A luxury housing development in Wailea was on track to secure its final approvals from a divided Maui County Council this month when a local nonprofit found a procedural mistake that is delaying construction.

The Planning Commission failed to hold a public hearing in South Maui where the project is to be located as required by law, according to Maui Tomorrow Executive Director Albert Perez.

He said there was an error in the commission’s handling of Bill 171, which along with Bill 172 would shrink affordable housing requirements to 288 units from the previously agreed upon 700 units at the Honua‘ula project, also known as Wailea 670. The bills also soften other requirements.

On Sept. 24, prior to sending the proposal to the council, planning commissioners held a public hearing in Wailuku, when it should have been held in South Maui — the community affected by Bill 171 — in compliance with Section 19.45 of the Maui County Code, according to Perez, who pointed out the mistake to county officials.

Planning Commission Chair Kimberly Thayer said the next step is to schedule a new public hearing in South Maui. That might not happen for a few months.

“I believe our January and February agendas are largely spoken for,” she said. “We might have to schedule a special meeting, otherwise it’ll be potentially after February.”

The Planning Commission is a volunteer body staffed by the Maui Planning Department. It’s the department, Thayer said, that sets the commission’s agenda, does their scheduling and picks the location of their meetings.

This type of proceeding doesn’t come up often, she noted, and even the Department of Corporation Counsel may not have been aware of the rules regarding the location of the public hearing.

“I truly believe it was an inadvertent mistake, but I’m glad we caught it in time, and we can go back and follow the correct procedure,” council member Tamara Paltin said.

In light of the mistake, the council canceled the bills’ first reading and public hearing scheduled earlier this month, also in Wailuku. Council Chair Alice Lee had planned to schedule the bills on Dec. 23 for a second and final reading.

Thayer said the whole process will have to start from scratch. The commission will schedule a public hearing, then convene to deliberate and make recommendations to the council.

“It’s as if the proceeding never happened,” she said. “So, we will have to do it all over again.”

Rush Hour At Council Chambers

The pair of bills were being processed side-by-side with uncommon speed by the nine-member council’s pro-development majority. Lee referred the bills directly to the Housing and Land Use Committee, where Chair Tasha Kama reduced the length of public testimony for each testifier.

The bills were approved by a 5-4 vote in committee after three days of deliberations in late November and early December — including two back-to-back days when the council canceled a different committee meeting to accommodate the continuation of the House and Land Use Committee the following day.

Council member Gabe Johnson said the council could be rushing the bills because of a pending lawsuit filed in late November by former council member Kelly King, who narrowly lost to incumbent Tom Cook in the last election.

Cook’s 97-vote victory assured the continuation of the council’s five-member majority, whose campaigns were supported by the construction industry and labor unions.

King’s complaint with the Hawaii Supreme Court points to potential irregularities in the voting process, including a high rejection rate of 1.9% of mail-in ballots. She’s asked the court to invalidate the results and hold a new election.

“That’s a real pickle,” Johnson said, adding there might be a special election for the South Maui candidate.

“If you have a new person on the council, then maybe this project won’t pass,” he said. “That’s why there was a sense of urgency for folks who wanted this to pass.”

“The whole entire town of Lahaina burned down, and there’s no sense of urgency.”

West Maui council member Tamara Paltin

Paltin, who represents West Maui, was particularly frustrated by the speed at which the council majority pushed these bills compared to others affecting Lahaina residents.

“The whole entire town of Lahaina burned down, and there’s no sense of urgency,” Paltin said at a meeting earlier this month, adding that 300 people who applied for permits to rebuild their homes in Lahaina still don’t know when they will be allowed to rebuild.

Meanwhile, Wailea 670 benefited from a direct referral that allowed it to bypass a step, according to Paltin.

“We see where the priorities are, and it’s not the people of Lahaina,” she said. “It’s the luxury developments.”

Shrinking Affordable Housing Requirements

Not even a month after the elections, the development-friendly council majority — who campaigned for affordable housing — is already softening developers’ requirements in the luxury home development in Wailea.

“There’s too much luxury development on this island already. I’ve said it and I’ll say it again, Maui is becoming a place for only the rich, the uber-wealthy… and that’s not the Maui I want to see, that the community wants to see,” council member Keani Rawlins-Fernandez said at a meeting earlier this month.

More than 16 years ago, a reluctant council that included former Mayor Mike Victorino reached a close 5-4 vote on final approval of the project only because it would bring 700 affordable homes to South Maui as part of the deal.

“I hope when this is all said and done that these developers don’t come back and try to see another council,” Victorino told his colleagues in 2007. “But if I’m not here, I hope that the record will show that I said, ‘Please do not change the conditions we put forward.’”

The 670-acre project on the southern tip of Pi‘ilani Highway was approved for 1,400 homes, with 50% of them being affordable units to comply with the law at that time.

“…if I’m not here, I hope that the record will show that I said, ‘Please do not change the conditions we put forward.’”

Former Mayor Mike Victorino, in 2007

Originally, 450 affordable homes would be built within the project’s site, with an additional 250 off-site. Those off-site homes would be at the proposed Pi‘ilani Promenade, also known as the Mega Mall — a project eventually blocked by the courts.

In 2022, the developers dropped the number of overall units to 1,150. Now they have asked the council to reduce the number of affordable units in accordance with a 2014 law that reduced the requirement to a 20% match for new developments.

The developers had also agreed to improve Pi‘ilani Highway. Instead, they want the state Department of Transportation to take over that responsibility. If so, the developers would build 50 additional affordable units as a tradeoff.

For each affordable housing built over the 20% current requirement, the developers are asking the council to grant them affordable housing credits. They could then sell those credits to other developers, who in turn would use them to reduce their affordable housing requirements.

“As a representative for our community, I refuse to beg for scraps and then tell our constituents to be grateful to these developers.”

Council member Keani Rawlins-Fernandez

Additionally, developers had committed to put $5 million toward a Little League Baseball field in 2008. Now, they want to exchange that for a cultural center on their land, with the land value subtracted from the $5 million.

“If these are approved, we’ll do 338 (affordable units), all coming out of our total of 1,150,” attorney Cal Chipchase told the council at a meeting earlier this month. “If more were required, the project simply wouldn’t proceed.”

To some council members, it was an assurance of affordable homes for the community. To others, it was a major and unwarranted reduction from the original 2008 agreement of 700 units.

“As a representative for our community, I refuse to beg for scraps and then tell our constituents to be grateful to these developers,” Rawlins-Fernandez said at a meeting.

Civil Beat’s coverage of Maui County is supported in part by a grant from the Nuestro Futuro Foundation.