The Department of Education has submitted a proposal to install photovoltaic panels at every single public school in the state. According to the proposal, the panels will be added over a five year period and will cut the DOE’s annual power bill by 50 percent. The DOE spent a total of $47 million during the 2011 to 2012 school year and feels that the money saved could be channeled into other funds. The Department of Education has a foal of using 90 percent clean energy by 2040.
According to the state Campaign Spending Commission, the Pacific Resource Partnership Political Action Committee has spent over $2.8 million during this election season. The pro-rail group has been focusing their advertising campaign against mayor candidate Ben Cayetano, who is anti-rail. Cayetano has promised that if he is elected he will do everything in his power to end the Honolulu Rail Project, while his opponent, Kirk Caldwell has stated that he will keep the project going. The Pacific Resource Partnership is made up of the Hawaii Carpenters Union and trade contractors that uses unionized workers.
According to Leroy Laney, professor of economics and finance at Hawaii Pacific University, Hawaii should see a 1.5 percent increase in gross domestic growth in 2012 and a 2.3 percent growth next year. The strongest industry for the state has been tourism, but Laney added, ”There are some bright spots besides tourism. Those bright spots, in a housing market that shows signs of turning, in retailing, in auto sales and in some other areas, are cause for cautious optimism as we head into 2013. Our gradual recovery following the 2008-2009 Great Recession has been very slow, like everywhere else, but on a more optimistic note, it has been fairly steady.”
Hawaiian Airlines added their fourth new route to Japan since November 2010 with a nonstop service to Sapporo, Japan. The ten hour flight will fly three days a week and will use a Boeing 767 which can hold 264 passengers. Hawaiian Airlines Chief Commercial Officer, Peter Ingram, stated, “Hokkaido is somewhat isolated from some of the other connecting points in Tokyo or Osaka, so we think there’s some demand that hasn’t been satisfied in recent years because it’s difficult train travel or air travel to Tokyo to get a connecting flight. We think that by adding nonstop service we’ll see really good demand for this market. It’s been reflected in the advance bookings, which have come in really strong for us.”
The Hawaii Tourism Authority predicts that this new route will generate another $61 million in annual visitor spending and $6.7 million in state taxes. It will also add another 41,000 seats from Japan to Hawaii. Chief Executive Officer for the HTA, Mike McCartney, stated, “Hawaiian’s entry into the Hokkaido market provides an additional port of departure from Japan, and more ports of departure from Japan gets into our strategic priority of expanding service from Japan. This is a significant move forward.”
The Hawaii Tourism Authority has issued a report which stated that the number of visitor arrivals to the Hawaiian Islands had increased by 6.1 percent and spending had increased by 15.6 percent during September 2012, as compared to the same month a year prior. This equated to 595,019 visitors and $1.1 billion spent. President and CEO for the HTA, Mike McCartney, stated, “We are encouraged by the growth we have seen in expenditures and arrivals for the year so far, and remain committed to working with the industry and our global marketing partners to achieve our targets of $13.9 billion in expenditures and 7.9 million visitor arrivals by the end of 2012. As we head into the fourth quarter, we anticipate the momentum to continue with increases in airlift thanks to new routes by Hawaiian Airlines from Sapporo and Brisbane, Allegiant Airlines from the West Coast, and Jetstar from Melbourne. These new routes are all servicing secondary cities, which will provide greater ease of access for visitors to come to the Hawaiian Islands. Festivals and events, including the Jazz Festival and Diamond Head Classic, will also help to draw visitors this quarter.”
January 14, 2013 will mark the 40th anniversary from Elvis Presley’s “Aloha From Hawaii” concert, and thousands of faithful fans are expected to make the journey to Honolulu to celebrate the occasion. The original 1973 concert was broad casted via satellite to over 40 countries and was seen by an estimated 1.5 billion people. Director of Public Relations for Elvis Presley Enterprises, Kevin Kern, stated, “More people saw Elvis in concert in Hawaii than saw man landing on the moon. That gives you an idea of the historical significance of this concert.”
According to a report released by the state Judiciary, there were only 51 new foreclosue cases filed across the entire state in September 2012. This was an 85 percent decrease from the 336 cases filed in the same month a year prior. In fact, the last time that the foreclosure volume was this low was 2006, prior to the recession. However, experts note that the low foreclosure volume is a direct result of a recent overhaul in state law, and it is believed that once lenders adopt the new procedures there will be an increase in foreclosure filings.
