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HomeMy WebLinkAboutPD Recommendation Report Kona Country Club, Inc. (PL-REZ-2025-088)1 RKonaCountryClubREZAmend.ak.11.11.2025 COUNTY OF HAWAIʻI PLANNING DEPARTMENT RECOMMENDATION KONA COUNTRY CLUB, INC. AMENDMENT TO CHANGE OF ZONE ORDINANCE NO. 20-65 (PL-REZ-2025-000088/AMEND REZ 09-000098) Upon review of the request, the Planning Director is recommending that a favorable recommendation for a 10-year time extension to Condition D (complete construction) be forwarded to the County Council. Since this recommendation is made without the benefit of public testimony, the Director reserves the right to modify and/or alter this position based on additional information presented at the public hearing. This recommendation is based on the following findings: The applicant, Kona Country Club, Inc., is requesting a ten (10)-year time extension to Condition D (complete construction) of Ordinance No. 20-65, which was approved by the County Council and effective on September 15, 2020. The applicant initially proposed to develop a maximum of sixty (60) single-family and multiple-family residential units and related amenities with the intent of having them used as vacation rental units. In trying to address the various rezoning conditions such as water, archaeology, and emergency access, the plan was scaled back to twenty-nine (29) single-family dwellings with related amenities. The request for a ten (10)-year time extension to complete construction of the Kona Country Club is, in part, due to delays caused by inability to secure project financing; the filing explains that financing “has been stalled due to the vagaries of the global economy,” and those challenges were later compounded by the COVID-19 pandemic, which disrupted market conditions and the ability to secure capital for a resort-oriented housing project. The project was expected to be completed by September 15, 2025, however, the developer faced unforeseen challenges in securing necessary funding. In parallel, a lengthy archaeological compliance process, including preparing and obtaining approvals for the Data Recovery, Burial Treatment, Preservation, and Monitoring plans (2013–2014) and later acceptance of the Data Recovery Report in January 2025, delayed when construction plans could be finalized, so no physical -2- construction ever began. Construction of the proposed project is anticipated to begin within five years following the approval of this amendment, is projected to finish by December 30, 2035, and is estimated to cost a minimum of $390 million. The non-performance of timed conditions is the result of conditions that could not have been foreseen or are beyond the control of the applicants, successors or assigns, and that are not the result of their fault or negligence. Since the change of zone ordinance was last amended in 2020, the applicant has been diligently working on satisfying conditions of approval, the most time consuming of which were completing archaeological and cultural resource mitigation plans. In accordance with Condition M of the Change of Zone Ordinance, the applicant completed an updated Archaeological Inventory Survey (AIS) approved by the State Historic Preservation Division (SHPD) in 2012 and subsequently completed several mitigation plans related to archaeological and cultural features found on the site (further discussed below in the PASH/ Ka Paʻakai Analysis). The applicant has also paid their water commitment fee pursuant to Condition B for sixty (60) units of water through July 31, 2027. The director is recommending retaining the condition requiring the applicant to maintain valid water commitments to support the proposed use until the water facilities charges are paid in full, additionally the condition will be revised to reflect the need for the applicant to provide a Water Master Plan to the Department of Water Supply (DWS). Additionally, prior to being granted Final Plan Approval (FPA) in 2012, the applicants obtained six (6) affordable housing credits in compliance with Condition O and paid fair share fees for the proposed 29-unit development, in compliance with Condition P. The director is recommending retaining the affordable housing condition and the fair share condition to ensure that the appropriate requirements are met should the applicant develop at a residential density greater than 29 units. These conditions have also been updated with the most recent fair share rates and standard affordable housing conditions. Based on the preceding and with much of the “soft” work already complete for the development, the applicant believes they can secure the required financing to -3- complete the construction plans and develop the project within the