Land Use Enforcement
Price of Paradise · Hawaii Public Radio · aired 1994-07-10
Guests: David Callies (Professor of Law, University of Hawaii); Don Clegg (Director of Land Utilization, City and County of Honolulu)
Duration: 1:04:51
Note: music outro 64 s

[0:00:00] Randall Roth: Good morning. This is Randy Roth, host of the Price of Paradise Radio show. Before getting into today's topic, I want to give you a brief report on the Pop 94 community issues conference, which was held yesterday. Over 250 people gathered at the East-West Center with the goal of identifying the most important questions that we as a community need to have answered by the candidates for political office. The discussion was lively and informed, and the end result was a list of questions that get to the heart of tough choices facing the candidates. Those questions can be found in this morning's advertiser on pages 10 and 11 of Section A.

[0:00:39] Randall Roth: We will now do our best to get meaningful answers from the candidates and then to publicize those answers. If you would like to receive a written report on the community issues conference, or to become a Pop 94 supporter, just give us a call at 956-6553. I'm also pleased to tell you that Hawaii Public Radio will be playing a major role in Pop 94 activities. Details will be soon available. Meanwhile, anyone wanting to know more about Pop 94 is invited to give us a call at the number I gave you a moment ago. That number is 956-6553.

[0:01:16] Randall Roth: Today's topic has to do with the regulation of land use, and with me in the studio to discuss it are Don Clegg, the director of the city and county of Honolulu's Department of Land Utilization, and David Callies, a professor at the University of Hawaii School of Law, who is recognized internationally as an expert on land use law. Locally, he is perhaps best known as the author of two hard-hitting books on land use regulation in Hawaii. Listeners are invited to ask questions or otherwise join in the conversation by calling 955-8821.

[0:01:49] Randall Roth: Again, today's topic is government regulation of land use, and our guests are Don Clegg and David Callies. Gentlemen, welcome to the Price of Paradise Radio show.

[0:01:58] Don Clegg: Thank you, Randy.

[0:01:59] David Callies: Good morning, Randy.

[0:02:00] Randall Roth: I have an article that appeared in the Los Angeles Times just in the last week or two, and it's talking about something called exactions, and the author refers to them as a practice of extorting property. David, what's he talking about?

[0:02:16] David Callies: Well, I I'm sure from some standpoints exactions look like extortion. Essentially, an exaction is a condition on land development that government imposes on the land developer for the purpose, at least in theory, of fixing problems that the land development causes. The most common kinds of exactions solve facilities problems. A new development of any size can be expected to cause the need for new roads, new water and sewer systems, new schools, new parks, solid waste disposal facilities. And local government really doesn't have the resources any longer to pay for all of those things itself with our tax dollars.

[0:02:59] David Callies: So local government is looking for a way to pay for those facilities, and the theory is that the developer who causes some of the problems by the development should pay for them. This is what an exaction is. It is exacted or levied on a land developer for the creation or construction of new facilities which that development causes need for.

[0:03:19] Randall Roth: Well, now I got to tell you, that sounds totally reasonable. Why why the word extortion?

[0:03:24] David Callies: Well, very often, the local government community, which is the local government, which is the usual exactor, in an attempt to, or perhaps an overzealous attempt to get as much as possible for the government, for the people that they represent, will take proportionally more from a developer than the developer causes the need for. Say require the paving of a two-lane road for an eight-unit subdivision. The requirement of a large fee for the development of something which does not in any way shape or form generate a need for facilities that fee would represent.

[0:04:06] Randall Roth: Like a 100 million dollar for a golf course permit or something like that?

[0:04:09] David Callies: Like 100 million dollars for a golf course permit, exactly.

[0:04:13] Randall Roth: The article that I mentioned earlier has this quote. It says, instead of challenging a regulation in state court, land owners should simply slit their throats. It would be quicker, cheaper, and easier and lead to the same result. Is there a little bit of hyperbole in that, David?

[0:04:31] David Callies: Well, I would hope so. I would hope there'd be a lot of hyperbole in that. I think that the the reality is that challenging such an exaction in court is a time-consuming process. It also leads to a belief, whether or not accurate, that the government being sued will not be happy about that lawsuit and therefore will take it upon themselves to see to it that the developer gets special attention for the rest of their permits. Again, whether or not justified, that's a wide perception. So between the time of the litigation and and the the concern about some kind of governmental retribution, a lot of landowners will pay rather than sue.

[0:05:10] Randall Roth: I talking about government and exact doors, we have Don Clegg, who's at the center of the action from the government side. What do you think of all this, Don?

[0:05:19] Don Clegg: Well, I've been classified as an expert in it on occasion, and the mechanism that is normally used here in Honolulu is the so-called unilateral agreement. And that's an agreement that the developers, when they come into the time of zoning, they make an agreement with themselves, and they then, they then, they record this agreement in at the Bureau of Conveyances, and it becomes a legal document. And the agreement with themselves, they didn't always exactly make up the the things they wanted to agree to. However, through persuasion, some of the thoughts that may have crossed their minds that David mentioned, why they sign this agreement. Now, there are several theories and thoughts on why all this happens.

[0:06:06] Don Clegg: One of the one of the things that's always bothered me is that the public is very demanding, and they don't really want to pay for the things that they want. So government doesn't have really have the funds through the taxes to do all the things that the public would like to get. The schools, and the daycare centers, and the parks, and the roads, and and all those good things. So government, any responsible government becomes very innovative.

[0:06:31] Randall Roth: I see. So, it it it's my my fault as Joe Public, in that I'm saying I want this and this and this, but don't raise my taxes. And therefore, you find an innovative way to get those things and it's called exactions.

[0:06:45] Don Clegg: Well, that's one of the pressures that that is on us is to not raise taxes, not and yet there's a scream and loud to to come and say I want all these things. So in our administration and others, we've we've, say, been innovative and come up with the unilateral agreement. There's a also a a thought which prevails, and that is that, after all, when you rezone somebody's property, aren't you making it more valuable? And you can rezone something from agricultural to residential, and you've increased in fact the value by a factor of four. And so why shouldn't government get a piece of that? The people did that.

