Rarely does the tension in a Land Use Commission meeting rise to the level of spine-tingling. But the LUC\u2019s hearing April 30 on the fate of 1,060 acres of Urban land owned by Bridge `Aina Le`a was high drama indeed.<\/p>\n
\tAt stake were entitlements to build roughly 2,000 units of upscale resort housing, a commercial center, two golf courses, clubhouses, and other recreational facilities. Along with the entitlements, the first of which were granted nearly 20 years ago, came certain obligations. At the time of the April meeting, these included: the construction of 385 units of affordable housing; installation of a signal and other improvements to a dangerous highway intersection; and the dedication of land for public schools and parks.<\/p>\n
\tFor the last couple of years, LUC members were showing more and more impatience with the developer, Bridge `Aina Le`a and its Saipan-based parent, Bridge Capital, LLC. Prospects seemed to grow dimmer by the day that Bridge Capital, the current landowner (the fourth since redistricting occurred), could meet a November 2010 deadline to have in hand certificates of occupancy for the affordable units. In September 2008, the LUC approved a show-cause order requiring Bridge to explain why the land should not be placed back into the Agricultural District.<\/p>\n
\tAfter two hearings on the order \u2013 the first in January, the second the one in April \u2013 the LUC had heard enough. After a five-hour-long meeting, interrupted by two executive sessions, a lunch break, and a couple of courtesy breaks to allow Bridge\u2019s attorney to huddle with his clients, the commission voted unanimously to revert the land to the state Agricultural District.<\/p>\n
\tAt that moment, the meeting room at the Waikoloa Marriott was dead still. You could almost hear the value of the land, not five miles from the hotel, shattering into smithereens.<\/p>\n
\u2018More or less the landowner\u2019<\/i><\/b><\/p>\n
That was hardly the outcome that Bridge had anticipated. In March, Bridge had given the commission notice of its intent to sell the land to DW `Aina Le`a, a Nevada limited liability corporation. DWAL was no stranger to the commission. In the summer of 2007, it had been identified by Bridge as a development partner, yet shortly thereafter, the company dropped from sight and progress toward meeting the affordable housing deadline \u2013 the condition that the commission was most eager to see fulfilled \u2013 once more stalled.<\/p>\n
\tDocuments that Bridge submitted in March indicated that Bridge and Robert Wessels (the \u201cW\u201d in DW) had signed a purchase and sale agreement more than six months earlier, in September 2008. Yet when Bridge filed its required annual report for 2008 in November, the agreement to sell the land was not mentioned.<\/p>\n
\tMoments before the April meeting was to begin, commissioners received a tabbed binder containing about two dozen documents of various sorts. They included contracts (mostly unsigned) between DW and other parties, a sort of prospectus that DW had prepared for potential investors, and architectural drawings of possible affordable housing units. Also included were materials relating to DW\u2019s negotiations with the County of Hawai`i to build offsite transitional housing \u2013 negotiations that, in the end, had led nowhere. (As reported in the March issue of Environment Hawai`i, in January, Bridge `Aina Le`a had originally proposed that the commission allow it credit against its affordable housing obligations for each unit of county transitional housing it built. In February, DW `Aina Le`a replaced Bridge in the talks with the county.)<\/p>\n
\tThe commissioners, accustomed to receiving exhibits and motions days, if not weeks, in advance of their meetings, were bewildered \u2013 and obviously displeased. The first question that was posed by Commission Chairman Duane Kanuha expressed their confusion. \u201cPetitioners,\u201d he said, \u201cwe\u2019re trying to determine who the actual petitioner is\u2026 We have Bridge `Aina Le`a\u2019s notice of intent to assign their interests in the petition area to DW. But nevertheless, for the record, Bridge `Aina Le`a is still the petitioner.\u201d<\/p>\n
\tMichael Carroll, an attorney with the Honolulu firm of Bays Deaver Lung Rose & Holma, responded for Bridge. \u201cDW has taken over development responsibilities pursuant to the purchase and sale agreement,\u201d he said. \u201cThey\u2019re in charge of development, and Bridge `Aina Le`a is more or less the landowner. Since [DW] are taking over, we\u2019ll be stepping out and they\u2019ll be taking the lead.\u201d<\/p>\n
\tAttorney Eric T. Maehara was also at the table. Maehara, familiar to commissioners as the lawyer who had most frequently represented Bridge, said that he was now representing DW.<\/p>\n
\tCommissioner Reuben Wong then asked, \u201cIf Bridge `Aina Le`a is the petitioner, and Mr. Carroll represents Bridge, what is Mr. Maehara doing at the table?\u201d<\/p>\n
