Musings: Abuse Chronicles 7

[Owner update at end of post.] Though the phrase Kauai-grown usually refers to plants, it could as easily apply to the process that grows humble little beach cottages into luxury vacation rentals. All it takes is a load of manure, and the signature of county building division chief Doug Haigh.

To illustrate, let's look at Hale Haena, which began life in 1967 as a 720-square-foot, one-story, three-room home — the last house on the makai side of the road before Hanalei Colony Resort. Locals might recall it as the Nishimoto house.

In 1972, the downstairs was partially enclosed to create a little carport, with a washing machine and toilet. And so it remained until March 2004, when it was sold for $550,000, primarily because of its large, oceanfront lot. The house, according to county tax records, was valued at just $64,500 that year.

Within a month, the owner applied for a building permit to perform construction work estimated at $106,000. Under FEMA flood regulations, any project that exceeds 50 percent of the building's value is considered "substantial improvements,” which means the structure must be brought into compliance with flood standards. As the flood hazard certificate states:

“All new construction and substantial improvements will have the space below the lowest floor free of obstructions. Such space will not be used for human habitation.”

The trick, some folks have learned, is to put a high value on the building, and a low value on the construction, so as to fall below the 50 percent threshold. In this instance, Tom Hegerty submitted an “opinion of value,” in which he claimed the house's value was actually four times its assessed value, or $252,975. He based that number on the replacement cost of the house, which he figured using construction costs of $225 per square foot. To justify those square-footage costs, Hegerty wrote:

“The cost of construction in the Wainiha/ Haena area greatly increases because the five single lane bridges on Kuhio Highway have weight restrictions causing the cost of concrete and lumber to increase. I trust this satisfies your concerns.”

But in figuring the cost of adding 465 sq. feet to the house, construction costs of just $50 per sq. ft. were used. This resulted in a total of $89,563, which thus rendered the alterations “unsubstantial.” Doug Haigh signed off on this scenario (scroll to the end of the PDF) and the “unsubstantial” work began. 

 You can see the original ground floor utility room in this picture.

By the time the “unsubstantial improvements” were completed, the house had grown by 672 square feet, and the downstairs had been enclosed, within the flood zone. The carport and laundry room had been converted into two bedrooms and two and a quarter baths.

Upstairs, a new roof was added, along with a new bath. The former kitchenette was remodeled into a “fully-equipped gourmet kitchen with top-of-the-line appliances, custom cabinetry and granite countertops.” The floors were refinished with “beautifully aged zebrawood floors and natural slate, “ while “oversized sliding doors” were installed leading to the new to “ipe wood lanai.” 

At the end of the day, it looked like this. All for under $89,563. 

County flood inspector Don Lutao signed the certificate of occupancy, despite a provision in the county zoning ordinance that states:

Any non-conforming structure [i.e., a house built before the flood law]... may be repaired, maintained or altered in any manner which does not increase non-conformity.

Wouldn't it seem that enclosing the downstairs to make bedrooms would be increasing its non-conformance with the flood law, which is intended to minimize property damage and keep people out of harm's way?

On March 12, 2009, the owners applied for a non-conforming use certificate to operate the Hale Haena transient vacation rental (TVR). Thirteen days later, the planning department granted the certificate, even though the application lacked the documentation of prior use required by law, including a reservation log and proof that transient occupancy and general excise taxes had been paid.

The house was placed on the market in 2009, with a listing that described it thusly (emphasis added):

Hale Haena is a newly remodeled 3-bedroom, 3.5-bath tropical retreat steps from a golden sand beach in the heart of Haena. Private Remarks: County of Kauai (TV-1057-NCU) approved vacation rental. 2008 gross revenues approximately $100K+/-.

The house was sold for $1.1 million cash on Dec. 24, 2009. In just five years, the owners had doubled their money, thanks to $89,563 worth of construction and the vacation rental certificate.

The new owner renewed the certificate on April 29, 2010. Though no subsequent renewal applications were included in the file, the county's on-line TVR log showed it as renewed for 2011 and 2012. The log, as you may recall, was created as a way for citizens to monitor TVR activity and report possible violations. But if it doesn't jive with the planning department file, is it a valid tool? [Update: The owner of Hale Haena has advised me that she is current with all her county TVR renewals and is also up-to-date on payment of her state general excise and transient accommodation taxes. She also uses an on-island property management company. She further contends that she had no knowledge of the property's history until she read it here.]

Musings: Rock Bottom

Former state Rep. Roland Sagum III is due to be arraigned Tuesday on second degree felony theft charges for allegedly stealing rocks from a preserve on A&B's Kukuiula property last year.

Sagum, a former deputy planner for Kauai County turned developer, represented the 16^th District from 2007-2011, when he lost to Dee Morikawa by a nearly two-to-one margin in the Democratic primary. Sagum's contributions in the Legislature included opposing civil unions and introducing a resolution expounding on the cultural virtues of cock fighting. Ironically, he just finished a five-year stint on Juvenile Justice State Advisory Council.

