A draft agreement between the Hawai`i County Office of Housing and Community Development and Bridge `Aina Le`a calls for Bridge to receive up to two credits for each unit of affordable housing it builds. Under the county Affordable Housing Code, such a doubling is allowed for housing units addressing needs of people with incomes of no more than 60 percent of the county median.
If the agreement is signed – a big “if,” since it depends on the Land Use Commission effectively giving the county the ability to determine when any affordable housing requirement imposed on Bridge is satisfied – it could mean that a project that once called for 60 percent of all housing units built to be in the “affordable” range, and which in 2005 was allowed to build just 384 “affordable” units, could now be required to produce no more than 192.
The draft, bearing a date of January 13, provides that Bridge will put $6 million into an escrow account that, with the county’s approval, Bridge will then draw down to cover its expenses in designing, engineering and building 24 transitional housing units and the infrastructure needed for the entire county Kaloko affordable housing project. (The environmental assessment prepared for the project, to be built on 8 acres of county-owned land above the Costco in Kona, says the project consists of the 24 “transitional” units as well as 72 affordable rental units, a food bank warehouse, and a community center. Full build-out costs are estimated in the EA at $12 million. The final EA and a finding of no significant impact were issued by the county last month.)
Construction of the 24 units is to be “substantially completed” within 13 months of plans being approved. If costs exceed $6 million, Bridge is still obligated to finish the transitional housing units. If costs are under that amount, the county is to “disburse any remaining funds in the escrow account, plus accrued interest, to Bridge.”
If Bridge doesn’t meet milestones for starting and completing the project, the county can use whatever remains in the escrow account to finish the work.
Whenever the work is finished, “whether by Bridge or the county,” the county will credit Bridge with two affordable housing credits for each unit built. (If the $6 million falls short and the county has to finish the work, however, the number of affordable housing credits received by Bridge is to be reduced proportionately.)
The draft also states that, “subject to further agreement with the county,” the county could give Bridge authority to develop 72 “affordable rental housing units” at the Kaloko site, for which Bridge would again receive up to two credits for each unit built. However, according to Sidney Fuke, a planning consultant for Bridge, that element of the agreement is now off the table.
Finally, the agreement states that “within the time constraints set forth in the LUC [decision and order], as it may be amended from time to time, Bridge shall further develop up to one hundred (100) workforce housing units within the `Aina Le`a development … for a maximum of two (2) credits per unit, for a maximum total of two hundred (200) housing credits.”
The environmental assessment for the project states that the county has already floated a bond for it. According to a staffer with the county Office of Housing, the bond, for $7.5 million, covers only part of the project. If private funds were obtained, then possibly the bond money could be reallocated to other projects, although this would require “some logistical things” be done, he said.
Originally, Catholic Charities, which operates the county’s transitional housing project at Kawaihae, had proposed to develop and manage the Kaloko project as well. “It was en route to becoming the developer,” said the housing office staffer, but then Bridge made its proposal. Catholic Charities’ proposal is still on the table, he said: “Now we have two potential developers.”
According to Fuke, Catholic Charities will probably end up developing the 72 affordable units at Kaloko. Bridge, he said, could end up building affordable units elsewhere for the county.
— Patricia Tummons
Volume 19, Number 9 March 2009
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