[0:07:20] Don Clegg: Now, the other side of that, if I may, so I don't show the total ignorance, is that we just given him back something that he owns in the first place.

[0:07:26] Randall Roth: I see. I I'm wondering, do the land owners and the developers, do they see the wisdom of of your uh, your suggestion that they're getting lots of increased value when you ask for these things from them?

[0:07:36] Don Clegg: They they recognize that there's increased value there. Uh, certainly they do and that's why they come in for it.

[0:07:41] Randall Roth: Uh, I want to remind you, this is the Price of Paradise Radio show. Today's topic is government regulation of land use. My guests are Don Clegg and David Callies. We are live and our phone lines are open. The number is 955-8821. Just give us a call. We'll have you on the air in no time, and neighbor Islanders are invited to call. Collect. Well David, do you have any reaction to what Don's telling us?

[0:08:04] David Callies: Well, I have a couple. Um, I think that the first reaction is is as we said before, Don is absolutely right that the people don't want their taxes raised in order to pay for these facilities. It's also true that any credible developer knows that he, she, or it cannot develop property unless there are facilities there. You need roads, you need water and sewer lines to tap into, you got to do something with the solid waste. There need to be parks for the residents, and so forth.

[0:08:27] David Callies: The difficulty is that under our Constitution, if the government takes more than a proportionate share from the developer, other words, if the developer is forced to pay for or contribute more than the development is causing a problem for, that's a taking of property under the Fifth Amendment, and the government has to pay for that. So I think that that's that is that goes beyond policy, but particularly after the most recent decision by the US Supreme Court, that's the law.

[0:08:54] David Callies: And and of course, in order to enforce the law on its side, a developer would have to go to court and to sue the city, unless the city and the county were to on its own decide that to undertake major proportionality tests, and and run all of their exactions through this new proportionality test and see what's proportional and what isn't.

[0:09:15] Randall Roth: Now, that proportionality, uh, it's hard to relate to that. Uh, I guess what that's saying is that because of this recent Supreme Court, United States opinion, uh, the government simply can't grab too much. Who decides what's too much?

[0:09:30] David Callies: That's a very good question. Uh, I think that there is probably some dispute between the land owner and the government as to which is too much. On the other hand, what the Supreme Court said was rough proportionality. They're not going to to quote our president, bean count. Uh if if you've exacted uh an extra $10,000 on a on a million dollar um condition, that is not going to be too much.

[0:09:53] David Callies: If you ask for an extra quarter of an acre of park land, that's not going to be too much. But if, for example, one were to require a a 50-acre park land dedication, which a community might very well need for a variety of reasons, as a condition to develop, they say a a 200-lot residential development, that's going to be too much.

[0:10:16] Randall Roth: And I guess we should make sure listeners understand this is not all theoretical. And I know Don, you realize there are a number of developers and land owners who feel that they've been asked to to give up much too much in the way of of land or or in cash payments or what have you in order to get their permits. What do you think? Is this recent Supreme Court opinion going to change the way the the the county approaches these things or what's your thinking on it?

[0:10:43] Don Clegg: Well, we've been pretty much going down that line, and I'll indicate a couple of areas where I feel we have not. But the concept of rough proportionality that came out of Dolan is uh, is fine. That's uh something that uh where we have a nexus, we have been applying it. The issue comes as where there is not a rational nexus or relationship between the community benefit as the term we use, is that uh uh coming out of a zoning versus uh what the community impacts are, uh by this project.

[0:11:15] Don Clegg: The uh, one of the areas that you mentioned earlier was the uh, the golf course. Uh, uh exaction, if you will, the 100 million dollars. The famous 100 million dollars, which we never got, almost had.

[0:11:27] Randall Roth: It was fun talking about, though. Well, You do a rough calculation. Let's see, 10 golf courses at a 100 million.

[0:11:33] Don Clegg: Well, we were looking at five, but that's okay. Okay. Uh, and uh yes, I think that is a, a there's no nexus associated there uh except an increase in the value in property and an ability at the marketplace to to kind of get it. The other area though, which uh is more uh uh directly related to the to the people, and that is our affordable housing. I have yet to find a nexus between the uh, between market housing and affordable housing. And that is, as you build market housing, do you create a need for affordable housing? And I think the answer is no.

[0:12:09] Don Clegg: But yet there hasn't been a zoning in the last uh uh 10 years that I know of where there has not been an affordable housing component that has been put into the into the uh in the equation for the unilateral agreement.

[0:12:21] Randall Roth: So you'll have to change that, you think?

[0:12:23] Don Clegg: Uh, I expect it will not be changed and it'll be waiting waiting to be challenged, and uh because we feel we need the affordable housing and we'll go ahead and uh and do it. The other area which we've seen uh recently in in some of the zonings is uh say two million dollars for a community association, and this would be a, some a trust put in into a fund.

[0:12:47] Randall Roth: Uh Don, let me let me come back to that. I I want to make sure I understand what you were saying a minute ago about affordable housing. And I've written down community association, I do want to come back to it. But I think you said that there there, the the the Supreme Court has said there has to be a nexus and you've said there isn't a nexus between developing housing and and the need for affordable housing. Isn't it just inevitable that the city will be sued and lose if it continues to require that affordable housing be provided as a condition?

[0:13:20] Don Clegg: Well, I think the concept of the rational nexus has been with us ever since uh the uh maybe the Constitution was written. This is not a new thing, it's just being talked about more. The the real test or a real uh popularization of this was with the uh the Nolan case uh which where the issue of of Nexus really was was was the core issue and the only issue involved. And yet we've been going ahead and I suspect we will continue to go ahead.

[0:13:47] Randall Roth: Does this get back to what David was saying a little bit ago, that that there are incentives, or maybe I should say disincentives on the land owner and the developer when it comes to suing the government, if it has to be dealing with the government on an ongoing basis that it's really quite hesitant to sue even if it feels it's going to win, David?