\t\u201cIn a normal case,\u201d Maehara replied, \u201cif we weren\u2019t facing the order to show cause, it\u2019d be a matter of Mr. Carroll introducing DW to the commission \u2026 and formally ask[ing] for a substitution of petitioners. But because we\u2019re in this situation, with the order to show cause, that\u2019s why we have this dichotomy. There\u2019s no clear line. Bridge, through Mr. Carroll, will make a statement. After that point, then I would indulge [sic] the commission to allow me to continue making the case for DW `Aina Le`a to prove its capacity to hit the ground running and attempt to meet all these conditions that the commission has set down in the past.\u201d<\/p>\n
\u2018Who\u2019s on first?\u2019<\/i><\/b><\/p>\n
The commissioners were not inclined to go along with Bridge\u2019s script. Commissioner Normand Lezy explained: \u201cThe order to show cause was issued against the petitioner Bridge as the entitlement holder in this matter. Bridge `Aina Le`a is obligated to show cause today why there should not be reversion. As far as I know, nothing has been brought before the commission to show that any other entity, whether it be DW `Aina Le`a or anybody else, has an interest or authority to make representations on behalf of Bridge in connection with the order to show cause.\u201d<\/p>\n
\tCarroll had earlier acknowledged that he was \u201cnot as familiar with the current status\u201d of the case as Maehara, prompting Lezy to ask, \u201cIs there somebody, an entity, that is here today that has agency authority on behalf of petitioner Bridge `Aina Le`a to make a presentation and respond to the order to show cause?\u201d<\/p>\n
\tMaehara tried again to push DW forward as the party to which questions should be addressed: \u201cIn the purchase and sale agreement, the responsibilities of maintaining entitlements have transferred from Bridge or is [sic] in the process of being transferred, as well as title to the property, to DW.\u201d<\/p>\n
\tLezy cut him off. \u201cYou just said, either has been done or is in the process of being done. What is the current status as we sit here today?\u201d<\/p>\n
\tMaehara replied by reading from the purchase and sale agreement language that authorized DW to assume \u201cdevelopment responsibility\u201d before closing on the property. \u201cThat, I believe, is the authorization,\u201d he said.<\/p>\n
\tCommissioner Ransom Piltz was not satisfied with Maehara\u2019s effort to substitute DW for Bridge. \u201cMr. Maehara, you have to understand, the commission has received this\u2026 and it causes a lot of confusion as far as who\u2019s on first and who\u2019re the players and everything. But essentially we\u2019re looking at Bridge `Aina Le`a and not DW\u2026 So you have to understand, all we\u2019re going to deal with today is Bridge `Aina Le`a. \u2026 if they\u2019re not here, then this session is over.\u201d<\/p>\n
\tMaehara asked for a short break to consult with the principals of both Bridge and DW. When the session resumed, Carroll said he would speak for Bridge. Several commissioners observed that the lawyer making filings on Bridge\u2019s behalf had been Maehara, with Carroll a relative stranger to the commission. Carroll then suggested Maehara could act as his co-counsel, an arrangement that seemed to settle the question of representation.<\/p>\n
\u2018A lot of bull\u2019<\/i><\/b><\/p>\n
The first witness called by Maehara was Sidney Fuke, a planner who had been working with Bridge for years but who had recently been retained by DW.<\/p>\n
\tMaehara\u2019s first question to Fuke concerned DW\u2019s taking over from Bridge negotiations with Hawai`i County over construction of transitional housing at a site some 20 miles away, at Kaloko. Fuke commenced with a history of the site going back nine years. Bryan Yee, the deputy attorney general representing the Office of Planning, questioned the relevance.<\/p>\n
\tMaehara acknowledged that the subject \u201cmay have little relevance to the issue at hand,\u201d especially since the DW\u2019s involvement with the project was now off the table, but nonetheless asked that the documents concerning the Kaloko transitional housing be accepted into evidence.<\/p>\n
\tYee again objected, as did Commissioner Lezy. \u201cI don\u2019t see how this evidence has any bearing or will lead to anything that has any bearing on the issue before us,\u201d he said.<\/p>\n
\tMaehara then began questioning Fuke about DW\u2019s plans to fulfill the on-site requirement for affordable housing, calling his attention to an easel displaying a map of the property, showing a small, 60-acre area near the southeast corner of the Urban area where the 400 or so affordable units were proposed to be built.<\/p>\n
\tCommissioner Wong protested. \u201cI have a problem. Mr. Fuke stated he represents or is a consultant for DW, and no longer for Bridge,\u201d Wong said. \u201cIf so, it\u2019s not relevant to us what DW is going to do in the future. So I\u2019m wondering whether or not all this testimony has anything to do with Bridge `Aina Le`a?… Unless there\u2019s a showing that DW owns the property today, I\u2019m not interested in what DW wants to do because it\u2019s not relevant to this proceeding.\u201d<\/p>\n