Below is the number of foreclosure filings reported by the State Judiciary:
September 2012 – 51 filings August 2012 – 58 filings July 2012 – 75 filings June 2012 – 458 filings May 2012 – 397 filings April 2012 – 382 filings March 2012 – 404 filings February 2012 – 345 filings January 2012 – 285 filings
On Saturday, the entire state of Hawaii was put under a tsunami warning by the Pacific Tsunami Warning Center due to a 7.7 magnitude earthquake off the coast of Canada. City and County officials and emergency responders quickly worked together to evacuate costal areas and prepare for the worst. Fortunately, the waves that did hitnhe Hawaiian Islands were tiny in size, with the largest reaching only several feet in height. Honolulu Mayor Peter Carlisle commented, ”We will learn from every one of these events that we have, and there are some small wrinkles that probably could have minor adjustments, but in fact this was done effectively, efficiently and professionally by all the people who were there in the emergency operating center. There wasn’t the slightest overreaction when you have that magnitude of an earthquake and you are aware of the fact that there are going to be tsunami waves traveling quickly across the ocean to Hawaii. This was a potentially dangerous situation and had to be treated as such.”
President and CEO of the Hawaii Tourism Authority, Mike McCartney, noted that he was very pleased with how the visitor industry handled the emergency. McCartney stated, ”I think what we see time and time again is that we have excellent leadership and excellent staff in our properties. They train for this; they know what to do. They handled the guests and it went well. The aloha spirit was alive and well. We just appreciated everyone’s patience, especially our visitors going through this. But in the end it was very important to be safe, and Hawaii really prides itself on that, being prepared and being safe.”
According to a new poll conducted by Ward Research Inc, the public support for the $5.26 billion rail project has been increasing, with 50 percent of those polled saying that rail should continue. This was an increase from the 44 percent of Oahu voters who supported the Honolulu Rail three months ago. That being said, there is a margin of error of 4.2 percentage points and only 552 like Oahu voters were surveyed by the research company. One interesting fact that should be noted is that 87 percent of those surveyed believed that the rail project will cost the state more then the $5.26 billion that is currently estimated.
Turtle Bay Resort on the North Shore of Oahu has seen huge gains occupancy rates thanks to a new marketing strategy which incorporates the areas high surf and water sports. Previously, the resort had struggled to consistently fill their 443 rooms, especially during the shoulder seasons, but 2012 the Turtle Bay Resort will have an average occupancy rate of 88 percent. Mark Skip Taylor, a marketing expert, was brought in to attract new customers and give the resort a new vibe and feel. Taylor stated, “When I got here I found an exclusive resort in a gated community. The first thing that we did was to tear the gates down. We want to give our travelers a chance to see the North Shore waves through the eyes of a local.”
Thanks to Taylor’s involvement, the Turtle Bay Resort strives to bring additional ocean sporting events to the North Shore of Oahu. Taylor commented, “It’s about authenticity. Even if they (our guests) aren’t surfers, they’ll come to watch or to be at Turtle Bay because it’s the home of these contests.” Vice president and general manager, Danna Holck, added, “We began to see our occupancy pick up last year. The exposure from all the different events has heightened awareness of our resort and filled in the shoulder seasons.”
The resort has just completed a $2.5 million renovation to their lobby and bar area and there are plans to start an additional $30 million renovation project in January 2013. All of the guest rooms will receive an upgrade, and changes will be made to the spa, fitness center, restaurants, lobby area and retail area.
ABC’s television drama “Last Resort” reported a viewership of approximately 6.5 million people this past week. While those numbers aren’t fantastic, ABC also noted that there was also an increase in the recording of the episode on DVR and estimate that another 3 million viewers record the show to watch later. Last Resort is filmed in Hawaii and has currently shot nine out of it’s thirteen schedule episodes. However, the ABC network just ordered the writing of two additional scripts, so it is possible that additional episodes will be produced.
The Visitor Aloha Society of Hawaii is a nonprofit organization founded in Hawaii in 1997 with the mission of helping visitors who are either a victim of a crime or who had faced some type of adversity while they were staying in Hawaii. While the organization might not be able to replace what was lost or stolen from them, they do have other resources including offering ocean-view hotel rooms, free transportation, clothing, legal assistance, entertainment or meal vouchers to assure that the rest of the visitor’s trip is a pleasurable one.
There are currently two full time staff members and five part time staff members for the Visitor Aloha Society, but most of the work is done by approximately 80 volunteers. Thousands of community members and organizations donate goods and services to the nonprofit organization including the Hawaii Tourism Authority. Terry Wade, the former board chairman, stated, "We cannot replace their property, and we certainly cannot bring back loved ones. But we can extend the aloha spirit to them, and we thereby hope to restore what I consider the most important gift we can offer to people in this troubled world.”
According to the U.S. Census Bureau, 11.1 percent of all households in the state of Hawaii are made up of multigenerational families. Per the study, this equated to 35,000 families in Hawaii and was significantly higher then the national average of 3.8 percent of total families. Specifically, approximately 5 percent of white family households were multigenerational, while 18 percent of Native Hawaiian of Pacific Islander and 13 percent of Asian households were multigenerational.