next ten (10) years. Granting the time extension amendments would not be contrary to the General Plan or Zoning Code and the original reasons for granting the change of zone. The reasons for granting the original change of zone under Ordinance No. 09-159 and amended Ordinance No. 20-65 have not changed. The RM-30 zoning remains consistent with the LUPAG designation and goals, policies, and actions of the General Plan. The site is served by appropriate infrastructure such as water, wastewater, access, and essential utilities. There are no irresolvable geological or topographical problems which cannot be rectified, or which would render the land unusable. Finally, plans to mitigate impacts on archaeological/cultural sites and resources have been approved and will be implemented through the development of the property. In response to this amendment request, the Department of Public Works – Engineering Division (DPW) requested that that an updated drainage report, traffic impact analysis report (TIAR), and construction plans be submitted prior to the issuance of any permits related to construction of the proposed project. The updated drainage report and construction plans will be submitted as part of Final Plan Approval application prior to issuance of building permits. With regards to the updated TIAR, the current proposal for dwelling 29 units is not expected to generate fifty or more peak-hour vehicle trips and therefore does not presently trigger the requirement for an updated TIAR. However, should the project be modified in a manner that results in fifty or more peak-hour trips, a TIAR will be prepared and submitted in accordance with the concurrency requirements for review and approval by the Planning Director and the Director of Public Works, as specified in Condition D. Based on the preceding, the proposed amendments meet this criterion. The request is not contrary to Chapter 205A, Hawaiʻi Revised Statutes, relating to Coastal Zone Management. The subject property is situated fully within the SMA but does not have shoreline frontage. On September 22, 2009, the Planning Commission approved SMA Use Permit No. 09-000034 to allow the development of a mix of 60 single- and multiple-family residential units and related improvements. The effective date of this permit was concurrent with the effective date of the subject rezone -4- ordinance and is currently still in effect. The current proposed twenty-nine (29) single- family residential development is consistent with the approved SMA permit and will comply with all conditions thereto. The request will not have a significant adverse impact to traditional and customary Hawaiian Rights. In view of the Hawaiʻi State Supreme Court’s Public Access Shoreline Hawaiʻi (PASH) and “Ka Paʻakai o Ka ʻĀina” decisions, the issue of Native Hawaiian traditional and customary rights and cultural practices must be addressed in terms of the cultural, historical, and natural resources, and the associated traditional and customary practices of the site. The Ka Paʻakai framework requires that an applicant and approving agency identify, assess, and reasonably protect Native Hawaiian customary and traditional practices potentially affected by a proposed project. • Investigation of valued resources: In compliance with Condition M of the subject Change of Zone Ordinance, the applicant submitted an updated Archaeological Inventory Survey (AIS), which was approved by the State Historic Preservation Division (SHPD) in 2012. The AIS identified a total of 52 archaeological sites, including 9 possible burial sites, 6 non-burial sites recommended for preservation, and several others recommended for data recovery or combined mitigation. These findings indicate the presence of wahi kūpuna (ancestral places) and iwi kūpuna (ancestral burials), which hold cultural and historical significance. • The valued cultural, historical, and natural resources found in the rezoning area: A Cultural Impact Assessment (CIA) was originally required as a condition of the initial rezoning request. This condition was later determined to have been satisfied, as noted in a letter from the Planning Department dated July 18, 2012. The condition was subsequently removed when the applicant amended their permit in 2020. The AIS documented sites associated with traditional Hawaiian practices and ancestral burials. Of the 52 identified sites: ▪ 22 sites were recommended for data recovery fieldwork; ▪ 9 possible burial sites, with 8 recommended for further exploration; ▪ 6 non-burial sites recommended for preservation; ▪ 1 site preserved due to proximity to a burial; and ▪ 1 site recommended for combined preservation and data recovery. -5- These resources represent important cultural and archaeological