HILO, Hawai'i — Big Island prosecutors have decided to drop charges against a convicted murderer accused of raping a 12-year-old girl earlier this week, and instead plan to seek a grand jury indictment in the case.

Peter Bailey, 49, will remain in jail without bail in the meantime based on an arrest warrant charging him with a parole violation, prosecutors said.

Bailey is accused of raping a 12-year-old girl in the office of a Pepe'ekeo church Sunday night after picking the girl up for choir practice. There was no choir practice that night, and police said Bailey used the opportunity to sexually assault the girl.

Bailey was active in the church the girl attended, had keys to the church building and sometimes worked on the grounds, parishioners said.

The case has stirred community outrage because Bailey in 1979 was sentenced to life in prison with the possibility of parole for the slaying of 17-year-old Carol Olandy on O'ahu.

Bailey was initially given a 35-year minimum prison term by the Hawai'i Paroling Authority, but parole officials later reduced that to a 20-year minimum. Bailey was paroled in early 2003.

Bailey and Francis Talo were convicted of kidnapping Olandy from a parking lot at the Pearl City Shopping Center on April 29, 1979. The pair said they wanted the Camaro that Olandy was driving "to do a job," according to testimony in the 1979 trial.

The two defendants took Olandy to a Kunia pineapple field and shot her, then drove to Fort Ruger Market and robbed the store. They were arrested a few minutes after the robbery, still driving Olandy's car. Olandy's body was located by authorities days later with seven bullet wounds.

Louise Kim McCoy, spokeswoman for the state Department of Public Safety, yesterday said that a check of prison records shows Bailey never participated in sex offender treatment during his time in the prison system because he had never been convicted of a sex crime.

Former Department of Public Safety Director Keith Kaneshiro earlier said Bailey was involved in a program for sex offenders at Kulani Correctional Facility on the Big Island in the late 1990s, but McCoy said the prison system has no record of that.

She said Bailey served time at Kulani because he was classified as a minimum security inmate, and Kulani is a minimum security prison. However, sex offender treatment is provided only to prisoners convicted of sex offenses, and McCoy said prison and parole records show Bailey was not involved in that treatment.

Reach Kevin Dayton at kdayton@honoluluadvertiser.com.