Punaluʻu Problems: Opponents of the redevelopment of Black Sand Beach, in the Big Island district of Kaʻu, celebrated in mid-May when it seemed the former owner, S M Investment Partners, LLC, had successfully sued the developer for foreclosure.
But the relief was short-lived. In late May, 3rd Circuit Judge Henry Nakamoto issued an order dismissing all claims. S M attorney, Lincoln Ashida, was reported to have told the Hawaiʻi Tribune-Herald, “They own the property free of any encumbrances or outstanding loans or anything.”
But satisfying the indebtedness to the lienholder may have come at the cost of paying attorneys representing Punaluʻu Black Sand Beach’s service utility, Punaluʻu Water and Sanitation, LLC, before the Public Utilities Commission. On May 28, the PUC, taking note of the court’s actions, asked for an update on the company’s financial health and “any other information that may be relevant to PWS’s ability to provide continued operations in the near- and long-term.”
Two days later, on May 30, Wil K. Yamamoto, of the firm Yamamoto Hetherington, notified the PUC that it would be withdrawing as counsel for the utility: “The undersigned is informed by PWS that it intends to proceed pro se going forward. PWS has indicated that it will respond directly to the commission.”
This isn’t the first time the utility has sought to represent itself. As Environment Hawaiʻi reported in March, it engaged Yamamoto Hetherington earlier this year, following a “pause” on its 2024 rate request so as to avoid paying attorneys and consultants.
On May 8, the PUC approved a temporary rate increase of 2,795 percent, allowing PWS to collect over the next 12 months about $639,000. For the last couple of decades, the utility had received around $22,000 a year to manage its sewer and water systems that serve the owners of condominiums in the area. Over that time, both systems suffered from a lack of maintenance and the rate hike was supposed to allow the developer, owner of the utility as well as the land, to make urgently needed repairs and upgrades.
Whether the utility is able to continue operations at this point would seem to be an open question. Comment was sought from the utility, but no reply was received by press time.
Marconi Update: On May 12, U.S. District Judge Jill A. Otake overruled objections by Makai Ranch, LLC and related companies owned by Jeremiah Henderson, III, to Magistrate Judge Wes Reber Porter’s March 28 order denying their motion to amend for the third time their complaint against the City & County of Honolulu and its Department of Planning and Permitting.
The complaint, originally filed in May 2023, seeks to avoid having to apply for a Special Management Area permit for further development of the Marconi Point Condominiums property on Oʻahu’s North Shore.
Later that year, Otake granted the city’s request to dismiss claims related to building permits the companies argued they are entitled to.
In their most recent motion to amend their complaint, the companies argued that new evidence revealed late last year during discovery supported the reinstatement of those claims.
Porter’s order, however, “concluded that Plaintiffs had not demonstrated the requisite diligence in: (1) seeking discovery of the New Evidence, and (2) moving for leave to amend after reviewing the New Evidence. Judge Porter also rejected Plaintiffs’ argument that the Supreme Court’s decision in Loper Bright Enterprises v. Raimondo, 144 S. Ct. 2244 (2024)—which overruled Chevron deference—justified leave to file a third amended complaint,” Otake stated in her order last month.
She found that Porter did not clearly err in his conclusions.
“To be clear, the Court did not engage in a Chevron analysis in its Dismissal Order; there was no ambiguous statute at issue and the Court wasn’t deferring to Defendants’ interpretation of such a law,” she wrote.
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