Some Progress Reported at Kohala Site that Won Reprieve from LUC

posted in: March 2010 | 0

After a year of ups and downs, work on a development near Puako, Hawai`i, finally seems to be getting under way, some two decades after the project was first proposed to the state Land Use Commission.

As reported in the October edition of Environment Hawai`i, the developer – now an entity called DW `Aina Le`a – was given until March 31 of this year to complete construction of at least 16 affordable housing units, of the 385 required. Last August, when the LUC voted to rescind its earlier order that revoked the Urban designation of the land, the Hawai`i County planning director, Bobby Jean Leithead Todd, put the odds of success at 85-15. Given the county’s ability to push things along through expedited permitting, Leithead Todd might be compared to a gambler with loaded dice.

Since the LUC action, Leithead Todd has informed the developer that no environmental assessment or environmental impact statement will be required for the connection of the subdivision roadway to the state’s Queen Ka`ahumanu Highway. In a letter to the developer’s planning consultant, Sidney Fuke, Leithead Todd wrote, on August 29 (two days after the LUC vote), that, “with the passage of Act 087 relating to Environmental Impact Statements on June 3, 2009, we are now able to declare the construction of a channelized intersection at the project’s access intersection with the Queen Ka`ahumanu Highway is declared exempt from the requirements of Chapter 343, HRS,” the state’s environmental policy law. Leithead Todd went on to quote from the act, which states that “any primary action that requires a permit or approval that is not subject to a discretionary consent and that involves a secondary action that is ancillary and limited to the installation, improvement, renovation, construction, or development of infrastructure within an existing public right-of-way or highway shall be exempt from this chapter.”

That must have been a huge relief to Fuke and his clients. In a letter dated Februry 19, 2009, Fuke had expressed concerns about the timetable for construction of the intersection improvements required as part of the LUC redistricting and which were also made a part of the County Council ordinance giving appropriate zoning to the 3,000 acres on which the full development is to be built. The rezoning ordinance states that “prior to final subdivision approval of any increment gaining access” from the intersection, “interim intersection improvements, including full channelization of the northern and southern access road intersections with Queen Ka`ahumanu Highway, shall be constructed” to satisfy state Department of Transportation requirements.

Fuke carefully parsed the language in his letter to Leithead Todd. “While the aforementioned condition requires the channelized intersection be completed ‘prior to final subdivision approval,’ the proposed affordable multiple-family residential project is not a residential subdivision” (emphasis in original). Also, Fuke said, the state DOT has generally deferred to the county on when to exempt projects from Chapter 343 compliance. “Pursuant to the above, we respectfully request your determination that said improvements within the existing right-of-way is [sic] exempt from the need for an Environmental Assessment.”

Yet it is not clear whether the state DOT is on board with the exemption. In the county Planning Department files are two identical forms, one dated April 20 and the other May 11, 2009, from Stanley Tamura, the Hawai`i District engineer for the DOT, reiterating his agency’s position on the intersection improvements. In both, Tamura states that the DOT is holding to the position expressed in a letter from Brennon Morioka, state DOT director, dated December 28, 2007. In that letter, addressed to John Baldwin, principal of Bridge `Aina Le`a, the former developer, Morioka states that it is his understanding that a Traffic Impact Analysis Report would be prepared for the intersection improvements as part of an overall environmental impact statement. “We are an interested party and look forward to receiving at least four copies of the Draft EIS,” Morioka states.

What about Wastewater?

But while DW `Aina Le`a may have escaped the requirement that it prepare an EA or EIS for the intersection improvements, getting out from under the onus of Chapter 343 for its sewage treatment facility may not be so easy.

That law requires that at minimum, an EA be prepared for any wastewater treatment unit that serves more than 49 units. DW `Aina Le`a has submitted to the state Department of Health plans for construction of what it says will be the first phase of a sewage treatment plant – designed to handle about 153,000 gallons a day, which is about what will be generated by the 385 affordable and around 50 market-rate units that DW has said will be built in the initial phase of the project. Altogether, said a source at the DOH, the plant’s full build-out will be sized to handle about 850,000 gallons of wastewater a day.

When asked whether an EA was being prepared for this facility, the Wastewater Branch staffer referred to the DOH’s Environmental Planning office. A person there stated that the position charged with ensuring Chapter 343 compliance was now vacant as a result of staff cuts.

Progress Report

In mid-December, the county forwarded to the Land Use Commission a progress report. “DW `Aina Le`a has done substantial work on Phase I of this project,” wrote Leithead Todd. Plan approvals for the first phase were given on November 30; grading plans for Phase I were also obtained, with 90 percent of the mass grading for the affordable component completed. Applications for building permits for the affordable housing units had been prepared and submitted to the county Department of Public Works.

In other respects, too, there is apparent progress. At the August LUC meeting, Robert Wessels, the “W” in DW, testified that his company would take title to the land slated for affordable housing as soon as the LUC vote was made official. The formal document was executed by the LUC on September 24. In mid-September, Wessels told Environment Hawai`i that he expected the deal to close by the end of that month.

Not until December 11, however, was any transfer recorded at the Bureau of Conveyance. On that day, Bridge, DW `Aina Le`a, and another Wessels company, Relco, agreed to transfer much of their interests in the affordable-housing parcel to `Aina Le`a LLC, a Nevada-registered entity whose manager is listed as Relco.

Since last summer, financing for the development has been pursued in an unorthodox manner, with Singapore-based real estate agents selling off small units of “urban land” in 400 square-foot units priced at $9,600 (in minimum blocks of 10 units). The purchasers are told they have “assured returns” of 30 percent over 30 months, since “the developer needs the title deed for the units held by you to sell the property” when the buildings are completed. Their $96,000 purchase can at that time be resold for $125,000.

The financing effort has been at least partly successful. The Hawai`i County real property tax office lists at least 151 different owners for the property, all with Chinese names but all having addresses in care of `Aina Le`a. If each one bought just one block, the total amount raised through the Singapore effort comes to just under $14.4 million.

For Further Reading

More background on the `Aina Le`a development may be found in these articles from previous issues of Environment Hawai`i:

    • “2 Decades and Counting: Golf ‘Villages’ at Puako are Still a Work in Progress,” March 2008;
    • “Hawai`i County Board Deals Setback to Stalled Bridge `Aina Le`a Project,” December 2008;
    • “Bridge `Aina Le`a Gets Drubbing from the Land Use Commission,” March 2009;
    • “After Years of Delay, LUC Revokes Entitlements for Bridge `Aina Le`a,” June 2009;
    • “Commission Stays Decisions to Revert Puako Land,” July 2009;
    • “Under New Management, `Aina Le`a is Given Yet Another Chance by LUC,” October 2009.


Patricia Tummons


Volume 20, Number 9 — March 2010


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