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The Honolulu Advertiser

Posted at 1:51 p.m., Thursday, July 5, 2007

Condemnation of Maui beach lot given a go

By HARRY EAGAR
The Maui News

WAILUKU — The county on Tuesday committed to use its powers of eminent domain to acquire the last piece of the Montana Beach condominium, The Maui News reported.

How much it will cost is unknown. The price may well be decided by a jury.

But the County Council Policy Committee agreed to pay $125,000 to hire a condemnation expert, with the likelihood that the final fee will be a lot more.

Whatever the price for acquisition, the county is also facing claims for damages filed by the current buyer of the condominium unit for alleged losses suffered over the past six years.

The county has already paid more than $6 million for the other two pieces of the 5.6-acre property, but that was not for real estate alone. It also included attorney fees and settlement of a variety of claims.

The remaining piece is about as big as the other two pieces combined.

The condominium was planned on the former Hawaiian Commercial & Sugar Co. lime kiln site, which adjoins Baldwin Beach Park. Designated on the county community plan as open space and park, it is classified urban and is zoned for residential use, although most of the surrounding lands are zoned conservation.

Whether the holdout owner, Asghar Sadri, has any development rights will affect the eventual valuation.

Some members of the council, most vocally Michelle Anderson, are certain he doesn't.

However, that has been the matter of complex litigation. The original owner, Kurt Ulmer, obtained a special management area exemption for the residential condominium, and construction began on three housing units.

The exemption was revoked following complaints initiated by an Upcountry woman, Christina Hemming. She won her point the old county policy of treating up to three residences on a lot as one for purposes of SMA exemptions was illegal under state Coastal Zone Management law.

However, it's possible to claim rights if government makes a mistake a fact reinforced just this week when the county announced a $1.5 million settlement in an unrelated shorefront lot case. In that case, a half-acre parcel in Lahaina was designated for residential use in the West Maui Community Plan as a result of a mapping error, and the owner, Doug White, initiated development based on the residential designation before an SMA exemption was revoked.

At Tuesday's Policy Committee meeting, Deputy Corporation Counsel Madelyn D'Enbeau avoided discussing whether Sadri still has any development rights. She said that would have to be discussed in executive session, if at all.

Chairman Danny Mateo said he saw no reason for a closed session.

Council Member Jo Anne Johnson, who joined Anderson in believing that there are no development rights left, said that if the courts don't agree, "It's really going to be expensive."

It may be years before the taxpayers learn how expensive.

The Office of Corporation Counsel asked the council to hire an outside expert, Rosemary Fazio of Honolulu, because of her experience in handing complicated valuations. Fazio was involved in the contentious lease-to-fee forced conversions of private property on Oahu.

D'Enbeau said it might save the county money in the long run. Her office requested $250,000, but at the suggestion of Council Chairman Riki Hokama that was trimmed to $125,000, to provide a point at which the council would get a chance to review progress.

Earlier this year, the council authorized a settlement offer to Sadri, who turned it down.

The council knows how much that offer was, though it has been kept secret.

To proceed with condemnation, the county will hire an appraiser and submit the expert's estimate of value, allocating that amount of money in a fund, to the Circuit Court.

At that point, the county will obtain control of the property, under its claim of eminent domain for a public purpose a park.

It could then proceed to develop it as a park, D'Enbeau said.

However, since Sadri has so far resisted giving up the property he says he wants his permits to build he probably would hire his own appraiser and submit his valuation to the court.

D'Enbeau said the two parties are "miles apart" in how they value the land. That is in large part due to the disagreement about whether anybody could ever build there.

D'Enbeau said it will likely take years for the condemnation to be adjudicated.

For more Maui news, visit The Maui News.