[0:14:05] David Callies: The that's right. There are a variety of reasons for that uh perception, but that's true. We have very few major or indeed any land use cases that get to our high courts in Hawaii. It is not common to bring suit in this state to enforce land use conditions and rights.

[0:14:19] Randall Roth: So, it may be academic, indeed, that uh tying it in with affordable housing um is problematic under the the law.

[0:14:28] Don Clegg: Uh that may be true, and uh I would contend to keep on putting these conditions into the unilateral agreement until somebody tells me not to.

[0:14:35] Randall Roth: Okay. And the folks who are saying we need affordable housing no matter what are probably applauding that.

[0:14:40] Don Clegg: They certainly are, and that brings up to another big issue which we will not get into at this time. Okay.

[0:14:45] Randall Roth: And uh I'm going to come back to community association. You were giving me that example, but we have a caller from the Big Island. David, you're on the air.

[0:14:54] David Callies: Yeah, I'd like to comment. Um, you you're talking about balancing the uh um payment that the developer has to make uh in in relation to the uh impact that he has on the community.

[0:15:07] David Callies: Uh, you you can measure of course such things as streets and schools and things like that, the direct impact that he has, but there are also a lot of uh other impacts that you can't measure, and I'm wondering how he pays for them like he's going to increase traffic, uh he's going to uh his development will um make for less open space, for less space at the beach, for uh, you know, less clean water and all the other impacts that the the large developments have that he really doesn't get charged for.

[0:15:41] Randall Roth: David, let me ask David Callies here in the studio how the Supreme Court would perhaps respond to that. Can that be taken into account in applying this rough proportionality test?

[0:15:51] David Callies: Well, things if I if I can, it goes into another area which is which is nuisance like things that the development may cause. To the extent that land development is going to cause things that are going to be injurious to the health and safety of of people, the government can always require either mitigation or indeed stop the development altogether. Uh and and all of the Supreme Court cases recognize that possibility.

[0:16:13] David Callies: But to the extent that the developer simply causes, and I say simply because it's easy to quantify, David, as you're indicating, a a quantifiable um problem, even increased traffic can be mitigated if not solved by by more and better roads, by contributions to uh the paving of roads that maybe aren't as as good as they should be to help ease problems over major roads. These can be done. There are folks whose profession is to quantify these things and and indicate what proportion the developer should pay. In the city and county of Honolulu, as other counties in Hawaii have retained people like that trying to do that.

[0:16:48] Randall Roth: So they're doing that and in your opinion, they can continue to do that, uh that this this new Supreme Court opinion doesn't prevent them from factoring those sorts of of indirect consequences into the process.

[0:17:00] Don Clegg: Absolutely. What what they can't do is as as Don indicated, and which we have disagreed with on a long time, is to put that condition or to require a payment as a condition of zoning or rezoning. Merely because the city from one standpoint increases the value of property by rezoning it, it does not give the city the right to exact for development. For that, it has to tax and it does not have the power to exact a tax like that except for the ad valorem property tax, which in theory gets more money and has the value goes up.

[0:17:30] Randall Roth: David from the Big Island, what do you think?

[0:17:33] David Callies: Well, um I I guess he answered my question.

[0:17:38] Randall Roth: Great. Do you have any other questions?

[0:17:40] David Callies: Well, there there is one other point. It's just a little bit different, but it's it's in the same family of lot of of questions. I I moved here recently from the mainland, uh and and one of the things that really disturbed me on the mainland is is this uh, uh frontier mentality that everyone has uh when it as far as development goes. You know, there there's always more land to develop and uh you have to grow or else you stay you're not progressing, you know, and and all this ultimately bankrupt theory.

[0:18:10] David Callies: And I thought when I moved to an island here with a very finite boundary uh that there wouldn't be any frontier mentality, but I I was disappointed to discover that it's it's alive and well here also. And uh you know, when you put a big development in on an island, uh you're you're losing a whole lot of things. You're losing open space, you're losing uh all all those things that make island living uh desirable. And and and yet somehow or other uh I I hear it, nobody seems to be paying any attention to the fact that we have a very finite boundary here and uh

[0:18:50] Randall Roth: Let me ask Don Clegg uh who's here, you know, working, you know, the head of the department for the city and county of Honolulu, but but we have our island over here too, so the issue of

[0:19:00] Speaker 1: I guess is the same as what you're facing on the Big Island. Don, to what extent is it government's role to um, uh, to keep growth either down to manageable proportion or maybe even uh prevent growth?

[0:19:14] Don Clegg: Well, the thing is prior to our constitution, we're not able to limit who wants to come here. All we can do is make it uh either unattractive which keeps them coming here and Like real expensive?

[0:19:25] Don Clegg: That's right, and it doesn't make it very attractive for us who are who are here, or we make it attractive and everybody wants to come. So, it's a dilemma that I don't have a solution for, and we're dealing with with a constitutional issue. I think it's uh, the frontier, uh, aspects is as a, is an issue with for people, that's what people seem to want to do, these the majority of the people, and that's why it seems to happen. Now the Big Island is the biggest and as has something like 10 times the area of this island, so if it feels, David, if you feel uh some some pressures on there, why, some islands like Oahu for example, with the 71% of the population, they certainly exist here too, but that's probably why you're on the Big Island and not here.

[0:20:08] Speaker 1: David from the Big Island, thank you very much for your call.

[0:20:11] Don Clegg: Thank you.

[0:20:12] Speaker 1: Today's topic is government regulation of land use. My guests are Don Cleg, Director of the Honolulu County Department of Land Utilization, and David Calis, the UH law professor, who has written extensively about land use law. His books include Regulating Paradise, and Preserving Paradise. Your calls are welcome. The number is 9558821. Well Don, earlier you were giving me a an example of something that had to do with community associations, and I rather rudely interrupted because I wanted to know more about affordable housing and the lack of a nexus, etc. Could you tell us what uh, what you were going to say about community associations?