Ivette Stern of the University of Hawaii Center for Family, stated, ”We can theorize that there is the emphasis on the ohana in Hawaii and taking care of your own, but also very likely what drives some of them is the cost of living.” Associate state director for AARP-Hawaii, Bruce Bottorff added, ”Hawaii residents are in many cases willing and able to provide much-needed support to their parents and grandparents or even more distant relatives.”
The Seibu Group has announced that they will no longer be trying to sell the Hawaii Price Hotel (Oahu), the Mauna Kea Beach Hotel (Big Island of Hawaii) or the Hapuna Beach Prince Hotel (Big Island of Hawaii). Seibu had valued the three properties at $500 million and had hoped to find a buyer for them, however a deal could not be made with any interested parties. In a letter to homeowners at the Mauna Kea Resort, vice president of operations, Jon Gersonde, stated, “While this process was extensive and the interest was high, a potential sale could not be consummated. Our parent company has expressed their renewed interest in their Hawaii assets and do not anticipate any further sales activity in the near future.” The Seibu group was able to sell the Makena Resort on the island of Maui in 2007 for $575 million.
Source: Honolulu Star Advertiser, 10-26-2012, www.staradvertiser.com
Posted by Jeff Uyemura-Reyes, Broker-in-Charge, Realtor®
Global Executive Realty, LLC
Allegiant Travel Company had a net income of $16.9 million during the third quarter of 2012, which equated to a 78 percent increase from the $9.5 million earned during the same period a year before. Andrew Levy, the President of the company, believes that their success is a direct result of Allegiant Airlines beginning service to Honolulu in June of 2012. Levy state, “Three-quarters of our flights, namely the Vegas market, is a market that has a lot of competitive capacity in there. And the fact that we had a very short booking window, 60 days approximately before our first flight, makes us feel really, really good about Hawaii. Normally we want to have that booking window open for six to nine months for Hawaii because typically bookings are made a little bit further in advance. So, all things considered, we think Hawaii is off to a terrific start.”
Allegiant Airlines will begin offering additional flights in November to Hawaii from Bellingham, Washington, Fresno, Santa Maria, and Stockton, California and Eugene, Oregon. The company also plans to start additional service from Phoenix, Arizona, Boise, Idaho and Spokane, Washington to Hawaii in February 2013. Levy added, “It’s a little too soon to be able to really have a whole lot of clarity on the three routes we’re starting up in February. We don’t want to hazard a guess there, but so far with what we have, we do feel really good about it. So we feel Hawaii is going to be extremely additive and it has been so far. We think that’ll continue as we go forward. At the same time, we’re going to learn about demand trends there and we’re going to be able to adjust both capacity and pricing decisions in the future as we get smarter with experience.
Cebu Pacific Air is the largest discount carrier in the Philippines. In a recent press release, the airlines has announced that they hope to get permission from the U.S. Department of Transportation to offer service from the Philippines to Honolulu and other cities in the United States. Currently all airlines in the Philippines are banned from the U.S. due to safety concerns. However, Cebu Pacific Airlines is proposing to lease an aircraft and crew from a currently register U.S. carrier and simply market the flights as Cebu Pacific. Other then flying to Honolulu, Cebu Pacific Air would like to fly to San Francisco, Los Angeles, Guam, and four additional unnamed destinations in the United States.
Hawaii Tourism Authority’s vice president of brand management, David Uchiyama, stated, ”We’ve been talking to Cebu for a while now. They have expressed an interest and we have been providing them with data. (The additional service) would help (Filipino) residents. We see a lot of family travel between the Philippines and Hawaii.”
Developers Lend Lease and Forest City Enterprises Inc. have both submitted bids to build a 650-foot residential tower in Kakaako located on state owned land located between Keawe Street, Pokukaina Street and Mother Waldron Park. The Hawaii Community Development Authority has asked both companies to submit preliminary proposals as to what they would build if they were given the contract
Lend Lease has stated that they would like to build two residential towers with a total of 1,002 units within them. One building would be 650 feet tall and contain 605 units while the second one would be approximately 400 feet tall and contain 397 units. Per Lend Lease’s proposal, half of the units would be reserved for people or families earning between 100 percent and 140 percent of Honolulu’s median income. Lend Lease stated, “Creating a residential sub-community of 2,000 residents near the proposed Halekauwila transit station will create a vibrancy that has been missing for decades since the time the area was an authentic residential neighborhood.”
