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Opposition to Kihei Retail Centers Grows

The Maui Weekly has covered events leading up to this dispute and has described the point of view of the developers. This third part in the series is written from the perspective of the projects’ opponents.

August 30, 2012
Susan Halas , The Maui Weekly

The history of Maui's commercial development clearly shows that no matter what land use designation is originally approved, as long as the actual zoning doesn't change, a project may often morph into something else. But usually, by then, it's too late to take action and the project gets built in its new form.

But this time it will be different if opponents of the Maui Outlets and Pi'ilani Promenade retail centers have their way.

Maui Outlets

Article Photos

South Maui resident Mark Hyde, representing South Maui Citizens for Responsible Growth, and Maui Tomorrow spokesperson Irene Bowie, said opponents of the planned retail centers do not object to additional shopping opportunities for South Maui, but they do object to failure to comply with the state Land Use Commission’s original order.

Maui Outlets and Pi'ilani Promenade are large-scale commercial projects that opponents say switched their land use designation from an Urban M-1 light industrial subdivision to a different use--intensive retail.

Opponents claim the community only heard about the new use after pre-construction was well underway.

The 88-acre parcel in dispute was at one time owned by Ka'ono'ulu Ranch. The State Land Use Commission (LUC) granted the change from Agricultural use to an Urban light industrial subdivision to the ranch in 1995. Since then, the project (and it successive owners) have filed 15 consecutive annual reports with the LUC, all explicitly stating its use had not changed.

It should be noted that light industrial and retail are both permitted uses in the M-1 zoning category later granted by the county. But the original 1995 order has stipulations that specify light industrial, and though that designation does not exclude retail, the conditions say that the use will be "substantially" light industrial.

The latest incarnation includes several phases--the Maui Outlets center and Pi'ilani Promenade--two very large retail developments owned by Eclipse Development of Irvine, California. A smaller portion of the property is currently slated for 250 units of workforce apartment housing. This portion is owned by Honua'ula Partners (successors to Wailea 670).

All are located on the mauka side of the Pi'ilani Highway at the Ka'ono'ulu Street intersection. In just the first phase of retail (where work has already started), there are over 1,600 parking stalls and dozens of stores indicated on the site plan.

This is a big-ticket construction project that until the day initial permits were issued, reported under penalty of reverting to its original Agricultural status, that it was a light industrial area. The 2011 annual report filed by the owners contains the words "LIGHT INDUSTRIAL AREA" in capital letters as its first line on the cover page.

However, the present site plan does not contain so much as a square foot of light industrial use. The report is over the signature of Charles Jencks, a liaison for both owners. A 2012 report has not yet to been filed.

On the radar at Kihei Community Association

These projects hit the radar of the Kihei Community Association (KCA) in 2010. But it wasn't until a January 2012 KCA meeting attended by South Maui County Councilmember Don Couch and County Planning Director Will Spence, that Kihei residents took notice of the major retail centers underway in their area.

According to South Maui resident Mark Hyde, who attended the meeting, both Couch and Spence told the KCA, "This is a done deal." The two county officials went on to say the projects had the blessing of Mayor Alan Arakawa's administration. That did not sit well with the community, according to Hyde.

County authorized changes

To a certain extent, Couch and Spence were right: The county knew about the retail development and gave preliminary go-aheads to the first phase. Other phases were also announced in the local press as large retail and housing development projects that would bring beneficial construction and jobs to Maui.

But not everybody saw it that way.

The KCA went to Irene Bowie, the spokesperson for Maui Tomorrow, a nonprofit corporation, and asked the organization to look into the matter.

Hyde, a retired former attorney, took a trip to Honolulu to visit the LUC office, where he reviewed the Ka'ono'ulu Ranch's original request to reclassify the land. He wanted to see what was said to the commission in 1994 that led to the 1995 order. He found that Condition 15 required the owner to build "in substantial compliance" with what had been represented to the commission, i.e. a light industrial subdivision.

South Maui Citizens for Responsible Growth forms

Quicker than you can say "due diligence," Hyde took steps to form another nonprofit corporation called "South Maui Citizens for Responsible Growth" and joined forces with Maui Tomorrow in challenging the development.

A third party, Daniel Kanahele, a Kihei resident who is concerned about increased traffic, also was added to the action. The three filed a show cause motion with the LUC in May.

Hyde and Bowie said opponents do not object to additional retail opportunities for South Maui. They do object to failure to comply with the LUC's original order.

The conditions of the original order are on the title of all seven of the lots which were originally owned by the ranch. These were later consolidated into four big parcels. The first-phase retail center is one of the four parcels.

Hyde said the new owners had every opportunity to make an assessment of what they could do with the property when they purchased it in 2009-10. He doubted that the buyers would have made such a major investment without carefully looking at the conditions.

Hyde added that the Kihei-Makena Community Plan enacted in 1998 specifically shows the light industrial area described by Ka'ono'ulu Ranch. He also pointed to language in the countywide policy plan adopted in March 2010 (before most of the property was acquired by Eclipse), which specifically rejects "urban sprawl" and embraces "smart growth."

Hyde characterized this development as an example of "urban sprawl" on a gigantic scale. He and Bowie also said changes were made without the opportunity for public comment and scrutiny.

Expanding on this point, Bowie said that when the land was identified as a light industrial project, there were provisions for additional roadways to handle the increased traffic that included a frontage road and a connector road. These roads have been eliminated in the current version of the plan, which is anticipated to generate even more traffic.

2011 annual report signed by Jencks

Hyde also pointed out that during the 1990s, Jencks was the Public Works director for the County of Maui. More recently, he was also a LUC commissioner.

"This is a person with a lot of knowledge and sophistication," Hyde said.

With his index finger, Hyde pointed to the exact language of the various conditions in the 2011 annual report. One-by-one, he also pointed to the written assurances that these conditions are all still in effect precisely as written. Jencks had signed off on all of them.

At minimum, the opponents think the LUC should reopen the docket and reexamine the projects' compliance.

Owners took '"calculated risk'

"The owners took a calculated risk," Hyde said. "The subsequent actions do not comply with the original order."

According to Hyde, LUC requirements take precedence over any action the county might have later authorized for the land, because state law requires the county to enforce the LUC's rulings and conditions--not circumvent them.

The opponents of the projects said the County of Maui not only failed to enforce the conditions, but openly flouted them. The county has filed its own brief with the LUC in support of the developer and the legality of its own actions.

Office of Planning sides with opponents

The State of Hawai'i's Office of Planning did not support the County of Maui's position. It filed a brief urging LUC reconsideration. The planning office said the first time official records showed a change of use was when grubbing and grading permits were issued by the county this spring.

A LUC hearing was held on Friday, Aug. 24, when the two sides were heard in the Maui Ballroom of the Royal Lahaina Resort in Ka'anapali.

A LUC spokesperson said the commission was hopeful the matter would come to a vote on that day and not be held over. (See "Substantially Means Substantially" on the front page.)

'Facts, law and public policy on our side'

Neither Hyde nor Bowie wanted to speculate on a possible course of action if their motion was not granted.

"I am confident," Hyde said, "that the facts, the law and public policy are on our side."



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