2 plaintiffs reject
proposal on embattled
Kona project

Discussions continue with
three other litigants on
a new Hokulia land plan

KAILUA-KONA » A developer is making a new proposal to reduce the number of house lots in the Kona luxury residential project Hokulia, eliminate a hotel-like lodge and double the number of affordable houses.

These are part of a proposed settlement of a lawsuit that has blocked the project for nearly two years.

The proposal was made in a July 22 letter written by Lyle Anderson of Arizona, a principal in the development company 1250 Oceanside Partners.

The 1,550-acre project was conceived in the late 1980s but was halted in 2003 by a Circuit Court ruling, which said the development is an urban project being illegally built on agriculturally designated land. The case is on appeal to the state Supreme Court.

Anderson's proposal is addressed to five individuals whose lawsuit won the 2003 ruling against the project.

Two of the five flatly rejected the offer in a letter to Anderson prepared for release today.

"To be blunt, our preliminary reaction to your offer is that you remain oblivious to all the years our community has suffered environmental and cultural damage," wrote Jim Medeiros, president of Protect Keopuka Ohana, and Jack Kelly, vice president of the organization.

The action was taken after consultation with the group's board, the two wrote.

Anderson still doesn't "get it," they told him. "Our perspective is long-term sustainability; yours is short-term profit," they said.

While the two rejected the offer, discussions are ongoing with the three other plaintiffs, said Hokulia president John De Fries. He declined to comment further.

Attorney Robert Kim, who represents the three in addition to Kelly, said people should understand that Kelly has a dual role. As vice president of Protect Keopuka Ohana, Kelly rejected the offer. But Kelly as an individual is also grouped with the three who are still talking.

Kelly told the Star-Bulletin that his rejection is firm.

Moses Haia, an attorney for the Native Hawaiian Legal Corp., said the group made the decision to reject the offer on its own.

Last year, Protect Keopuka Ohana rejected a settlement offer worth $43 million in community benefits. The group wanted $50 million, the company said.

The latest proposal has no price tag, but it offers doubling the number of affordable houses the company will provide to 168. It would create a foundation benefiting health, drug treatment, education, and other public benefits, funded by 2 percent of new lot sales, an increase from the previous offer of 0.5 percent.

The company would build a connector road to the nearly complete first phase of the Mamalahoa Bypass. Traffic in Kona has long been recognized as severely congested.

Some of the offers are repetitions or variations of last year's proposals. The company offers to reduce the number of homesites to 665, down from the planned 730. Last year's offer, although not precise, suggested an even lower number.

As it did last year, the company also is offering to give up plans for a 100-room lodge.