LIHU‘E — The Kaua‘i Planning Commission’s Subdivision Committee took about an hour to decide that the fate of a 2,029-acre proposed development across from Kealia Beach wouldn’t be decided Tuesday. The three-member committee reluctantly pushed the decision back another month.
LIHU‘E — The Kaua‘i Planning Commission’s Subdivision Committee took about an hour to decide that the fate of a 2,029-acre proposed development across from Kealia Beach wouldn’t be decided Tuesday. The three-member committee reluctantly pushed the decision back another month.
“Oftentimes we feel like we’ve been taken advantage of. Aloha spirit can dry up really fast,” Committee member Hartwell Blake said right before adding his vote to defer a decision on a request for an unprecedented eight-year extension for subdivision permits.
Yet the committee unanimously voted to grant developers of the controversial Kealiakealanani Agricultural Subdivision an additional month to continue consideration on a number of issues raised by the Kaua‘i Planning Department and to ensure tax issues are resolved.
“The issues in the Planning Director’s Issues List are complicated and (Kealia Properties LLC) needs the additional time to work through what it can do. We would like to request an extension to the hearing on Dec. 11,” wrote attorney Lauren Sharkey, of the Honolulu-based firm Case Lombardi & Pettit, in a letter dated Nov. 7 that was addressed to Committee Chair Herman Texeira and Planning Commission Chair Jan Kimura.
At stake is a request for an eight-year extension to subdivision permits to two lots totaling 2,029 acres of prime agricultural lands immediately across from Kealia Beach, on the north end of Kapa‘a.
The permits were set to expire two months ago, and Planning Director Michael Dahilig has recommended the committee to deny the request from developer Kealia Properties LLC for the multi-year extension.
“What is the purpose of the ag subdivision law?” said Kaua‘i County Council Vice Chair JoAnn Yukimura. “The main purpose of the ag subdivision law is to provide land to farmers within a reasonable time. Will an extension do that? Arguably, the main purpose of our ag subdivision laws has been already been thwarted, given the fact that an extension is being requested.”
Furthermore, Yukimura said, there is little evidence that the developer is committed to completing the subdivision.
Kealiakealanani
Ag Subdivision
The original subdivision permits were granted on Sept. 11, 2007, and since then the project’s ownership has changed twice — once due to foreclosure.
The permits were set to expire on Sept. 11, but the developers asked for an unprecedented eight-year extension, which would exempt them from complying with laws passed since the original permits were granted, and with laws that could be passed in the next eight years.
The current permits allows them a one-time subdivision of both ag lots into a total of 76 lots, which can be further sliced into 188 Condominium Property Regime units, each with a farm dwelling on it.
If the extension is denied, the developer would have to re-apply and comply with the current law, which would mean a reduced density of 115 CPR lots and an additional burden of building 56 affordable units.
Additionally, Kealia Properties is asking the county to execute a first mortgage as a substitute for a surety bond equal to the cost of the infrastructure work — which was $18.4 million in 2007.
The Kaua‘i County Code requires the surety bonds to make sure the applicant completes infrastructure improvements within a required time frame, or else the county may take over and complete the work, and recover the full cost of its expenses from the surety bonds.
If the county would accept taking the first mortgage as a substitute for the surety bonds, it would potentially save the developers between $1.5 million and $6 million.
But Dahilig is opposed to the idea. He has said he doesn’t believe it would legally replace the surety bonds requirement.
And in case it would be legal, he said, the first mortgage would not provide high liquidity, leaving the county with substantial financial losses if the project is foreclosed on and goes into liquidation.
On Sept. 11, when the issue was first up for discussion — and deferred — several members of the Kealia community attended the committee meeting to show support for the project. Developers had met with them previously and had agreed to do a number of area improvements even before the infrastructure would be laid out.
Those improvements would include up to $500,000 for the rodeo arena, up to $500,000 for a poi mill cooperative, and up to $350,000 in restoration to the Kealia Post Office and its adjacent store.
Still, Dahilig, committee members and some Kaua‘i residents who testified on Sept. 11 questioned the legality of offering improvements to the private sector in exchange for an extension to the permits.
Tuesday’s meeting
On Tuesday morning, Dahilig said there were three written testimonies submitted in support of his recommendation to deny approval of the permits’ extension.
Also, all five public testimonies at Tuesday’s meeting were not in favor of a straight extension of the permits, including testimony from Kapa‘a residents Marj Dente and Gabriela Taylor and Kaua‘i County Council members Tim Bynum and Yukimura.
Yukimura said a first mortgage from the county would require coming to the council for approval, because of the nature of the multi-year contract with the county.
Yukimura didn’t go as far as saying the extension should denied; rather, she said that without an amendment, an extension should not be granted.
“If the deadline under the old law has not been met, the developer, at minimum, should be held to requirements of the new law currently in effect which lessens the density allowed on open zoned lands in agricultural districts,” said Yukimura.
She added that the Planning Commission has the obligation to protect the public interest by requiring a reduced density per current law, thereby lessening fragmentation of ag lands — a threat to the preservation of such lands.
Rayne Regush, from the Wailua-Kapa‘a Neighborhood Association, also criticized the request for extension. Regush called the request an “eight-year land banking,” which, based on an uncertain economy, does not speak well for the county to support the project.
Taylor also spoke against the project.
“This high-grade agricultural 2,000-plus acres should be used to feed our island, not serve as the playground for gentlemen farmers who have proposed only to grow tea,” said Taylor, adding that increased traffic would create disaster in Kapa‘a Town, and that current density and affordable-housing requirements should be honored.
Protection of ag land
Andy Friend, representing the developers, said the project’s documentation, dating back to 2007, has extensive conditions that were put into place to protect the integrity of the agricultural aspect of the lands, including an ag plan which must be approved by an agricultural review committee to ensure that the project will become an ag-residential community.
Approval of farm dwellings, Friend said, would only be granted after an ag plan would be reviewed and approved. And such ag plans will have to include a marketing plan.
Each CPR unit will have ag pressurized water, according to Friend.
Blake, however, said he thinks it would be difficult, or even impossible, to run a farming operation that would not be a losing proposition from the get-go, and people will make anything possible to turn around a losing proposition.
Upon hearing from Dahilig and Friend the reasons why the developers were asking for a deferral, Blake said the tax issue was not relevant to him. He said he was not inclined to grant yet another extension after Dec. 11.
“Take your best shot and that’s it,” said Blake, regarding the developer’s request for a deferral.
Taylor took the stand a second time, and called the request for an ag plan something “totally unrealistic,” based on enforceability.
“Who’s going to enforce that?” she asked.
Texeira said the applicant can address the enforceability on Nov. 11.
• Léo Azambuja, staff writer, can be reached at 245-3681 (ext. 252) or lazambuja@ thegardenisland.com.
