[ OUR OPINION ]
AS continued unease about the economy powers the current momentum to renovate Honolulu's prime tourism district, it is clear why the City Council approved Hilton Hawaiian Village's plan for a 35-story time-share tower. Despite public concerns about blocked views, increased traffic, parking shortages, more people and decreased ocean access, the Council sees the project as an economic benefit and a necessary part of sprucing up Waikiki. Hilton’s plan will give
Waikiki needed boost
THE ISSUE The unstable economy fuels the push for new development in Waikiki and Kakaako.
As the focal point of tourism on Oahu, Waikiki is the logical place for industry expansion. The 350-unit structure will refresh a scruffy site and Hilton has promised to clean up its contaminated lagoon and has assured parking and traffic improvements will be made along the choked Ala Moana Boulevard. Although these measures are in Hilton's self-interest, they would help the community at large. The Council should make sure to hold Hilton to its word.
Further up the urban coastline, the state is quickening its pace in developing the Kakaako waterfront, which is geared more toward commerce and residential interests than tourism.
As with everything these days, a chief concern is how to finance improvements, which may become a sticking point between the city and the state. The Hawaii Community Development Authority, which has charge of the 180-acre waterfront area, is discussing a plan to pay the city a base property tax rate for the entire acreage. When development increases property values and tax assessments, the authority would take the amount above the base rate. The trade-off, the authority contends, will be new development for the city, and a boost in jobs and income for residents.
Because the city relies on property taxes for the majority of its revenue, it may not want to relinquish precious dollars to the state. However, city officials should keep an open mind and perhaps explore sharing a percentage of the tax revenue with the authority, rather than a flat rate.
The authority faces another tough problem in finding a way to get pedestrians safely from the mauka side of Ala Moana to businesses on the makai side. Few pedestrians now have reason to brave crossing the busy thoroughfare, but to bring necessary customers and commerce to the waterfront, officials are considering overpasses or underground passages. Both have drawbacks and the authority will have to be creative in seeking a solution.
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FLAWED legislation provided an unintended problem for leasehold condominium owners in purchasing fee interest in their homes. The state Supreme Court pointed out the flaw in a June ruling, and the City Council should correct the mistake, which has benefited large condo landowners. Complaints by the Liliuokalani Trust, one of the landowners, should not stand in the way of eliminating the problem. Council should enact
condo conversion bill
THE ISSUE The City Council is considering a bill to fix the ordinance allowing condominium land lessees to acquire fee-simple ownership.
The Council gave preliminary, although narrow, approval last month to corrective action. Final approval is needed to put the lease-to-fee conversion procedure back on track.
The city ordinance, approved in 1991, was patterned after the Hawaii Land Reform Act of 1967. The state law allows lessees in a tract of free-standing homes to acquire land ownership if at least 25 or more than half of the homeowners apply to purchase the lots.
The city ordinance was intended to provide the same opportunity to condo owners. Indeed, the original wording of the city bill would have done that. However, the Council -- due either to sloppy draftsmanship or deliberate and surreptitious rewording -- unintentionally required applications by more than half the owners, regardless of whether they resided in the condominiums.
Absentee landlords are less motivated to acquire fee interest than are owner-occupants, so the Supreme Court decision made it more difficult for about 32,000 condo owners seeking full interest in their homes to reach the legal threshold. As a result, the large landowners gained undue protection.
In the debate over the state law, the Bishop Estate complained that forcing it to offer sale of lots to homeowners would drain its resources and harm Kamehameha Schools. The Queen Liliuokalani Trust now maintains that requiring it to sell fee interest in condos will diminish its ability to fund social programs for Hawaiians.
Thomas Kaulukukui Jr., chairman of the Liliuokalani Trust's board, says lease payments from Foster Tower and three other properties account for 11 percent to 15 percent of its $14 million in annual revenues. If required to offer the condo land for sale to homeowners, the trust will only be placed in the position of reinvesting the revenue it receives from those sales in other areas.
Other investment areas may not be as lucrative as land-lease revenues, but the trust will hardly lose the percentage of revenues it contends will be lost. Those marginal losses pale in comparison with the need to assure condo owners the same opportunity as other homeowners to acquire full interest in their homes.
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Published by Oahu Publications Inc., a subsidiary of Black Press.Don Kendall, Publisher
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