You defy odds, gamble and lose
By Jack Kelly
Lyle Anderson is a gambling man. And when you gamble, sometimes you lose.
The developer of the Oceanside 1250 project in Kona, also known as Hokul'ia, gambled big and lost. It's not like he didn't know where he was going.
He's a powerful guy with big-time backing, used to getting his own way.
Operating on the fringes of the law, squeezing the bottom line for all it's worth, is part of the corporate culture exhibited by Anderson and his projects worldwide.
There's a history here that the smooth PR machine of Anderson companies would like to ignore while proclaiming how unfairly they have been treated.
In 1989, Oceanside attorneys advised their client that compliance with the regulatory scheme involved three factors: the Hawai'i County General Plan designation for the area; the county's Land Use Pattern Allocation Guide map; and the requirements of state land-use law.
In 1993, the Office of State Planning informed Oceanside that their project appeared to be a "small resort"; Director Harold Matsumoto noted that OSP's West Hawai'i Regional Plan did not "encourage resort development at the project site."
Even the county planning director, Virginia Goldstein, very early in the review of the project in its initial stages cautioned that "the law requires that the project be viewed in its entirety to properly assess the project against the guidelines for approval of the various amendments to the land-use designation and permits."
Judge Ibarra ruled, "Ms. Goldstein never retracted this statement in writing, which constitutes the official position of the County of Hawaii."
In 1994 Oceanside's own attorney, Christine A. Low, cautioned Anderson that "there is no indication that the residential units proposed by Oceanside 1250 are either farm dwellings or otherwise relate to an agricultural activity."
Councilman Curtis Tyler remarked in a Planning Committee workshop in 1996, "Oceanside is trying to avoid the state Land Use Commission."
In 2000, Anderson attempted to implement another luxury gated golf course community in Kona, the Keopuka Lands project, this time on the shores of Kealakekua Bay, two miles south of the Hokuli'a site.
That move resulted in the birth of Protect Keopuka 'Ohana as well as community group Keep Kealakekua Wild.
We led a drive to stop that project which in turn led to attorney David Frankel petitioning the Land Use Commission for a declaratory ruling. The commission found that gated luxury golf course communities were not an appropriate use of agricultural lands.
This is the same ruling Anderson would have gotten if Hokuli'a had gone before the commission.
Between May 1998 and December 2000, Oceanside expended approximately $55 million for construction and development costs. Between January 2001 and July 2003, Oceanside expended approximately $136 million. This in spite of the judge's warning in early 2001 that no "vested rights" would be considered by the court to have accrued since the date of the filing of the lawsuit in November 2000.
In spite of the Keopuka ruling, with disregard of the many warnings from government officials, professional planners and attorneys, Anderson continued to gamble.
In the end, after hearing and carefully considering all of the evidence, Judge Ibarra ruled that the developer had no vested rights in its investment because it did not act in good faith to comply with the regulatory scheme.
Kona is an agricultural community. Kona coffee is a thriving commodity, and diversified agricultural products of all kinds are produced here. Projects like Hokul'ia are bad for business if your business happens to be agriculture.
Protection of the agricultural district is imperative for agriculture to flourish.
If, as Linda Lingle proffers, more ag lands need to be opened up for urban development, certainly no lands in Kona would fall into that category.
On the other hand, in 1995, the State Land Use Boundary Review called for many of the agricultural lands in mauka Kona to be reclassified to conservation, because of the critical nature of the Kona watershed in providing sustenance to the community a recommendation that would provide an even higher level of protection.
However, this recommendation was met with stiff resistance by the large landowner families that are the same ones today aggressively marketing their properties to the highest bidder.
The watershed is being reduced daily as the majestic 'ohi'a forests of Kona are bulldozed into oblivion. And not for agriculture but for subdivisions.
Lingle believes in "home rule," but home rule is what got us where we are today. "Home" is where money talks and until recently justice took a back seat to the methods of the "good old boy" network.
Today, we are left with the legacy of the Japanese investment boom of the '80s and the wholesale selloff of our island by our county government during the Yamashiro regime in the '90s.
This state needs a strong Land Use Commission and a strong State Office of Planning to oversee the overall vision of land-use planning, not rule by the local bullies.
Hokuli'a's recent filing of a motion to suspend and stay final judgment is nothing more than fear mongering, typical tactics used to further divide this community and spread fear of some catastrophic economic demise.
When you're a gambling man, you have to be willing to lose, and when you lose, you should shake hands and show a little dignity, not whine about your bad luck.
Jack Kelly is vice president of the Protect Keopuka 'Ohana and a plaintiff in Kelly v. 1250 Oceanside Partners.