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HomeMy WebLinkAbout2016-02-04 Hearing Transcript - PD Initiated Redevelopment Area Banyan Drive WINDWARD PLANNING COMMISSION COUNTY OF HAWAI‘I HEARING TRANSCRIPT FEBRUARY 4, 2016 A regularly advertised hearing on the request by the Planning Director for the designation of “redevelopment area” for that area encompassing properties along Banyan Drive, Lihiwai Street and Kamehameha Avenue in the Waiākea District of Hilowas called to order at 9:27 a.m. in the County of Hawai‘i Aupuni Center Conference Room, 101 Pauahi Street, Hilo, Hawai‘i with Chairman Charles Heaukulani presiding. COMMISSIONERS PRESENT: Charles Heaukulani, Donn Dela Cruz, Gregory Henkel, Donald Ikeda, Myles Miyasato, and Raylene Moses. ALSO PRESENT: Duane Kanuha (Planning Director), Danny Patel (Deputy Corporation Counsel for the Windward Planning Commission), Daryn Arai (Planning Program Manager), Jeff Darrow (Staff Planner), Christian Kay (Staff Planner), and Sarah Hata-Finley (Commission Secretary). And approximately 14 people from the public in attendance. INITIATOR: PLANNING DIRECTOR Designation of “redevelopment area” for that area encompassing properties along Banyan Drive, Lihiwai Street and Kamehameha Avenue located within the Waiākea District of the City of Hilo in accordance with Section 53-1, Hawaiʽi Revised Statutes regarding the Hawaiʽi Redevelopment Agency as administered by the County of Hawaiʽi Planning Department pursuant to Section 16-10 of the Hawaiʽi County Charter. Should this proposed redevelopment area be so designated by the Windward Planning Commission, the Planning Department may then undertake and carry out a redevelopment project(s) within all or any part of these redevelopment areas that may include the planning, development, replanning, redesign, clearance, reconstruction or rehabilitation, or any combination of these as deemed appropriate or necessary in the interest of the general welfare and in accordance with procedures and authorities set forth in Chapter 53, Part I (Urban Redevelopment Act) and Part II (Urban Renewal), Hawaiʽi Revised Statutes. HEAUKULANI: We’ll go to Agenda Item No. 4, Initiator: Planning Director. This matter is a designation of a “redevelopment area” for that area encompassing properties along Banyan Drive, Lihiwai Street and Kamehameha Avenue located within the Waiākea District of the City of Hilo in accordance with Section 53-1, Hawaiʽi Revised Statutes regarding the Hawaiʽi Redevelopment Agency as administered by the County of Hawaiʽi Planning Department pursuant to Section 16-10 of the Hawaiʽi County Charter. Should this proposed redevelopment area be so designated by the Windward Planning Commission, the Planning Department may then undertake and carry out a redevelopment project or projects within all or any part of these redevelopment areas that may include the planning, development, replanning, redesign, 1 EXHIBIT C clearance, reconstruction, or rehabilitation, or any combination of these as deemed appropriate or necessary in the interest of the general welfare and in accordance with procedures and authorities set forth in Chapter 53, Part I, it’s the Urban Redevelopment Act, and Part II, the Urban Renewal, Hawaiʽi Revised Statutes. Daryn, please? ARAI: Thank you, Mr. Chairman. Good morning, Commissioners. If I may direct your attention to the presentation screen, again, what you have before you is a Planning Director initiated request for the designation of a redevelopment area for the Banyan Drive peninsula. The County, through its Planning Department, and the State, through its Department of Land and Natural Resources, or the DLNR, have announced their joint support for economic development and the revitalization of the Banyan Drive area by implementing an urban renewal project that will be administered by a new redevelopment agency to be established specifically for the Banyan Drive peninsula. The State’s urban renewal law, which is Section 53 of the Hawaiʽi Revised Statutes, provides the necessary authorities to the County to pursue this particular project. However, it first requires that the Windward Planning Commission designate the Banyan Drive peninsula area as a “blighted area.” I’m sorry, I was hoping the photo would be lot bigger, but this is an aerial photo of the Banyan Drive peninsula which is the focus of today’s request. At the bottom of the map is Kamehameha Avenue. This is Lihiwai Street, which is running along Suisan and Banyan Drive, which loops around and connects back with Kamehameha Avenue. Projects of note as highlighted on this aerial photo includes Hilo Bay Café; Liliuokalani Gardens in this area here; Coconut Island or Moku Ola in this location here; Hilo Hawaiian Hotel located in this location; right next to it is Uncle Billy’s Hilo Bay Hotel; and further next to it is the Hilo Naniloa Hotel. Other residential developments include the Country Club Condominiums; the Banyan Drive—sorry, the Banyan Apartments; and the Reed’s Bay Resort. Other noteworthy facilities include, again, Suisan in this particular location here; the HELCO power station located in this particular area; and this is Hilo Seaside Hotel. This is a map which not only identifies the Banyan Drive peninsula as indicated or highlighted by various colors, but