Forest City would build only one 650-foot tower which would contain 804 total units with approximately half of them meeting the same workforce housing income limits that Lend Lease’s development would follow. Forest City offered a second proposal which would build three towers on the two acre lot. However, the biggest difference would be that all of Forest City’s unit would be rentals. Jon Wallenstrom, an official for Forest City, stated, “We’re really focused on the workforce housing. It’s important to bring significant workforce housing into the core of Honolulu.”
The Department of Education has announced that by 2015 they would like to provide every public school student either a laptop or a computer tablet in an effort to modernize instruction. They have asked the state for $42 million over the next two year to help standardize curricula and modernize classroom instruction. The DOE would then lease 60,000 laptops and computer tablets for three year periods, which would require additional funding from the state. The plan is that children in kindergarten through eighth grade would get tablets while high schoolers would receive laptops.
Hawaiian Airlines announced that they had made a net income of $45.5 million during the third quarter of 2012, which represents a 77.6 percent increase from the $25.6 million that the company had made during the same period a year prior. According to the president and CEO of Hawaiian Airlines, Mark Dunkerley, opening new routes to various countries in Asia have been the driving force behind their profits. Dunkerley stated, ”Our earnings for the third quarter continue to show the strategy that we’ve been pursuing has been a success. Hawaiian Airlines has long recognized the need not only to grow, but also to diversify our sources of revenue geographically. The introduction of the new fleet of Airbus A330s has enabled us to put this in practice with our expansion in Asia.”
While Hawaiian Airlines’ international business and domestic business to the mainland United States has been doing well, Mark Dunkerley did admit that their interisland service could be improved from a financial standpoint. Dunkerley stated, ”That market has been a bit of a disappointment to us. We’ve provided a lot of extra seats but haven’t seen demand grow at the same rate, and that has adversely affected our financial performance. But this is an important part of what we do. We’re absolutely committed to flying between the islands in the state, and it will be a little time before we can calibrate things to where it’s appropriate.”
Bob McAdoo, an analyst with the investment bank Imperial Capital, added, ”They’re doing as good or better than anybody. They’ve got their own little part of the world they operate out of, and they’ve found a bunch of niches that other people weren’t paying attention to and they’re making it work.”
The Pacific Resource Partnership is a political action committee made up of members from the carpenters union and unionized construction companies in the state. They are a strong supporter of $5.26 billion Honolulu Rail Project and have so far spent over $1.2 million urging the public not to vote for Ben Cayetano, who opposes rail. The Pacific Resources Partnership has accused Cayetano of taking illegal campaign contributions in the past and for rewarding his supporters with no-bid contracts under a “pay-to-play” system.
Former Governor Ben Cayetano has filed a libel suit against the Pacific Resource Partnership in state Circuit Court and alleges that the PRP is “conspiring to conduct a coordinated campaign of push polls, or politically biased polls, broadcast advertisements and fliers that falsely accuse Cayetano of knowingly accepting illegal campaign contributions, giving government contracts in exchange for contributions, and keeping contributions for personal gain.” One of Cayetano’s attorneys, Jim Bickerton, stated, “This case is about big money for big lies, and it’s about the future of elections in Hawaii. It’s bigger than Ben vs. Kirk, and it’s bigger than rail vs. bus. It’s about whether we’re going to let secret, shadowy groups with unlimited funds pump lies into the public discourse.”
Mayor candidate Kirk Caldwell has remained quiet regarding the battle between the the PRP and Cayetano. Caldwell stated, “As for my own campaign, my priority is to stay positive and focus on city issues and what’s best for the people of Honolulu.”
The State Historic Preservation Division of the Department of Land and Natural Resources is responsible for protecting Hawaii’s cultural and historic sites, and are the ones ultimately responsible whenever a Hawaiian burial is discovered at a construction site. The Division’s name has been in the spotlight over the past few months due to the Honolulu Rail Project, the work being done at Kawaiaha’o Church and the newly discovered remains found at the Waihonua development in Kakaako.
In the case of the Honolulu Rail Project, the Hawaii Supreme Court found that the State Historic Preservation Division (SHPD) was in violation for allowing the city to start construction without having an archaeological survey completed of the entire rail line. At Kawaiaha’o Church, the Hawaii Intermediate Court of Appeals stated that it is likely that the SHPD violated their own procedure for approving the construction of a multipurpose building without requiring a survey from the church. The SHPD has stated that a lack of funding is partially to blame for these challenges.
In the last two years the SHPD has hired four archaeologists two burial site specialists and an architectural historian. The Division has stated that over the next eight months they would like to hire another two archaeologists another burial sites specialist, an archivist, an information technology specialist and a history and culture branch chief. If these hires are made, the State Historic Preservation Division would have a total staff of 30 people.
