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HomeMy WebLinkAbout2020-10-15 Leeward Exh B (Public Testimony re AMEND SMA 388) LEEWARD PLANNING COMMISSION COUNTY OF HAWAII HEARING TRANSCRIPT OCTOBER 15, 2020 Public testimony regarding the application of DPM ACQUISITION LLC DBA DIAMOND RESORTS INTERNATIONAL (FORMERLY PACIFIC MONARCH RESORTS, INC.) (AMEND SMA 388) was called to order at 11:07 a.m. via live-stream online meeting, with Chairperson Nancy Carr Smith presiding. COMMISSIONERS IN ATTENDANCE: Nancy Carr Smith, Barbara DeFranco, Perry Kealoha, Max Newberg, Mark Van Pernis, Michael Vitousek and Faith"Faye" Yates ALSO IN ATTENDANCE: J Yoshimoto, Esq. (Counsel for the Commission), Michael Yee (Planning Director), John Mukai, Esq. (Counsel for the Planning Director), Jeff Darrow (Planning Program Manager), Alex Roy (Planner), Jessica Andrews (Planner), Tracie-Lee Camero (Planner), Rachelle Ley (Secretary to the Planning Director), Kim Tanaka (Secretary to Boards and Commissions) and Noriko Sauer(Leeward Planning Commission Secretary) APPLICANT: DPM ACQUISITION LLC DBA DIAMOND RESORTS INTERNATIONAL (FORMERLY PACIFIC MONARCH RESORTS, INC.) (AMEND SMA 388) Application to amend Condition No. 2 (Time to Complete Construction) of Special Management Area Use Permit No. 388, which was issued in 1998 to allow the development of a commercial/condominium complex and related improvements on 76,739 square feet of land. The property is located on the makai side of Alii Drive bounded by Alii Drive and Kahakai Road, south of Royal Kona Resort and north of Kona Reef Condominium, Pua`a 3rd, North Kona, Hawaii, TMK: (3) 7-5-018:011. Secretary's Note: "- - -" indicates that there were technical and/or internet difficulties, which made the conversation inaudible. CARR SMITH: Thank you very much everyone for your patience in waiting for your turn to testify. We really appreciate it. Next, we are going to move on to the testimony for agenda Item 42 and first on my list is Theresa O'Brien. Are you here? Theresa O'Brien. Alright, I will move on to Frank and Margo Kotulak. Am I saying that correctly? Hi, Margo. M. KOTULAK: It's Kotulak. CARR SMITH: I have two (2)windows for you. I think you going to have to close one. You have 2 devices open? Maybe a computer and a phone or something like that? M. KOTULAK: I do not. Ma'am. LEY: Margo, this is Rachelle. I'm going to try to disconnect one of yours. Oh, that's better. 1 EXHIBIT B CARR SMITH: Okay Margo. While Margo is getting set. I'm going to move to Herve Grison. Is Herve Grison here? M. KOTULAK: Is that better? CARR SMITH: Hold on Margo. Okay, I don't see Herve Grison. M. KOTULAK: Better? CARR SMITH: Yeah Margo, let's try I still see 2 windows for you I'm not sure why. So, but let's give it a shot. Go ahead. Go ahead Margo. Margo are you still there? Alright, how about let's move to Heidi Ruffner? RUFFNER: Hi, I'm here. CARR SMITH: Okay, Heidi, go ahead with your testimony please. RUFFNER: Aloha, thank you for the opportunity to testify. My name is Judith "Heidi" Ruffner. My husband and I own a condo which is located directly across of Kahakai Road from the Diamond Resorts International (DRI)property described in SMA 388. I am here to respectfully request that you deny DRI's request for a fourth five (5)year time extension on this permit."- - -" the permit should be expired for several reasons. First, the original permit was granted back in 1998, twenty-two (22) years ago. The local population and the visitors to Kona have both increased by over 50% since then resulting in significant traffic congestion,pedestrian safety concerns, and increase strain on the environment. Second, the updated building plans for the site was significantly increased in potential occupants. From 190 to "- - - " excuse me. CARR SMITH: Sorry, Heidi continue. RUFFNER: Thank you. The new site plans was significantly increased in the number of potential occupants. From 190 to 460— M. KOHULAK: Why, can't we hear. RUFFNER: —this dramatic increase in the number of occupants should be evaluated for its environmental impact on this sensitive coastal zoned region. Third, DRI has done nothing to improve or even maintain the property since acquiring it in 2013 and receiving the 5-year time extension on this permit in 2014. The partially completed concrete monstrosity has been an eyesore for over twelve (12) years and poses numerous safety, security, and environmental hazards. The current structure is decaying with cracked concrete, rotted wood, and an overgrowth of weeds. Worst yet it attracts unlawful activities such as vagrancy, drug dealing, and dumping. Year after year DRI has demonstrated a complete disregard for the condition of its property and its ongoing negative impact on local residents. DRI's inability