[0:20:48] Don Clegg: Sure. I think, uh, several examples. One is earlier on when the, uh, West Beach, uh, project was being zoned, the, uh, West Beach Corporation, uh, managed to negotiate, uh, I think it was about $300,000 which they gave to a group of, uh, advocates for no development and, uh, to as a, as a, uh, trust, and now they, they set up a, I know it's an organization that could use that money, and there's no nexus there, I don't believe. Similarly the, uh, the golf course which was, uh, recently in, uh, Barconea. They gave $2 million to a group. Um, the on the other side at Hayek, uh, they gave 160 acres to a local community group. Now, I guess I would have a little problem with the nexus issue on that, but these people did get their developments.

[0:21:45] Speaker 1: So, you again you're saying this is an innovative way for the, the government to address, uh, the demands of of the people without raising taxes and, uh, because it's part of this unilateral agreement that you describe, because the landowner or the developer is agreeing to it, then, um, it must be working even though there there does appear to be a legal problem.

[0:22:07] Don Clegg: I'm, I don't want to mistake, I'm not exactly an advocate of this process, I just happen to live with it and work with it.

[0:22:13] Speaker 1: I want to ask you in a minute, uh, whether you have a suggestion for a better process, but we've got several people on the line. So, first we'll go to Peter in, uh, is it Wailua?

[0:22:24] Caller: Peter, are you there? I'm not sure I can read the handwriting that I'm looking at. Yes. Can you hear me?

[0:22:28] Speaker 1: Yes, where are you from?

[0:22:30] Caller: Wailua.

[0:22:30] Speaker 1: Okay, great. Go ahead.

[0:22:32] Caller: I'm a farmer. Uh, Mr. Cleg, uh, is there a, uh, chance the Wailua, uh, lands, uh, after they're out of sugar can be distributed to farmers somehow?

[0:22:44] Don Clegg: I don't think there's, uh, to be blunt about it, a chance at all. Those lands are owned by, uh, mostly by, I believe, uh, Castle and Cook, uh, and by, uh, Campbell, and, uh, I don't see them giving up the lands for nothing, do you?

[0:23:02] Caller: Well, why doesn't the, uh, government condemn it?

[0:23:05] Don Clegg: Well, we're back to this issue of money again. That there are a lot of things that people would like to have, and then some matter of establishing priorities. If it is a priority of the people in the government that they use the money that they get to condemn that land rather than putting in a new sewage treatment plant, then that's the way it will go, but that has not that been the case in the past.

[0:23:24] Caller: So, I don't see why it would benefit anybody in Hawaii to continue allowing these, uh, big landowners to to build housing, because the more housing you build, the more mainlanders come over. The more mainlanders come over, the more, I mean this place keep, keep, keep on that, that snowball rolling down the hill. You're going to end up with a Hong Kong here.

[0:23:42] Don Clegg: You have a, you're absolutely correct that, uh, as to how that process goes. I think, uh, you you've heard, uh, Mayor Fasi enough, he would like to break up the big landowners. I'm not sure how you had to do that constitutionally.

[0:23:55] Speaker 1: Peter, let me read, uh, a quote from from a newspaper article that appeared recently. Uh, this happens to be the statement of somebody who's with, uh, an environmental group. And he says, uh, describing this case that we've talked about, this is an extraordinary intrusion by the court into the authority of local government. It elevates the interests of property owners over the interests of the community as a whole. And I have the impression you would agree with that, uh, David Calis, our legal expert. If, uh, the community as a whole wants something, can we take it from a landowner?

[0:24:34] Don Clegg: Well, I think that that it's certainly possible to do if what the community wants is something that the developer causes a problem with with his development. Indeed the Dolan case which we have talked about was over just that issue and that is to the ex- what to what extent a developer can be required to give to the community a right in property or a piece of property as a condition for developing property. Uh, I have a lot of sympathy with with what Peter is saying. However, it's a matter of whose property and at what time. Certainly I would expect that Peter would would regard it Let me put words in your mouth, Peter. You tell me if I'm wrong. If after the land were distributed in some fashion to farmers, what would you think if the community decided by vote that it should be taken away from farmers again and given to some other use? Then it would be interfering with vested rights that you would hold as opposed to vested property rights the landowners hold. Kind of makes a difference at what point government interferes, doesn't it?

[0:25:30] Caller: Yeah, it sure does. Uh, well, I hope Fasi can get in there and, uh, um, break them up. Thank you.

[0:25:36] Speaker 1: Thank you, Peter. Don Cleg agrees with that last statement, by the way. We've got several other people on the line. Let's go to Herman on Maui. Herman, you're on the air.

[0:25:46] Caller: Good morning.

[0:25:47] Speaker 1: Good morning.

[0:25:48] Caller: My name is Herman Adalas and I'm calling from Wailuku, and I'm sitting here looking out my east facing living room window at the island and mountain of Haleakala, and looking at sugarcane fields of HC&S and private farms, and residential areas in Kula, and a big residential area in Pukalani, and a road that goes up there to get people up there to their houses and whatnot, and I was astonished that in the discussion you talked about, I wasn't surprised. I'm, I'm a construction consultant, and I've been in the business since 1954. I've lived here 21 years, and I'm weekly working on a book called 20 Years of Strange. But, what amazes me is that we keep using these old systems and referring back to the mainland, where frontierism didn't work, or if you believe in the big city and, and beauty, the beauty of mass, and whatnot, uh, then it did work. But I think the climb level is created and everything is is, uh, blemishes that opinion. What I'm saying is, it's land manipulation that is causing the problem. And if you offered HC&S or uh Sebrur, or anybody that you want to name that's got a big piece of land, the sugar that's going out of sugar now, uh, on the island of Oahu, instead of selling it, that they lease it to the government, state or county, and that the county then long term, one generation, two generation, uh, lease it to farmers, so that it could be written off. Because when you when I want to rezone some of that aggland on the slopes of Haleakala, I have to do this road thing for you and I have to put in the sewer plant for you, or for me, or for them, as a developer, and that costs money. So if you gave all of these people who develop a sellable tax credit so that they could pedal it to somebody that needed it, that was making a lot of money, you would have done the same thing. And I know it's simplistic, it's a complicated thing, I understand. But so

[0:28:18] Speaker 1: Well Herman, let's, let's, let's get a reaction to that. Don Cleg, you're making some notes over here. What do you think of what Herman is is saying and suggesting?

