Ka Wai Ola - Office of Hawaiian Affairs, Volume 11, Number 2, 1 August 1994 — Panaʻewa homesteaders seek solution to housing nightmare [ARTICLE]

Panaʻewa homesteaders seek solution to housing nightmare

by Deborah L. Ward Pana'ewa homestead families are preparing to file a $7.4 million suit for summary judgement so their homes ean be repaired, removed or rebuilt. The families say they took out 30-year mortgages in good faith for quality homes that inspections later showed to be substandard. Negotiations with the Department of Hawaiian Home Lands have not produced fair and acceptable solutions, say Pana'ewa family representatives Kepā Maly and Rhoda Simeona. This spring the state Legislature passed a measure appropriating up to $3 million from DHHL's administration account to be spent in fiscal year 1994-95 for repair, removal or replacement of the Pana'ewa homes; or allowing DHHL to make a direct settlement with the Pana'ewa homeowners. DHHL has said it was not specifically directed to replace the homes. Original price of the Pana'ewa homes was between $63,000 and $75.000. In April. DHHL offered eaeh family approximately $40,000 cash, but homesteaders said this amount would not cover

the actual cost of needed repairs to bring the houses up to code, whieh is closer to $70,000. This does not cover additional costs for defective septic tanks, electrical and plumbing systems, or roofing. In some cases, they say, the homes need to be demolished and rebuilt. DHHL made subsequent offers to buy back the homes at 7 3/4 percent per annum from the homesteaders until they ean relocate; to move homesteaders to lots in Keaukaha along the Hilo airport runway, or to smaller lots in Pana'ewa; or to put them on a priority waiting list. These alternatives were unaeceptable to the homesteaders. They felt that the first alternative would result in depriving other families on the waiting list from obtaining their award of a residential lot. or plaee the Pana'ewa families back on the waiting list without addressing the issue of the construction defects. The second alternative contained too great a disparity between the sum offered in settlement and the estimated costs of repair, they said. Kepā Maly, Pana'ewa homesteader and member of the

Pana'ewa Residence Lots, Units 3 and 4 residents' committee, said "We are a tight-knit community. We know everyone there. We have fought together for better homes. We don't want to move. We want the department to take away the defective homes and build the homes we originally expected. "Our lives are in limbo. Will HUD step forward and take action on their investment? Will Bank of Amenean foreclose on us? Will DHHL try to evict us from our homes?" Earlier this year the families sought to negotiate with the Department of Hawaiian Home Lands on a solution to the dispute. The families were required by DHHL to participate in facilitated meetings as part of negotiating a settlement to resolve the longstanding dispute. Since DHHL and the Hawaiian Homes Commission had attorneys present, the homesteaders had to retain legal counsel as well. Although DHHL had ai ranged the meetings, they denied the homesteaders' request to defray the cost of their participation, according to the testimony of home-

steader representatives Simeona and Maly. The homesteaders later withdrew from the meetings because the costs were averaging about $2,000 per meeting. They later asked for and received funding from the Office of Hawaiian Affairs to cover those legal costs. The Board of Trustees voted to appropriate $26,300 in trust funds at its June 24 business meeting. The 45 families have agreed to repay the sum if they receive any money as a result of pending litigation. DHHL has since directed the homesteaders to talk to its special

counsel. The homesteaders told the OHA Board that the official inspection commissioned by DHHL and the Hawaiian Homes Commission found, among other things, that 90 to 95 percent of the construction failed to comply with applicable contractural agreements between DHHL, HUD, HFDC, Bank of Amenea, the general contractor and the homestead families, and that the construction violates federal, state and county building codes. That estimate put repair costs at a minimum of $49,000.