\tMaehara said he would try to \u201cconvince the commission of the fact that DW has the wherewithal, past experience, the financial capabilities to step in place of Bridge `Aina Le`a.\u201d<\/p>\n
\tCommissioner Piltz responded: \u201cThose of us who have sat on this commission throughout some of the promises that Bridge `Aina Le`a has made, we bring you this dilemma\u2026 We\u2019ve heard a lot of bull. We just don\u2019t want any more coming down the road \u2013 that we\u2019re going to do this, we\u2019ve got a thing that isn\u2019t completed yet with DW. Why should we believe what\u2019s going on? You\u2019ve not proven yourself in the past. Granted, everybody wants to get affordable housing, but your clients have not done their job. We\u2019re skeptical about what\u2019s going on here.\u201d<\/p>\n
\u2018A troubling indicator\u2019<\/i><\/b><\/p>\n
Maehara said he was attempting to show, \u201cunder oath, that there have been considerable sums of money transferred from DW to Bridge, substantial amounts already paid out to consultants\u2026\u201d<\/p>\n
\tWong wanted to know, again, whether DW had \u201cactually acquired all of the rights of Bridge?\u201d Or did it merely \u201chope to acquire it some day in the future?\u201d<\/p>\n
\tMaehara acknowledged DW had no legal title, but again argued that \u201cDW has assumed responsibility of proceeding with all entitlements and all other proceedings.\u201d<\/p>\n
\tCommissioner Lisa Judge pointed out that while there is no legal requirement that the LUC approve in advance any transfer of the land, \u201cit is in our conditions that petitioners are supposed to inform the commission of their intentions to transfer property. One of the things that troubled me when I started to look through these documents, this has been going on back to September 2008. Since then, there was a status report from the petitioner, where none of this was mentioned. At a hearing in January\u2026 no mention of intent to sell the property was ever hinted at or disclosed to the commission at that time.<\/p>\n
\t\u201cNow, on March 20, we get all these documents that date back to September 2008\u2026 Many of these documents are unsigned, I don\u2019t know what weight we give them when they\u2019re unsigned. That to me is a troubling indicator of the process we\u2019ve followed for the last four years.\u201d<\/p>\n
\tChairman Kanuha asked Maehara if any representative of Bridge was going to be testifying.<\/p>\n
\tMaehara: \u201cWe intend to follow Mr. Fuke with Mr. Robert Wessels, who is a principal in DW. And then follow with a representative of Goodfellow Construction.\u201d<\/p>\n
\tKanuha: \u201cSo the answer is \u2018no.\u2019 You\u2019re not intending to call any witness relating to the petitioner.\u201d<\/p>\n
\tMaehara: \u201cWe had no intention of calling any witness who is a principal or officer in Bridge `Aina Le`a, but if need be, we can submit authorization of Bridge for these persons to submit testimony.\u201d<\/p>\n
\u2018Hopes and dreams\u2019<\/i><\/b><\/p>\n
After lunch, Maehara explained how he and his clients \u201chad a long discussion as to how we\u2019re going to proceed.\u201d He set forth a new list of witnesses, beginning with Hoolae Paoa, the CEO of Bridge `Aina Le`a, and then Fuke again, followed by other witnesses. \u201cIt\u2019s important that we clear the air, [explain] what this transaction, the purchase and sale agreement, is all about, the relationship of the parties, have that all resolved,\u201d Maehara said.<\/p>\n
\tBefore he could proceed, Commissioner Wong asked for an \u201coffer of proof, what are all these witnesses going to testify to. Give me a roadmap as to where we\u2019re going.\u201d<\/p>\n
\tMaehara answered that he would be making the argument that \u201cDW in fact is in a position to meet the conditions, specifically the [affordable] housing condition that is a concern to this commission.\u201d<\/p>\n
\tThat wasn\u0092t good enough for Wong. \u201cBeing that we\u2019re here on an order to show cause, I\u2019m asking the petitioner to appear and demonstrate why the order for reversion should not be granted\u2026 The construction you\u2019re proposing is only one component.\u201d All the things Maehara was proposing to show, Wong continued, were \u201chopes and dreams and things we aspire to accomplish,\u201d but they did not \u201caddress the issues of the order to show cause.\u201d Wong wanted to know the reasons why Bridge had not met the conditions of the LUC\u2019s decision and order, amended several times over the years, associated with the Urban reclassification. \u201cIt could\u201d he suggested, \u201cbe natural disasters, pandemic, tsunamis,\u201d that prevented the petitioners from doing \u201call the good things we said we were going to do.\u201d<\/p>\n
\t\u201cThe offer of proof,\u201d Wong continued, \u201cdoes not address this\u2026 It merely talks about the hopes and dreams and things that we want to accomplish. Those are not the issues before the commission. In view of that, I move that the petition area in this docket be reverted to agriculture.\u201d<\/p>\n