to perform on a projected budget 2 EXHIBIT B overrun as a result it submitted updated building plans which were approved in May 2017. As usual nothing has been accomplished since then. Meanwhile the recent pandemic has decimated the tourism industry around the world. It will likely take years to recover. So, I ask you how can we expect DRI to complete the proposed construction within the next 5 years under this weak economic forecast when it was unable to do so during the previous seven (7) years of strong economic growth? For these reasons, we ask you to deny this time extension request. DRI should be required to apply for a new SMA permit based on updated building plans that must be thoroughly evaluated by the Hawaii Planning Department to determine the potential impact on the environment and"- - - " in Kona. Alternatively, DRI could sell or donate the property to the County through the Public Access Open Space and Natural Resources Preservation Commission (PONC). CARR SMITH: Thank you Heidi your time is up. RUFFNER: Thank you, mahalo. M. KOTULAK: I think I'm working now. CARR SMITH: Okay, are there any questions Commissioners for Heidi? Okay, seeing none thank you very much Heidi you can drop off the call we appreciate your patience. RUFFNER: Thank you very much. CARR SMITH: Okay, Margo and Frank let's give it another try here. Let's start with you Margo. M. KOTULAK: Okay, my names is Margo Kotulak. My husband Frank and I have been staying in Kailua-Kona for more than nine (9) years and have been small business STVR property owners at Kona Reef next to the property in question for five (5)years. We had to walk by this derelict eyesore which we believe reflects negatively on the Leeward Planning Commission and the Kailua-Kona Community. Diamond Resorts International (DRI) has done nothing to improve this property during the last decade and we believe they do not deserve the requested for extension for doing nothing. We honestly thought they were bankrupt. Their past action should be considered as the primary reason for denying this extension. We are specially concerned about the proposed changes in the plan which would significantly increase the number of potential guests and negatively impact local traffic and parking capacity. We believe that some significant changes in their plans have not gone through any public vetting process. If that's true that's is also reason for denying approval of this extension. Therefore, we recommend that the Planning Commission should reject the extension request and require DRI to do one of three things. One, despite their inability to act on a plan approved twenty-two (22) years ago and the fact they have not provided off-site improvements like curb, gutters, sidewalks, and utility relocations required by their 2014 extension. They should be required to create and get approval of a new plan which has a lower rental density. Due to 3 EXHIBIT B concrete falling of rust the current construction will need to be fully replaced. Option number two sell the property to another developer who will follow through with a new approved plan. That could contribute to the local economy in way that it would enhance existing businesses in the area providing retail businesses that would generate a tax base. And three our preferred option would be to sell the property through Public Access, Open Space and Natural Resources Preservation Commission (PONC) which could return the property and a condition of the property to its natural state. In recent years, the State of Hawaii has been acutely aware of its indigenous people and their history we recommend that you add this parcel to their Historic Preservation efforts which one would hope would consist of removing this extreme eyesore and returning the parcel to its original state. This would greatly benefit the local community. Thank you. CARR SMITH: Thank you Margo. Let's go ahead and have your husband Frank. F. KOTULAK: No, I have nothing else to say. M. KOTULAK: No, this a joint statement. Thank you. CARR SMITH: Okay, very good. Commissioners, any questions? Okay, thank you very much for your testimony and your patience you can drop off the call now. Thank you. Alright, Peggy Lindquist are you still with us? Peggy Lindquist? Okay. Are you here Peggy? LINQUIST: Can you hear me? CARR SMITH: Yes, okay so you are speaking on the phone from a(262) area code, is that correct? Or not. Peggy, can you speak up please. Okay, sorry, we can try you another time. Alex Duncan are you here? Yes, Alex thank you so much for your patience I've seen you the whole time. Thank you, you can proceed with your testimony. Unmute yourself please. Alex please unmute yourself. DUNCAN: There we go. CARR SMITH: There you go. Go ahead, thank you. DUNCAN: Hi, sorry you had to