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HomeMy WebLinkAbout2018-03-28 BDHRA Minutes BANYAN DRIVE HAWAII REDEVELOPMENT AGENCY COUNTY OF HAWAII MINUTES March 28, 2018 The Banyan Drive Hawaii Redevelopment Agency met at 2:00 p.m. in the County of Hawaii, Aupuni Center Conference Room, 101 Pauahi Street, Hilo, Hawaii, with Chairman Brian DeLima presiding. MEMBERS PRESENT: Brian DeLima(Chairman), Barry Taniguchi, and Sigmund Zane MEMBERS ABSENT & EXCUSED: Nathan Gaddis and Elmer Gorospe ALSO PRESENT: Michael Yee (Planning Director), Amy Self(Deputy Corporation Counsel for the Agency), Jeffrey Darrow (Planning Division Manager), and Kim Tanaka(Secretary) A quorum was present with three members in attendance. STATEMENTS FROM THE PUBLIC There were 7 members of the public in attendance. At 2:00 p.m. Chairman DeLima opened the floor to take statements from the public. DELIMA: We'll take statements from the public. We have Donald Inouye who's passed out statements, written testimony. Mr. Inouye, would you want to come and present your testimony? You've handed it out, we've read it, but if you want to say anything more. INOUYE: Yeah, I'm Don Inouye, president of the corporation Reeds Bay Resort Hotel on Banyan Drive and the reason I handed this letter out was because there's certain things that been bothering me in regards to the progress of things. And then I am on a month-to-month revocable permit, and so all of these things kind of add up. And I was curious to know, not curious, but I needed to know so I can make plans, future-wise for my business. Because being on a month-to- month, that's uh, you know, very disturbing. And with no real guarantee of future because, after all, I'm in the hotel business and we make reservations aheadI have reservations clear up to December, and I've prepaid my monthly rent, we're up to December. Hopefully there'll be no interruptions. And as you know, or maybe you don't know, since the fire in Honolulu on Marco Polo, that kind of made all the counties come to attention and go out and do better inspections. And I appreciated the inspection they did on my building, and I had, oh, many, many—you could call them violations and not all were violations, but some of them were requests to improve on some of the things that should have been done. And we've got pretty well all of them underhand, but kind of hard if you have a building department you have to satisfy. I am on a fine now of$1,000 and $1,000 a day because I haven't taken out enough permits. Now, you know, when I got all of the notification, I did the things that had to do with safety first. And I figured, well numbers are numbers, and the more I do better and now we're attacking the rest. I spent upwards to almost $50,000 last year in trying to catch up on some of the so-called violations. I expect to spend another $100,000 this year if I'm forced to. And I probably will go ahead and do it because I look at the overall work that you've been doing here; accordingly I'm supposed to Page 1 of7 Banyan Drive Hawaii Redevelopment Agency March 28,2018 Minutes stay on my month-to-month until you come to a point of your master lease being completed and then the environmental studies being completed. All of this going take time so I'll be on a month-to-month. So I, you know, I'm kind of in-between. I'd like to get a lease, a long-term one, and I do have an application in for a long-term lease which I submitted in August 21 to expend, which I do have approval, for $2,200,000 to bring the building up to code. Now that hasn't helped any. Now that was in August; I have no response to that yet. It's been seven months and I have response from the Building Department. And hopefully I can coordinate the two and not have to pay the $30,000 and get that appealed, taken care of, okay. And I put this letter in because I'm concerned about certain things and looking at the future. And I appreciate being able to come to the Board and say what I have to say. And I thank you very much. If you have any questions, I'll be glad to answer. DELIMA: Does any member have any questions? Thank you, Mr. Inouye, and I think you hit the nail on the head in terms of the position that the Planning Department has taken in regards to this agency that we have to pass, we have to have the various plans completed before we are empowered to do anything and the County doesn't have the money to do the plans and they're at the Legislature trying to get the money, the matching the funds, but INOUYE: And I'll always do the best I can. TANIGUCHI: Mr. Chairman, I have a question. DELIMA: Mr. Taniguchi has a question. TANIGUCHI: Not of Mr. Inouye, but on this topic. Actually it's for the State DLNR. DELIMA: Okay. TANIGUCHI: What—is the month-to-month a standard practice or is there—that's only that and long-term leases? Can you do year-to-year leases? Mr. Gordon Heit from the State Department of Land and Natural Resources approached the microphone at this time. HEIT: To answer your question, there's no set minimum as far as the length of a lease. Originally I think we were working on a short-term lease or—from Mr. Inouye's request on a short-term lease of either five or