Lealiki Koli, a rock wall builder, is also charged with second degree theft and criminal property damage.

It seems Prosecutor Justin Kollar has been sending an OPA representative to neighborhood meetings, where Koloa residents offered information about the alleged theft, which led to the arrests.

Speaking of rocks, and the prosecutor's office, I was fascinated to read Councilman Ross Kagawa's comments regarding the transfer of money previously allocated for Keiki POHAKU to the Teen Court instead. As The Garden Island reports:

What [Kagawa] has heard from the teens is that the consequences of Teen Court were quite easy, he said, and if the consequences are not severe enough, they look at it as joke and are not worried about going through the program again.

And that made me think of how Ross was let off so easy, as in full on free ride, back when he was managing the Convention Hall and caught doing something he shouldn't. So was this his way of saying he took it all as a joke, because he really didn't have to suffer any consequences? Or is he saying the youth should be held more accountable than he?

Or is he just pandering to a certain constituency, like when he talks stink about the endangered Newell's shearwater, blaming the birds for turning off the lights on the night games, when it was really due to the county's stumbling and bumbling? Yup, Ross made it clear in a recent ocean users meeting that he's a “buck the firds” kinda guy.

Which would be a little easier to swallow if he weren't a lawmaker, sworn to uphold the laws. Not to mention a teacher, who really should be setting a better example about respecting and protecting imperiled species that are endemic to Hawaii — as in found no where else on Earth.

Musings: Bleed It

I couldn't help but raise an eyebrow, then two, when I read Casey Quel Fitchett's "A Letter from the publisher,"  extolling the virtues of new ownership for The Garden Island.

First, she feeds us this crock: “Local ownership with local sensibilities is a positive step for us, keeping money circulating in Hawai‘i and not going out of state.”

Uhhh, last I looked Oahu Publishing Inc. (OPI) is owned by David Black, of Black Press Ltd., a Canadian-based newspaper company.

Then she writes: “Another reporter will also be added initially, and we expect more growth.” But they just laid off business reporter Laurie Cicotello, assistant editor Tom Finnegan and another editorial staffer. So even if they hire one more reporter, they're still down two.

I know it's a sensitive point, because the OPI bigwigs actually stopped the presses 45 minutes into the press run — something you do only if the president has been shot or find a racial slur in a headline — to revise the “Kauai loses last press” story written by  Léo Azambuja. It seems they feared people would think the quality of the paper was declining if they read the truth: that three editorial staffers had been axed. So they just conveniently edited that part out.

That's why it's just a little bit hard to believe Casey when she writes, (emphasis added):

“OPI is committed to assuring The Garden Island remains a functioning, independent daily newspaper.”

Then she gives us this: Another positive for the entire community is OPI’s commitment to community philanthropy.

Mmmm, yeah, that's great, except what about the 25 people in our community who lost their jobs, jobs that some had held for over a decade, because OPI essentially outsourced their work to Honolulu?

Oh, and just to show you what kind of people they are, they didn't call in the folks who were being terminated and tell them they didn't have a job. No, they let them sit there all day as the people who were retained were told they did have jobs. Come 5 p.m., when the management went home, it became clear to those left sitting that they were no longer employed.

Classy.

We would all love to see TGI become a better paper. But it ain't gonna happen, Casey, by stuffing it with Kmart inserts, filler from Honolulu, a weekly business feature from the Wall Street Journal (wtf?) and crisp photos from OPI's "modern marvel" of a press — the one they're using to systematically stifle independent presses around the state.

No, Casey, it will require investing in quality reporting staff, and keeping your mitts off them — yes, we know you're a daily presence in the newsroom, where publishers should not be — so they can do their job.

Though I am a perennial optimist, I don't see that happening.

Because David Black didn't buy TGI to beef it up, but to bleed it.

Musings: Abuse Chronicles 6

Crank up the B-52s, because “we're looking for the Love Shack, the love getaway....” How do you get away with running a vacation rental, one that is advertised in at least a dozen places on the Web, and booked into December, even though you haven't renewed your Kauai County TVR permit since it was issued in 2009? Or even get the TVR permit at all, without supplying the necessary documents?

The same way you get away with transforming a plain Jane studio into the Love Shack — a “sleeps four” luxury vacation rental — through the use of “unsubstantial improvement” building permits, thus skirting flood and septic requirements. 

And the same way you turn the Love Shack's tar paper-roofed shack — built without a permit — into a single-family residence. All in the flood zone, sandwiched between the narrow road in Haena and the sea. “Just steps to the ocean,” the ads extoll, though they don't mention those big north swells.

That's when, as the B-52s would wail, “The whole shack shimmies! The whole shack shimmies...”

But let's back up for a bit, to 1980, when a 1,088-square-foot studio — the future Love Shack — was built. The Department of Health found the cesspool was 50 feet from the water, and so allowed it, though with a dye test to determine it wouldn't pollute the ocean. 

