{"id":12852,"date":"2020-09-01T04:40:54","date_gmt":"2020-09-01T04:40:54","guid":{"rendered":"https:\/\/www.environment-hawaii.org\/?p=12852"},"modified":"2020-11-10T06:48:44","modified_gmt":"2020-11-10T06:48:44","slug":"panel-green-lights-zoning-change-for-hotel-other-uses-at-kona-airport","status":"publish","type":"post","link":"https:\/\/environment-hawaii.org\/?p=12852","title":{"rendered":"Panel Green-Lights Zoning Change for Hotel, Other Uses at Kona Airport"},"content":{"rendered":"\n

In July and August, both the Leeward and Windward Planning Commissions of Hawai\u02bbi County approved a recommendation that the County Council change the county\u2019s zoning ordinance and county code to allow for a range of activities at the county\u2019s two major airports, in Kona and Hilo.<\/p>\n\n\n\n

\tThe change involves adding a definition of \u201cprimary airport\u201d to the zoning code that conforms to the Federal Aviation definition of an airport that receives 10,000 or more passenger boardings a year. The proposed definition also lists \u201cstandard accessory uses\u201d at primary airports, including, but not limited to, retail and dining establishments, rental car offices, service businesses, and hotels and conference centers.<\/p>\n\n\n\n

\tPlanning director Michael Yee, who initiated the change, said the current zoning at airports \u2013 Limited Industrial (ML) and General Industrial (MG) \u2013 does not allow for a number of uses that are already occurring at the airports, such as retail businesses and automobile rental companies. \u201cOne reason for this amendment is to bring these uses in line with the Zoning Code,\u201d Yee stated in his recommendation to the commissions.<\/p>\n\n\n\n

\t\u201cAnother reason for this amendment,\u201d Yee wrote, \u201cis the county has received a request from the Department of Transportation \u2013 Airports Division to allow for conference centers, and for overnight accommodations (hotel) to support airport operations \u2026 mainly for the Kona International Airport.\u201d<\/p>\n\n\n\n

\tThis \u201cPrimary Airport\u201d land use along with accessory uses, Yee wrote, will still require plan approval be obtained from the planning director. \u201cThis plan approval review will allow the planning director to approve the request, including requested accessory uses, as well as review and approve the associated elements of each use, such as height, amount of rooms, parking, setbacks, landscaping, etc.\u201d<\/p>\n\n\n\n

\tThere was little public objection when the matter came before the Windward Planning Commission in July. But last month, when the proposed zoning changes were heard by the Leeward Planning Commission, several members of the public voiced concerns that the proposal was, as Janice Palma-Glennie put it, the \u201cnose under the tent\u201d that would unleash much more \u2013 and much more inappropriate \u2013 development, impairing nearby coastal waters.<\/p>\n\n\n\n

Testifying in favor of the changes was Chauncey Wong Yuen, the Hawai\u02bbi District manager for the DOT\u2019s Airports Division. It was Wong Yuen who wrote Yee last December, requesting the changes be made. In justifying the request, especially the hotel, Wong Yuen noted that a hotel was already in the Kona airport master plan. It would \u201csupport the needs of business and government travelers\u201d and would provide accommodations to travelers who might be stranded. \u201cAlso,\u201d he wrote, \u201cwe are targeting a hotel size of 150 rooms, which would accommodate a typical flight size in the event of a cancellation.\u201d<\/p>\n\n\n\n

The hotel, he concluded, \u201cwill be a tremendous benefit to the Ellison Onizuka Kona International Airport at Keahole, and to the traveling public and community\u2026 The hotel would still be subject to RFP [request for proposal] requirements of [Hawai\u02bbi Revised Statutes Chapter] 102, and subject to approval by the Board of Land and Natural Resources.\u201d<\/p>\n\n\n\n

\tAfter Yee drafted the proposed changes, the DOT submitted further comments in April, this time from DOT Director Jade Butay. While DOT-Airports \u201cappreciates and supports the \u2026 action to address this zoning inconsistency,\u201d Butay wrote, he objected to the language requiring plan approval from the county planning director.<\/p>\n\n\n\n

