Waikōloa Timeshare, Affordable Housing Project Passes First Reading in County Council

The Hawai’i County Council on Wednesday, March 23, moved forward with rezoning requests by a Waikōloa developer seeking to repurpose nearly 180 acres near the Waikōloa resort area to be used for timeshares, affordable workforce housing and other facilities.

Council members approved the first readings of Bill 112 and draft 2 of Bill 115, which would rezone the property located between the 75- and 76-mile markers on the makai side of Queen Kaʻahumanu Highway to allow Waikōloa Land Company to develop the proposed Kumu Hou project.

But while council members lauded the efforts and willingness of the developer to work with the council and community to address concerns and meet their needs, several proposed amendments — including one the developer had not yet seen — and changes to those amendments resulted in some discord.

Kumu Hou would consist of 900 timeshare units, 264 multi-family residential units and up to 25 single-family residential lots, including at least 140 units for affordable workforce housing. The project also would include private community centers, a convenience retail center, golf support facilities, an operations facility, public parks and recreational amenities and associated infrastructure.

Three proposed amendments to Bill 115 specifically caused council members to pause. The amendments concerned how the Council would identify some proceeds from the project that would go to the Waikōloa Foundation to benefit specific causes it finds of critical importance, such as providing Native Hawaiian communities with potable water sources in the area of the proposed project; language regarding water conservation and offset that would result in a net-zero draw on the region’s aquifer; and the number of affordable housing units to which the developer would commit, a proposal the developer had not seen prior to Wednesday’s council meeting.

There were also several editorial changes requested by the developer on two of the three proposed amendments.

Councilwoman Ashley Kierkiewicz, who introduced both bills and the amendments to Bill 115 concerning potable water and water conservation, eventually withdrew her motions to include those amendments on first reading of the measure so requested changes could be made before the council takes the bill up again for second reading.

Several council members had reservations about the amendment dealing with the foundation, including Chairperson Maile David who had reservations about putting a financial condition in an application process for a development when there are already laws in place that protect things such as water access.

David also was concerned about having money generated by a private foundation included in a subdivision application and the precedent that would set for future developments.

“What we do here, especially with money from the outside being part of a legal application process, I’m not sure,” she said, adding she thinks the foundation aspect of the development could go on its own course without being included in the conditions of the bill.

“What I hear you saying is you don’t want to set a precedent where you can essentially buy your zoning,” Kierkiewicz said. “And I think what we are all struggling with is to find a way to really memorialize the commitment that the developer is bringing to the table but having to do so in a way where it is not a condition of our decision-making.”

“I don’t want to set a precedent that this is how Native Hawaiians get their issues addressed through development,” David said.

Councilman Tim Richards appreciates the intentions of the proposed amendment but wasn’t sure if it would be the right way to move ahead.

“That’s been a community that needs water, but this may not be the way to do it because it may dilute the effort of the bigger needs,” said Richards.

Kierkiewicz suggested the developer and Council could work on other language based on David’s comments that doesn’t set any unrealistic precedents moving forward.

“This is very important decision-making that we are doing right here, so I just want to make sure we are all able to read exactly what we are going to be voting on with the amendment,” Kierkiewicz said.

It was the amendment for a commitment to additional workforce housing, introduced by Councilman Holeka Inaba, that nearly derailed the passage of Bill 115.

Inaba explained that the amendment would ensure that the 140 workforce housing units would be built prior to any timeshares, but beyond that, it would also put into place an additional requirement for another 250 workforce housing units to be developed later in the project. The amendment also would clarify language and ensure the units remained affordable for a term of 65 years.

“We have a vast need for workforce housing, and the Waikōloa development area is a key hub to a lot of that workforce that travels across the island to serve in their roles in those facilities,” said Councilwoman Rebecca Villegas.

But while the developer is agreeable to including as many workforce housing units as possible, it had not yet seen Inaba’s proposed amendment. And that didn’t sit well with several council members.

“I’m a little shocked that they haven’t seen this amendment at all,” Richards said.

He didn’t think it was appropriate to present a proposed amendment that moves the goalposts on the project, adding additional units to the conditions of the project, at the last minute, saying it’s not fair to a developer that has done so much to accommodate the requests and concerns of the community.

“So I find this very distasteful,” Richards said.

Councilwoman Sue Lee Loy is getting concerned the council is going too far with amendments and the project is getting augmented along the way.

“There’s an idea of what is going to be accomplished, and my concern is that when we add in additional units, it feels a little bit like a bait and switch compared to what was originally represented to where we’re headed,” said Lee Loy.

She thinks the amendments that were done in committee, those introduced by Kierkiewicz, were good and the discussion has been great, “but now this is beginning to feel a little bit out of bounds.”

Inaba eventually withdrew his proposed amendment to give the developer more time to review it, but he was not comfortable with Bill 115 moving to second reading with all of the suggested changes.

Villegas moved to postpone first reading for Bill 115 to the council’s April 6 meeting, being more comfortable with keeping the measure at first reading as council members and stakeholders in the project continue to navigate the process. Inaba and Councilman Matt Kanealiʻi-Kleinfelder agreed.

“I think it would be better for us to come back at first reading and not feel rushed,” said Kanealiʻi-Kleinfelder.

However, the rest of the council wasn’t convinced that was the right move.

“This isn’t sitting well with me, the way this is going, especially from an outfit that has really bent over backwards in trying to address the concerns of this body and of the community within the constraints of their financial resources and ability to develop,” said Councilman Aaron Chung, adding he is concerned about how the process is unfolding, including the proposed change to the number of workforce housing units.

“We’ve taken this too far,” Chung added.

“A lot of the amendments that have been put forward are the continuation of discussion from prior committee meetings, and as council member Chung said, the developer has engaged us and community every step of the way here,” Kierkiewicz reminded the council.

Villegas offered her reasons for moving to postpone the measure.

“Based on the time we are at in history and all of the different issues that we are facing as an island and the pleas that have been made for the last two years to transition away from such a reliance on external resources and a visitor and tourist economy, I want you to understand, that that’s why I’m asking for a postponement,” she said.

Villegas said postponing the first reading of the bill wouldn’t take away from the gratitude the council has for the developer for including workforce housing in the Kumu Hou project, but the question becomes is it enough?

“They have come to the table, they have delivered,” Richards said. “They don’t have to do any further workforce housing. We’re not talking about 250, we’re talking about an additional 250. And there’s space for it. We can do it in the open green space that we so wanted. This has been derailed.”

Chung pointed out that the bill still has another reading before it is adopted.

“If it gets postponed at that time, well so be it,” he said. “I just don’t see the reason to do it now.”

The motion to postpone the first reading of Bill 115 failed, with only three council members voting in favor — Inaba, Villegas and Kanealiʻi-Kleinfelder — and the six other members voting to move forward with the measure.

The first reading of draft 2 of Bill 115, with an amendment in regard to the King’s Highway Foot Trail being turned over to the state and clearing up some of the language, which the council passed earlier in the meeting, was approved by a vote of 6-3, with David, Inaba and Villegas voting no.

The first reading of Bill 112, a companion rezoning measure to Bill 115, also passed by a vote of 6-3, with Inaba, Villegas and David voting no.

Both bills now move on for their second, and possibly final, readings at the next council meeting scheduled for April 6.