In 1983, a slab was poured and a tiny structure placed atop it — the future Love Shack's shack.

“Funky little shack! Funky little shack!”

Now the building department had identified it as an illegal structure — “existing storage” — as early as 1994, and issued a citation, in part because it wasn't elevated 21 feet, as the flood zone required. But years went by, with no change.

Nick Michaels bought the property in 2002. In 2004 he submitted an application for some building improvements in which he identified the illegal shack cum existing storage as a “one-bedroom, one-bath cottage,” built in 1983, when the flood standards were in existence. The county told him to get a certified shoreline, so he pulled back, and the next year put in another application to do some work on the future Love Shack. In these plans, the “cottage” is now being called a “carport.”

In 2007, Michaels submitted yet another application, this time to re-roof the future Love Shack and enclose the 200-square-foot “carport.” The county again said it was an illegal structure, and engineering commented: “Note toilet, etc., this is not just garage and storage.”

Meanwhile, the county engineering department ruled the storage, though built after the flood law, was “grandfathered” from its regulations, and so could remain on the ground. Next followed some wrangling over whether the work Michaels proposed was substantial, meaning he would have to meet flood laws, or unsubstantial, in which he got a pass.

Michaels hired appraiser Dennis Nakahara to weigh in. Nakahara described the carport-storage as an “existing cottage,” one that had somehow grown to 320 square feet, though retaining its T&G walls and tarpapered plywood roof. Nakahara used new construction replacement costs, rather than the structure's appraised value, to make the work fit into the “unsubstantial” category.

Permits in hand, Michaels went to town, first gutting the Love Shack's still-unpermitted funky little shack, and then doing the remodel literally under cover. And of course he had to cut the trees to open up the view even more.

Just about the time he gets finished, the county passes an ordinance regulating vacation rentals in existence prior to 2008. Michaels lines up, like so many others, and submits his application for a two-bedroom, two-bath TVR, as in the Love Shack and its still unpermitted, but much enhanced shack. On his application, Michaels claimed he had used it as a TVR since Feb. 4, 2003 – except he didn't buy it until Sept. 9, 2003. He didn't provide any of the required documentation showing prior rental, either.

Planning records show it was inspected on March 18, 2009, though there's no report, and no inspector is named.   Inspector Bambi Emayo recommends approval, and the county agrees. Meanwhile, the illegal shack, still with no building permit, has somehow become "SFR-2" — as in single family residence #2 — with an approval date of July 9, 2003. Or at least, that's what Michaels claimed in his affidavit, and apparently no one checked, because he got his TVR permit on March 25, 2009.

Michaels never renewed his permit for 2010, 2011, 2012 or 2013. But the Love Shack was rented anyway, to happily oblivious tourists. Well, aside from those who left disgruntled comments on TVR ad sites: 

Comment: Great house but...

Guest: Anonymous (Carlsbad, NM)Date of Stay: 06/12/11 Review Submitted: 10/21/11

…My final issue with the Love Shack is that we stayed there in the middle of June and I am still waiting on my security deposit to be returned, near the end of October. This is not a huge issue but more of an annoyance.

Guest: David & Leigh1 (Phoenix AZ)
Date of Stay: 08/19/10 Review Submitted: 12/12/10

…The Love Shack is as described in the listing. It was the perfect location for us & we thoroughly enjoyed our stay there in August. Would have rated it an Excellent, but it is now December & we still have not received our deposit back even though we've been assured that we would.

We'll let the B-52s weigh in here: "Sign says, Woo, stay away fools, 'cause love money rules at the Love Shack!”

Oh, one last thing: Back in 2004, Michaels applied for a permit to install a 6' 3” high fence along the entire makai side of the property, effectively cutting off public beach access. Citizens fought it, and when the county required him to do a certified shoreline first, he dropped it. But recently, a fence was put up — with no permit.

“Love baby, that's where it's at....

Huggin' and a kissin', dancin' and a lovin' at the love shack....”

Musings: Abuse Chronicles 5

Following the planning department's unauthorized inspection of his house, Councilman Tim Bynum filed a police report, in which he asked the cops to conduct an investigation into whether inspectors Sheila Miyake and Patrick Henriques had trespassed onto his property. I checked with the cops, asking what ever happened with the report, and got this response:

[T]his report remains under police investigation so details cannot be released at this time. Once the investigation is complete it will be sent to OPA. KPD has no timeline of when this might occur.

Meanwhile, the statute of limitations has expired.... I guess they were unable to find probable cause despite Sheila's own admission —secretly taped by former first deputy prosecutor Jake Delaplane — that  former deputy planning director Imai Aiu and county attorneys had raised concerns about her trespassing. As you may recall, Tim faced misdemeanor criminal charges, which were later dismissed, based on Sheila's claim that a rice cooker, as opposed to an installed range, comprised a kitchen, and thus created an illegal multifamily dwelling.

