Council committee advances Kaloko sewer improvement district

Neighbors of the 1,300-unit master-planned Kaloko Heights development will get a free ride on sewer hookups, thanks to an improvement district initiated by the developers.

Bill Moore, representing RCFC Kaloko Heights LLC, said the developer wanted to move swiftly on the improvement district, which will allocate shares of the cost of the estimated $12 million project to each unit, except for the affordable housing components.

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Rather than spend time negotiating with each neighboring land owner to pay part of the cost of the infrastructure, the developer decided to provide the stub-outs free of charge on the sewer line that will connect the development to the Kealakehe wastewater treatment plant.

Developers want to move with haste because they want to provide sewer service to the affordable housing component of the project, about 100 units on 10 acres on Hina Lani Street between Ane Keohokalole and Mamalahoa highways. Each unit at the Kaloko project would be about 750 square feet and come furnished with a range, oven, refrigerator and solar water heating.

“We’re trying to stay on schedule so this sewer line is ready when (the nonprofit Hawaii Island Community Development Corp.) opens their project,” Moore told the County Council Finance Committee Tuesday.

The council is involved because at some point there will be a county-issued improvement district bond to pay for the sewer project.

But Finance Director Deanna Sako said neither the county’s borrowing power nor its bond rating are affected by the sewer bond.

“Strictly this project will be paying for the sewer line,” Sako said. “We will do an improvement district bond. … That’s the amount that will be paid by the improvement district members. It’s not a cost incurred by the county.”

Nor are taxpayers on the hook because the bond is collateralized by the land, said council Chairman Aaron Chung. He praised the developers for their community spirit.

“We have this huge need for affordable housing, and what you folks are doing is working to address that,” Chung said.

The council Finance Committee voted unanimously to recommend favorably a petition from the developers to form the improvement district, the first step in a process that will involve more updates as the project reaches certain benchmarks in its progress. Resolution 502 faces one more vote at the council level.

In total, there could be as many as seven buildings at the affordable housing site, each of them two or three stories. The development would also include a community center, on-site property management space, kitchen, meeting rooms, mailboxes and laundry facilities.

“The affordable housing project, they will be paying sewer rates but they won’t have to pay for the actual infrastructure,” Moore said. “We’re trying to make it as viable as possible.”

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Hamakua Councilwoman Valerie Poindexter praised the project and its developers.

“You’re going to be a hard act to follow,” Poindexter said. “You’re raising the bar on this and setting the standard for future developments.”

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