[0:28:27] Don Clegg: Well I guess a couple of things. One, is, uh, I'm not so sure that the frontier, uh, movement in, in the mainland was a failure. I really think it was a great success, it brought a lot of good things with with it long as, as well as a lot of some bad things too, but overall, I'm going to give it a, a plus. As far as the agricultural land is concerned, we don't need that much agricultural land. Uh, we can grow everything we can possibly use on 5,000 acres in this whole state. Except for the large things like corn and large field agriculture. If we can find another large field, uh, crop such as pineapple and sugar, we'd be we'd be putting it in the ground today that we can grow economically. So there just isn't enough need for agricultural land in small plots, and there's not enough, there's no products that we can use large, uh, acres of land for.

[0:29:16] Caller: I'd like to respond to that. Sure. If you grew fuel, alcohol, and I'm I'm not I'm not being simplistic. If you grew, in fact, if those sugar fields that I'm looking at were turned into alcohol and we had Stanley steamers, we wouldn't be paying the oil companies and the federal government, and this is part of your frontier thing. This would be a new frontier, of facility and resource utilization. If we drew alcohol on that land, and didn't burn, and had a combination of distillation and, uh, like wines and beers, of, of alcohol in by another system. Uh, and I'm not saying that this is, hey, this is the answer, this is what you ought to do. I'm saying that if we use our minds and think about ways to utilize this precious piece of stone that doesn't grow anything unless that sunshine's here. It's the location of these islands and the breezes and the rain that they put on the mountains. Herman, are you suggesting the government can better decide how to efficiently use that land or productively use that land as compared to any landowner?

[0:30:37] Caller: No. What I'm saying is that in cooperation with the owners of land who have a privilege, not necessarily a right, and I don't care whether it was the original colony in New England, or whether it was the rich plantationist who had slaves who helped win the revolution, or those on either side in the Civil War, we're people. We make mistakes, but I'm saying that always the government has been a partner.

[0:31:09] Speaker 1: Okay. Herman, I've got some people on the line. I appreciate your comments. Uh, I'm going to move on to um from let's see, is it Kaniaho? Kaniaho? I can't I can't read my son's writing. Married from Kaniaho. Your son can't spell, that's his problem. That's it. He's a He gets good grades. I don't know why he can't spell. Mary, you're on the air.

[0:34:41] Caller: Oh, good morning. Uh, the so-called nuisance impact, uh, you talked about on existing landowners, uh, can be very large. And it seems to me that the developer has always been able to buy his way out of minimizing, minimizing the impact. And the landowner is powerless, and government has not so far been responsive to the pressured parties. And, um, so the the developer has all the money, he can buy his way out of any situation just about, but the existing landowner is just sort of left hanging there at the mercy of everybody. Is there any way that the landowner can get some clout? Existing landowner.

[0:35:25] Don Clegg: I'm not sure who you mean by the existing landowner.

[0:35:28] Caller: Well, say you you put a development into an area that is already has homes on it, and the homes are, you know, well spaced, and there's some around them, and then you put in this very dense development, and, um, which really I don't think improves the existing landowners' property.

[0:35:51] Don Clegg: Right, I understand. Well, you you're uh And this is Don Cleg responding by the way. Go ahead, Don.

[0:35:58] Don Clegg: I thought mine was distinctive from David's. Well you are distinctive, but your voice may not be. Go ahead, Don. Thank you very much. Uh, what you're you're bringing up is a dilemma that we always face because as you build the houses smaller and you crowd them, they become cheaper. And it's become cheaper, more people can buy them. And there's a lot of people in the community who would like to see that and they think that's great. And I can understand your concerns and I may have the I have those same concerns. I don't really believe that we should go in and develop increased density, uh, as a just as a a policy without taking into account the the impacts and without rezoning land. So I've had always some concerns about the so-called Ohana uh concept, which is an increase in density without rezoning. There's there's a dilemma there, and we've got different priorities and different needs in the community, and they're obviously in conflict with each other, and somehow this thing all settles out, and in the democratic process, somebody wins and somebody loses, and uh, that's just that's just the way it goes.

[0:37:04] Caller: If I understand what you're saying, I think the landowner, existing landowner, gets very frustrated because he feels totally powerless against these huge entities like government and a developer, and they really have very little to can say very little in, in what's happening to the property surrounding them.

[0:37:22] Speaker 1: Don, is there a mechanism for concerned citizens effectively communicating with your department?

[0:37:30] Don Clegg: Oh, of course. Um, we're always open. You can call, you can write letters, uh, you can get groups to come together and and, uh, talk to us and, uh, give us what your opinions are. That doesn't mean that's that's what's going to happen. But there are other areas, you know, there there's the the city council is the policymaker. I really just implement the policies that that they and they pass, and I implement and sometimes interpret them. Uh, they don't care for that part. And the mayor is another

[0:38:00] Don Clegg: or avenue. So all of these things are part of the political process and it is a part of a power process to to finally end up with something that that the community uh has to live with whether they and presumably in democracy, that's what they also want.

[0:38:15] Caller: Yes, I uh and I guess this has always been an ongoing conflict that will I think the conflict will go on as long as we have elected government and even if we don't have elected government, it will go on in some fashion in a different way as well. We just feel that we have the by the better form of government right now, but I can assure you that I've watched a a uh dedicated group of uh 15 to 20 people change the the city council's voting and change their minds, maybe not their minds, but at least their votes and and come out with uh something that they wanted. Thank you, Mary. We really appreciate your call.

[0:38:51] Randall Roth: In case you tuned in late, this is the Price of Paradise radio show and today's topic is government regulation of land use. My guests are Don Cleg and David Callies. We're live and the phone lines are open. The number, 955-8821. Neighbor Islanders are invited to call, collect again the number, 955-8821.