In 2009, planning inspector Bambi Emayo found an illegal multifamily dwelling when he inspected Hale Pohaku, a luxury vacation rental in Wainiha. He noted the following use violations: two kitchens and lockout separating single family residence into two dwellings. One of those units was on the ground floor, which had been enclosed within the flood zone. The violations were confirmed in a subsequent inspection a month later.

But the owner, Tom Brooks, was not charged with any crimes. Instead, he was rewarded with a nonconforming use permit for his vacation rental — a permit that was initially denied, based on the violation. A permit that was later quietly granted,  even though the current web ad for the vacation rental, which has been renamed Pohaku House, makes no bones about it still being a multifamily dwelling:

Totally brand new, this wonderful home features a large living room with a big screen satellite TV and surround-sound speakers, open kitchen with breakfast bar, hardwood floors, and large windows facing the magnificent mountains. A dining area for 6, two bedrooms, and two bathrooms round out the spacious upper living floor plan.   The Lower level features a suite with 2 twins, separate kitchen, and bathroom with Jacuzzi tub and shower combination. A separate bedroom with queen bed, flat screen satellite TV and detached bath with shower stall completes the downstairs.

How is such a thing possible? It seems that when it comes to inspection and enforcement, the county has several categories: regular folks, regular folks with connections, political enemies, and rich people who want to operate a vacation rental.

In April 2011, I published an extensive two-part series on Hale Pohaku on my other site, PIKO. In part one, I outlined how Brooks miraculously transformed a 30-year-old beach house into a luxury vacation rental — an entirely new use with a now fully enclosed downstairs and an additional bedroom, bath and kitchen — using a building permit issued for $60,000 worth of “unsubstantial improvements.” As a result of that “unsubstantial designation,” Brooks never had to upgrade to a septic, and the beachfront TVR, which sleeps 8, continues to use its original cesspool. Here's the photographic evolution of that “unsubstantial” construction:

In part two, I detailed how planning staff had recommended the planning commission grant non-conforming use permits to operate transient vacation rentals to Hale Pohaku and 29 other properties. When citizens presented details about the Hale Pohaku violations — information that had been submitted to the department months earlier — it resulted in a conversation between staff and commissioners that is quite revealing, and well worth a read.

As a result, Hale Pohaku's permit TVNC-1914 was denied, as well it should have been. Aside from the use violations, the owners had failed to submit documentation that the house was in use as a TVR for 30 days prior to 2008. Under the law, such documentation was to include proof of paying general excise and transient occupancy taxes, reservation lists and payment receipts.

The only “proof” offered was a lease showing cash payment for rental Jan. 9-20, 2007 — a time when the house was under construction. In the original sales listing, it was disclosed that the house previously had not been used as TVR. Brooks' application also presented it as a three-bedroom house with "work space," though it was being advertised on the Internet as having either four bedrooms and four baths or a "lower suite" with two twin beds, kitchen and bath.

In 2010, the County Council amended the TVR law it had adopted in 2008. Brooks re-applied. An unsigned, July 13, 2010, field inspection report references a meeting with Brooks' representative. It notes:

Previously existing cabinets and appliances have been completely removed. Note: workroom furnished as a bedroom.

On April 12, 2011, Brooks submitted an affidavit in support of his application in which he swears there “were no expansions, alterations, improvements, or uses contrary to State and County land use and planning laws” — despite the record of violations noted in Bambi's October 2009 inspection.

In May 2011, the planning department acknowledged receipt of Brooks' “completed” application for TVNC-4291, though full documentation of prior use had not been provided. No reference was made to TVNC-1914, and its previous denial. 


An undated investigation report by planning inspector Vill Balisacan noted that a field inspection of Jan. 14, 2009 was recorded on the county TVR log, though no records of that inspection or its report were found. Vill also noted the first application was considered denied on March 30, 2009. Yet he goes on to write:

Based on the applicants prior use as a vacation rental and permit history it is recommended that the nonconforming use certification (TVNC-4291)...should be issued and the use continued....

The permit was issued on Dec. 9, 2011. The house, with its ground-floor, kitchen-equipped "suite,” is now renting for $400 per night.

Musings: Dig Deeper

So the Hawaii Tourism Authority is spending $500,000 on a month-long “blitz” to attract more tourists from urban areas like Chicago and New York. Wonder how much Kauai County spent rescuing those 54 people from Hanakapiai last weekend, where a woman from New York drowned in a flash flood? Not to mention the risk posed to our fire rescue guys, or the damage to the trail from having dozens of clueless tourists tromping through it in the mud.

“Having images of Hawaii and being able to show what the weather is like here is, I think, very powerful,” enthused David Uchiyama, HTA vice president of brand management.

Yes, I can imagine that televised images of dirty, scared, rain-drenched hikers returning to their vandalized cars at the Kee Beach parking lot prompted a lot of folks to book trips.

Obviously, we can't save tourists from themselves. As this video shows, even a Seattle fireman, someone who should know better, was among those who foolishly kept crossing the stream in the rain.

