Denby Fawcett: House Speaker Offers OHA $100M To Can Kakaako High Rises - Honolulu Civil Beat

About the Author

Denby Fawcett

Denby Fawcett is a longtime Hawaii television and newspaper journalist, who grew up in Honolulu. Her book, Secrets of Diamond Head: A History and Trail Guide is available on Amazon. Opinions are the author's own and do not necessarily reflect Civil Beat's views.

The deal would also greatly increase Public Land Trust payments.

House Speaker Scott Saiki is proposing to pay the Office of Hawaiian Affairs $100 million to give up its quest to build three residential high rises up to 450 feet tall on its Kakaako Makai land.

OHA’s proposal to build the residential towers was rejected by the Legislature, but OHA has made it clear it will keep trying to build the condo towers by continuing to urge the state to toss out a 2006 law that prohibits such construction on all land makai of Ala Moana Boulevard.

Saiki met with Office of Hawaiian Affairs Chairwoman Carmen Hulu Lindsey and Gov. Josh Green in the governor’s office Friday to discuss the new offer that asks OHA to accept a cash payment to prevent the high rises. It also proposes an increase in the state’s annual payments to OHA from the public lands revenues.  

Many of the Kakaako Makai lots are currently empty or have industrial uses. (David Croxford/Civil Beat/2022)

Here are the highlights of Saikiʻs offer to OHA as outlined in a letter he sent to Lindsey on Monday:

  • Pay OHA $100 million for a public easement to prohibit residential development in order to preserve public access, scenic views and building height and density in Kakaako Makai.
  • $65 million to OHA for wharf repairs the agency says are badly needed on the revetments in the former Fisherman’s Wharf area.
  • Increase OHA’s share of Public Land Trust revenues from the current $21.5 million a year to $25 million beginning January and to increase payments to OHA annually using a formula of a three-year average of the Consumer Price Index.
  • Pay $100,000 to the state Department of Land and Natural Resources to put an inventory of the Public Land Trust properties on line to make the information easily searchable by the public.

In urging OHA to act promptly, Saiki says the proposal would be funded with money from the current state budget surplus and that there is no guarantee such a surplus will be there in the future.

The proposal, although blocking residential development, would not hinder the kind of construction OHA is allowed to do on its Kakaako Makai land including low density commercial, office and retail developments with some buildings up to 200 feet tall.

OHA’s public relations consultant Ryan Kawailani Ozawa says the agency is not ready to respond to Saiki’s offer.

“The proposal involves a number of complex issues and is among several moving parts to which the OHA Board of Directors must give serious consideration, and therefore OHA cannot provide official comment at this time,” Ozawa said in an email.

Rendering of planned Kakaako Makai development OHA
An architectural rendering of OHA’s planned Kakaako Makai development. (Office of Hawaiian Affairs)

In a phone conversation with Civil Beat on Tuesday, Saiki said the offer is important because it would “make OHA whole again.”  

Meaning it would address OHA’s contention it was shortchanged in 2012 when it agreed to accept 30 acres of Kakaako Makai land in a settlement from the state even though, at the time, both parties were in firm agreement the land was worth $200 million.

Since then, OHA has said it was not paid enough. OHA says despite four attempts to lift the residential development restriction on Kakaako Makai lands — restrictions that had been in place six years before OHA accepted the land — it is handicapped by being legally blocked from developing the land to its fullest commercial potential.

OHA says its appraiser claims the restrictions make the property worth only $43.6 million today. However, the current Honolulu County property tax assessment for the land is $283.7 million.

Saiki says the most salient part of the proposal is its offer to substantially increase the amount of money OHA receives each year in ceded lands payments. 

Ceded lands are former government and crown lands. The 1.8 million acres of land in Hawaii were transferred to the U.S. after the overthrow. The lands were transferred again to the state government when Hawaii became a state in 1959.

OHA, year after year, has pleaded with the Legislature to increase the ceded land payments, arguing they are only a fraction of the 20% of the gross revenues from public lands they should be receiving.

In a statement Tuesday the governor said, “I’d like to express my support for continued dialogues between relevant stakeholders in this issue, especially House Speaker Saiki and the Office of Hawaiian Affairs. My priorities are the same — we’d like to expand our housing resources for local residents, promote jobs and to respect our urban open spaces.”

OHA’s board of directors will meet Thursday to discuss the new offer from Saiki.

It is too late to put the proposal into a bill to be voted on by lawmakers in the Legislature’s regular session.

Yet, Saiki says if OHA accepts the offer there are other ways lawmakers could advance it this year including a special session of the Legislature this summer.

But a special session would have to be called by the governor or by a two-thirds vote of the House and Senate. And it is too early for that to be under discussion now.

Read this next:

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About the Author

Denby Fawcett

Denby Fawcett is a longtime Hawaii television and newspaper journalist, who grew up in Honolulu. Her book, Secrets of Diamond Head: A History and Trail Guide is available on Amazon. Opinions are the author's own and do not necessarily reflect Civil Beat's views.

Latest Comments (0)

It should be noted that no one twisted OHA trustees to take the deal back in 2012, that was when the trustees had the legal obligation to do their due diligence before accepting the stated value. Apparently they didn't and they should be held accountable by their beneficiaries. All their ads claiming discrimination should have a footnote that the trustees are incompetent when it comes to real estate deals. There is no fight to be had, no developer should be allowed to build on Makai, as the law set in 2006 states. A&B tried prior to that and was denied, so did Andy Anderson. It doesn't mean that lower rise development can't be done, much like Aloha Tower, it fits under current zoning. But at this point the ball is in the current trustees hands to try and rectify their ineptitude. And Sakai has thrown out the first olive branch for consideration, nearly equal to the 2012 settlement, maybe that number will go higher? And OHA can't have it both ways, if they claim the land is only worth $43.6M today, then they should seriously look at taking the money and/or another piece of land elsewhere and getting out completely. No one in OHA is qualified to be a developer.

wailani1961 · 1 month ago

Blocking views (both ways) is exactly what all the Kakaako condos did with their "approved" variances! We used to feel the cool tradewinds coming over the Koolaus while paddling at Ala Moana Beach - those cool breezes are no more, along with the majestic views of the Koolaus. Honolulu is morphing into Hong Kong - no land and a polluted sea. What good is an assessment of $386 million dollars on a property that looks like an industrial dump that cannot be developed to it's potential. Saiki pulled a fast one on OHA - don't let him get away with it.

CivilTutu · 2 months ago

Remember when the State offered OHA the Kaka'ako package with a short time limit to accept the deal which now reveals that it was not the value stated? Remember also that this Kaka'alo deal was to make amend for years of failed payments to OHA by the State. Now what is the crooked deal to OHA with the $100M and increased payments is the State covering up? In politics, there's no goodwill to the tax payers nor the host culture of Hawaii. This smoke screen is to divert our attention from what is the true picture.

kealoha1938 · 2 months ago

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