Kakaako street dispute headed for hearing

A state board decided Wednesday to retain a legal expert to officiate a dispute over poor pavement conditions and parking restrictions on several privately owned streets in Kakaako.

Hawaii Community Development Authority board members voted 6-0 to hire an arbiter to hold a contested-case hearing to rule on whether the agency can compel the owner of the streets to pay fines now totaling $352,500 under a year-old state law aimed at resolving a situation that has riled numerous area business owners and residents.

HCDA’s board voted to have a legal expert conduct the hearing following impassioned public testimony at the agency’s meeting Wednesday.

“I am scared,” said Mai Frascarelli, the owner of a Shell gas station bordering Queen and Kawaiahao streets and Ward Avenue. “I really need your help.”

Frascarelli said two brothers, Cedric and Calvert Chun, who operate Kakaako Land Co. and charge for parking along several streets, rent out one stall that partially blocks one of the station’s driveways. “It’s hard for me to run my business,” she told the board.

Frascarelli, who has operated the station since 1982, also said she owns a spa on Kawaiahao Street where Kakaako Land rents out a stall where cars obstruct the spa’s front door.

Chuck Garner, owner of Chuck’s Corvette Clinic on Queen Street next to the Shell station, said the Chuns recently told him they plan to take over 12 stalls that Garner reserves for his customers in front of the body shop.

“It would put me out of business,” Garner said. “Parking is at a premium in Kakaako.”

Discord over parking claimed by Kakaako Land has been growing since 2010 when the company began charging to use stalls along portions of eight streets to which Kakaako Land acquired ownership deeds in 1985 from the last remaining heir of Charles S. Desky, a man who subdivided sections of Kakaako more than 100 years ago.

The move by Kakaako Land upset many businesses including some that had long reserved street parking for their own use. Business owners complain that Kakaako Land patrols its streets with tow trucks that frequently remove cars parked without permits. Business owners and residents also complain that the company hasn’t kept the roads in good condition since the city ceased maintenance after Kakaako Land began restricting parking.

State lawmakers created a law last year that pressures Kakaako Land to quit charging for parking. The law requires that privately owned streets in Kakaako meet city construction and maintenance standards, which include sidewalks and storm drains that are largely absent from Kakaako Land property, if the owner charges a fee for any use and the streets have been used by the public for at least six months.

The law, Act 009, allows HCDA to impose a $500 daily fine per street. Since Jan. 16, Kakaako Land has been accruing fines for five streets: Queen, Kawaiahao, Ilaniwai, Cummins and Clayton streets. At $2,500 a day, fines totaled $352,500 as of Wednesday. Kakaako Land also claims to own whole or partial segments of Kamakee, Waimanu, Curtis and Dreier streets.

HCDA sent Kakaako Land an order in April to pay $250,000 by May 15. In response, the company requested a contested-case hearing and argued that the law is unconstitutional in part because it discriminates based on a specific geographic area and doesn’t apply to the owners of other private roads in Kakaako.

“Act 009 was tailored to only apply to KLC,” Jonathan Ortiz, a Honolulu attorney representing Kakaako Land, wrote to HCDA.

On Wednesday, Sen. Sharon Moriwaki and Rep. Scott Saiki urged the board to carry out a hearing expeditiously.

Bob Emami, owner of The Car Store on Kawaiahao Street, said some business owners have been filling potholes themselves on Kakaako Land streets he considers to be in shameful condition.

Emami also said he has one employee devoted to making sure unsuspecting customers of his don’t leave their car in any stalls reserved by Kakaako Land.

“I deal with this every single day,” he told HCDA’s board. “The businesses and residents of Kakaako have suffered long and hard due to the greedy actions of Kakaako Land Co.”

One agency board member, Phillip Hasha, who owns a business in Kakaako and attested to Emami’s description of the situation, abstained from the vote.

HCDA estimates that its hearing could take place between July and October. A decision by the arbiter could, however, lead to an appeal in state court.