Kyo-ya ruling vital lesson in variance limits

Rules are not made to be broken, or at least not without a very good reason.

So said the Hawaii Supreme Court last week in a stunning decision that correctly buttresses land-use rules as tools to manage urbanization.

The case should resonate as a cautionary tale for developers, as well as the government regulators and officials who make the decisions, particularly at a time when variances from rules are being pursued all over the Hawaii map.

And it ought to convey satisfaction to the citizen groups who stood up to assert the law, and to others who might now find the resolve to do the same.

The variance Kyo-ya Hotels & Resorts wanted — which the city ultimately granted — would depart drastically from the height setback from the shoreline.

Kyo-ya argued that the special design district ordinance passed in 1976 to protect Waikiki excessively constrained its plans to redevelop the Moana Surfrider Diamond Head Tower.

The problem was the magnitude of the change, authorized when David Tanoue, then Honolulu planning director, granted the partial variance from the district rules in 2010.

The original, aging eight-story structure would be replaced with a 26-story hotel and residential tower, one that would encroach by 74 percent into the height setback area, a provision of the design district rules intended to keep some measure of openness along the beach.

There are, under the design district rules, three criteria required in order for a variance to be granted. In a 5-0 decision, the justices ruled that none of them were met.

Those conditions for approval:

>> The applicant would be deprived of the "reasonable use" of the property.

>> The variance was needed because of "unique circumstances" faced by the applicant.

>> Approval of the project would not alter the "essential character of the neighborhood" or be contrary to the purpose of the special ordinance.

Tanoue had granted the variance based on his own analysis, accepting the Kyo-ya arguments.

These included contentions that the narrowness of the lots constrained development, especially as it was bounded on one side by a historic structure, the Banyan Wing, and the fact that the setback issue was made worse because the state had failed to meet its commitment under a 1965 agreement to restore beach lost to erosion.

Among other findings, Tanoue reasoned that the shoreline may move seaward by about 40 feet under a pending beach maintenance project, and that the "encroachments will be reduced substantially."

Clearly, the state’s high court wasn’t buying it, and the justices’ reasoning was clear.

To begin with, they said in the decision, "an applicant for a variance is not deprived of the reasonable use of its land or buildings simply because the applicant may not be able to utilize the maximum potential density of the site."

This is the rational way to construe a special design district ordinance, since its purposes include managing the density of further development.

One of the key components of the ordinance was the shoreline setback, and a tower that closely abutted the shoreline is, in fact, contrary to that purpose.

Credit goes to the environmental organizations for making the right arguments all the way up the ladder — from the Department of Planning and Permitting, to the Zoning Board of Appeals and through the court system.

The plaintiffs — Surfrider Foundation, Hawaii’s Thousand Friends, Ka Iwi Coalition and Kahea, the Hawaiian-Environmental Alliance — have set an example of the power and importance of citizen advocacy.

Waikiki plainly did not develop with the forethought it deserved. The rapid growth of the tourism industry fueled construction at a feverish pace, especially in the post-statehood era when the aim was to capitalize on Hawaii’s lure as a visitor destination. That generally meant maximizing the density of the development.

Belatedly, the city sought to soften that mistake, adopting rules that were meant to moderate growth and redevelopment going forward.

Constantly bending the rules simply defeats the protection that the nearly 40-year-old ordinance was meant to convey.

Redevelopment is continuing through Waikiki and in other special zones — the urban waterfront comes to mind, where variances have sought allowances for everything from reflective windows to exemptions from park requirements.

Developers, but especially the government officials who serve as the land-use gatekeepers, should listen carefully to the message from the state Supreme Court.

Variances are meant to be the carefully justified exception, rather than the rule.