But we can be more honest about the reality of this place, about the risks they face in nature and at their vacation rentals.

Like remember the professional wedding photographers who had $30,000 worth of gear, and images from a couple's recent wedding, stolen from their Anahola vacation rental two weeks ago? And how the owner offered to put up $1,000 for a reward?

It might possibly have been more meaningful for the owner to advise renters that three burglaries had been reported at that particular house since Jan. 1, 2012, according to Kauai police.

And within that little cluster of oceanfront Anahola vacation rentals, at least nine incidents  — burglary, assault, criminal property damage, disorderly conduct, unauthorized entry into a motor vehicle and trespass — have been reported since Jan. 1, 2012, according to police.

As the “blog” on one of the Poha Street TVRs notes, “It pays to stay in Anahola.”

For the guy who are doing the ripping, that is.

I noticed the ad for another rental advised: “All Weddings or party guests must park at the Anahola Beach Park and stroll along the beach to the home.”

Encouraging off-site parking at a public beach is one of myriad ways that the proliferation of TVRs adversely impacts our island.

And as I've been reporting in the Abuse Chronicles — the four covered thus far are only the very tip of the iceberg — many of these TVRS were approved by the county planning department even though they did not meet the legal requirements.

We've seen building permit violations, flood ordinance violations, no inspections, inspections that failed to note violations. We've seen these valuable permits approved, and renewed, even though the owners provided no proof of prior TVR use or other required documentation. We've seen Realtors urging people to apply for permits for which they were not eligible, and possibly engaging in fraudulent representations to help owners secure permits.

In the process, we've seen a dramatic intensity of use as small beach bungalows are transformed into mini-resorts that sleep 12 to 14, often while using the original cesspool. 

Council Chair Jay Furfaro has asked Planning Director Mike Dahilig to attend tomorrow's Council meeting and give an update on the department's TVR enforcement initiatives.

They might want to dig a little deeper, like inquire about how the inspectors are trained, what sort of review is conducted when these nonconforming use certificates — some of them adding up to $1 million to the value of a house — come in for renewal. Because they're rife with what appears to be fraud, and some of the permits should be revoked.

And since these questionable permits were issued under the reign of former Planning Director Ian Costa and his deputy, Imai Aiu, why not invite them in to explain what the hell happened under their watch? After all, they're still working for the county, thanks to the mayor, who transferred them to other administrative jobs, without explanation.

Surely, when you consider the way TVRs have totally consumed the North Shore, and other communities, and the tremendous value these permits carry, we have a right to know why things went down the way they did — and what the county plans to do to set things right. And that includes the prosecutor's office, which is charged with investigating crimes.

Musings: Abuse Chronicles 4

How can something so bold be hidden? I wondered at dawn upon finding the night's brilliant moon totally obscured by clouds. The same question could be asked of the process that has resulted in numerous ineligible properties getting transient vacation rental permits (TVR) from Kauai County.

Today we shine the light upon a three-bedroom, 2.5-bath house that was built, in 1997, for $240,000 and purchased by Geoffrey and Sadie Barish for $1.925 million on Aug. 3, 2005. It is located just off the beach, in Wainiha Subdivision II, which has very specific Covenants, Conditions and Restrictions (emphasis added):

“No owner shall subdivide or re-subdivide his Lot, nor shall any Owner seek a zoning amendment, use permit, variance or any other type of approval which would allow a use of his Lot for other than single family residential use. No commercial activities shall be allowed on any Lot.”

In keeping with that restriction, the Barishes did not use their house as a vacation rental. In fact, they went so far as to pay off agent Gary Fischer, who had been renting it out as a TVR prior to their purchase and had future reservations booked. They didn't give their house a cutesy name, or take out any advertisements. But when Barish went to sell the house, North Shore Properties (NSP) reportedly advised him to apply for a TVR permit under the county's newly passed ordinance for regulating TVRs in continuous use before 2008.

In support of his application, Barish submitted a letter, dated Aug. 19, 2008, from Roberta Haas and Mimsy Bouret of NSP. The letter said NPS had been the property management company for the Barishes since Nov. 1, 2007, and the house, known as Hula Hale, had been part of their vacation rental inventory from that date. The letter goes on to state:

“Mr. and Mrs. Jeffrey Barrish [sic] have had transient guests occupying the subject property in exchange for compensation prior to the effective date of the Transient Accommodation Rental Ordinance with a pattern of consistency that evidences an ongoing and lawful enterprise.”

In further support of that “ongoing and lawful enterprise,” Barish submitted a GE tax license — though it had been closed on Sept. 5, 2005. He submitted no other documents required by law to prove previous TVR use, such as general excise, transient accommodation or Hawaii state tax returns, reservation lists or receipts for rental payments.

But he did include the mandated floor plans for the house, which showed three very small enclosed units had been added to the ground floor — without county building permits, in violation of federal flood laws.

