like Brian, you and I have said, we're getting a little tired banging our heads against the wall on this issue and so if there's an offer that DLNR can offer in terms of how we can move forward with an EIS, to share that responsibility, then we'd love to hear it. But we keep throwing things out, we have legislators throwing out different ideas and we just keep getting no. You know, in the end, whether or not we get one of the bills to pass and then is forced upon DLNR, we'll see, but again if neither of them pass I kind of wonder what's our next step again. So I don't feel like we're on any clearer path than we were a year ago, two years ago, at this point still. Page 8 of 15 Banyan Drive Hawaii Redevelopment Agency February 27,2019 Minutes DELIMA: Well, you know, I've tossed this out from the very beginning and my suggestion was, why do we need an EIS? If we're committed to a footprint no bigger than what we're presently utilizing. So, you know, cause I take the position what we're proposing is no bigger than what exists. So if we're not increasing the footprint and density, why do we need an EIS? That's been my suggestion. And I know Corporation Counsel has a thought on it. SELF: Because it's on State land so it triggers Chapter 343. Any use of State or County funds, any use of State or County land triggers Chapter 343-5. HEIT: And that being said, there are components to that chapter as well. They can either do a full Environmental Impact Statement or they can do an Environmental Assessment depending on the scope of work. So that's where we really need to DELIMA: So perhaps the Environmental Assessment could be that in as much as the density is the same, the footprint is the same, we don't believe there's any detrimental environmental consequences to empower the commission, or the agency, to implement the plan as presently constituted, something to that effect. We could, that possibly may work. HEIT: That's a possibility. DELIMA: But that costs money too. HEIT: Everything costs money. You know, that's a given. DELIMA: Okay. HEIT: But when you present a scenario like what you have here, you know, the scope of it on the face of it would more likely trigger an Environmental Impact Statement. Full, you know, environmental review. DELIMA: Because it's all next to a shoreline HEIT: But if you're going to do components of it, yeah, if you're just do individual components, yeah, that's a different, you know, a different story. You could probably do an environmental assessment. DELIMA: It would be good if, and perhaps the Council could make it a priority and then appropriate a million dollars and get it done. So anyway. CANNON-EGER: Mr. Chairman? DELIMA: Go ahead, K.T. CANNON-EGER: When was an Environmental Impact Statement done for this area previously? Page 9 of 15 Banyan Drive Hawaii Redevelopment Agency February 27,2019 Minutes HEIT: I don't believe there ever was one for the entire area. This development was done prior to any environmental laws and regulations created. CANNON-EGER: Thank you. DELIMA: Go ahead. ROY: I did a review of existing environmental Chapter 343 assessments done for the Waiakea peninsula and I found, one, two, three, four, covering—let me go back here. We have, the only place that really wasn't covered is the resort area. There's a previous EA for the gardens, previous EA for this entire golf kind of area, there's an EA for this section here, the hotels, and the park here, and then there was one for the Reed's Bay kind of section. So again, the only spots that have not been—so this is '99, 2007, 2010, and 2015. I didn't go back much further than CANNON-EGER: 2015 is the most recent? ROY: Two thousand fifteen is the last one and that was for the Kuawa Street Sports Field Development. That's across the street here. So like I said, we have one here, Lili`uokalani, one for this area, one for this area, and then one here. So what was not done, included in any EA that I found that's recent, you could go back but pretty much after ten years they're useless, is this area, the resort area. So yeah, I had gone through and found that number of EAs had been done. There's a lot of information that's already out there so might be useful. DELIMA: Okay, any further discussion? If not we're going to move to the administrative matters which is the INOUYE: (From the audience) Am I eliminated from speaking? DELIMA: Well, you had your opportunity at the time of statements from the public. INOUYE: I requested to be on discussion. DELIMA: Well we don't have a period of discussion, but I'll give you your three minutes right now, you can say anything you wish about the matter. Go ahead, Mr. Inouye. INOUYE: Thank you. DELIMA: No problem. We have your written testimony but you may address any issue or concern. INOUYE: Yeah, this last letter that I submitted, February 19 DELIMA: Mr. Inouye, use your mic so they can record it. Page 10 of 15 Banyan Drive Hawaii Redevelopment Agency February 27,2019 Minutes INOUYE: Hello. DELIMA: Yes. INOUYE: Okay, yeah, this last submission to the Agency here, excuse me—recognize our Chairman, Mr. DeLima and the Board, I'm Don Inouye, owner 100 percent of the corporation Reed's Bay Resort Hotel, Inc.