[0:39:12] Randall Roth: Well, something that Mary said and and actually it's a theme that uh I've heard a couple of times today is that the developers and the landowners, now I'll call them the monopoly landowners, uh can afford anything, that uh government should be in there taking for the people everything that it can possibly get. Uh and yet I know from conversations with David and others uh that there is ultimately a shifting of that. And I guess the question is, if government is taking more than what the recent Supreme Court case would would allow under this rough proportionality test, David, who ultimately pays for that? Is that just a part of of these outrageously high housing costs that we have here in Hawaii, a a a hidden tax of sorts? Or how does that work?

[0:40:04] David Callies: Well, that's what developers represent and I think they have a pretty good point. Uh the demand is is almost insatiable in Hawaii for housing at almost any level. If that's true, then there is a market for virtually any any priced housing. A land developer is not in in the business of providing just a community service. He's in there for for business reasons. Therefore, if if an an exaction or a dedication required by government is going to add 20, 50, 100,000 dollars a unit to certain houses, that's going to get passed on to the consumer because the consumer or some consumer can afford to pay for it. Uh of course that drives up the cost of of market housing. It is one of the major problems with tacking on a 15, 20, 30, 40 percent affordable housing increment on market housing. It raises the prices of market housing and increases the gap exponentially uh between those people who can afford houses at the market and those that have to be subsidized.

[0:41:00] Randall Roth: In fact, there was an article in the newspaper, one of the local papers recently, where a local expert came up with a $100,000 $150,000 as the additional cost of a single-family house as a result of government regulation. Does that sound anywhere near possible? It just sounds like an awfully big number to me.

[0:41:21] David Callies: Oh it sounds very possible because I believe the developer was was referring not only to the exaction cost, those dedications and requirements, but also the time it takes to process a land development in Hawaii. Uh there are many places, particularly in the southwestern part of the United States in which one can get permit for development within 60 to 90 days, maximum 120. Here, it it's no secret that that most large mediums medium and large-sized development from the time a land owner buys and decides to uh or or has land and decides to commence development, can take as long as eight years. I've been in conferences where where knowledgeable people have thrown out 10 and 12 years. Interest costs are running at that point and it just drives up the costs unreasonably.

[0:42:04] Don Clegg: I'd like to take some issue with that. Go ahead. Because uh I've seen this uh seven and eight year number, this scare number that's thrown out, and what's never put in there is the time that the land developer and the architects are doing nothing. And believe me, it's well over half of that time. The time between they get some permit or some decision before they implement that decision going from the uh the zoning on to the the building permits. Now, we're also talking when we talk those long periods of time, we're talking uh starting off from ag land in the state uh agricultural district which means yes you got to make it urban and then you have to go get to development plan and to get to zoning. There are a lot of there are a lot of uh uh gates along the way that have to be uh gone through and there's the time between application of those gates that that really uh also adds up and I I've had my staff go through some of these so-called horror stories that we hear to find out how much of this was government delay, government time, and how much of it was due to developer delay. The financing was not there, uh they decide not to do something uh now or just yet. They go they go bankrupt, they try to sell the property. We can look at uh things like uh Ever Village now, we can look at uh Ever Marina. Ever Marina has changed hands a couple of times. Yes, that Ever Marina started off in as I recall Ever Marina in 19 uh 72 and it still hasn't uh turned a stick of dirt. But there was a lot of time in there when they were trying to find financing and and trying to sell the property.

[0:43:36] David Callies: Well, I I'd make two responses. First of all, I think that that Don has has made my case in or or the case whether it's mine or someone else's in in that I'm not suggesting it's all county delay time, but it that's that's another point. We have a a substantial layer of state permitting and changing to go through too that a lot of states don't have. That's not to say that there aren't good reasons for it, but we have to understand that the price we pay for these sophisticated two-tier controls is time. Secondly, Don, let's cut it in half, four years. That's still an awful lot of time to get a a process through. Um even if you take it down to two years, that's a lot of time to take it through. It adds costs and and we need to understand as a community that adding time, substantial amount of time to development project translates directly into increased costs. There is no reason for a developer to eat those costs given the market that we have here.

[0:44:28] Don Clegg: Okay, but one of the but uh I I I agree with this is too much time. However, one of the big pieces of time in there is public participation, public hearings. I have public hearings. We don't have enough public to go around all the hearings that we have. I kid you not. We go to public hearings, there's nobody there. That that that my my staff and and the developer and who are and just so we have so many public hear, we have so much public input. And I think the public also has got to recognize that they can't draw things out forever and ever. Decisions have to be made, should be made, and they should be made quickly. But if you've gone to the city council, city council has three uh three readings and then three committee hearings, every one of those is a public hearing in effect and if it's a hot issue, that drags out till midnight when hundreds of people come down and say the same thing that they said the last six times. So, I think the public has to recognize if they want to get some of these things through faster, cut the cost of housing, cut the cost of processing, they've got to cut their participation as well.

[0:45:27] Randall Roth: You know, in preparing for this show, I talked to a couple developers and I asked them what their thoughts are about the whole thing. And the one constant was that they said it it just takes too long to to get a permit and that was very frustrating to them. But something else that they said was that at least they felt and maybe this is just perception rather than reality, but they felt that in order to get that permit or in order to get that permit more quickly than otherwise would be the case, that they had to hire um what what they referred to as consultants that typically used to work for the department that they're going to, that that knew the people there, and they had the feeling that that was just a a an added um oh let's just say a an added cost of their project that was totally unnecessary. What do you say to folks like that?

[0:46:19] Don Clegg: There there is a thriving business out there of consultants uh who are helping people process through the maze of uh government and land-use controls and uh so I I I'm on the other end of it and I have trouble figuring out sometimes uh what has to be done and whether we should make a decision this way or that way.

[0:46:38] Randall Roth: So you think those those consultants are really providing value, because the two people I talked to had the impression that um uh that they really weren't adding any value, but it was necessary to pay them their fee in order to get that permit?