\tThe plan approval requirement remained. <\/p>\n\n\n\n

A Done Deal?<\/em><\/strong><\/p>\n\n\n\n

Wong Yuen claimed in his letter that a competitive request for proposals would be issued before any hotel plan would be submitted. And in his testimony to the commissioners in August, Craig Biscard, the property manager for the Kona airport, said that he would \u201clook for potential lessees to do the development.\u201d<\/p>\n\n\n\n

\tHowever, Melvin G. Mason Jr. seems to think he already has a lock on the hotel.<\/p>\n\n\n\n

In his testimony before the commission, Mason said he was the CEO of Keahole Hotel & Suites, a business that, according to the Department of Commerce and Consumer Affairs, was organized in October 2019. He had already worked out an agreement with the neighboring Natural Energy Laboratory of Hawai\u02bbi Authority \u2013 NELHA \u2013 for delivery of seawater for a sea-water air conditioning system for the hotel. \u201cIt\u2019s been in the works since 2006,\u201d he said.<\/p>\n\n\n\n

\t\u201cI was the one who actually propositioned and proposed this to be built,\u201d he added. In getting to this point, \u201chonestly, I went through a lot of hoops, red tape, black tape, purple tape, blue tape, white tape. Everything. Even with the Ethics Board.\u201d (He did not explain this further.)<\/p>\n\n\n\n

\tMason said he was the former CEO and president of Keahole FBO I, LLC, \u201cwhich is actually the big development with the FBO at the end\u201d \u2013 at the south end of the airport property, that is.<\/p>\n\n\n\n

No one raised an eyebrow at that. It was one of many claims Mason made in his 10-minute testimony that day, celebrating his ali\u02bbi ancestors, his business acumen and experience at home and abroad, and his successes in developing inventive educational tools and curricula.<\/p>\n\n\n\n

\tRight before the commissioners were set to vote on the issue, commissioner Max Newberg asked Mason, \u201cOut of curiosity, are you a developer?\u201d<\/p>\n\n\n\n

\tMason replied, \u201cYes, I\u2019m going to be developing this.\u201d<\/p>\n\n\n\n

Connections<\/em><\/strong><\/p>\n\n\n\n

In fact, Mason was involved with not one but two businesses that received approval from the Board of Land and Natural Resources for no-bid leases to develop fixed-base operations \u2013 FBOs \u2013 on property at the Kona airport.<\/p>\n\n\n\n

\tOn the same<\/em> property, in fact.<\/p>\n\n\n\n

On December 9, 2016, the Land Board approved a Department of Transportation request that it be allowed to issue a 35-year direct lease (not competitively bid) of 239,456 square feet \u2013 about 5 and a half acres \u2013 of land at the southern end of the Kona airport to Keahole Enterprises, LLC. The leased land included land straddling both the state Urban and Conservation districts, although the map attached to the DOT\u2019s submittal did not indicate state district boundaries. The DOT regularly claims in its submittals to the Land Board that such direct leases are authorized under Chapter 171 of Hawai\u02bbi Revised Statutes. The negotiated lease rent for the first five years was just under $127,000 a year. Listed as the sole member of Keahole Enterprises, which had been registered with the Department of Commerce and Consumer Affairs just six months earlier, was Jon Riki Karamatsu, a former member of the state House of Representatives and a partner of Mason in a number of enterprises. The Land Board approved the request without discussion.<\/p>\n\n\n\n

\tLess than a year later, the DOT was back before the Land Board, seeking its approval for a direct 35-year lease of land at the Kona airport. This time, the area to be demised was the same as had been approved by the board earlier, but it also included an additional 17 acres, for a total of 22.7 acres.<\/p>\n\n\n\n

\"\"
Maps submitted to the DLNR in 2016 and 2017 show the areas proposed for a direct lease for an FBO at the Kona airport. The area proposed in 2016 is included in the 2017 proposal.<\/figcaption><\/figure>\n\n\n\n

\tThe proposed lessee on this occasion was Keahole FBO I, LLC, an entity organized in August 2016. Again, the Land Board approved it and about thirteen other requests from the DOT in just one vote. And again, the sole member of the LLC was Karamatsu. Proposed rent was $474,397 a year for the first five years, with increases thereafter.<\/p>\n\n\n\n

