Steering Growth - Extended Version
6 Leaders Discuss Development in Hawaii
Read the shorter, edited version of this forum here
(page 6 of 7)
Anderson: And we are also going to subsidize the rail in a number that we don’t understand or appreciated yet. Feeding counties is going to need an awful lot of subsidy dollars. Where does the city and county get its money from basically? Real property tax. They’re not going to get real property taxes to pay for all these subsidies and all their other rising labor cost etc. From affordable housing on some kind of incentive program and/or cheap rail stops. They’re going to generate the dollars that they need by some growth. I mean so do they stop development? Stop the real property tax income? Then how do they pay for all these subsidies? I mean we’re kind of caught in a Catch-22 in some of these things. The subsidies that we’re going to pay for transportation minus the car are astronomical.
Yukimura: If you haven’t done Kapolei, what kind of public monies would you have had to invest in transit and Kakaako and development here?
Anderson: I like Kapolei.
Yukimura: No, it’s not about Kapolei, it’s a conceptual thing. It’s about making choices on where you put the public money.
Anderson: Why are you negative about our city and our state? I kind of like us. I really think I live in a great town. Honolulu to me is exciting. It’s providing economic growth. It provides for my children and my grandchildren. It provides for me and I got a couple hundred employees. I mean if I want to go to Waikiki knowing what it is, I’d go there. If I want to go to the North Shore and get stuck 45 minutes going down three miles because of turtles, I’d go or I don’t go. But we planned 25 years ago, longer, for the Second City. We’re talking about intelligent planning a little while ago. There are some people today out there trying to block off some of this Second City destination area that we shouldn’t build homes there anymore. I mean if government does plan intelligently and then the activists or the conservative person, or whoever comes in, and wants to change it all, you can never plan. I mean you got a plan. You do it right, hopefully. You make a decision and then you live with it.
Burris: One of the big ironies there as a Second City – the whole idea that was build a place where people would live and work and not commute back and forth.
Anderson: All our people work in town.
Doane: And that part of it didn’t work.
Kane: I was going to ask Mr. Doane for his comment: Is there a tipping point? Take for example, if UH-West Oahu were to happen, is there a tipping point where there would be a massive redirection of flow (of commuters)?
Doane: I think there is going to be. It’s going to take a while. I don’t know, what’s your opinion on it?
Kane: I don’t have a good feel. I feel like if UH-West Oahu comes along, if Kalaeloa develops into what it potentially can.
Doane: The Family Court is out there. I’m not sure if rail is going to work or not. I hope it does, but it’s like there’s two times to play on a tree: 20 years ago and tomorrow. I’m going to wish we had had the rail 10 or 15 years ago. I really wish we had because I don’t know if it would make it better, but it’s the only alternative that I’ve seen that could make it better.
Yukimura: That’s right.
Anderson: Or building more freeways.
Doane: And I think we’ve got enough of those. I wish we had done it 10 or 15 years ago. It’s going to be another 10 years before it goes, but I think it’s the one option we do have to take a situation that is going to get worse even with rail, it’s just not going to be as worse as it would be without rail.
Yukimura: But if gas goes to $120 or $150 a barrel, well, it’s going to cost more to build the rail. But people are not going to be able to drive their cars. They’ll have a hard time commuting to Kapolei.
Anderson: Mayor, I guess I’ve heard this, people are not going to be able to afford to do something and the economy is bad and I go into any home from Manoa to Waikiki to Kahuku or to Waianae: Every Friday night, dad’s got his beer; every kid down to 10 and 11 years old had a damn cell phone; every kid’s got computer games. If things are so bad, where are these people getting this disposable income to buy things that you would think they’re second or third priority?
Yukimura: On Kauai, people buy cars because they can’t afford a house. They don’t have any prospect in owning a house so they buy a car. And the other piece of the formal housing solution, and Micah knows this well, is mortgage-ready families. And there are a couple of wonderful homeowner programs that are teaching families to be mortgage-ready. But we have had situations where there are houses available and people are not ready yet and so that’s the human factor. The solution to affordable housing is not just one thing. It’s doing proper public requirements for developers and it’s about developers stepping forward to do their share and it’s about creating mortgage-ready families, which in this day and age of credit cards and unbelievable personal debt, we have to shift again.
Photo: David Croxford
Doane: I think that some of the things that people have disguise real problems. I don’t know whether it’s 20 percent or 30 percent. But there is a major element and it’s not just Hawaii. It’s just about everywhere you go. There is a fairly large element of the society that right on the edge at all times and there’s a smaller element of society that’s over the edge and whether they’ve got video games or they got a car on credit or something, there’s some deep problems there that get camouflaged by maybe some of what you might be seeing with these folks, so I do subscribe to the fact that there’re some very basic issues. The difference to the most part in Hawaii is you see it. You see it more here. In some places (elsewhere), it could be 20 miles away. Here, all you got to do is drive a quarter-mile or half-mile or you might be in the middle of it somewhere or maybe your friend’s friends. I do subscribe to the fact that there are issues.
Kane: I think Ms. Yukimura’s point shouldn’t be lost and the case in point is what is happening right now on Kauai and DHHL (Department of Hawaiian Home Lands). There are available loans in the $140,000, $150,000 price range right now for anybody who jumps on that list. The problems are qualifying for a loan, getting their FICO scores up, and getting consistent income. Obviously the pre-qualifying requirements have hiked up substantially over the last 6 months to a year.
Anderson: In the $140,000, how far below market description definition on Kauai? What’s the market on Kauai?
Yukimura: Let’s see for a family of 4 people, median income was about $65,000, so whatever you can afford with that.
Anderson: Not much.
Hawaii Business Publisher David Tumilowicz: You know one of the things that hasn’t come up explicitly, although it’s been alluded to a couple of times: Mr. Doane talked about in the kind of economic context the national and international and they’re all part of the formula for DHHL success was to make affordable housing with economic development and, Mayor Kim, when you refer to the root of the problem, we can look at controlling housing cost or we can look at raising people’s income, so I’m wondering if you all would comment explicitly on the connection between economic development and land development.
Yukimura: If you’re thinking of economic development, we have to go the issue of education and I think that is going to be the subject of another of your forums, but the level of public education where I think 27 percent or 30 percent of the 9th graders are not graduating from high school, in a world where the college degree is the standard. If you don’t have good public education, the future is very dim. And it factors into all this, being about mortgage-ready families, health – there’s a huge correlation between level of education and health – all of that. So to me that’s the bigger connection than economic development is to development?
Kim: What we have done in past couple of years really identifies what our values are or what we’re willing to pay for and not willing to pay for. For example, yesterday’s news that the state is contemplating raising the one-way bus fare for kids by $1.50 to $3 a day. The way the university system has changed in regards to tuition. After all the threats and in a multitude of other things that reflect what kind of values that we have that devalue ourselves to this lifestyle. I’ve come down to this: It is simply us in the community who determine what kind of lifestyle we want, and we need to aim for and dream about and work for it. There is no simple answer here. It’s going to take both government and business to identify those things, for government to set certain kind of rules that will enforce some kind of things that we collectively identify. I was going to make a crack when Andy was saying about this and then and I said, “Andy, I’ve lived like that, too,” but you’re the guy with resources, and Jerry ,I want to be friends with Andy. I think Hawaii is the most beautiful place on God’s given Earth. But that don’t take away from the simple fact that we have a quarter of a million people here on this island for whom survival is day to day. And your answer is absolute: because a person buys a toy for a kid or has beer in the weekend or whatever whenever. You just haven’t been there.
Anderson: I haven’t been there?
Do you like what you read? Subscribe to Hawaii Business Magazine »