Although the county's TVR log and the property's nonconforming use (NCU) form indicate the house was inspected on March 18, 2009, there is no inspection report. Nor is there any explanation of how it could have passed with such an obvious violation. Nevertheless, and despite the complete lack of documentation to prove prior TVR use, then-deputy planning director Imai Aiu approved NCU Certificate 1059 for the structure in June 2009.

Meanwhile, the Barishes had sold the house to David and Karen Burse, of Los Gatos, Calif., for $1.7 million on March 31, 2009. FEMA also had begun investigating reports that some Kauai County houses were not compliant with federal flood regulations. The Barish-Burse house was one of them, and on May 7, 2010, the county wrote to FEMA:

“Cited by building division for non compliance with the flood ordinance. Property will not receive a renewed NCU certificate for the next year.”

An initialized, handwritten note, dated 6-8-10, is attached to the file stating, “cannot renew because TVR ceased. Since 2009. Has permit submitted.”

On Aug. 26, 2010, then-county engineer Donald Fujimoto sent Barish a notice of apparent flood violation.

On Oct. 12, 2010, after the county had passed a second ordinance liberalizing the TVR permitting process, Burse sought a TVR permit for the “Burse Residence.” As “proof” of former use, he submitted a notarized affidavit that states “On information and belief the former owner operated a transient vacation rental,” and says he is remedying the unpermitted ground floor units. He also includes a copy of the NSP letter that Barish had originally submitted, and a reservations report from NSP that purports to show “arrivals for all complexes between Jan. 1, 2001 and Dec. 31, 2009." However, it lists just 12 arrivals and shows no income to the Barish account.

On Dec. 8, 2010, the National Flood Insurance Program conducted a site visit and noted numerous flood violations on the property.

On Jan. 10, 2011, county planning inspector Vill Balisacan sent Burse a letter advising him of “actions required to complete the TVR registration and NCU form” he had submitted the previous October. The “missing documents” included proof of payment of TAT and GET taxes, and as-built plans for the structure.

On Feb. 8, 2011, Burse sent planning inspector Bambi Emayo a fax, thanking Bambi “for your call and your explanation that we can still apply for renewal of NCU certificate 1059 for the renewal periods of 2009-10 and 2010-11.”

Now remember, this is the same NCU permit that had not been renewed because of the flood violation and also because, according to the initialized, handwritten note in the file, “TVR ceased. Since 2009.”

As has been noted previously, under the county zoning ordinance:

“If any nonconforming use ceases for any reason for a continuous period of 12 calendar months or for 1 season if use be seasonal, then the use should not be resumed and any use of the building or property thereafter shall be in full conformance with the provisions of this chapter.”

With that fax, Burse retroactively submitted a 2009 renewal form, and followed it up with a 2010-11 renewal form. He also submitted GE and TAT licenses that showed a business start date of 11-4-2010.

On Aug. 15, 2011, Burse sent Balisacan another letter, in which he confirmed his Aug. 4, 2011 telephone conversation with Vill and Bambi and writes:

“Mr. Emayo informed me that (1) our application for TVNC 4280 was complete; (2) no further inspection is required because of the previous inspection done in conjunction with the approved (now expired) TVNC 1059; and (3) final approval of our TVNC 4280 application will be granted as soon as we can provide a 'clearance from the Kauai Co. Public Works Dept. which [sic] respect to the Noticed 'FEMA Audit' Flood Violation.”

On Oct. 11, 2011, county engineer Larry Dill sent the Burses another letter advising them of what must be done to bring the ground floor units into compliance with the county's flood ordinance.

Remember that handwritten note? At some point, these words were added: “Renewal affect 10-14-11. Meeting.”

And at some point, Burse apparently got the original 1059 permit renewed — a permit that should not have been issued because it never met the original requirements, a permit that  was out of use for more than a year, a permit that had expired.

On Sept. 24, 2012, his newly authorized representative, Realtor Jane Abramo, submitted the NCU renewal form for “Hale Koaniani.” (She and Coldwell Banker are now in the business of handling these pesky renewals for absentee owners.) Abramo included a note that read:

“We hereby withdraw NCU application no 4280, which was originally filed on your recommendation because of uncertainty at the time of the renewal status of certificate 1059. However, as you explained during our conversation on June 27, certificate 1059 is now “active” and eligible for renewal, and application 4280 was rejected because there cannot be two active certificates for the same property.

To avoid public confusion due to there being both an “active” permit and a “rejected” permit listed for the same property (TMK 5-8-9-052), we ask that you please delete the public listing of NCU application 4280, or at least change the status to “withdrawn” instead of “rejected.”

Musings: Abuse Chronicles 3

Remember Billie Jean King, the tennis star? She had one of the first “fancy” houses on North Shore Kauai, though even with its tennis court and satellite dish, it was relatively modest compared to the mansions that crowd the white sand beaches of Wainiha now. In the years since King sold it, the house has grown, too, tripling in size, with a partially enclosed and furnished "basement." The value grew, too, from a sales price of $1.85 million in 2006 to $4.4 million in June 2012.