it’s over—also overlaid with this pink area here which is the original boundaries of the Kaikoʽo Project. The Kaikoʽo Project was established in order to facilitate the rd redevelopment of the Kaikoʽo area due to the May 23, 1960 tsunami which devastated portions of Hilo. The extent of the Kaikoʽo area which is basically highlighted by pink extends to the northeast from Ponahawai Street, runs along Kīlauea Avenue, encompasses all of Wailoa State Park, runs along Piʽilani and Manono Streets, and then along portions of Kuawa Street before encompassing most of the Banyan Drive peninsula. Of note is the Kaikoʽo Project boundary did not include Moku Ola or Coconut Island as well as the resort and condominium facilities located 2 EXHIBIT C on the makai side of Banyan Drive. You may also note that the Hilo Seaside Hotel was also excluded from the Kaikoʽo Project boundaries. Also of note is that upon completion of the redevelopment of this area, to clear the basically, the devastation and the debris caused by the tsunami, the project itself concluded in 1971. And upon its conclusion, the Hawaii Redevelopment Agency, which oversaw the implementation of the Kaikoʽo Project, basically was suspended. So, today’s request is the Planning Director is requesting that the Planning Commission identify as a “blighted area” those properties which are highlighted here by the various colors. They, again, it includes portion of Hilo Iron Works, which is this blue color here off to the left; portions of Kuawa Street; and then across Kamehameha Highway is the rest of the Banyan Drive peninsula. The colors basically represents the various landownerships within this particular area with the Federal being this pink color here which is right next to Hilo Bay Café; State lands are identified by green; and private landholdings are identified by the blue colors. Again, today’s request is for the Planning, Windward Planning Commission to provide an affirmative vote to designate the Banyan Drive peninsula to the extent as shown on Exhibit A within your Background and Recommendation Report as a “blighted area” pursuant to Chapter 53, Hawaiʽi Revised Statutes. So with that, I stand ready to answer any questions that the Commissioners may have. HEAUKULANI: Thank you, Daryn, very much. Commissioners, any questions? IKEDA: Yes. HEAUKULANI: Mr. Ikeda. IKEDA: Daryn, can we go back to the map you had before? I get confused after a while. Yeah, this one here. So the blue is private and so they’re not part of this redevelopment? ARAI: The blue is currently private, and we are asking that all of the lands or parcels, I should say, identified by the various colors whether it’s green, blue, or pink be included within that area designated as a “blighted area.” IKEDA: I cannot understand the top right, like, there’s a blue—which property is that? ARAI: If I’m not mistaken, that blue is the Country Club Condominium. OGUSS (from audience): No, Naniloa, half of, half of Naniloa is privately owned from before the Kingdom days. ARAI: Excuse me, one moment, the Director can answer. 3 EXHIBIT C KANUHA: I believe that, that parcel is owned by Hawaiʽi Forest and Trails. No? HEIT, GORDON (from audience): Benda Trust—Benda Trust is a private trust. KANUHA: Yeah, there’s a, there’s that private parcel in there between the Naniloa and Country Club Condominium. IKEDA: Okay, I’m surprised. I thought was, it all belonged to the State. Thank you. HEAUKULANI: Commissioners, any other questions for staff? Director Kanuha, do you want to add anything? KANUHA: Yes, the purpose of this designation really is to provide an opportunity for the newly designated redevelopment authority which would be created by the County. The authority would basically consist of a board of five members appointed by the Mayor and confirmed by the Hawaiʽi County Council. This would be pretty much the exact same process that was utilized when the initial Hawaiʽi Redevelopment Agency was convened back in—you know, in response to the tidal wave action of 1960. At that time, that, that agency and this newly created agency would still, you know, retain a lot of authority. And, what the Hawaiʽi Redevelopment Agency did back then in order to create what we have today was, was a lot more than we’re envisioning for what will happen under this particular designation. At that time, there was a need to acquire, condemn, readjust properties for the purpose of redeveloping that area. Under this particular effort, all it is, is an effort to coordinate some economic revitalization of Banyan Drive within the proposed designated area. We don’t anticipate the need for condemning leases or taking hold of property, that kind of an effort. That will come after the agency gets appointed. A master plan within this boundary will be prepared. That master plan, by the way, will come to this Commission for your approval prior to it going to the County Council and the agency for their review and approval. Once that is done, then the agency itself will not be implementing any of the recommended actions. The agency would then either put out proposals for the development corporations to come forth and implement, you know, whatever redevelopment scheme comes forward. What it does, essentially, it provides more redevelopment and economic opportunities