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Cochran’s focus remains on pre-qualification provision

Council panel backs approval of Waiale South project

Maui County Council Land Use Committee members recommended approval of A&B Properties’ Waiale South project Monday, while continuing to wrestle with questions about the developer’s vetting of prospective homebuyers for its 600-home Kamalani project in north Kihei.

The committee’s 5-0 action advances A&B’s requests for its 950-home subdivision. The developer is seeking a change of zoning, a community plan amendment and establishment of a project district on nearly 123 acres of former sugar cane land south of Waiko Road abutting Kuihelani Highway.

A quarter of the project will be affordable housing as required by the county’s workforce housing ordinance.

Committee Chairman Bob Carroll and Council Members Gladys Baisa, Elle Cochran, Stacy Crivello and Mike Victorino voted to recommend approval of the development for first reading before the full council.

Monday’s action came in a continuation of a meeting recessed Wednesday.

During last week’s meeting, Cochran questioned a rewording of Kamalani affordable housing marketing materials from what is provided for in the county’s workforce housing ordinance.

The code requires prospective homebuyers to “pre-qualify for a loan with the applicant’s (the buyer’s) choice of lender.” The marketing materials said that the developer reserved the right to require applicants to pre-qualify from a list of developer-approved lenders.

Carroll proposed including a zoning condition for the Waiale development that restated the homebuyer pre-qualification provision, a move that some noted would be redundant.

Cochran said Carroll’s proposed zoning condition was “totally ridiculous” and had “no bearing, really.” She maintained that the county ordinance had been “rewritten” and “was utilized in an illegal way.”

“And now we’re trying to codify in some condition of rezoning to make it all OK?” she asked. “You get a DUI. You don’t get let off of that DUI because you didn’t get into an accident or because you didn’t kill somebody on the streets. You still get a DUI because you broke the law.”

She told Carroll that she understood what he was trying to do with the zoning condition, but she said the law was “broken.”

“It was rewritten by this corporation counsel for the developer, and nobody’s even talking about it,” she said.

Carroll said: “That’s what we’re doing right now.”

“No, we’re not!” Cochran said. “We’re just sweeping it under the rug and saying that we can put a condition of zoning in order to make it all OK for their past practices. I beg to differ, and I don’t have a straight answer.”

Carroll said: “Past practices are not on the agenda for discussion today.”

He told her that the agenda item was the Waiale subdivision and not “past practices.”

Corporation Counsel Patrick Wong said he had reviewed the workforce housing ordinance and the Kamalani workforce housing agreement between the developer and the county Department of Housing and Human Concerns.

Wong said: “Based on my review of the agreement and the code I did not find anything that would lead me to conclude that the agreement or the materials were in contravention to (the code), which reads ‘pre-qualify for a loan with the applicant’s choice of lender.'”

After being questioned by Cochran, Wong asked her to show him documents that show the problem because “I couldn’t find what you’re referencing at all.”

Cochran had copies of Kamalani marketing documents shown to Wong on the council floor.

Later, he said he agreed with Cochran that “there are areas in here that may cause confusion . . . but I maintain my position that in reviewing these materials there is language in here . . . that is not in contravention to the code.”

He read verbatim: “Developer reserves the right to require that the applicants obtain a pre-qualification letter from a list of developer-approved lenders; provided, however, (this is very, very significant because it’s consistent with the code) the applicant may obtain the loan for the purchase from the applicant’s lender of choice.”

Wong said that if such issues are raised, then “I think in fairness you need to raise it in its complete context and not carve out areas that are negatively shed on this project.”

He asked anyone who believes they’ve been “maltreated” by the loan pre-qualification process to contact his office.

Cochran said that the problem is with obtaining the pre-qualification letter, not with obtaining mortgage financing later.

“If you do not pass ‘go,’ you do not continue on,” she said. “That is where the restrictiveness and the hardship has occurred for people.”

After Crivello, Victorino and Baisa questioned raising issues relating to Kamalani when that project wasn’t on the committee’s agenda, Cochran agreed to back off. But she pledged to continue pursuing the matter.

“This matter is not over,” she said. “We will figure out when the proper time and place is to hash this out and get to the bottom of it.”

Earlier in the meeting, A&B Vice President Grant Chun apologized for “any confusion that our practices or our language might have caused in the marketplace.”

A&B’s online marketing for Kamalani no longer has its former developer-approved lender language.

Chun told committee members that A&B had “made some changes to make it clear that we want to appeal to as many buyers as we possibly can.”

“An applicant is indeed at liberty to pre-qualify with any lender of his or her choice,” he said. “That’s our practice.”

Victorino said he thought the ordinance may need to be amended to require pre-qualification from a “qualified lender,” or someone trained and equipped to know about the county’s workforce housing ordinance.

“There are some foreclosures that are occurring right now,” he said, referring to overzealous lenders who give homebuyers mortgages they can’t afford. “The end product is the person who ends up holding the bag, who cannot pay, who cannot fulfill the obligation. Their credit is destroyed, not the lender,” he said. “That has happened. It happens all too often.”

* Brian Perry can be reached at bperry@mauinews.com.