ten years. We're still reviewing it. We're kind of waiting for these studies to be completed, the ones that were just done on usefulness of the life of the building. TANIGUCHI: Well, the reason I ask is that, I mean to go month-to-month is pretty, pretty tough. When you gotta take out reservations for ten months in advance or, you know, at least a year-to-year you have some kind of set—some kind of assurance that at least a year from now you'll still be there. Maybe a year and a day not, but—you know what I'm saying? Something other than a month-to-month. Longer than a month-to-month. HEIT: Yeah,just so you know, the process for leasing State land is bid through public auction so it's open to everybody. So, you know, when we do the property up for lease, we want to Page 2 of 7 Banyan Drive Hawaii Redevelopment Agency March 28,2018 Minutes make sure that one there's interest from the general public and those that are qualified to bid on it, so you know, to do it for a year is kind of a—it's a long procedure for a short term. So if we do put it up for lease, it would be for, you know, probably a little bit longer, five, ten years, maybe even fifteen years. A lot has to deal with, you know, the direction of this agency and the Department coming up with a long-term plan. To put out, you know, commit property for a length of time, you know, we need to have some type of overall master game plan. TANIGUCHI: I know what you're saying, but I can also, it's going to take a while. I agree with Mr. Inouye. It's not gonna be an overnight thing. It's going to take a while for this thing to get done. HEIT: Oh absolutely, yeah. TANIGUCHI: So why not give `um a year or two? HEIT: Well again, we're not gonna—we can't give it to him. We can give him the opportunity to bid on it. TANIGUCHI: Yeah, right, right. HEIT: Just so you understand. It's public auction. TANIGUCHI: Okay. HEIT: Open to everybody. TANIGUCHI: Thank you. DELIMA: Okay. Dean Au. AU: Good morning, commissioners. Thank you for your services. You know, I know you guys are volunteering and it takes out a lot of your time from your busy schedules so thank you for, for being on this board and volunteering. My name is Dean, last name Au, I'm with the Hawaii Regional Council of Carpenters. We represent 6,000 carpenters and dry wallers in the State of Hawaii. Of these 6,000 working families, we also represent 200 plus of our signatory contractors and one of the main things that we advocate for is area standard wages. So an area standard wage is the prevailing wage. It's a livable wage and benefit that a construction worker makes and they can provide for their—themselves and their families. We, the carpenters union, we feel it's a fair wage and as we move forward, as you and the State, moves forward with the process of redeveloping Banyan Drive, you know, through this process we would like to see area standard wages paid to construction workers on Banyan Drive. I attended the jobsite visit today with Mr. Gordon Heit for that Uncle Billy's Hilo Pagoda job visit. You know, I realized that it's gonna, it's gonna be a long process. Whatever happens to that facility and Mr. Inouye's facility, and all the other facilities that are in a similar situation as Hilo Bay, it's gonna be a long process. But at the same time, I'm very excited. You know, a lot of you guys here have seen Banyan Drive during their heydays. I haven't so I don't know what Mr. Applegate and all these people are talking about because I haven't seen it. But I'm very excited to see it get there. It's gonna be a long process, you know, we would love to see new hotels, we would love our contractors to Page 3 of 7 Banyan Drive Hawaii Redevelopment Agency March 28,2018 Minutes have a chance to bid these hotels. So I just wanted to make that comment, you know, as we move forward and as these projects go out to bid, you know, we would like to see area standard wages being paid to construction workers. Thank you. DELIMA: Any questions? Thank you. Patti Heidenfeldt. HEIDENFELDT: Good afternoon. I know we've all met before and I represent the Reeds Bay Resort Hotel and Don had mentioned about the NOVs and there were 94 NOVs, and of those 94, we eliminated almost 90 percent of them. We're down to, there were 27 that were urgent that we got them all done with the exception of 7. So 20 out of 27 and those 7 were included in the $2.2 million that he said that are gonna have to all be done in that renovation, but I want you to understand that the monies that have been spent during this lease-to-lease are really a hardship because we know that in the master plan, if we are allowed to bid on this lease and we get it, we're going to be doing that $2.2 million renovation again. So we've been in a position to have to do repairs on things that are already included, and as Don mentioned we welcomed the inspectors when they came because the inspections hadn't been done for many, many, many years. So we had no idea where we were at. But we have since corrected, like I said, 90 percent if not higher. We're down to a very small number of things that need to be done. And I just want you to understand the effort that Don Inouye has put