Woo vs. Harmon - Witness Everett Dowling

David C. Farmer, Successor-Trustee vs. Harmon

(Formerly Woo vs. Harmon & Nicholson vs. Harmon)

U.S. District Court For the District of Hawaii

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DEFENDANT’S WITNESS

EVERETT DOWLING

Maui developer; President/CEO of Dowling Company, Inc., developer of such projects as Four Seasons Hotel Resort in Makena, Kai holu, Kamaole Heights, Residents at Kulu Malu, Villages of Leialii, etc.; publisher of The Maui Weekly; former University of Hawaii Regent.

Everett Dowling
Dowling Company, Inc.
2005 Main Street
Wailuku, MAUI, Hawaii 96793

Email: everett@dowlingco.com

Website: www.dowlingco.com

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THE EVERETT DOWLING PHOTO GALLERY

http://www.dowlingco.com/mauinews/pdf/Spring07.pdf

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NEW DISCOVERY (06-06-08):

June 6, 2008

OHA vows millions for Hawaiians’ housing

The money is bound for the state's Home Lands Department

By Richard Borreca, Honolulu Star-Bulletin

The Office of Hawaiian Affairs has agreed to give the state Department of Hawaiian Home Lands up to $90 million over 30 years to help fund housing projects for native Hawaiians.

In making the announcement yesterday at OHA's boardroom, Haunani Apoliona, OHA chairwoman, said the trustees approved giving up to $3 million a year to the state to help fund housing projects.

"In OHA's 30-year history, there has been no other OHA-DHHL financial partnership on the scale and magnitude of this one," Apoliona said.

Gov. Linda Lingle said the partnership will help the state to build homes for native Hawaiians and also help the state economy.

"The infusion of capital into the construction industry helps to preserve jobs in all sectors of our economy," Lingle said.

The OHA money will go to cover the interest payments for up to 30 years on revenue bonds used to fund a portion of the Hawaiian Home Lands construction budget.

The bond money goes to build housing projects across the state. According to Lloyd Yonenaka, a Hawaiian Home Lands spokesman, more than 1,000 housing units are planned and awaiting funding.

The Legislature approved Hawaiian Home Lands' request this year to authorize $100 million in revenue bonds for housing projects.

Lingle said the agreement means that Hawaiian Home Lands will be able to more quickly move to finance construction projects.

"OHA's assistance will enable DHHL to directly touch an additional 400 to 500 beneficiaries over the next 12 to 18 months with affordable housing opportunities," Lingle said.

Asked why the two agencies have not jointly funded housing projects for native Hawaiians in the past, Lingle said the two have previously felt they had "different job descriptions."

"The beneficiaries were saying, 'Why don't we get together?' It takes leadership and vision and they provided it," Lingle said, praising Apoliona and Micah Kane, Hawaiian Home Lands chairman.

Kane said the state has used money from commercial leases of department land to pay for housing projects, but the OHA money goes straight to the state.

"This money is specifically obligated to go to the revenue bond. The money will come to the department as revenue, and it will be applied to the bond," Kane said.

OHA has given $22.3 million to individuals to build homes throughout the state, including ones on Hawaiian Home Lands property.

According to federal law, the Hawaiian Homes Commission is responsible for the "rehabilitation of the native Hawaiian people through a government-sponsored homesteading program."

According to the law, native Hawaiians eligible for housing assistance are defined as those who have at least 50 percent Hawaiian ancestry

http://starbulletin.com/2008/06/06/news/story03.html

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The Blessing of Home Ownership

The Maui News
Saturday, September 24, 2005

By BRIAN PERRY, Assistant City Editor

WAIEHU – Kilakila Kamau was moving into his new home on Friday.

The two-bedroom, 900-square-foot building stood virtually empty, a bare wall in the kitchen awaiting a new refrigerator ready to be lugged from a pickup truck parked outside. And Kamau, a disc jockey known as the "Big Hawaiian" on Q-103 FM, smiled broadly, showing a spacious living room that leads to a lanai and a yard in need of landscaping.

"I'm blessed," he said.

The blessing of homeownership was indeed on the minds of more than 100 people who took part Friday in the dedication of the Department of Hawaiian Home Lands' Waiehu Kou 3 subdivision.

The project developed by the Dowling Co. has 115 two-, three- and four-bedroom homes and lots. Seventy-nine homes are developer-built, and the remaining 36 are ready for owner-builder construction.

Kahu Charles Kauluwehi Maxwell Sr. chanted and blessed the project, thanking Gov. Linda Lingle and Department of Hawaiian Home Lands Director Micah Kane for their commitment to move Native Hawaiians off of waiting lists and onto homestead lands.