features associated with Native Hawaiian ancestral presence in the area. • Possible adverse effect or impairment of valued resources: Potential project- related impacts included disturbance to burial and archaeological sites. To address these, the applicant developed and SHPD approved a comprehensive set of mitigation plans, including: ▪ Final Archaeological Data Recovery Plan (2013); ▪ Burial Treatment Plan (2014), preserving three burial sites in place with concurrence from the Hawaiʻi Island Burial Council (HIBC); ▪ Archaeological Preservation Plan (2014) for eight sites; and ▪ Archaeological Monitoring Plan (2014) to ensure compliance during construction. By letter dated January 16, 2025, SHPD confirmed that the Archaeological Data Recovery Report was acceptable and that all mitigation measures had been successfully executed. Therefore, potential adverse effects to significant cultural properties have been appropriately mitigated. • Feasible actions to protect native Hawaiian rights: Condition N of the Change of Zone Ordinance requires the applicant to comply with all provisions of the approved archaeological and burial treatment plans. These measures ensure that any cultural sites and iwi kūpuna are preserved in place or properly treated in accordance with State law and HIBC concurrence. Given SHPD’s confirmation that mitigation has been successfully completed, the proposed action is not anticipated to adversely affect traditional and customary Native Hawaiian rights or practices. Lastly, this recommendation is made with the understanding that the applicant remains responsible for complying with all other applicable governmental requirements in connection with the proposed use, prior to its commencement or establishment upon the subject properties. Additional governmental requirements may include the issuance of building permits, compliance with the Fire Code, installation of improvements required by the American with Disabilities Act (ADA), among many others. Compliance with all applicable governmental requirements is a condition of this approval; failure to comply -6- with such requirements will be considered a violation that may result in enforcement action by the Planning Department and/or the affected agencies. Based on the preceding findings, the Planning Director recommends a favorable recommendation for a 10-year time extension to Condition D be forwarded to the County Council. The accompanying draft bill to amend Ordinance No. 20-65 is provided for your consideration. Please note the proposed conditions of approval attached to the draft bill, including updates to conditions that have been complied with and to reflect current standard condition language. Material to be deleted is bracketed and struck through; new material is underscored. -1- COUNTY OF HAWAI‘I STATE OF HAWAI‘I BILL NO. ORDINANCE NO. AN ORDINANCE AMENDING ORDINANCE NO. 09-159, AS AMENDED, WHICH RECLASSIFIED LANDS FROM AGRICULTURAL – 5 ACRES (A-5A) TO MULTIPLE- FAMILY RESIDENTIAL – 30,000 SQUARE FEET (RM-30) AT KEAUHOU, NORTH KONA, HAWAIʻI, COVERED BY TAX MAP KEY NO. 7-8-010:101. BE IT ORDAINED BY THE COUNCIL OF THE COUNTY OF HAWAI‘I: SECTION 1. Section 2 of Ordinance No. 09-159, as amended by Ordinance No. 20-65, is hereby amended to read as follows: “SECTION 2. In accordance with Section 25-2-44, Hawai‘i County Code 1983 (2016 Edition, as amended), the County Council finds the following conditions are: (1)Necessary to prevent circumstances which may be adverse to the public health, safety, and welfare; or (2)Reasonably conceived to fulfill needs directly emanating from the land use proposed with respect to: (A)Protection of the public from the potentially deleterious effects of the proposed use, or (B)Fulfillment of the need for public service demands created by the proposed use. INSERT CONDITIONS” (Planning Department) -2- SECTION 2. Material to be repealed is bracketed and stricken. New material is underscored. In printing this ordinance, the brackets, bracketed and stricken material, and underscoring need not be included. SECTION 3. Severability. If any provision of this ordinance, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of the ordinance which can be given effect without the invalid provision or application, and to this end the provisions of this ordinance are severable. SECTION 4. This ordinance shall take effect upon its approval. INTRODUCED BY: COUNCIL MEMBER, COUNTY OF HAWAI‘I , Hawai‘i Date of Introduction: Date of 1st Reading: Date of 2nd Reading: Effective Date: 1 CKonaCountryClubREZAmend.ak.11.11.2025 KONA COUNTRY CLUB, INC. AMENDMENT TO CHANGE OF ZONE ORDINANCE NO. 20-65 (PL-REZ-2025-000088/AMEND REZ 09-000098) AMENDED CONDITIONS OF APPROVAL A. The applicant, its successor or assigns (“Applicant”) shall be responsible for complying with all stated conditions of approval. B. The [applicant, successors, or assigns are] Applicant is responsible for maintaining valid water commitments to support the proposed use until such time that required water facilities charges are paid in full. C. The [applicant, successors, or assigns] Applicant shall provide a Water Master Plan and install and construct necessary water system improvements meeting with the requirements of the Department of Water Supply prior to the issuance of a Certificate of Occupancy. D. [Construction of the proposed development shall be completed within five (5) years from the effective date of this amended ordinance. Prior to construction, the applicant, successors or assigns shall secure Final Plan Approval for the proposed development in accordance with Section 25-2-70, Chapter 25 (Zoning Code), Hawai‘i County Code. Plans shall identify all existing and/or proposed structures, paved driveway access and parking stalls associated with the proposed development. Landscaping shall also be indicated on the plans for the purpose of mitigating any adverse noise or visual impacts to adjacent properties in accordance with the requirements of Planning Department’s Rule No. 17 (Landscaping Requirements), Chapter 25 (Zoning Code), Hawai‘i County Code. An updated traffic assessment shall be submitted in conjunction with the plans for Plan Approval. Should the assessment, subject to concurrence by the Planning Director and Public Works Director, conclude that the project is anticipated to generate fifty or more peak hour trips, then a Traffic Impact Analysis Report (TIAR) pursuant to the concurrency requirements of Section 25-2-46(d), Chapter 25 (Hawaiʻi County Code) shall be prepared and submitted for the review and approval of the Planning Director and the Public Works Director. All recommended traffic mitigation outlined in the TIAR shall be implemented prior to issuance of a Certificate of 2 Occupancy for the first residential unit within the project area.] Construction of the proposed development, or other development/use permitted by the zoning district classification, shall be completed within ten (10) years from the effective date of this amended ordinance. The time during which required plans, reports, studies, or relevant permit applications are under review for approvals by government agencies shall not count towards the deadline established in the ordinance. To justify this tolling, the Applicant shall provide evidence of the excluded time period to the planning department for its review and approval, which shall consist of dates obtained from a government agency website, permitting program, or office indicating when the required plans, reports, studies, or permit applications were submitted, approved, denied, or returned by the government agency. E. The Applicant shall secure Final Plan Approval for the proposed development in accordance with Section 25-2-70, Chapter 25 (Zoning Code), Hawai‘i County Code. Plans shall identify all existing and/or proposed structures, paved driveway access and parking stalls associated with the proposed development. Landscaping shall also be indicated on the plans for the purpose of mitigating any adverse noise or visual impacts to adjacent properties in accordance with the requirements of Planning Department’s Rule No. 17 (Landscaping Requirements), Chapter 25 (Zoning Code), Hawai‘i County Code. An updated traffic assessment shall be submitted in conjunction with the plans for Plan Approval. Should the assessment, subject to concurrence by the Planning Director and Public Works Director, conclude that the project is anticipated to generate fifty or more peak hour trips, then a Traffic Impact Analysis Report (TIAR), pursuant to the concurrency requirements of Section 25-2-46(d), Chapter 25 (Hawaiʻi County Code), shall be prepared and submitted for the review and approval of the Planning Director and the Public Works Director. All recommended traffic mitigation outlined in the TIAR shall be implemented prior to issuance of a Certificate of Occupancy for the first residential unit within the project area. [E.]F. Plans submitted for Plan Approval shall reflect a minimum 10-foot wide emergency evacuation access route that extends from the project's easterly boundary, through the existing golf course identified by TMK:7-8-010:051, and up to any point along 3 Aliʻi Drive. As this access traverses an existing golf course and will be used only for emergency evacuation purposes, it need not be paved but will be reasonably compact enough to accommodate vehicles leaving the project site. The right of access across the emergency evacuation access route, including the terms of its