In the process, the property skirted federal flood regulations and a shoreline certification and somehow managed to get two TVR permits.  Yes, the former King Hale has become, in vacation rental parlance, the King and the Princess, as in a multi-family rental, each with a separate nonconforming use permit. It's unclear how this could happen, since multi-family vacation rentals outside the Visitor Destination Area (VDA) have always been illegal, and still are.

But let's back up a little, to 1980, when the Kings divided the house into a horizontal — as in side-by-side — two-unit CPR. By the early 1990s, it had morphed, without the aid of permits, into four illegal vacation rentals. Neighbors clamored for enforcement against the mutli-family rental, and the county began investigating. Meanwhile, the structure, and its price, continued to evolve.  Developer Craig Maas bought Unit B in 1998 for $300,000. After putting it through an extensive remodel, for which no building permits are listed, he sold it for $700,000, just 18 months later.

Murray Charlton, an Australian with a misnamed LLC called My Bungalow, bought both units for $1.85 million in 2006. The sales listing identified it as a five-bedroom, three-bath unit, with the caveat, “Property not in VDA, buyer should check with the county on vacation-rental issues…”

On Oct. 31, 2006, Charlton applied for a county building permit to add 4,350 square feet to the structure and make the house whole again. The value of the permit was listed at $256,000. On Aug. 3, 2007, the application was denied as a “substantial improvement” that would require the house to comply with federal flood standards. On Aug. 15, Charlton submitted a second application for a $243,000 remodel — just under the "substantial" threshold — and on Oct. 23, 2007, he got his building permit.

So began the “unsubstantial improvements,” which are also detailed on architect Glenn Forman''s website, that resulted in a much grander house.

Now prior to construction, in July 2007, the county had directed Charlton to conduct a shoreline certification, which is used to determine the structure's setback. The state surveyor came and discovered a revetment of rock and telephone poles fronting the house, on the public beach. He set the shoreline, which marks the extent of the public beach, at the red line marked on this photo.

The owner rejected the recommended shoreline, which would have made him remove the revetment as an illegal encroachment and restore the public beach. He appealed to the county, which inexplicably waived the shoreline requirement. The revetment was left in place, and the beach has since been heavily cultivated with naupaka, causing the once broad expanse to become narrow and steep.

In 2008, the county adopted a bill regulating vacation rentals. Charlton applied for two TVR permits: one for the King Hale and the other for the Princess Hale, which was identified as the ground floor of the King Hale, even though the application noted a remodel project in which "two halves of house joined together."

Neighbors objected, pointing out that it was still under construction, and if it was to be treated as a multifamily dwelling, then a special management area (SMA) permit should have been required for the renovation. Their primary concern, however, was that it would allow ground floor habitation in the flood zone, on a lot with no setback in a hazardous coastal area. But both TVR permits were approved, though planning inspector Bambi Emayo noted “SFR (single family residence) under construction” on his 2009 inspection report.

Meanwhile, the state Department of Health, acting on a tip, cited the owner for installing the new septic tank without a permit on the previously identified public beach seaward of the red line. DOH required the tank be dug up and moved to the mauka side of the house. The resulting hole on the makai side was filled with dirt, rather than sand, and the red clay now leaches onto the white sand of the public accessway and beach.

The house got its final building inspection on August 19, 2009. This picture, taken on July 11, 2008, shows the gutting of the house is well under way, and it is obviously not in use as a vacation rental.

As noted in Abuse Chronicles 2:

“If any nonconforming use ceases for any reason for a continuous period of 12 calendar months or for 1 season if use be seasonal, then the use should not be resumed and any use of the building or property thereafter shall be in full conformance with the provisions of this chapter.”

But since it had been operating as an illegal multifamily TVR, it should not have qualified as a previous nonconforming use.

On June 1, 2012, Charlton sold the property to Hale King LLC, of Berkeley, Calif., for $4.4 million. Curiously, 2013 county tax records  still show the house at its original 1,880 square feet,  and it is described as one building and one dwelling. Even more telling, the property's assessed value is just $2.775 million, which indicates people are willing to pay a substantial premium for permits that allow them to operate commercial enterprises on prime beachfront land. 

Advertisements for the vacation rental, which sleeps eight and rents for $1,450 to $1,750 per night, with a seven-night minimum stay, depict it as having three bedrooms, three baths, a kitchen and living area on the main floor, as well as a first floor guest suite, with a bedroom, sitting area, full kitchen and separate entrance. In short, it is operating as a multi-family vacation rental, which is an illegal use outside of the visitor destination area. So how did they get not just one, but two permits for this illegal use?

The property is also described as a “stone's throw” from the ocean, which may not prove to be such a selling point for the unsuspecting ground floor inhabitants during the next big wave event or tsunami.