\tAs a condition of the lease, Keahole FBO I was required to invest at least $5 million in improving the premises in the first two years of the lease. As before, the report submitted to the Land Board stated that no environmental assessment or environmental impact statement would be required for the anticipated development, since it was already covered in an environmental assessment of 2013 for the Kona airport master plan.<\/p>\n\n\n\n

\tIn January 2019, at the opening day of the Legislature, Karamatsu posted on his Facebook page a photo of legislators milling about on the floor of the House chamber.  \u201cMy business partners and I are working to build facilities, infrastructure and services for private jets\u201d at the Kona airport, he wrote in an accompanying post, \u201cwhere we have over 15 acres of land. \u2026 Further, our entities are helping the state on improvements they want in their KOA [Kona airport] master plan.\u201d<\/p>\n\n\n\n

\tThat year, Senate Bill 652, and a companion bill in the House, called for authorization of up to $50 million in special purpose revenue bonds to support the development proposed by Keahole FBO I. Among those supporting the bill was the Department of Transportation, which said the bonds would \u201cprovide a portion of the financing for the Kona Jet Center \u2026 situated on a 16-acre development at the south end\u201d of the Kona airport. The project would include \u201csix acres of new ramp, a 6,500 square foot fixed base terminal, a 36,000-square-foot state of the art hangar, a 50,000 gallon above-ground fuel facility,\u201d in addition to roads, parking lots, and utilities, the DOT testimony stated.<\/p>\n\n\n\n

\tLater in the 2019 session, the Senate bill was amended to delete the mention of $50 million and instead leave the dollar amount of bonding blank. In testimony on this draft, Keahole FBO I asked that the original amount be restored, stating: \u201cIn addition to the lease fee for our premises and lease fee for the areas to be developed for the DOT, the DOT will receive $7.5 million in in-kind donation of developed infrastructure and generate revenue from 2 percent of our gross profit, $0.04\/gallon of Jet A fuel we sell, and 30 percent of any of our subleases.\u201d<\/p>\n\n\n\n

\tThe bill did not make it out of conference committee. By that time, Keahole FBO I had hooked up with AV8 Partners, LP, whose principal, Matthew Clayton, identified himself in testimony to the Legislature as one of the founders of Keahole FBO. Today, AV8 Partners is listed in the DCCA registration as the sole manager of Keahole FBO I, LLC. Its mailing address is in care of one Kevin Allen in Phoenix, Arizona.<\/p>\n\n\n\n

Meanwhile, it is unclear whether the DOT ever did execute a lease with either of the Mason-affiliated entities. A query was made to the DOT, but no response had been received by press time. A list of private companies occupying the Kona airport site appears on the Hawai\u02bbi County property tax website, but the name of Keahole FBO I or Keahole Enterprises is not among them.<\/p>\n\n\n\n

On his website for Keahole Enterprises, however, Mason has a page devoted to the Keahole Hotel & Suites. \u201cEven if you don\u2019t travel a lot,\u201d the website states, \u201cyou\u2019re [sic] always enjoy the benefits of an VIP at our smoke-free Legacy of Keahole Hotel & Suites in Kailua-Kona, KEAHOLE, HAWAI\u02bbI, at the Kona International Airport.\u201d<\/p>\n\n\n\n

\t\u201cOur hotel also has a coffee shop, sundry shop, banquet rooms, and an airline ticket desk,\u201d the website says.<\/p>\n\n\n\n

\tPhotographs show the inviting lobby and bar \u2013 of the Hotel Plano \u2013 Frisco, in Plano, Texas.<\/p>\n\n\n\n

\t\t\t\t\t\t\t\t— Patricia Tummons<\/em><\/strong>
<\/p>\n","protected":false},"excerpt":{"rendered":"

In July and August, both the Leeward and Windward Planning Commissions of Hawaiʻi County approved a recommendation that the County Council change the county’s zoning ordinance and county code to allow for a range of activities at the county’s two … Continued<\/a><\/p>\n","protected":false},"author":1,"featured_media":12888,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[338,473],"tags":[7],"class_list":["post-12852","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-land-use","category-september-2020","tag-patricia-tummons"],"_links":{"self":[{"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/posts\/12852","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=12852"}],"version-history":[{"count":0,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/posts\/12852\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=\/wp\/v2\/media\/12888"}],"wp:attachment":[{"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=12852"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=12852"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/environment-hawaii.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=12852"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}