The Federal Transit Administration had hired an outside consulting firm, Jacobs Engineering Group Inc, to help monitor the $5.26 billion Honolulu Rail Project. In a recently released report, Jacobs Engineering expressed a significant concern regarding the “rapid use of cost contingency funds” and that the project contingency cash reserves dropped “below accepted control levels”. On August 24, 2012 the Hawaii Supreme Court ruled that all construction for the rail project had to be halted until an archeological survey be done for the entire project. This delay, estimated to take another 6 to 7 months, will cost the city between $64 to $95 million.
The city had budgeted $644 million as part of their contingency fund for the project and officials stated that they expect that the majority of it would be spent before the Honolulu Rail Project is completed. However, Jacobs is now recommending that the city should maintain a larger contingency cash cushion then $658 million. Jacobs is also recommending that the city create a list of “secondary mitigation” items at can be used to reduce costs in case the rail project runs short of cash. Example of secondary mitigation items include but are not limited to reducing the number of station entrances, eliminating escalators or reducing the size of the canopies that are planned to cover the stations and tracks.
The Hilton Hawaiian Village, the state’s largest single hotel property, has announced some major changes to their room service system. Instead of having an in-room table service, the hotel has decided to offer a new delivery service which will offer plainer fair at a more reasonable price. For those that wish to save some money on delivery fee and gratuity can pickup their food themselves and take it back to their rooms.
According to area vice president, Jerry Gibson, the new service is meant to service today’s travelers who want a less expensive and more convenient alternative to traditional room service. Gibson stated, ”We’re not getting many guests who want Chateaubriand (steak) and cherries jubilee. That was 15 years ago. Our customers have demonstrated, through a dramatic decline in the use of room service, that they want an alternative to the traditional in-room dining experience. Room service is hundreds of years old; we wanted to perfect and re-energize it.” Guest may order the food by phone, online or on their smart phone and pick up their food anytime from 7 am to 10 pm. For those who wish to have food delivered to their rooms, there is an $8 delivery fee plus a 17% gratuity fee.
The Kilauea Volcano on the Big Island of Hawaii is once again attracting droves of scientists and tourists in anticipation of a possible explosive eruption in the next few weeks. All key indicators are pointing towards this possibility, as the lava lake at the summit continues to rise and the number of small earthquakes have increased to as many as 15 per day. A similar set of circumstances occurred in March 2011, which lead to natural firework show where molten rock flew as high as 80 feet in the air. The Hawaii Volcanoes National Park suggest that visitors come to the park after dark “to view the dramatic glow that lava beneath the surface casts upon clouds and the plume of volcanic gas.”
Honolulu Mayor Peter Carlisle has signed off on having the city lease it’s 12 affordable housing complexes to Honolulu Affordable Housing Partners LLC for $142 million. Under the agreement, the HAHP will obtain a 65-year lease from the city and would have to keep rental prices within federal affordable housing guidelines. They would also have to spend approximately $42 million in the renovation of the 12 complexes.
The Japan Association of Travel Agents in association with the Hawaii Tourism Authority has announced a new goal of increasing the number of Japanese visitors to 2 million people per year by 2016. Director of the board of JATA, Tatduo Hayashida, stated, ”While many Japanese have traveled to Hawaii before, there is still a greater majority who have yet to visit the Hawaiian Islands. The Hawaii Two Million Visitors Initiative offers an opportunity not only to capture a new market, but also create first-time experiences for repeat travelers outside of Waikiki.”
Mike McCartney, the President and Chief Executive Officer for the Hawaii Tourism Authority, stated that if this goal is reached, it would pump a total of $4 billion into the states economy and provide $440 million in tax revenue. In comparison a total of 1.35 million Japanese visitors are expected to arrive in 2012 and spend $2.49 billion. McCartney added, ”The 2016 targets are our most aggressive of any market, but we are confident that we can reach them.”
Bombardier Transportation USA Inc. had filed a lawsuit saying that the city of Honolulu unfairly gave a $1.4 billion contract to Ansaldo Honolulu to build 80 rail cars and design and run the train operating system for the Honolulu Rail Project. However, the Hawaii Intermediate Court of Appeals has ruled that a ruling made at a lower court stands and that Bombardier does not have a case.
Honolulu Authority for Rapid Transportation’s executive director, Dan Grabauskas, was pleased with the court’s decision and stated, “The contract award was successfully upheld by three independent and separate reviews. All of these extensive reviews underscored the validity of our procurement process.” Grabauskas added that the city’s residents ”can expect a state-of-the art automated system that is safe and reliable. Equally important, we intend to keep this contract on time and on budget and this decision will help us do that.”
