Landowner petitions for rural designation

by Bobby Command
West Hawaii Today
bcommand@westhawaiitoday.com

Friday, August 5, 2005 9:52 AM HST

The owner of more than 400 acres in rural North Kona has petitioned the state to move the property from its current Agricultural designation into the Rural District.

Big Island Country Club Homes in Puuanahulu is also the second landowner in recent months to seek a large-scale reclassification from the state Land Use Commission into the Rural District. Kamehameha Investment recently received Rural reclassification for about 450 acres in Keauhou.

The property is on the makai side of Mamalahoa Highway in the town of Puuanahulu and already contains an existing 18-hole golf course, which was completed in 1997. The developer, a subsidiary of Lynch Investments of San Francisco, proposes to develope 106 to 136 house lots of one to three acres each.

Lynch Investments purchased Big Island Country Club Homes in June 2004 for $10 million and within months had it back on the market for a reported $15 million.

The property, which was zoned by Hawaii County as Agriculture 1-acre, is in the state Agricultural District, a designation that has been clouded by the 2003 Hokulia decision in Third Circuit Court, which found that homes unrelated to farm uses are not a legal use of agricultural property.

R. Ben Tsukazaki, an attorney representing Big Island Country Club Homes, said recent land use law changes have prompted his client to seek the reclassification into the Rural District. Tsukazaki also said the company hopes to stay within the 106 lots that county zoning allows.

"However, given the time it may take to develop the property," said Tsukazaki, "the developer wants the flexibility to increase the number to 136 if it becomes necessary."

Anthony Ching, executive director of the state Land Use Commission, said the petition is being examined for completeness and whether it will trigger the compilation of a environmental impact statement. He said the LUC has 60 days to put the item on an agenda.

Ching said two large landowners seeking conversion into what was once a rarely used classification may be a signal that developers realize so-called golf course subdivisions are a better fit in the Rural District.

The 2005 Legislature changed the state land use laws, which previously allowed golf courses on marginal Agricultural land. The recent action now limits golf courses to the Rural and Urban Districts, although it grandfathers existing courses built on farm lands.

Designed by Pete and Perry Dye, Big Island Country Club opened in 1993 and was built by Japan-based Spear Development and Saiga California. It features a temporary clubhouse and carries with it a Special Permit that allows a 40-unit members' lodge.

The members' lodge was unsuccessfully challenged by a number of Puuanahulu residents in 1995. The LUC was also concerned that the zoning for the members' lodge represented "parceling," a technique where developers try to avoid comprehensive examination of a project by approving small portions of it at a time.

Tsukazaki said the current petition does not involve the members' lodge.

The Legislature last year also called on Ching and planning directors from the four counties for recommendations on how to enhance the Rural District and what lands might be more suited for such designation.

"The legislative interest in this subject show there is some concern that there might be a proliferation of subdivisions in the Agricultural District," Ching said.

Big Island Country Club Estates was the second of three major purchases by Lynch Investments, first spending $10 million for 866 acres of residential property in Waikoloa before its acquisition of the 1,652-acre Makalei Golf Course in January, where about 150 homes can be built.

It was purchased from Intrawest Golf, which itself purchased the facility from Spear Development in 2002 for a cash payment of $8.9 million.