use, maintenance, relocation, and related matters, will be recorded as an easement burdening TMK: 7-8-010:051 in favor of TMK: 7-8-010:101. The improvements of this emergency evacuation access route, if necessary, will be completed and the necessary easement will be recorded prior to issuance of a Certificate of Occupancy for the first residential unit within the project area. [F.]G. Access to the development shall meet with the approval of the Department of Public Works. The roadway easement from the Māmalahoa Highway Bypass to the project shall be constructed to County dedicable standards, including curbs, gutters and sidewalks, meeting with the approval of the Department of Public Works, and [dedicate it] dedicated to the County upon request. [G.]H. Any vehicular security gate shall be set back approximately 60 feet from any County dedicated road. Whenever in use, the security gate shall be staffed to facilitate access by emergency vehicles and personnel. [H.]I. All wastewater generated shall be disposed into the Keauhou Resort’s sewer system owned and maintained by the Keauhou Community Services, Inc., [it’s]its successors or assigns. [I.]J. All development-generated runoff shall be disposed of on-site and shall not be directed toward any adjacent properties. [J.]K. A drainage study shall be prepared by a licensed civil engineer and submitted to the Department of Public Works. The recommended drainage improvements shall be constructed, meeting with the approval of the Department of Public Works, prior to issuance of a Certificate of Occupancy for the first residential unit within the project area. [K.]L. During construction, measures shall be taken to minimize the potential of both fugitive dust and runoff sedimentation. Such measures shall be in compliance with construction industry standards and practices utilized during construction projects of the State of Hawaiʻi. 4 [L.]M. Earthwork and grading shall conform to Chapter 10, Erosion and Sediment Control of the Hawaʻi County Code. [M.]N. The [applicant, successors or assigns] Applicant shall adhere to the commitments made in the Archaeological Inventory Survey approved by the State Department of Land and Natural Resources – State Historic Preservation Division (DLNR-SHPD) throughout the life of the development. [N.]O. The [applicant(s), successors, or assigns] Applicant shall comply with all provisions of the Archeological Preservation Plan, Archeological Data Recovery Plan and Archaeological Monitoring Plan approved by the State Department of Land and Natural Resources – State Historic Preservation Division (DLNR-SHPD) and the Burial Treatment Plan approved by the Hawaiʻi Island Burial Council throughout the life of the development. Prior to any ground disturbance on the property, the Applicant shall provide SHPD the documentation requested in SHPD’s letter dated January 16, 2025. P. In the event that surface or subsurface historic resources, including human skeletal remains, structural remains (e.g. rock walls, terraces, platforms, etc.), cultural deposits, marine shell concentrations, sand deposits, or sink holes are identified during the demolition and/or construction work, the Applicant shall cease work in the immediate vicinity of the find, protect the find from additional disturbance and contact the Department of Land and Natural Resources-State Historic Preservation Division (DLNR-SHPD) at (808) 933-7651. Subsequent work shall proceed upon an archaeological clearance from DLNR-SHPD when it finds that sufficient mitigation measures have been taken. [O.]Q. [To ensure that the Goals and Policies of the Housing Element of the General Plan are implemented, the applicant, successors or assigns shall comply with the requirements of Chapter 11, Article 1, Hawaiʻi County Code relating to Affordable Housing Policy. This requirement shall be approved by the Administrator of the Office of Housing and Community Development prior to Final Plan Approval.] To ensure that the Goals and Policies of the Housing Element of the General Plan are implemented, the Applicant shall comply with the requirements of Chapter 11, Article 1, Hawai‘i County Code relating to Affordable Housing Policy. This 5 requirement shall be approved by the Administrator of the Office of Housing and Community Development as evidenced by an executed and recorded affordable housing agreement which shall be provided to the Planning Department by the Applicant prior to Final Plan Approval or Final Subdivision Approval. Fair share requirements under Condition R shall be conditionally waived for affordable housing units or lots, if the Applicant executes an affordable housing agreement to provide fifty (50) to one hundred (100) percent of the development as affordable housing units or