WAILUKU - A Maui County Council committee Tuesday recommended a new independent appraisal for Launiupoko lands the county administration wants to purchase for open space and park use, with the committee chairman calling the current appraisal "fundamentally flawed."
The Budget and Finance Committee is recommending the new appraisal for 186 acres in Launiupoko that Mayor Alan Arakawa's administration has negotiated to purchase for $13 million. Committee Chairman Mike White said that the Arakawa administration provided the original appraiser with hypothetical conditions and assumptions for calculating value that led to an inflated price and not fair market value.
Finance Director Danny Agsalog, the county's chief negotiator in the deal, told the committee that the administration did not tweak the appraisal to meet the seller's requirements. He added that the seller had previously asked for $16 million.
Landowner Makila Land Co. LLC has given the county a Dec. 31 deadline to purchase the land and has repeatedly told council members - including Tuesday - that the deadline and price of $13 million were firm. The deal proposes acquiring 148 acres from the northern edge of the former Olowalu Landfill to Launiupoko Beach Park and 37 acres from Launiupoko to Puamana Beach Park.
Council Member Don Couch was the only member to vote "no" on the resolution that passed by a 7-1 tally (Council Member Mike Victorino was excused). Couch said that he was worried about the deadline and is concerned about what would happen if the new appraisal was not finished by Dec. 31.
He said he doesn't want residents 20 years from now commenting on development along the Launiupoko coastline, and asking: "Aw man, who let that land go?"
"Twenty years from now, $13 million is going to sound like a steal," Couch said earlier in the meeting.
Council Vice Chairman Robert Carroll told White that if the appraisal does not come through before the deadline he wanted to make sure council members will be able to vote on the measure either way. After the meeting, Carroll said he voted for the new appraisal to expedite things because the committee had already spent most of Tuesday discussing the resolution, and he did not want to prolong it.
In addition to the new independent appraisal, ACM Consultants - which came up with the $13 million value of the land on which the current sale terms were based - was hired on Sept. 29 in a council resolution to produce a reappraisal. The company has said that the reappraisal can be done within 90 days from written acceptance of the proposal from the county, which has yet to be done.
White said that he was aware the deadline was making some council members "uncomfortable," but said that he was comfortable with ordering the new appraisal. He said that ACM was able to turn around a reappraisal quickly.
Regarding the landowner's hard deadline and stand on price, White said he doesn't think there are any buyers waiting in line for the parcels. He noted that the landowner has already extended the deadline twice - once for the mayor and the other for the council.
The reason it has taken so long for the committee to decide on the purchase is because he needed to take a closer look at the appraisal process, White said.
"We may still decide to buy it for $13 million," depending on what the new appraisals show, White said, adding that that he, too, is eager to purchase lands for open space.
"I want to make sure we do it in a way that's prudent," he said.
If the appraisals come out a little higher than $13 million, "I'm OK if they make a little extra money," White said, adding that he just wants to see what the market value is.
After the meeting, White said he was going to try and make sure the appraisal and reappraisal come in as soon as possible to meet the deadline.
The Arakawa administration fired back.
"Councilman Mike White says he is comfortable paying for more than the current assessment and that he acknowledges that he is playing a game of 'chicken' with taxpayer dollars," said Rod Antone, county communications director. "This area is well-used by everyone. Drive by on any weekend and you'll see dozens upon dozens of local families fishing, diving, camping and surfing in the area. Mayor Arakawa does not want to miss the chance to purchase this land for the community, because it is all of us who will suffer if this deal falls through."
White has said that the county administration has refused to provide documentation on the purchase, including an earlier draft of the appraisal that came in around $8.7 million.
On Tuesday, Agsalog shared the initial appraisal with council members, noting that he has provided all the documentation the council had requested of him. He said that the council's earlier request for information had gone to another department of the county administration.
* Melissa Tanji can be reached at email@example.com.