—Limited, excuse me. Anyway, on my letter that I submitted to the agency February 19, which was a week before this meeting to be on the board agency discussion, I also had one to continue from the last one. But this request subject was to request to be on the agenda to discuss the following solutions to the problem. One, either a new lease or a solution of remaining on the month-to-month permit, okay? I need help from DLNR and the Agency to resolve this dilemma, this catch-22 that I'm on, that you all discussed. If I can't get a lease I'm satisfied to stay on the month-to-month, but I'd like to have you review the letter that you have a copy of from Mr. Yee from the Planning Department. And he states, and that's on the second page, but first of all this letter dated—let's see if I can dig it up. You all have it there, yeah, here we go, is directed to, to DLNR and this particular letter--oh here weoh, I don't know where it is. Anyway, it states that in answer to DLNR's requests concerning month-to- month permits and a month-to-month permits as you know Reed's Bay been caught as well as Naniloa Hotel, all the hotels on Reed's Bay that were built many years ago when the fire from the Marco Polo we all had to be inspected. Prior to that we had the AIA architectural report that came through and checked all three buildings, gave a very thorough report on the safety hazards as well as many other little things, and all of these amounted to money in correcting. Now I know that Country Club has a lot to do, Naniloa's still involved in some of`um. And you know, I was fined $1,000, and $1,000 a day last year, and I had that repealed by the Building Department. And then there's a letter in here referring to that. Now I can't afford to be fined again this year because I'm faced with about $200,000 worth of repair work on violations. Now these violations, some of`um, I mean none of`um are life threating because I've taken care of all of the life threatening ones. These are, are, violations such as I have two rooms that are two roofs that are unpermitted there at Reed's Bay. Now these two roofs that are unpermitted were done years and years ago, before I even came aboard. I came aboard in 2002 as the owner of Reed's Bay. And from 2002 to this date I've been spending a lot of money on refurbishing, also upgrading on the direction of increase in business and I've got the business built up to the point now to where I could support this $200,000 if I had to pay it. But I don't think it's fair because they're not life threatening, I don't have a lease, and Mr. Yee's letter states that any month-to- month permit, the lessee or renter that has that permit is not going to support it or get a loan because they're only on a month-to-month. I can't get a loan for $200,000, but I can take it off the profits out of the corporation, but you know, this could go on and on. This is a revocable permit. Month-to-month. All I'm asking is that we make a decision, either I get a lease or that I know that I'm going to stay on the month-to-month, but if I stay on the month-to-month, I'm looking at this agency as being a super agency. In other words you can make decisions. I feel you can go and make a demand or recommend to the Building Department that any outstanding discrepancies or violations that are not life threatening can be delayed until we come up to the master plan or implementation. Then I would be happy to stay on month-to-month. I would be happy to go into a new lease, extended lease. Now you have the scope of work, I put a copy in there of the one I submitted in August of 2017, as 2,000, I mean $2,200,000, which I had obligations on the financing. Some of those things go away, you know. Its been a year and a half Page 11 of 15 Banyan Drive Hawaii Redevelopment Agency February 27,2019 Minutes since I submitted that. Now do you think the lender's going to keep saying, "Well Mr. Inouye, do you still qualify for that?" Well, my financial condition hasn't changed, I'm sure I'll qualify, but the interest rates going up, there's a lot of things going up. There's solar in here, what if they decrease the solar rebate and all the things that are going to help with the $2,200,000 upgrade? Now this upgrade would've taken care of all these violations that I've had to work over because if you look in there they were scheduled to. Now this was submitted in August and I prepared three months to come up with this scope of work and then the Marco Polo fire came in July, then the inspections came in August. And the timing together was great if I could've got my lease and got started on it then I wouldn't be out of almost $300,000. DELIMA: Okay, Mr. Inouye, I appreciate your view that this Agency has the authority, but the discussion that we've had today, and Corporation Counsel could correct me, is that we don't have any authority to take action as you have requested. INOUYE: Okay, let me put this, if I may. DELIMA: Well this is not a discussion. INOUYE: No, well it said discussion here on the agenda DELIMA: Yeah, but not for you. Your opportunity to give input. I'll give you the last word though on this subject matter because we don't have the authority to do so. Your right now, the only place that you can get what you're requesting is from the Board of Land and Natural Resources, unfortunately. But if INOUYE: Okay but see DELIMA: There's no but's, Mr. Inouye. You—I'll give you the last word. You can state what you want to state but we don't have the authority. INOUYE: Okay fine. Okay, great. Department of Land and Natural Resources and the County went