The upcoming Honolulu Mayor’s race is becoming increasingly as special interest groups sling mud about candidates hoping to influence the election. The most vocal and best funded group is the Pacific Resource Partnership, which represents the contractors and unions who would benefit from the Honolulu Rail Project, one of the key issues in this election. The PRP has already spent over $1 million in advertising and have been aggressively attacking candidate Ben Cayetano, who opposes the Rail Project. According to the PRP, Cayetano ran a “pay to play” scheme while he was governor of Hawaii and took millions in illegal contributions. In a recent mailout, the Pacific Resource Partnership has been trying to link Cayetano, who is a Democrat, to Republicans Mitt Romney and Linda Lingle, as well as the tea party and as being anti-Obama. The PRP states that Cayetano ”will eat, sleep, breathe Republican”.
Mayor candidate Kirk Caldwell has tried to separate himself from the Pacific Resource Partnership and their attacks against his opponent Ben Cayetano. Caldwell stated, “I’m not going to condone it. I’m not going to criticize it. It’s just part of the political process in our country.”
Kamehameha Schools has just finished converting an old office building in Kakaako into an apartment complex for middle-income tenants. Located at 680 Ala Moana, the four-story building has been renamed Six Eighty and will have a total of 54 units. Units are configured in studio and one-bedrooms sizes between 304 to 613 sq ft and they will be rented for between $1,100 and $1,400 per month. Limited parking is offered for another $75 per month based upon availability. Applicants have to earn a maximum of $57,890 for a single person, $66,160 for a couple, or $74,430 for a family of three. Director of Kakaako’s Development for Kamehameha Schools, Paul Kay, stated, “We’re excited for our new residents to move in and be part of our Kakaako. They are joining a small, but active, hui of entrepreneurs, chefs, artists and innovators who share a strong sense of community and are helping to author Kakaako’s future.”
The long term goal of Kamehameha Schools is to redevelop nine city blocks of Kaakako currently filled with warehouses and old office buildings and build a total of 2,750 housing units and shopping areas.
Hawaii’s time-share industry has done extremely well over the past few years and experts believe that there is still considerable room to grow. There are currently 10,201 time-share units in the Hawaiian Islands and another 1,436 are expected to be built by the end of 2013. Even more encouraging for developers is the fact that in 2011 the occupancy rate for time-share units in Hawaii was 87 percent, as compared to the national average of 78.9 percent. American Resort Development Association’s Chief Executive Officer, Howard Nusbaum, stated, “Hawaii continues to be an inspirational destination. Two kinds of people buy in Hawaii: those who love Hawaii and those who are time-share devotees who realize it’s a powerful exchange. Having Hawaii is like having Boardwalk and Park Place in a Monopoly game.”
Honolulu residents currently pay a special surcharge on their general excise taxes to help pay for the $5.26 billion Honolulu Rail Project. This surcharge is expected to raise a total of $3.36 billion. Former Governor Ben Cayetano has stated that if he is elected as Mayor he would end the rail project and use the money from the surcharge to pay for his Bus Rapid Transit program which he is calling FAST for Flexible Affordable Smart Transportation. Cayetano has stated that FAST would cost approximately $1.5 billion out of which city tax payers would pay $990 million, the state $210 million and the federal government $300 million.
However, supporters of the Honolulu Rail Project are questioning if Cayetano would be able to transfer funds specifically set aside for the Honolulu Rail Project and use it for a different transit program. According to the 2005 law that created the surcharge, the money raised must be used for construction or operation of a “locally preferred alternative for a mass transit project.” furthermore, it specifically prohibits use of the money raised to “support public transportation systems already in existence prior to the effective date” of 2005. Furthermore, if the rail project is abandoned, it may cost the state about $1.55 billion in federal funding.
Cayetano doesn’t see a major challenge with this law and even believes that the city’s legislature would be willing to release some of the fund for other projects like fixing the city’s water and sewer systems. Cayetano also argues that the federal funding is not guarantied and it is much more likely that the federal government would give the state $300 million as opposed to $1.55 billion. Cayetano stated, “I think it’s bad policy to chase that kind of money just for the sake of chasing that kind of money and build something that will have a permanent and bad effect on the character of our city.”
Kirk Caldwell, the other candidate for mayor, made a written statement about Cayetano’s FAST proposal. Caldwell wrote, “It is difficult to respond seriously to something that has not been vetted by any third parties and is so utterly lacking in detail on construction plans, costs and timelines. There is no detail whatsoever provided as to how he has arrived at his cost estimates and assertions. No backing data. No conceptual or technical drawings. Nothing. It’s clear to me that this has been cobbled together purely for political purposes and not to address Oahu’s critical transportation needs. Honolulu voters deserve better.”
As the Honolulu Mayor race approaches the November 6th election day, supporters of both Kirk Caldwell and Ben Cayetano have been working hard to sway voters through fierce advertising campaigns. Political action committees have taken a much more vocal stance during this election due to the Honolulu Rail Project. Former Governor Ben Cayetano has vowed that if elected he would everything in his power to end the rail project, while Kirk Caldwell has pledged his support to bringing rale to Honolulu.