look at me for so long, Nancy, Okay. Good morning Commissioners. My wife and I have owned and been residents for over twenty-one (21)years at the Kona Reef which is directly next door to this property that is in discussion right now. We don't feel there should be another issuance of another five (5)year extension. Based on the fact that the Diamond Resorts bought the property back in 2012, nothing has been done, they've been issued two (2) 5-year extensions, promises in 2014 in regards to putting in sidewalks, paving Kahakai Road, curbs, gutters, and nothing has been done over eight(8) years. Over the years we've tried to find an on island contact to notify them of the graffiti that being sprayed painted on the sidewalls, to stop the vagrancy that is living in the underground parking, to stop the drug dealings that are also going on in the underground parking. We see it from our 4 EXHIBIT B complex. The local community has been cleaning the graffiti off the sidewalls of the structure for years and quite frankly we are getting a little tired of doing it but it's the only way to keep it up. We don't feel that Diamond should have another 5 years extension. The Kona Reef pays over $700,000.00 in property tax per year, Alii Cover across the street pays $1.1 million in property taxes and guess what, Diamond only pays $12,000.00, oh sorry $14,200.00 in property taxes. Its time they do something before another extension is issued. Thank you. CARR SMITH: Thank you Alex appreciate it. Mr. Van Pernis, do you have a question? Let's make sure your mike is on. Go ahead. VAN PERNIS: I have a question for Mr. Duncan, you testified that he tried to find a local representative for Diamond is that correct? DUNCAN: I cannot hear a thing, I'm sorry. CARR SMITH: Mark, can you put the microphone closer to you please. VAN PERNIS: Can you hear me now? CARR SMITH: That's better. VAN PERNIS: You testified that you could not find a local representative of Diamond is that correct? DUNCAN: Can someone repeat what he is asking or saying? CARR SMITH: Excuse me Noriko, can you help. YATES: I can. CARR SMITH: Okay, thank you. YATES: He is asking if you had tried to contact people from that particular development. VAN PERNIS: Locally. YATES: Locally. DUNCAN: Yeah, locally yes. We tried everywhere to contact people even their sales office which is in the Royal Kona Resort. They know nothing, they are not cooperative. They didn't even want to try and help. They have a full sales office; they have the South wing of the Royal Kona Resort as their temporary time share sales office. We've contacted in Las Vegas where Diamond Resorts is located to try and find an on island contact somebody that we can say, hey, 5 EXHIBIT B you've got more graffiti on the sidewall, you have vagrancy that are doing drug deals and/or worst, We can't find anybody at Diamond who would cooperate with us. YATES: Thank you. CARR SMITH: Thank you. Any other questions? Thank you very much Alex for your testimony, appreciate your patience. DUNCAN: I'll sign off. CARR SMITH: Thank you so much. Alright, Nancy Lorenzo is not here. LINDQUIST: Can you hear me? This is Peggy Lindquist I got back on. CARR SMITH: Okay, good. Thank you, Peggy go right ahead with your testimony. LINDQUIST: Okay, I am Peggy Lindquist and Dennis Lindquist is my husband. We own and we stay half of the year at the Kona Reef every year. CARR SMITH: Thank you Peggy. "- - -" Excuse me Peggy, go ahead I think we are good now. Go ahead Peggy. LINDQUIST: Anyway, my name is Peggy Lindquist, and we are residents at the Kona Reef for the winter every year, six (6) months and I don't want to repeat everything that Heidi Ruffner and Kotulak's and Alex Duncan said. I'm just going to echo them because everything they said is actually very important. I'm going to add the beach access, the public access to Hano Beach in front of our property. Is under danger of erosion at this time we are working with the County to prevent that. With increased people coming across from this new complex that they plan on building its going to be unsafe and more dangerous. We are not just unhappy as owners we are worried about the safety of others and the continued erosion which will increase more quickly and of course the safety is very extremely concerned because that building like Alex Duncan said attracts vagrancy, drug dealers, and so mostly safety on both ends that's my opinion. So, I want you to deny and hope you will deny this request. CARR SMITH: Thank you very much, appreciate it. Any questions? Seeing none, thank you very much for your testimony and your patience, you can drop off the call now. The public testimony ended at 11:24 a.m. Respectfully submitted, Melissa Dacayanan-Salvador Secretary to Boards and Commissions 6 EXHIBIT B