into this place and what it means to him and the importance in being able to stay there, and the difference between the structure, the life structure of the building and the internal structure. So the life structure of the building is longer than what, I think, people are conceiving. It's the internal, the wiring, all of the things that are in that $2.2 million dollars' worth of renovation that will bring it to where it needs to be. So I just wanted to kind of clarify that I think some people are confused to the lifespan of the building versus the lifespan of what's internally in there. And that's in that $2.2 million. We're going to bring that internally part up to where it needs to be. So, I just wanted to give some clarification as to what he's done, and his efforts, and in the money and the expense with no guarantee of recapture. Thank you. DELIMA: Thank you. Since we have no further statements from the public, we'll proceed to the Business Agency portion of our agenda. BUSINESS OF AGENCY The Agency took this item up at 2:13 p.m. with approximately 7 members of the public in attendance. 1. Review and discussion regarding bills of the 2017-2018 legislative session that involve or pertain to properties within the Banyan Drive redevelopment area. DELIMA: I guess the Planning Director will lead off discussion. Thank you for coming today. YEE: Thank you. Michael Yee, Planning Director. So there's basically two bills that are kind of still alive. One is SB 2972, 2972, yeah, which basically is a matching fund for the EIS, so State would put up $250,000 and we would put up $250 [thousand] from the County. Also has in a 10 percent of revenues from DLNR would help fund going forward. There were changes from the original draft, which isn't important, but that's where it stands right now. I think priorI did fly out to Honolulu to testify for 2972, and at that time we had the Mayor verbally commit to the $250. When the budget came out, it's not included in the current budget, but I'm Page 4 of 7 Banyan Drive Hawaii Redevelopment Agency March 28,2018 Minutes certainly working with both the Mayor and the County Council to try to ensure that the $250 will be in the final budget so TANIGUCHI: Which budget? State or the County? YEE: Insorry, within the County budget to have that match ready to go if the bill passes. In terms of the other bill which is SB 3058, that would create a committee out of DLNR that would help kind of do the planning for Banyan Drive. We've tried to craft the legislation where the BDHRA would still work in conjunction with this new group; could be a contracting, whatever, we tried to leave it a little bit flexible. Basically that bill also addresses the KIAA leases in trying to create a ten year pilot project where they, there is a process to renew, there's a process of people invest could—and if they didn't get the lease would get their improvement money back. Creates a process which to notify DLNR that you want to go through a process to, to bid for the property and stuff I think it's a compromise to previous bills that try to just basically open up renewing these leases and there was a lot of rub with trying to extend the leases too far out while the constitution said we should put these leases back out to bid. So a ten- year pilot project, I feel, is kind of the compromise and we can try to see how this works I think is where the legislators have landed. So both of those bills are still alive and I guess we're all trying to work to get them through this year. DELIMA: Questions? TANIGUCHI: Question. Both were Senate bills. Has it, did they cross over to the House? YEE: Yes, they are in the House right now. TANIGUCHI: There's only—no companion bill? YEE: Three zero five eight (3058)had a companion that just got re-referred so it's, I think they are hoping that this Senate bill will work its way through but it did have a companion that's kind of stopped for now. TANIGUCHI: What does the outlook look like in the House? YEE: Based on an email I got from Jim McCully today, they were crafting 3058 with certain languages where that were in different versions and he's had some verbal support from key House members that would seem to imply that hopefully it, you know, is gonna keep moving forward till it can get to conference, but you know, that's all I guess at this point. As for 2972, the $250, I'dI haven't heard any strong opposition to it yet; again, when it comes down to assigning the money that's probably the critical point, at this point is how much it would be funded by the State. At one point it was written in for $250 with a certain amount, and that was kind of taken out,put back in, and stuff and where it finally lands we're not sure. DELIMA: I'm of the opinion that I think it's gonna be very difficult to get any of these bills passed and if they are passed, I think that's a great thing to bring this master plan to reality where some form of addressing the need for that peninsula. I think we all have sympathy for those who have had these long leases and there's desire to do something in terms of their own property Page 5 of 7 Banyan Drive Hawaii Redevelopment Agency March 28,2018 Minutes