This letter is in response to the letter last week by Jody Kono (TGI Forum, March 15) asking for help to keep the Courtyards of Waipouli as affordable rental units.
I grew up and spent most of my life on the windward side of Oahu. My wife and I were blessed to have raised four kids. What saddens me and concerns a lot of local residents who grew up in the islands is the high cost of housing here. Currently, three of my four adult kids, all college graduates, live on the mainland. They feel the cost of housing is too overwhelming and may never be within their reach.
Politicians say if elected they will provide more affordable housing. When, where and for whom? It is time for action. Losing an affordable rental unit to convert them into possible timeshare units? We need more affordable long-term rentals, not less.
My question to the council is what is fair compensation to the county, state and people of Hawaii by allowing a developer the ability to rezone an area of the county and enable the developer to build more units than those current zoning rules allow?
The estimated cost for the Courtyards of Waipouli was approximately $16.4 million; $2 million for land acquisition and $14.4 million for the building of the 82-unit complex, which averages out to about $200,000 per unit (information attained from Kauai County tax records).
Now, any developer that is required to add something to a project, i.e., solar or underground utilities, would now add the additional cost into their overall cost of the project, so that cost could be spread out over the whole project.
If you were to add to the cost to build the 750 luxury units in the Hokuala resort next to the Kauai Marriott the cost to construct the Courtyards of Waipouli, this would have attached approximately $22,000 per unit cost to the 750 luxury units in the Hokuala resort project, which was a negligible addition to the overall building cost.
Additionally, it was one of those added requirements that allowed the developer to accomplish the rezoning, allowing the building of the 750 units ultimately sold at a sizable profit.
My second question to the council is what is the appropriate percentage of a project that a developer should build as affordable to rezone the property to increase density and profit for the developer? What is that formula to allow for the maximum good for the people of the county to enable this change and allow the developer to make their profit?
In the case of the Courtyards of Waipouli, the developer was allowed to rezone, enabling the building of and sale of 750 luxury units, units which I am unsure were being sold as condominiums or timeshare units. If they were sold as timeshare units, the value increased exponentially, where the developer had, from the previous sale had already made their profit on that luxury condominium project.
What the county received for this massive zoning change was 41 affordable rental units for 10 years. An example of a poor decision of the council that seems to have benefited the developer and parties who sold the developer the land on which to build.
My understanding is the developer was required to provide more affordable units. However, due to the economic conditions at the time, the developer was allowed to decrease the number of affordable units and maybe also allowed the 10-year time frame.
The financial situation forced the council to make changes that benefited the developer. Current economics and the lack of available, affordable housing on Kauai now should allow the council and mayor to make changes to protect and provide the just and fair compensation that should have been done to allow the zoning change.
I believe that the council should vote to condemn the building for the greater good of the county and put all of the units which were the original purpose of the rezoning into affordable units, or at the very least, they should extend the affordable rental requirement to 30 years, and increase the number of units offered.
In closing, I would like to say to all politicians, especially our council members: You promised to represent everyone, not just a few. Stop talking, fighting, work together and DO YOUR JOB! Make this place better for residents first.
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Stephen Frank is a resident of Kapaa.