Abuse Chronicles 2

As we continue our investigation into idiosyncratic North Shore Kauai transient vacation rental (TVR) permits, our attention turns to two tiny A-frames that were built in 1972, right across the street from windswept Kepuhi Point.

Though they are no longer tiny, having experienced the vacation rental-induced mushrooming effect of so many houses in these parts. One of the A-frames is called Rainbows End, and is owned by Joseph and Patricia Gernard of Texas. The other is called Ka Hale Poo O' Kauai and is owned by Ron Seiple of Oahu and his wife, Mary Elizabeth.

In his Oct. 6, 2010, application to the Kauai County Planning Department for a nonconforming use (NCU) permit to operate a TVR, Seiple submits a notarized affidavit in which swears that he has operated a vacation rental on the property since 1972. Under the county ordinance, a unit must have been in use as a TVR prior to 2008 to qualify for a permit. Seiple also added a note that read, in part:

We have owned this property since 1972. It was a legal [sic] vacation rental managed by Kauai Real Estate and Vacation Rentals, Napali and Prosser from that time until it was seriously damaged by hurricane Iniki [in 1992]. After Iniki we rented this property as a long term rental unit until a few years ago. Two years ago we began a major re-building of our property as it was long overdue.

The “major re-building” he is referencing was a $243,000 expansion that added 2,111 square feet to the existing 1,178-square-foot house. It was allowed under a building permit that was first issued in 2007, revoked on June 24, 2008 and then re-issued on Aug. 14, 2009.

The county zoning ordinance states:

“If any nonconforming use ceases for any reason for a continuous period of 12 calendar months or for 1 season if use be seasonal, then the use should not be resumed and any use of the building or property thereafter shall be in full conformance with the provisions of this chapter.”

Yet despite acknowledging that his property had not been in vacation rental use for the previous 18 years, and had been under construction for the past two years — two admissions that proved the nonconforming use had ceased for more than a year — Seiple was still given a TVR permit. Curiously, the TVR permit was issued before the final building inspection on June 30, 2011.

Seiple clearly had, by his own admission, ceased his non-conforming use for more than a year, yet still he was allowed to resume it. What's more, a review of county tax records show his property taxes are calculated according to the original square footage, not the expansion.

Meanwhile, after the county adopted the first TVR ordinance in 2008, the Gernards applied for an NCU permit to legally operate Rainbows End, which they had purchased in September 2000 for $600,000. In his notarized affidavit, Gernard claims the house had been used as a vacation rental since Jan. 1, 2001, and swears:

“No building permits have been issued since then [the original in 1972]. The house has not been modified since it was built. A previous owner modified a garage storage area to accommodate an “Ohana Unit”. It is not known to us if these modifications were permitted by the county. This “Ohana unit” is presently unused and is being reverted to storage in accordance with the regulations for TVR.”

The county conducted an inspection, as the initial TVR ordinance required, and found that the “ohana unit” was an illegal dwelling unit with a full kitchen — as in an installed range, not just a rice cooker.

The county ordered the Gernards to cease and desist TVR uses on the property, and stop using the storage shed as a living unit. The Gernards also were ordered to “submit plans and applications along with filing fees for review by the department for all illegal construction additions and alterations. Such construction, additions and alterations without proper approval shall be demolished and removed.”

The Gernards responded by getting a building permit valued at $54,000 on May 28, 2009. The Planning Department reviewed the permit and made the comment, “Violation exists.” That permit was subsequently closed. On July 26, 2010, the Gernards were issued a building permit for a lanai, garage and bedroom addition that essentially encompassed the illegal structure into the original 1,577-square-foot residence, enlarging it by 1,234 feet. 

However, it appears that even more work was done, as a current ad for Rainbows End states, emphasis added: "Everything in the 3 bedroom 3 bath house is new." The original house had just one bath. The property is served by a cesspool.

In 2010, the county revised the TVR ordinance, removing the mandatory inspection and other requirements, and allowing agricultural properties to apply. On Sept. 23, 2010, when the house was still under re-construction, the Gernards resubmitted their application. This time, it was granted, on April 5, 2011, even though, like Hale Poo, the non-conforming use had ceased for more than a year. Like Hale Poo, the permit was approved months before the final building inspection, which took place on Sep. 21, 2011, when the certificate of occupancy was also granted. 

And like Hale Poo, Rainbows End was able to accommodate many more guests than in the original structure. Non-conforming uses are supposed to be brought into compliance, not expanded.

A review of the TVR files shows no record of either owner submitting any documentation to prove the houses had been used as vacation rentals prior to 2008, such as leases or a record of paying general excise or transient occupancy taxes. 

Furthermore, it appears that Seiple is currently not using his house as a TVR, which raises the question: are people allowed to “bank” these valuable permits until they're ready to sell the property and take advantage of the higher prices that can be gained by having a lifetime TVR permit? As we saw in the first installment of "Abuse Chronicles," a TVR permit can add $1 million to the value of a house.

Next, the King and the Princess.