The Pacific Resource Partnership a partnership between the Hawaii Carpenters Union and the state’s unionized contractors, has already spent more then $1.2 million attacking former Governor Ben Cayetano record and accusing him of a history of “pay-to-play” politics and accepting illegal campaign contributions. Workers for a Better Hawaii have also run a series of ads supporting Kirk Caldwell. On the other hand, Defend Ben, has been formed trying to show that Cayetano is a man of honesty and integrity while Save-Our-Honolulu.com is anti-rail and as a result pro Cayetano.
Kirk Caldwell and Ben Cayetano have tried to stay out of the negative campaigning done by these political action committees. Caldwell stated that the process was part of the “rough and tumble nature of politics.” Cayetano added, “I’m happy that some people think I’ve been getting a raw deal. I’m happy that people think PRP (Pacific Resource Partnership) is lying and trying to smear me.”
According to a study released by the Hawaii Association of Independent Schools, the annual enrollment for children attending private school in the state has decreased for the fifth consecutive year. Since the 2007 to 2008 school year, the private school system has lost almost 3,200 students, or approximately 8 percent. Experts believe that this is due to tougher economic times compounded with the fact that public charter schools have been becoming more and more popular. A total of 37,097 students are attending private school this year.
The Honolulu City Council voted in favor of allowing the city to sell 12 affordable rental complexes to a private company for $142 million. In a 6-2 decision, the city council noted that the Honolulu Affordable Housing Partners LLC, who made the offer, would have a 65-year long lease with the city and have to spend a minimum of $42 million of their own money to renovate the projects. This will help to save city taxpayers approximately $500,000 per month currently being spent to subsidize the complexes.
Councilmen Tom Berg and Romy Cachola both voted against the proposal and stated that they wished to postpone a final decision until more concerns were met. Current residents expressed a huge concern about how much rents would increase under new private management.
The Hawaiian Electric Company has announced that electricity would cost 33.6 cents per kilowatt-hour on the island of Oahu for the month of October. This is an increase from 33.5 cents per kilowatt-hour posted the month prior. Maui Electric Company charges their customers 36.1 cents per kilowatt-hour. Big Island of Hawaii residents pay 40.4 cents per kilowatt-hour. Kauai has the highest electrical rates at 44.9 cents per kilowatt-hour through the Kauai Island Utility Cooperative. The state has the highest electrical rate in the country with an average of 37.7 cents per kilowatt-hour posted in July 2012. According to the U.S. Energy Information Administration, the national average in July was 12 cents per kilowatt-hour.
Another 19 sets of ancient Hawaiian human remains were found during the excavation for the foundation of the new Waihonua at Kewalo condominium in Kakaako. Developer Alexander & Baldwin had previously discovered 27 burials on the property when they had conducted an archaeological survey in 2010 and lead A&B to redesign the building size and footprint. Six more iwi or burials were discovered in 2011 during an exploration of a layer of ground to recover Hawaiian cultural artifacts. Those iwi were allowed to be moved to another location on the property.
It is still unclear if these 19 newly discovered remains would force addition delays or create new changes. One additional challenge is that the new burials are believe to be be alii or royalty due to whale-tooth necklaces that were found with them. The State Department of Land and Natural Resources’ State Historic Preservation Division will be determining the treatment of the burials. The Oahu Island Burial Council and cultural descendants of the area will also be allowed input in the decision making process.
The Waihonua condominium project currently has binding contracts for 239 of their 341 units. The project is expected to be completed in April 2015.
The Howard Hughes Corporation has released their new development plan for what they are calling the Ward Village. The plan calls for building a total of 22 residential towers on 60 acres of land and add double the number of existing retail shops and restaurant in the area. The entire project will cost approximately $7.5 billion to complete and will take a total of 15 years. The first phase, which would include three residential towers, will break ground in 2014 and be completed in 2016, pending approval from the Hawaii Community Development Authority.
The exact plans for where the building will be located will not come out until an archaeological survey has been completed and presented to the state Department of Land and Natural Resource’s State Historic Preservation Division. Hawaiian groups praise this decision by the Hughes Corporation, as there is still a concern that the survey would find iwi’s or Hawaiian burials on the land.
The Hawaii Supreme Court had ruled in August that all construction of the Honolulu Rail Project needed to be halted until an accurate archaeological survey was completed for the entire 20 mile stretch. In a new report released by the Honolulu Authority for Rapid Transportation the costs associated with the court-ordered stoppage will be more than $114 million in claims, change orders and other expenses. It should be noted however, that there may be “additional cost impacts due to escalation for future contracts and extended agency and consultant staffing.”