investments, but we're appointed to this agency and I'm of the opinion if there is no money to do the studies, then I think we need to take a fresh look at what is really required in order to consider the master plan. And I had a short discussion with our Corporation Counsel representative here, but to me, if we're not increasing density and we're keeping the same footprint of the existing buildings, then I don't see the need to spend, to be frank, a half a million dollars to do a study when all our plans call for is the existing density and structure; it seems like a waste of taxpayer money, to be frank. I think what we really want to do is give the signal to developers that we welcome investment in our community to build new structures to present a 21st century opportunity for visitors and residents alike. And then tweak the amenities that are not really structures, per se, but things that are accessory to the use of the peninsula properties. And then we had some recommendations regarding rezoning some of the private properties on the peninsula so that those land owners would have the ability to make their properties more attractive and not a nuisance for being compatible with the tourist attractions in the area. So allI'm not into making a hassle about anything, so if there was a desire to implement the master plan by spending money that's available, fine. I'm into the path of least resistance. But if there is going to be a resistance of lack of funding, then I think we need to rethink how this agency can move forward to assist the potential development of that area. And if it needs to, maybe we need to get the lawyers in the room and take a look at how we can work with the planners so that we can be empowered because I think the State wants to empower us too. So if we're all on the same page to facilitate approvals, then we can work through a memorandum of understanding as to how Oahu has done. We just need to make it attractive for capital investment. And I think that's—we're all on the same page to do that; we just have to find the most practical way to do it in as quickest time possible. YEE: I'm in agreement that I'm not much for banging my head against the wall with the same idea. I—when I first got in here a year ago, this was already on the table; we went through one Leg session. I wasn't working with the Leg last year, I was too new. This year is different. I'm giving it my best shot to work the County and try to, again, no money no mission here, so we need to find the money. If we don't find the money this year, this way, yes I would say we have to, you know, start thinking of new ideas to spur that investment. To me, if I could get the $250 from the State and $250 from the County, that would help us do an EIS, that would help us signal to folks that we want to start reinvestment, it would get investors interested in the area. And so to me, that's a small investment on our part if we can get that. Again, I won't keep banging my head if we can't get it through, and if there's a year that I think we can get it through, this year, it will be this year. I feel as if the folks that are gonna support us are there and if we're not gonna do this year then, you know, we're not gonna have it any better in future years. So, I agree with you, Mr. DeLima. DELIMA: I appreciate that response Mr. Yee, I really do. Any other questions or comments? Okay. YEE: Thank you. DELIMA: Thank you very much and I hope those who are in attendance understand that our desire is to help people who are there who operate business there and help the property owners there to make their lands attractive so that we can have our contractors and our carpenters, and everybody else improving the structures that are on the peninsula. Thank you all for coming. Page 6 of 7 Banyan Drive Hawaii Redevelopment Agency March 28,2018 Minutes ADMINISTRATIVE MATTERS The Agency took this item up at 2:24 p.m. 1. Approval of minutes from the November 29, 2017, Banyan Drive Hawai`i Redevelopment Agency meeting. DELIMA: We do have an action item that we have to approve our minutes that have been circulated. Is there a motion to approve the minutes of November 29, 2017? TANIGUCHI: Move to approve. DELIMA: Mr. Zane will you second? ZANE: Second. DELIMA: It's been moved and second. Any discussion? Seeing none, all those in favor say aye. ALL: Aye. DELIMA: Opposed say nay. Motion is carried. ANNOUNCEMENTS The Agency took this item up at 2:24 p.m. 1. Next meeting date. DELIMA: We have a next meeting date, I would suggest that we meet after the Legislature is adjourned. When would that be, in May? YEE: May. DELIMA: End of May? Okay, so we'll meet at the end of May if there's no objection. Okay, seeing none, so be it and again, thank you all for coming. I like our short meetings. At that time we can see and we can maybe have agendized an open discussion on how we proceed from there. We hope for good news. Thank you all for coming again. Meeting adjourned at 2:25 p.m. Respectfully submitted, Kim Tanaka, Secretary ATTEST : Brian DeLima, Chairperson Banyan Drive Hawaii Redevelopment Agency Page 7 of 7 Banyan Drive Hawaii Redevelopment Agency March 28,2018 Minutes