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Couch amends financials with rent income

Don Couch

Council Member Don Couch filed an amended financial disclosure statement late last month, breaking out the rental income he and his wife received for a Waikapu home, in the wake of a review by the Ethics Board of a complaint.

The amended report, which was received by the board Oct. 31, said that the couple earned between $25,000 to $49,999 in annual rental

gross income from the home, which they sold for $669,000 in August. The report lists only ranges of income.

The reporting of the specifics of the rental income stems from a complaint questioning how Couch and his wife were able to qualify as buyers for an affordable home in 2005 and later, in May 2007, to buy that home at Kai Makani Villas in Kihei for $389,088 — two months after purchasing a Waikapu Gardens market-priced home for $595,900 in March 2007.

Couch, who lost his South Maui residency seat Tuesday, has explained that he and his wife initially qualified and signed an agreement to purchase an affordable home at Kai Makani, where they currently reside. Although his income increased between the agreement to purchase and the actual purchase, county rules allowed the couple to still buy the affordable home, he and county officials have said.

The couple intended to back out of the Kai Makani home after securing the Waikapu home, but learned that they could not renege on the deal without losing “a substantial sum of money,” Couch has said. Instead, they decided to keep both homes, renting out the Waikapu Gardens home.

The Ethics Board, which met in executive session Oct. 12, declined to investigate the complaint against Couch because the allegations were “vague,” exceeded the statute of limitations and did not cite a specific Code of Ethics violation that the board could act on.

The complaint also questioned the absence of rental income derived from the Waikapu home in Couch’s financial disclosures. Couch told The Maui News that he did report the rental income, but that it was included in his wife’s income because she collected the rent.

The Ethics Board did not directly address the substance of the housing qualification and purchase issues but did allow Couch to amend his 2015 income statement filed in March.

“The board notes that one of the allegations was that Mr. Couch failed to properly disclose rental income in his financial disclosure statements,” said Chairman Randol Leach in a letter to both Couch and complaintant Sean Lester. “As is the practice of the board for any county officer or employee who may have omitted or incorrectly stated a matter in a financial disclosure statement, the board will return Mr. Couch’s March 14, 2016, financial disclosure statement and invites him to consider whether he wishes to clarify or amend the portion of his March 14, 2016, financial disclosure statement that relates to his 2015 income.”

Couch’s amended financial report reduced his wife’s annual income from $50,000 to $99,999 to $25,000 to $49,999 and broke out the rental income for the Waikapu home, in which he and his wife each had a 50 percent stake.

Couch lost his council seat in a close race with Kelly King in the general election Tuesday.

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