into collaboration DELIMA: Use your mic. CANNON-EGER: Microphone. INOUYE: Oh. Department of Land and Natural Resources and the County of Hawaii, which was the Planning Division, and not only the Planning Division, the Windward Planning Commission all went into collaboration and turned it all over to you all. Because you have the, the gavel now to make decisions and to say what? Because if you look in there, I also gave to you the information of what authority you have. Now you say you don't have it, I'm not an attorney DELIMA: Well, I am Page 12 of 15 Banyan Drive Hawaii Redevelopment Agency February 27,2019 Minutes INOUYE: I know you are. DELIMA: —and so with all due respect, Mr. Inouye, I wish we had the authority and if you listen to the discussion we had today, I want to get the authority, but to get the authority we need to have the implementation plans. I've tried to find different ways to get the authority. To my left is the Corporation Counsel, she's the attorney for the County assigned to this agency. Mr. Yee has expressed his opinion too. I can ask the Corporation Counsel, Madam Corporation Counsel do we have the authority to implement what Mr. Inouye seeks? SELF: No. The County does not own the land so we have no say in it. INOUYE: Okay but what about make the recommendations to the Building Department in regards to if there's not a life threatening (inaudible). CANNON-EGER: Microphone please. DELIMA: Mr. Inouye, you gotta use the mic. INOUYE: if a life threatening permit. If that, if the violation is not life threatening can you make the recommendation to them to lay off so I don't get fined? DELIMA: Again, the County of Hawaii is not the agency that issues the permit. It is the State that issues the permit. It is the Board of Land and Natural Resources. So if you're asking us, can we make a recommendation to the Board of Land and Natural Resources, I guess we could state our opinion to any agency, but at this point you need to bring your—the only person, the only agency authorized to take action for what you're requesting at this time is the Board of Land and Natural Resources. And if you take something before the Board of Land and Natural Resources and you want to advise this agency that you have a pending matter before the Board, we can agendize it and discuss taking a position on your request. INOUYE: Okay, February 16, 2016, DLNR would remain the landlord and receive lease rent. We're really just a collaborator where a landlord, and this was said by the Board Chairperson, Susan [sic] Case. In other words, in this collaboration they turned everything over to you all. Everybody is avoiding making decisions. I'm in this catch-22 and I'd like to have the Board, the Agency review this 53-53 that I printed out DELIMA: We have that, you've given it to us. INOUYE: —and it gives you the source where you can make the decision. And I'm through. DELIMA: Okay, I wish we had that power that you indicate, and we would want that at some point. Okay, so anyway, we thank you very much for coming today and I think we all empathize with your position. I wish we could do more than we can. Page 13 of 15 Banyan Drive Hawaii Redevelopment Agency February 27,2019 Minutes INOUYE: Well the alternative I have is to go ahead and retire, okay? And close up and have Gordon Heit go and find somebody else and they can sell all my business to another hotel. DELIMA: Okay, I'm not going to comment on that. Okay so, moving on to the election of officers for 2019. ADMINISTRATIVE MATTERS The Agency took this item up at 2:57 p.m. 1. Election of Officers for 2019. DELIMA: I don't desire to remain as Chair and I was hoping that, I know Nathan has indicated to me that he'd be willing to serve as Chair and, you know, K.T. would you like to serve as an officer as well? We used to have a Chair and Vice Chair before. K.T. are you CANNON-EGER: I'm listening. DELIMA: Well we can just, we can just elect Nathan and then in the future somebody else can volunteer to be a Vice Chair. So if, you know, I would nominate Nathan to be Chair. CANNON-EGER: Second. DELIMA: Okay, any discussion. Seeing none all those in favor say aye. CANNON-EGER: Aye. GADDIS: Hey, discussion. DELIMA: It would be good that we have a new energy. So if there's no objection, Nathan is the Chair and I'll take the final business of approve the minutes. 2. Approval of minutes from the September 24, 2018, Banyan Drive Hawai`i Redevelopment Agency meeting. DELIMA: Is there motion to approve the minutes? CANNON-EGER: So moved. DELIMA: Is there a second? GADDIS: I second. DELIMA: All those in favor say aye. ALL: Aye. DELIMA: Opposed say nay. Motion is carried. Now announcements. Page 14 of 15 Banyan Drive Hawaii Redevelopment Agency February 27,2019 Minutes ANNOUNCEMENTS The Agency took this item up at 2:59 p.m. 1. Next meeting tentatively scheduled for Wednesday, March 27, 2019, at the Aupuni Center Conference Room. DELIMA: Next meeting is tentatively scheduled for March 27. Perhaps we can put the private property things on the agenda. Staff can consult with Nathan as to the balance of the agenda. And if there's no objection we'll stand adjourned. Thank you. Meeting adjourned at 2:59 p.m. Respectfully submitted, Kim Tanaka, Secretary ATTEST : Brian DeLima, Chairperson Banyan Drive Hawaii Redevelopment Agency Page 15 of 15 Banyan Drive Hawaii Redevelopment Agency February 27,2019 Minutes