for existing leases or landholders within this designated area. Currently, there are certain restrictions in terms of existing buildings or existing uses or activities that would restrict, you know, further improvement, further investment into the area. This designation would allow this agency to provide additional opportunities, for example, adding density in certain areas perhaps allowing the reconstruction of facilities that, under the current laws, rules, and regulations, could not be reconstructed in that particular location. Things of that nature. It’s, it’s very akin to what the State is doing in Kakaʽako in Honolulu, and it’s, we believe it’s an opportunity for everyone in the area to have an opportunity to basically, you know, create some revitalization for that area. We—the State is pursuing various efforts. 4 EXHIBIT C They’ve conducted a few studies because they are the primary landowner in that area. I believe they recognize the importance of this collaborative effort, and they’re very supportive of it. Obviously, it would enhance the opportunities for their revenue flow because it would give their leaseholdings other opportunities than that which exists today. So, if there’s any questions, that’s pretty much a fairly complicated effort in, in a nutshell. HEAUKULANI: Commissioners, any questions for Director Kanuha? IKEDA: Yes, I’ve got a question. HEAUKULANI: Sure, Commissioner Ikeda. IKEDA: Mr. Kanuha, so the term of the lease and the conditions of the lease still stays with DLNR? KANUHA: Uh-huh. IKEDA: Okay, that’s all I wanted to know. KANUHA: Yes, yes, the ownership doesn’t, doesn’t change. HEAUKULANI: Commissioners, any other questions? MIYASATO: I have a question. HEAUKULANI: Sure. MIYASATO: Director Kanuha, is there timelines for this Commission or for any of this multi- layered process if it’s approved? Timelines—is it, are there timelines? KANUHA: No, there’s—there’s no timelines actually. We’ve been in discussions with this for a while. What makes this an initiative that we’ve encouraged the administration to take sooner rather than later is basically because as all of you know, the leases for a lot of these properties have expired or are about to expire, and we’d like to make sure that there’s a smoother transition to whatever opportunities can come forward. And, that’s why we’re putting it up now, because the process itself will actually go on for some time. But, it is one of the priorities for the administration to try and pull this particular project together for Banyan Drive. HEAUKULANI: Commissioners, any other questions for Director Kanuha? All right, we have one individual signed up to testify. Is there any other members of the public that are interested in testifying on this agenda matter? Sir, you can come forward. Please remain standing. Raise your right hand. Do you swear or affirm to tell the truth on this matter now before the Planning Commission? 5 EXHIBIT C OGUSS: I do. HEAUKULANI: Could you please state your name for the record? OGUSS: Carl Oguss. HEAUKULANI: And where do you reside, sir? OGUSS: At 121 Banyan Drive, Country Club parcel. HEAUKULANI: Thank you. Go ahead, sir. OGUSS: Yes, hi, I’m glad that the County is taking an active interest in Banyan Drive. We have had certainly many economic problems over the years. These seem fairly clearly connected to the fact that back in the 1960’s, the Hilo area overdeveloped the number of hotel rooms in the hopes that availability would equal demand, and that turned out not to be the case. Approximately half of the hotels in Hilo, including these, went broke and changed to other uses or in some cases had fire or other damage and the owners choose not to rebuild. There just wasn’t the demand for it. Even now, and including the West side of our County, we only have about 75 percent occupancy. What I would like us to consider are really two things. One has to do with the direction that any future use of Banyan Drive should take, but the other and since you’re not deciding that issue yourselves today, the other is whether or not we should designate this entire area a “blighted area” and then go on to redevelopment. As a taxpayer and community member, we all realize that any action by this Commission has to serve the general welfare. That means the average person, the majority of people and their most essential needs. What this community needs very definitely is more affordable housing. What the community also needs is better medical services. You may have seen in the newspaper just the other day extended care is looking to further reduce their capacity which creates a problem when you have a loved one in extended care, and they have been sent down to Kaʽū or Hāmākua, which has been the trend, to keep the bed use at about half of its original potential and to send people to private institutions in other places. It means you’ve got a very long drive before you can go and visit those relatives in extended care. Extended care is facing a backlog of only $6 million. To really have a good impact on our community, we should consider what our priorities are. I would be loathed to see you spend any County funds on redeveloping Banyan Drive as, in a manner that would further reduce affordable housing. You may or may not realize it, but between three properties