Kauai County Council Chair Mel Rapozo suggested taking ownership through eminent domain. The owner says it’s for sale anyway.

For 30 years developers have pitched a rebirth of the majestic Coco Palms hotel, where Elvis Presley’s “Blue Hawaii” was filmed, where Frank Sinatra stayed, and long before that, where Kauai’s royalty reigned. 


And for 30 years those plans have stalled amid fluctuating property ownership, a lack of investor capital, costly repairs, permitting hurdles, Native Hawaiian protests and disputes over land rights.

Kauai County Council Chairman Mel Rapozo said it felt like deja vu on Wednesday as the council spent over seven hours unpacking a tangle of legal issues and a lack of clarity on where things stand with the controversial effort to redevelop the hotel ruins on a patchwork of public and private parcels along one of Kauai’s most congested traffic routes.

The discussion, during which council members questioned the developer’s attorney and state and county regulators, centered on the project’s newest controversy: an investigation into alleged land use violations against the Coco Palms developer by the Department of Land and Natural Resources.

Kauai’s Coco Palms Resort was damaged in Hurricane Iniki in 1992 and has never been rebuilt. (Allan Parachini/Civil Beat/2020)

The dialogue hit a high note when Rapozo announced his intent to explore the use of eminent domain to wrangle the Coco Palms site away from a revolving door of hotel developers and instead preserve the historic property for public use.

The chairman’s proposal drew public cheers and applause.

“But that comes at a price,” Rapozo warned. “Because with condemnation comes the real market value that we’ve got to pay. I’m committed to finding that money. We could put some CIP projects on the side for a little while. We can tap our reserve. I believe this: If this is what this community wants, we can get it done.”

Attorney Mauna Kea Trask, who represents developer RP21 Coco Palms, said the county need not pursue eminent domain because his client is willing to sell its ownership in the dilapidated hotel and former Sea Shell restaurant for $22 million — an amount equal to the developer’s original investment.

“The money that was lent for this project was from a pension fund for firemen, police officers and other government employees,” Trask said. “That’s why they need that money. The reason why they’re pursuing development of this project is because they need to make their money back for that purpose.”

The historic Coco Palms has been closed since being ravaged on Sept. 11, 1992 by Hurricane Iniki. 

Hopes for its restoration have hinged on a county ordinance that allowed property damaged by Hurricane Iniki to be rebuilt in compliance with the county rules and permitting requirements in place at the time of the storm. 

The current application to rebuild the Coco Palms was approved before what’s colloquially known as the Iniki ordinance sunset in 2015. So although the hotel ruins sit across the highway from a vulnerable coastline fortified by sandbags and an old seawall, the hotel redevelopment project does not have to comply with newer county rules, such as its conservative shoreline setback ordinance that aims to defend new construction from a watery demise.

“Yes, it’s a bad idea,” Kauai Planning Director Ka’aina Hull said of the prospect of redeveloping the hotel with 1992-era building rules that don’t account for the predicted effects of a merciless rise in sea level. 

The project is currently in the throes of a state land use investigation.

On April 19, the DLNR sent a notice of alleged violations to RP21 Coco Palms, the owner of the private properties in the resort complex. The notice alleges that the group used machinery to grade land and clear trees on state-owned land in a conservation district without a required permit or Board of Land and Natural Resources approval. 

On April 21, the DLNR issued a notice of default to Coco Palms Ventures — a leaseholder that at one time planned to redevelop the hotel site — alleging violations of six provisions in its revocable 65-year lease agreement, including failure to pay county property tax, removing at least 77 healthy coconut trees and uncontrolled noxious weeds.

Other investigations into possible violations related to wetlands in the area are underway by the State Historic Preservation Division and the Division of Forestry and Wildlife, according to DLNR Chairwoman Dawn Chang, who appeared at the council meeting. SHPD has also opened an investigation into the razing of dozens of trees in the coconut grove planted in the mid-1890s.

A group of mostly Native Hawaiian activists occupied the Coco Palms hotel site for about a year starting in 2017 in a dispute over land use rights. (Brittany Lyte/Civil Beat/2018)

Trask said he doesn’t think his client RP21 Coco Palms violated any land use laws in performing grading work and cutting down coconut trees. 

“We don’t want to fight with the community,” Trask said. “We’re going to work with the DLNR to address these things.”

More than 160 people submitted written testimony and roughly two dozen people testified in person at the meeting. Although not everyone agreed on a vision for the property’s future, none spoke in support of the hotel’s long-planned redevelopment during public testimony.

“What should be done is shut this project down however we can,” said Fern Holland, a Kauai activist and member of I Ola Wailuanui, a nonprofit that’s fundraising to buy the famed hotel and restore its grounds as a cultural, historical and ecological resource. “There’s so much loss of trust. There’s so many examples of failure to do due diligence, failure to even follow the plans that they’ve put forward time and time again.” 

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