But members of the Nu'uanu Valley Association say boulders already have come crashing down nearby valley walls killing one woman and barely missing another. They say construction in the steep terrain could loosen rocks, cause flooding and damage cultural sites.

Residents want lawmakers to prevent construction on steep hillsides not only in Nu'uanu but statewide.

"We are saying there are issues involved here and we want them addressed," said Nu'uanu resident Barbara Chu. "We should have some say in our community. The city is saying this is just administerial. The land is zoned residential and that is all there is to it. People know we cannot continue to build on hillsides, but with this booming housing market developers will build anywhere."

The 50-acre Nu'uanu parcel stretches about a half-mile along the east side of the valley above homes from Ragsdale Drive to Kamuela Place.

The property has changed hands twice in the past eight months. Ann and Earl Frawner of Anchorage, Alaska, bought the land for $3.65 million Nov. 19, 2004 under a limited liability company called Puu Paka PD LLC.

The company's manager, Jon Gomes, applied for city permits to subdivide the property and said the plan was to create nine separate lots with homes.

Shin's attorney, Sam King Jr., said the subdivision is moving forward under the new owner but final development plans have not been made.

King said the former owners have done a study that shows there is no problem with boulders and any development will be done within the bounds of the law.

"These guys just want to stop development behind their houses," King said. "When they developed behind other people's houses, it was OK. Now that people want to develop behind their houses it is not OK anymore.

"This is perfectly legitimate development. It is R-10 zoning. The city has approved everything. There is plenty of water, plenty of sewer. It is just a standard 101 development. That is all it is."

Shin, who previously worked on large federal construction contracts, pleaded guilty last year to attempting to bilk the federal government out of $200,000. Shin faces a maximum sentence of five years in prison and a fine of $250,000 when he is sentenced later this year. He was also banned from doing further work with the federal government, a process known as "debarment," according to King.

City Department of Planning and Permitting Director Henry Eng said residents have asked that a public hearing be held on the subdivision application to air their concerns, but he said that is not a requirement on property already zoned residential.

"Subdivision is the sort of thing that a property owner has the right to apply for and if the requirements are met, then the approval is granted," said Eng.

DPP staff member Bob Sumitomo said a geo-technical assessment is required for the permit that would determine the ground conditions and potential for rockfall hazard.

"(The assessment) is supposed to make recommendations as to whether it is a hazard and what would you do to mitigate it," Sumitomo said. "It's more of a soils report and to point out if there are any rockfall hazards."

But residents say a report done by the property owner may not be complete.

"We just want to make sure that the new owners take into consideration area residents concerns and to protect our health and safety," said Wesley Chun, president of the homeowners association. "We are looking for a permanent solution so that this problem doesn't reoccur every time the housing market heats up."

In 2002, a boulder crashed down a mountainside and into a home in Nu'uanu, killing 26-year-old Dara Rei Onishi as she slept. The tragedy occurred a half-mile from the property planned for development. Another boulder tumbled down the Nu'uanu hillside in 2004, narrowly missing Rose Hamakado as she stood in her back yard.

Rockfalls across O'ahu have damaged cars and property and have prompted builders and the state to take extraordinary measures to assure safety, including road closures, evacuations and placing protective netting over hillsides.

Leroy Akamine, a Hawaiian resident of the valley, said he has walked in the hills and found the remains of Hawaiian structures that need to be protected. He said a public hearing would allow residents to air their concerns, but the city refuses.

"We think because of all the concerns we should have a voice," Akamine said. "It should be addressed at this time. It is inappropriate to take that mountain side, the home of the ali'i, with all the concerns the community has, and to say it is administerial and let the chips fall where they may. Our goal is to stop the inappropriate use of this mountain side."

Residential zoning for the parcel was approved decades ago, and the Nu'uanu homeowners said it has since become clear that building homes there is inappropriate.

Stephen Martel, a geologist with the University of Hawai'i, said it is a legitimate to ask what was the basis for the zoning decision.

"If they are not made with regard to the geologic conditions, then that opens the door for geologic hazards to raise their ugly head. It allows for that possibility," he said.

State Rep. Sylvia Luke, D-26th (Punchbowl, Pacific Heights, Nu'uanu Valley), and City Councilman Rod Tam have been meeting with the residents and have introduced legislation to scrutinize development on hillsides.

The City Council last year passed a bill introduced by Tam that requires an engineering slope hazard report with a grading or building permit application on steep terrain.

"I oppose any development on that hillside," Tam said. "The property is too steep. The city issues building permits but if there is a landslide, who is liable? I'm trying to protect the city, too."

Tam said the whole area is substandard in terms of infrastructure, roads, sewer lines, water lines and not suitable for more homes until upgrades are made.

Luke has introduced several measures to regulate or stop development on steep hillsides, but none has passed. One bill would have required the counties to identify hazardous land areas and adopt standards for building there and another would have given a tax credit for property owners who donate their property to the state as conservation land.

"The problem is as a state we want to protect citizens from rockfalls and landslides, but the situation is actually within the jurisdiction of the counties," Luke said. "When they come forward and say it is a home rule issue, legislators have a hard time overcoming that."

Luke said safeguards need to be put in place before more people are hurt.

"Now that we have this major lack of affordable housing problem, developers are going to look at every available piece of land, even undevelopable or unsafe lands, to see if they can try to turn things into a profit," she said. "We are seeing it all over in the urban Honolulu area.

"If you look at the Nu'uanu area, the only place you can build would require major excavation. It's fronting some of the neighbors that have mountains that are right in back and that is where they are going to develop. I think that is really, really hazardous."