there—Country Club, Reed’s Bay, and Bayview Banyan Apartments—you’ve got about a thousand people living there. These are units that if we decided to redevelop as another way of perhaps talking about improving hotel-resort use, those people would have to move. This would be a nightmare for them. 6 EXHIBIT C This is something that we should really consider in the light of what State government has just recently said—that affordable housing and homelessness are their highest priorities. If we are to designate Banyan Drive as a redevelopment area, then that money should be put to use to improve residential use and perhaps expand it. We’re all sorry to see Uncle Billy’s perhaps going under but there’s a new developer from Oahu who was born here in Hilo and wants to take the property over. At our last meeting, we had Reed’s Bay owner, Don, \[sic\] tell us that he would love a long-term lease. Well, what does that mean? That means that for the three properties that are immediately before you as the most critical to make decisions about, that Reed’s Bay is willing to take care of its own. They’re willing to reinvest and stay in business as a mixed hotel-residential property. The Uncle Billy’s has a new developer who, very likely, would love a long-term lease and to acquire that property and nurture it, partly ‘cause he is a Hilo boy, and this is something he feels strongly about. He’s not just involved for the short term for a few months. This is an interest in expanding his legacy. That being said, we’re left with Country Club. Country Club has long-term residential use for the most part as it has for many decades. Of the people who are living there now would love to form a cooperative, getting long-term lease, pay that lease and finally, start taking seriously our utility bills. You may or may not realize it, but we have over $400,000 that we owe the electric company at this point. That’s from years of neglect of our most essential bills. Current management runs the place with over a dozen employees. The next door, Bayview Banyan, a larger property, has two. I’ve owned apartment buildings before. Having two full-time employees is fairly normal. Having a dozen is ridiculous. What we need, I would suggest, is either to rethink whether we want to, at taxpayer expense, invest in Banyan Drive, when the three properties are willing to take care of their own future. It would be much easier for the people who are now spending $750, $850 a month at Country Club to bring that down to $450 or so, which is still higher than the average condominium pays in the entire State of Hawaiʽi. But, that would be plenty for the kind of rehabilitation that our building needs. If you’re going to recommend a redevelopment project, I would suggest that it be done for the purpose of redeveloping and improving existing properties for long-term residential use. Affordable housing is a big need. Affordable housing for the elderly is an especially big need. I would love if Uncle Billy’s is not going to be taken over by this outside developer, and there’s no other lease buyer interested, I would love to see that facility change into an elder care facility. So, thank you. HEAUKULANI: Thank you. Is there any other members of the public that wish to be heard on this agenda item? Hearing none, Commissioners, I need a motion to close public hearing. MOSES: I make a motion to close public hearing. HEAUKULANI: Motion by Commissioner Moses. 7 EXHIBIT C MIYASATO: Second. HEAUKULANI: Second by Commissioner Miyasato. Any discussion? Hearing none, all those in favor, signify by saying aye. COMMISSIONERS: Aye. HEAUKULANI: Anyone opposed? Motion to close public hearing carries. Commissioners, I need a motion for action, please. MIYASATO: I’ll make a motion. I move that those Federal, State, and private properties highlighted in Exhibit “A” to the Planning Director’s Background and Recommendation Report be designated as a “blighted area” pursuant to the Planning Director’s recommendations and findings which shall be adopted. HENKEL: Second. HEAUKULANI: I’ve got a motion by Commissioner Miyasato; a second by Commissioner Henkel. Any discussion or comments? HENKEL: Mr. Chair? HEAUKULANI: Please, Commissioner Henkel. HENKEL: I really appreciate Mr. Oguss’s presentation and testimony, and I would think that, you know, I like what he had to say, and I think to designate it as a “blighted area” would even, you know, ease the process to move along the lines of, you know, what he’s talking about, and I would encourage him to join the— OGUSS (from audience): —I would love to— HENKEL: —the new committee when it is formed. That he volunteer for it. That’s basically all I have to say. HEAUKULANI: Any other discussion, comments Commissioners? Daryn, would you please roll call the vote, please? ARAI: Thank you, Mr. Chairman. Commissioner Miyasato? MIYASATO: Aye. ARAI: Commissioner Henkel? HENKEL: Aye. 8 EXHIBIT C ARAI: Commissioner Dela Cruz? DELA CRUZ: Aye. ARAI: Commissioner Ikeda? IKEDA: Aye. ARAI: Commissioner Moses? MOSES: Aye. ARAI: And Mr. Chairman. HEAUKULANI: Aye. ARAI: Mr. Chairman, your motion carries with six aye votes. HEAUKULANI: Thank you, Daryn. The discussion ended at 9:53 a.m. Respectfully submitted, Sarah Y. Hata-Finley, Secretary Windward Planning Commission 9 EXHIBIT C