Council set to kill leasehold conversion
The City Council appears headed toward dismantling mandatory condominium lease-to-fee conversion after a key committee approved a measure yesterday that would repeal the law.
Bill 53 -- the measure to repeal mandatory lease-to-fee conversion -- comes up for a final vote before the City Council at its meeting 10 a.m. Jan. 26 in the third-floor Council chambers in City Hall.
"Unless anybody changes their mind ... I think it's a good indication how the Council will act on the 26th of January," when the full Council is expected to vote on the bill, said Executive Matters Committee Chairman Romy Cachola.
Cachola and Council members Ann Kobayashi, Rod Tam, Donovan Dela Cruz, Nestor Garcia and Todd Apo approved the measure, while Charles Djou, Barbara Marshall and Gary Okino objected.
The Executive Matters Committee, made of up all nine Council members, also approved an amendment that would make it impossible for any pending leasehold conversions not already approved by the City Council to continue.
"What you have put down now ... will kill the possibilities of these people going forward," said Joachim Cox, attorney for lessees of the Kahala Beach condominium, who have been battling landowner Kamehameha Schools for years to purchase the fee interest in land under their building.
After approving the amendment, the committee voted to defer acting on two pending leasehold conversion applications for lessees living at the Camelot and Discovery Bay condominiums.
Lessors fighting to stop condominium leasehold conversions were elated with yesterday's outcome.
"I think it's long overdue," said landowner Hans Peter Jensen, whose family owns a portion of the land beneath the Camelot.
But Jensen said that he realizes there are a lot of "political maneuverings behind the scene ... so I think the matter will not rest until the final vote."
Mayor Mufi Hannemann reiterated his position yesterday that he will sign any bill that comes before him that repeals the current law. "This is something now that's in the Council's bailiwick, and once they come up with a final product, we'll look at it at that point."
In 1991 an ordinance known as Chapter 38 was passed to help condominium leasehold owner-occupants gain title to the land under their units. The city would use its powers of eminent domain to condemn the land and turn over the fee interests to the eligible unit owners.
Yesterday's action by the committee came after hours of testimony.
Landowners said the leasehold conversion law needs to be repealed because it is flawed and has led to revisions.
Members of charitable trusts such as the Kamehameha Schools and the Queen Liliuokalani Trust said that if the law is not repealed, their organizations could lose income that helps to fund needed services.
"Chapter 38 must be repealed because of the potentially devastating impacts on important programs for Hawaiian children and Hawaiian families," said Diane Plotts, chairwoman of the Kamehameha Schools board of trustees.
But lessees contend that they are not taking the land from the landowner, because they compensate the lessors for the fee interest. They said the law is needed to give them the tools for home ownership and to avoid losing their homes because of high lease payments.
George Heil said he bought his Waikiki condominium on leasehold land and has applied for conversion to fee simple.
"I applied, have been approved, sent my $1,000 in, employed a lawyer with 28 others in the Wailana (condominium), and we are now at the stage of nothing because of (Bill 53)," Heil said. "I think the timing is bad, and they should give those applicants that applied ... a chance to purchase."
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