\tMaehara, Carroll, and their clients present in the meeting room appeared shocked by the suddenness of Wong\u2019s motion. Kanuha offered Carroll the chance to make a statement before the commission\u2019s vote, and then granted Carroll a five-minute break in which to talk things over with his clients.<\/p>\n
\tWhen the meeting resumed, Carroll said his clients strongly objected to any reversion. \u201cIt\u2019s procedurally improper,\u201d he said. \u201cWe haven\u2019t had the opportunity to make our case\u2026 We\u2019ve not had an opportunity to explain\u201d the March 20 disclosures. \u201cWe\u2019ve got vested rights, have spent $20 million. We have the ability to go forward with the project.\u201d<\/p>\n
\tIn further discussion on the motion, Commissioner Judge asked Hawai`i County Planning Director Bobbi Jean Leithead-Todd, Hawai`i what she thought were the prospects for completing work on the affordable housing by November 2010. \u201cWe\u2019re talking now less than 18 months. Do you, in the county\u2019s opinion, believe you can get certificates of occupancy for 385 units, given the status of development at this point?\u201d<\/p>\n
\tLeithead-Todd stated she wanted to give the developers the benefit of a doubt. \u201cGiven the status of development at this point, it\u2019d probably be very difficult,\u201d she said. However, she continued, \u201cI\u2019d like to give them until November 2010 to deliver. Whether they can do it, I don\u2019t know\u2026 I don\u2019t see any harm in giving them that opportunity.\u201d<\/p>\n
\tCommissioner Lezy asked Leithead-Todd to \u201chandicap\u201d the odds of fulfilling the affordable housing condition by the November 2010 deadline. \u201cCan you give me a numerical probability, say 50 percent,\u201d he asked.<\/p>\n
\tLeithead-Todd agreed that the odds were probably no greater than that.<\/p>\n
\tCarroll restated his objections to the reversion. \u201cWe are reasserting all objections \u2013 it\u2019s a violation of our fundamental rights.\u201d After 2005, when the LUC imposed the 2010 deadline for affordable housing, he said, \u201cthe Superferry decision came out, which impacted our progress.\u201d<\/p>\n
\tCommissioner Judge recapped some of the recent history of LUC actions on the Bridge docket. \u201cI feel like we keep going in this circular motion, for those of us who sat through those several meetings in 2005, \u2026 we were told there were no further discretionary permits needed, no changes of zoning, \u2018Please, just get out of our way, we have machines on site, just get out of our way.\u2019\u2026<\/p>\n
\t\u201cEven then, there was a level of skepticism\u2026 That\u2019s why the [housing] condition was written the way it was.\u201d<\/p>\n
\tThe issue before the commission was more than \u201cjust about affordable housing,\u201d she said, and instead went to the heart of the commission\u2019s basic process. \u201cThis has been ongoing since 1989.\u2026 Promises were made of benefits to the community. Just one was affordable housing.\u201d<\/p>\n
\t\u201cAt the last commission meeting,\u201d Judge continued, referring to the January hearing on the show-cause order, \u201cit was disclosed by petitioners\u2019 representative that, no, we\u2019re not going to do sewage, no, we\u2019re going to do something totally different. That was disturbing to me, in the sense that we made agreements. If nobody is going to live by them, why spend all this time and effort to do this?<\/p>\n
\t\u201cSo I\u2019m all for affordable housing, we\u2019d love to have affordable housing, but there are a lot of layers to this\u2026. All the other promises made in 1988 and 1991, and nobody\u2019s even talking about that.\u201d<\/p>\n
\tCarroll asked for a chance to confer with his client before the commission voted. Kanuha said he\u2019d already had the opportunity.<\/p>\n
\tWithout further ado, the commission voted 7-0 in favor of reverting the land to the state Agricultural District.<\/p>\n
\tFor the next few weeks, said Dan Davidson, executive director of the LUC, the state Attorney General\u2019s office will be drafting the formal order of reversion. After that is signed, Bridge will have the opportunity to ask the commission for reconsideration.<\/p>\n
— Patricia Tummons<\/p>\n
Volume 19, Number 12 June 2009<\/p>\n","protected":false},"excerpt":{"rendered":"
Rarely does the tension in a Land Use Commission meeting rise to the level of spine-tingling. But the LUC’s hearing April 30 on the fate of 1,060 acres of Urban land owned by Bridge `Aina Le`a was high drama indeed. … Continued<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[171],"tags":[450],"class_list":["post-1191","post","type-post","status-publish","format-standard","hentry","category-june-2009","tag-aina-lea"],"_links":{"self":[{"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/posts\/1191","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1191"}],"version-history":[{"count":0,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/posts\/1191\/revisions"}],"wp:attachment":[{"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1191"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1191"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1191"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}