[0:47:22] Don Clegg: Well, they're not adding value is except that the value comes when the when the permit is issued. Now, when you say they're necessary, they're necessary to work their way because they are they are familiar with the process. It's not a matter that you pay that that pay this person to process it, and and he goes and pays somebody in government to get a process. And I want to lay this back as a pet peeve of mine is that we have too many laws. And

[0:47:42] Randall Roth: I thought you were going to say too many lawyers.

[0:47:47] Don Clegg: Both, they they they they go together because one generates the other. But we have we have so many land use laws and so many other laws, so much regulation that um uh I I I can't get the legislative bodies to not do this. Now, there was a suggestion then which I have had is to limit legislators in session to 10 laws each, 10 statutes, that's it. You can put 10 laws in and that's it. We have over 3000 that go in the legislature. We have a city council that keeps passing law after law and the complexity is in the policy that these people are passing, which apparently is what the what the general public wants. Otherwise, they would elect somebody who doesn't do this.

[0:48:14] Randall Roth: David, I I think as lawyers maybe we're expected to to defend something, but I I suspect you and I agree completely with what what Don has just said.

[0:48:35] David Callies: Except in Hawaii. Except in Hawaii. We have uh a caller and uh his name is Lol, but I suspect that he doesn't spell it l o a l. Uh but lol from Honolulu, you're on the air. Hi, Randy. This is Lol.

[0:48:48] Randall Roth: Oh, Lo Calappa. How are you? Welcome. You know, my my question has to focus on financing and and certainly I haven't heard all the program this morning, but to both Don and and Dave there, um this whole discussion of impact fees, you know, the whole idea that people don't want their taxes raised because of some new development because of the infrastructure costs. Lo, I want I want you to continue but Don Cleg reacted to something you just said. Let me get his reaction then I want to give it right back to you, Don.

[0:49:43] Don Clegg: Uh follow agricultural land has more tax value than productive agricultural land by a factor of three or four, I believe. And so uh that's why the Bishop Estate was so very generous when they offered Wylua Sugar to let them have the land for nothing. It saved Bishop Estate something like $300, 400,000 a year in taxes.

[0:50:12] Randall Roth: And and our caller, in case listeners don't realize, Lo Calappa is the head of the tax foundation here in in Hawaii. Lo, what do you have to say about Don's comment? Don Cleg, do you agree with that?

[0:50:43] Don Clegg: Uh, yeah, it's just a matter of there's so much uh increased use you can make of property economically. It's a matter of how much industry and and there is out there and we're about at a level. It's sort of a self-seeking level. The amount of industry you can and and and you can generate economically, then that's about tells you about how many people are going to be around.

[0:51:17] Randall Roth: Don Cleg, any thoughts?

[0:51:21] Don Clegg: Well, I think there's we have plenty of land on Oahu. It's just that maybe as as you do, Lo, we're just not using it the way that um uh we some people would say don't use it. So, I would say the way in which we could get the best return from it. To some people, many people, the best return from this land is not to do anything with it.

[0:52:14] David Callies: Well, Don, I think that's true. I think everybody agrees with with that uh are we willing to do we have the political will to do it? And as you know, the bill that was introduced this year wasn't half as bad, but maybe that's a that's a telling tale is that everybody disagreed with it.

[0:53:23] Don Clegg: The first thing you don't do is violate the law because they got some pretty stiff penalties.

[0:53:28] Randall Roth: David, do you have a comment?

[0:53:30] David Callies: Yeah, following up on the comment on the Land Use Commission. You know, it may be time for the Land Use Commission uh to be folded in and and and that power of of major division passed to the counties. But it's worth noting that if you look at the map, the land use map of Oahu for example in the 1960s and you look at the land use map today, it is amazing how well our much-maligned planning and land-use policies have worked in terms of keeping urban development where it was more or less intended to go and keeping open space where it was by whoever was making the decision more or less intended to go.

[0:54:40] Randall Roth: Don, I think that was a compliment.

[0:54:42] Don Clegg: Yes, well we Dave and I compliment each other quite often. You made a deal ahead of time.

[0:54:47] Randall Roth: This is the Price of Paradise radio show. Today's topic is government regulation of land use. My guests are Don Cleg from the City and County of Honolulu and David Callies from the University of Hawaii School of Law. We're live, phone lines are open. The number is 955-8821.

[0:55:03] Randall Roth: Don, I'm looking at uh a copy of the cover story from the July Hawaii Investor magazine. It's about uh Jack Myers. And as I read it, I feel a lot of frustration uh coming from Jack where uh he's a a well-known local developer and he has things like uh the following. When you get into legislative tit-for-tat into one politician's office or another, you're not dealing in real estate or commerce. You're dealing in extortion and corruption. Elsewhere in the article, he says, talking about his company, we want to position ourselves to be more in control of our destiny independent of the regulators. For the individual entrepreneur here, I'm in an impossible situation. He says it's an impossible situation. He says, I'm 46 and I'm really disturbed and alarmed that there isn't a group of young developers snapping at my heels. There isn't because there can't be any. Lot of frustration there. And the couple of developers that I talked to in preparing for the show, uh when I encouraged them to call in, they said, oh gee, you know, we we can't call in. We've got too much to lose. I think there's some frustration by developers and there's some some fear factor. Is that unfounded?

[0:56:19] Don Clegg: Um, not at all. I think that there is a great deal of frustration I and I sense it myself. And uh and there is an element of fear that if they come out publicly and say something against the legislature, a legislator or or against the Director of Department of Land Utilization there will be some kind of retribution for this. Now, I can't speak for the legislatures but certainly not in my case. I'm I'm willing and want to hear whatever they have to say. If people come in and say your department's too slow, you're doing something that uh that's costing me money, most of the time I have to point to the law and say I'm only trying to implement this law. You know, there's no good guys or bad guys in the zoning code. And people will come up to me and say, well how come you

[0:57:00] Speaker 1: can't process this for me. It's not going to hurt anything. My neighbor doesn't mind and I'm saying it's that that be nice but uh is this it's not it's not it's not legal to do that under the land use ordinance.