The city is working around the clock to complete an archaeological survey, but it is still expected that the survey will not be finished until the March or April 2013. Executive Director of the Honolulu Authority for Rapid Transportation, Daniel Grabauskas, noted that the Honolulu Rail Project has a $644 million contingency fund to cover these unexpected costs.
Several native Hawaiian groups met with members of the Honolulu Authority of Rapid Transportation and urged the city officials to leave any burials and other human remains found during the archaeological survey in place. Kumuela Kala’i, one of Hawaiian spokeswoman, pleaded that the burials should not be disturbed and definitely not moved. Kala’i stated, “I’m going to be very clear about this. Iwis in the ground, leave them alone, period.”
Executive Director of the Honolulu Authority for Rapid Transportation, Daniel Grabauskas, responded by stating, “As long as I am the executive director of HART, we will respect the iwi kupuna, and you can help me to do that.” Grabauskas added that he would work under new cultural protocols set forth by the State Historic Preservation Division. So far the new archaeological survey has discovered the remains of four people at three different sites.
According to the State Historic Preservation Division, human remains were found at two additional sites in Kakaako, along the route where the Honolulu Rail Project is set to go through. One of the sites appears to be a pre-contact burial site, which under state law must be protected and may result in the city having to redesign part of the transit system to accomodate this find. The possible burial site is located at a location where the city had planned on building a transit system utility box.
Executive Director of the Honolulu Authority for Rapid Transportation, Daniel Grabauskas, stated, “This work is being done years in advance of any construction in the area so that we can make any necessary design changes now. We have a protocol in place that involves working closely with the State Historic Preservation Division, the Oahu Island Burial Council and other stakeholders to ensure that iwi kupuna are treated with sensitivity and great respect. Our iwi kupuna protocol is the product of months of collaboration with our stakeholders and we will continue to work together throughout this process.”
The Hawaii Supreme Court had ruled on August 24, 2012 that the city should have completed an archaeological survey prior to starting construction on the Honolulu Rail Project. As a result, all construction for the $5.26 billion project was put on hold until a survey has been completed. It is estimated that this step could take between 8 to 10 months and would cost the city $7 to $10 million per month in costs for the delay.
Archaeologists discovered additional human remains at two different locations in Kakaako over the weekend along the route which the Honolulu Rail Project will follow. More importantly, one of locations may qualify as a burial, which could mean that the city would have to redesign the rail project to avoid the area. Until the archaeological survey is completed, all construction for the $5.26 billion project has been halted. It is anticipated that the survey would take 8 to 10 additional months to complete.
The city and county of Honolulu has decided to foreclose on a home in Punchbowl for failure to connect to the city’s sewer system after nine years of notices and legal battles. Sunny Lee, the 93-owner, and her daughter Monica have been fighting the city in court and argue that Sunny has a legal right to use an underground sewer line that goes through their neighbor’s property. The city maintains that Sunny Lee is in violation of state and city laws and have incurred hundred of thousands of dollars in penalties.
Lee purchased the home in 1957 and had her sewer line connect through a line that ran through Melvin and Mildred Bender’s property, her next door neighbor. The Benders did not know about the line until is started to leak in 2000. The Benders then filed a lawsuit saying that Lee did not have an easement or legal right to use the line. Lee lost the lawsuit and the sewer line was shut off. Lee then filed an appeal with the Hawaii Supreme Court in 2006 which was rejected unanimously and affirmed that Lee did not have a legal right to the line. The state Department of Health started sending notices to Lee in 2003 and filed a lawsuit in 2008 stating that Lee owed over $170,000 in penalties. Health inspectors showed that high levels of bacteria were found in waste water flowing to a neighbor’s property.
A Circuit Court Judge ruled in favor of the state and noted that Lee must hire a licensed engineer and contractor to connect her home to the city sewer system. Lee was required to pay $25,000 in past violations and $150 per day until it was connected starting from 2005. Lee refused and the city filed for foreclosure in 2007. In August 2012 a judge ruled that the city was allowed to foreclose of the property.
This is a relatively unusual case as the city rarely has to file for foreclosure due to a lack of sewer line connection.
Foodland Super Market Ltd. will be opening a new store at the Kapolei Village Center. The store will be located at 4850 Kapolei Parkway and will be approximately 36,000 sq ft in size. Chairwoman and CEO of Foodland, Janai Wall, stated, “After many months of preparation and planning, we are excited to finally be opening Foodland Kapolei. As a locally-owned company, we truly care about the communities we serve, and know that we will be a great community partner in Kapolei. Many of our customers have told us they want and need a locally-owned supermarket in Kapolei, and we are excited to open this brand new store to serve them.” The store will hold their grand opening on October 17, 2012 and will be open daily from 5 am to 11 pm.