lots. If the affordable housing units or lots are not produced and sold or rented in accordance with the affordable housing agreement, any fair share requirements under Condition R that were waived will become due and payable. [P.]R. The [applicant, successors or assigns] Applicant shall make its fair share contribution to mitigate the potential regional impacts of the property with respect to parks and recreation, fire, police, solid waste disposal facilities and roads. The fair share contribution shall become due and payable prior to receipt of Final Plan Approval. The fair share contribution for each unit shall be based on the actual number of residential units developed exceeding twenty-nine (29) units. The fair share contribution in a form of cash, land, facilities or any combination thereof shall be determined by the County Council. The fair share contribution may be adjusted annually beginning three years after the effective date of the amendment to the ordinance, based on the percentage change in the Honolulu Consumer Price Index (HCPI). The fair share contribution shall have a maximum combined value of [$9,366.52] $11,500.24 per multiple family residential unit [$14,596.67] $17,921.82 per single-family residential unit). The total amount shall be determined with the actual number of units according to the calculation and payment provisions set forth in this condition. The fair share contribution per [single-family residential] unit shall be allocated as follows: • [$4,620.24] $5,672.74 per multiple family residential unit [$7,038.77] $8,642.22 per single-family residential) unit to the County to support park and recreational improvements and facilities; • [$146.02] $179.29 per multiple family residential unit [$339.55] $416.90 per single-family residential unit) to the County to support police facilities; 6 • [$449.18] $551.51 per multiple family residential unit [$670.66] $823.43 per single-family residential unit) to the County to support fire facilities; • [$200.20] $245.81 per multiple family residential unit [$293.62] $360.51 per single-family residential unit) to the County to support solid waste facilities; • [$3,950.87] $4,850.89 per multiple family residential unit [$6,254.07] $7,678.76 per single-family residential unit) to the County to support road and traffic improvements; In lieu of paying the fair share contribution, the [applicant] Applicant may contribute land and/or construct improvements/facilities related to parks and recreation, fire, police, solid waste disposal facilities and roads within the region impacted by the proposed development, subject to the review and recommendation of the Planning Director, upon consultation with the appropriate agencies and approval of the County Council pursuant to Section 2-162.1(a) of Hawai‘i County Code. [Q.]S. Should the Council adopt a Unified Impact Fees Ordinance setting forth criteria for imposition of exactions or the assessment of impact fees, conditions included herein shall be credited towards the requirements of the Unified Impact Fees Ordinance. [R.]T. The [applicant] Applicant shall comply with all applicable County, State and Federal laws, rules, regulations and requirements. [S.]U. An annual progress report shall be submitted to the Planning Director prior to the anniversary of the effective date of this amended ordinance. The report shall include, but not be limited to, the status of the development and compliance with the conditions of approval. This condition shall remain in effect until all of the conditions of approval have been satisfied and the Planning Director acknowledges that further reports are not required. [T.]V. [If the applicant(s), successors, or assigns should require an additional extension of time, the Planning Department shall submit the request for the amendment to the change of zone and the SMA Use Permit to the Planning Commission and the County Council for appropriate action. Should any of the conditions not be met or substantially complied with in a timely manner, the Planning Director may initiate rezoning of the property to its original or more appropriate designation.]An initial 7 extension of time for the performance of conditions within this ordinance may be requested in accordance with Section 25-2-44, subsections (c) and (d), of the Hawaiʻi County Code. W. If any conditions have not been completed by the deadline, or if a time extension request has not been submitted in accordance with section 25-2-44(c), the planning department shall inform the Applicant that the ordinance is null and void without further action by the County. In that event, the zoning designation of the property(s) affected by the ordinance shall automatically revert to its immediate prior zoning designation.