[0:57:12] David Callies: I know you have a reputation for being a a stickler for the law. If I'm not mistaken, you're the one that ordered the folks in Kahala that built their house a little bit too high to to cut off the top of it.

[0:57:21] Speaker 1: It was about two and a half feet uh that came off the top and uh

[0:57:24] David Callies: You were a hero with my neighbors, by the way. They they like that decision, but I'm sure there were others who didn't.

[0:57:29] Speaker 1: There are others who don't and they they go to the zoning board of appeals, they go to the mayor, and they go to a bunch of people.

[0:57:35] David Callies: I see. We've got several people on the line. First Ed from Makiki, Ed, you're on the air.

[0:57:40] Caller: Thank you, good morning. A little bit in the sympathy of the likes of Don, who have to try to juggle the planning process. I know it's unconstitutional by law to set population limits, but I think that that is the core behind practically all the problems we have.

[0:57:57] David Callies: I think Don called it the the dilemma that nobody has an answer for.

[0:58:01] Caller: It would seem to me that a plebiscite of I would say address to each county as to what that population at that time thinks is the ultimate or the the optimum population to support. Would set a clearer path. If because from that, then you can start to talk about the economic support of that population. But unless you start with that, you will always have what amounts to like it or not, a break on the what, incessant growth and overcrowding, especially like uh what we have in the island of Oahu here. I just want to leave it at that.

[0:58:36] David Callies: Thank you, Ed. Appreciate your comment. We have a call from Julia from Kani Ohe. Julia, you're on the air.

[0:58:43] Caller: Yes, I was just I was a little bit concerned because they were talking about um public review process, that somehow we have too much of that. So um I was a bit concerned about that because I do feel that um we have like the most recent bow I guess in Maui, where um there was a community review process that went together and people came together and created like a plan for the Hana district to go into the year 2000.

[0:59:09] Caller: And even with all of that uh public input or whatever, when it got to the planning department, the representative of the largest land owner, um wrote to the planning department and everything he requested to have altered was altered in the community plan. And so what happens is you have community input, but what you also have at the same time is that certain players have a larger mouth.

[0:59:31] Caller: So when we talk about getting rid of of or removing some of the community input, I'm kind of nervous about that because I think what it means is that um those other individuals that represent major land owners or let's say who represent a company that's developing a particular area, it doesn't mean lessening their input, okay?

[0:59:51] David Callies: Thank you, Julia. Appreciate your comment.

[0:59:53] Speaker 1: I think we have to recognize land owners have rights and they are to be respected the same way constitutionally, legally, as anybody individual's rights. And when I said that we have uh too much public input, that's again uh establishing priorities. If you want to cut the processing time down, if you want to uh thereby reduce the cost, then you have to have you have to take a little bit of all the pieces that make this processing time uh so long and and cut it out and one of those things is public input.

[1:00:23] David Callies: We have another caller and we just have a few minutes left. So, I'm going to go to Lisa on Maui. Lisa, you're on the air.

[1:00:28] Caller: Yes, thank you. I wanted to uh comment on on both previous calls. Uh carrying capacity is certainly an issue that I think somehow we have to come to grips with and I don't know how you do that exactly and allow for um developers to develop and land rights and so forth. But I wanted to do that comment specifically on the AG 25 bill if you've been following it here on on Maui. uh at this point, Aglands can be subdivided without public review and it seems that that is a very serious problem uh that uh we do need public input so that some of the impacts can be adequately mitigated.

[1:01:03] Caller: At the present time, we just have an administrative process and we have literally hundreds of thousands of acres in agland so I wondered if you could uh see if you could balance all of these ideas and come up with something that's going to work so as we don't just uh allow the islands to be over developed. Thank you.

[1:01:19] David Callies: Thank you very much. Uh you know, something that I want to ask you before we run out of time and we're down to the last couple of minutes, there was a lot in the newspapers a few weeks ago, maybe a month ago, Don, talking about um uh some gentry projects where, if I recall correctly, you were saying that that they hadn't satisfied the condition that had originally been agreed to with respect to affordable housing.

[1:01:43] David Callies: If if they haven't satisfied it, and my understanding is that they're arguing that they have and so there is that question of fact, but if it's determined that they haven't satisfied that, can you force them to do so? Or is the nature of this unilateral agreement process such that you really can't force them to live up to that?

[1:02:01] Speaker 1: Well, the city council can force them by taking away the zoning and as it's clearing the unilateral conditions that if they do not meet up meet with they do not comply with these conditions, that we we will not issue any any more permits for anything. So uh in this case, they did come to an agreement with the department of housing and they have a dedicated their next uh three or four uh subdivisions to all affordable housing to catch up with the affordable housing that they did not have previously.

[1:02:31] David Callies: Okay, David, you got just a few seconds to respond to that. I think it is always great when people can come together and not sue over. The fact of the matter is that the unilateral system is is fraught with legal problems in primarily because it is unilateral. What the community should be doing is getting together and doing bilateral development agreements as as I said under our statute whereby one party gives up some and the other party gives up some and and that's enforceable. I think it's going to be very difficult for the city to enforce its unilateral covenants because they are unilateral even though they have the benefit of the land use ordinance behind them.

[1:03:02] Speaker 1: The unilater development agreement is something David and I have been both pushing for for years and the city council has never seen fit to uh to pass the ordinance even though we can, and uh maybe we'll get and do it again.

[1:03:14] David Callies: The city council open your hearts and minds, right? Gentlemen, thank you. My guest this week were UH law professor David Callies and director of land utilization for the city and county of Honolulu, Donald Clegg. This week's show was produced by Susie Roth with help on the phones from one of my sons, who can't spell very well and technical assistance from Jeff Ilarity. Next week we'll be talking about public education in Hawaii with Superintendent of schools, Herman Aizawa and board of education member, Karen Knudson. Among other other things, we'll get their thoughts on the Pop 94 questions having to do with public education.

[1:03:47] David Callies: I hope you'll tune in for what promises to be a lively exchange of ideas and concerns. You've been listening to the Price of Paradise Radio Show. I'm Randy Roth. Aloha.