Unity House suit settled
By Johnny Brannon
Advertiser Staff Writer
The Unity House labor organization has agreed to pay the city more than $1.1 million to settle a lawsuit stemming from the development of federally subsidized housing in 'Ewa Villages.
The 2000 suit charged that Unity House backed out of a plan to develop additional housing and failed to notify the city by a 1998 deadline.
The settlement, up for a City Council vote today, requires Unity House to turn over $1,124,585 in income and interest it retained after developing the 96-home Lokahi Greens subdivision and selling the properties.
The U.S. Department of Housing and Urban Development warned earlier this year that allowing Unity House to keep the money would violate HUD's financing agreement with the city.
HUD ordered the city to either collect the cash for use on other housing projects or to reimburse a federal grant fund the city used to help bankroll Unity House's $9.2 million purchase of the Lokahi Greens property.
Unity House spokesman Jim Boersema said the nonprofit organization that assists union members never intended to keep the $1.1 million but had retained it as part of a plan to develop a second 'Ewa Villages subdivision.
That deal fell apart after Unity House determined it could not cover its costs on the project unless the homes were sold at market rate, which HUD would not allow, he said. Now, the money will go toward a plan to refurbish a subsidized apartment complex in Kane'ohe that Unity House is a partner in, Boersema said.
"It's a win-win story for everybody," he said. "We're no longer in a lawsuit fighting each other, so everyone comes out ahead."
A spokeswoman said no one from the city administration or Corporation Counsel's office would comment on the suit until the settlement is approved.
City Councilman Charles Djou said officials had handled the project poorly.
"This whole transaction was a fiasco," he said. "I think everybody's happy we can put it to bed. It was a big waste of time and money for everybody."
Reach Johnny Brannon at jbrannon@honoluluadvertiser.com or 525-8070.