"The governor has supported us 100 percent," he said.

Maxwell told the new homeowners they're living in a historic and sacred area, near many burials of their ancestors and on land much fought over by Hawaiians before and after contact with the West.

"You are in a very sacred place," he said. "You are in a very special place that you should honor."

Kane said that while homesteaders and public officials gathered Friday to dedicate the completion of the subdivision, "it's really the beginning for our people."

He said the Department of Hawaiian Home Lands and the Lingle administration are committed to completing many more such subdivisions in the future.

The Dowling Co. already is set to work on nearby Waiehu Kou 4 and the Villages of Leali'i in Lahaina. Waiehu Kou 4 will provide 84 two- to four-bedroom homes and 12 lots for self-help Home ownership housing. Groundbreaking is expected in late October, with homes ready for families in late 2006.

The first phase of the Villages of Leali'i will have 104 homes priced from $127,000 to $242,000. Construction is planned to begin in November with the first homes ready in June.

Kane said the Lingle administration's support of Hawaiian homestead projects is "unprecedented."

He said he views the governor's Cabinet as "just an extension of DHHL."

Lingle said she was honored to be part of the fulfillment of the decades-old promise to provide homestead lands to Native Hawaiians, whom she challenged to work together for their community.

"The vision of Hawaiian people is to make certain the entire community is uplifted," she said.

Lingle said she was saddened, though, by "all that wasn't done for such a long period of time."

She said she didn't want to dwell on the lost opportunities, but she pledged that "those days are over. . . . There are not going to be any more decades of waiting."

In the next 18 months, the Department of Hawaiian Home Lands plans to offer nearly 2,000 leases to homesteaders.

"We're excited about the progress that we're making," Lingle said.

She urged Hawaiians still waiting for homestead properties to get their debt and finances in order so that when their opportunity comes for a homestead property they'll be prepared to qualify for a loan.

James Aki, president of the Waiehu Kou 3 Community Association, was among the first families to begin moving into the new subdivision in late January.

He said he had been on a homestead waiting list for 20 years. Sadly, his mother died a month before she could see her son move into his new home.

"It's been a long time . . . but well worth it," Aki said.

The former Paukukalo resident sold his former home and used the proceeds to move into a four-bedroom, 2?-bath residence. Aki and his wife, Suzie, landscaped their property, and bought appliances and other amenities for their home.

They share their home with a 24-year-old daughter and two dogs. A 20-year-old son is attending college in Utah.

"It's a nice home," Aki said.

Leilani Justice and her husband, Jim, moved into their homestead home in May after living in San Clemente, Calif., for more than 15 years. Leilani Justice was born in Pauwela in 1938 and graduated from old Maui High School in 1956.

She moved to the Mainland, where she met her husband, and lived there for more than 40 years while remaining on the homestead waiting list and nearly giving up hope of being able to return home.

"We never thought it would happen," she said. "I'm so blessed."

Kamau's 7,500-foot-lot is a little smaller than the average lot size of 8,000 square feet. Homes ranged in cost from $99,850 to $169,850.

Living on a Hawaiian homestead property, Kamau will pay $1 a year for 99 years on the leased property. He said his home cost $105,000, and, thanks to financing help from developer Everett Dowling, he didn't need to come up with a down payment or closing costs.

Dowling's company secured $405,000 in federal grants [a.k.a. US Taxpayers] to support buyers with down payments and closing costs. Bank of America provided home construction financing, and Hawaii Community Lending is the project's lead lender, providing mortgage financing for the home buyers.

On Sept. 30, Kamau and his fiancee, Marguerite Young, will say goodbye to paying $1,700 each month to share a Kahului residence with a roommate in the Maui Lani Subdivision. Their housing payments will drop to less than $1,000, Young said.

Now, the couple can look forward to other things.

"We'll fix our house and then get married," she said.

http://www.moolelo.com/home-ownership.html

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Raising Cane

By Rob Perez, Star-Bulletin Sunday, May 25, 2003

UH may buy
regent’s land on Maui
for astronomy site

The way the proposed land deal came together, the University of Hawaii was all but asking for trouble.

It's no surprise, then, that UH administrators are now fending off allegations of insider dealing and a conflict of interest.

What did they expect?

This smells like a classic insider transaction, although UH appears to be getting a good deal in the process.

Still, you have to wonder how it all came about and whether UH is careful enough in trying to avoid such controversies.

This one started like this: The folks at the university's Institute for Astronomy wanted to acquire land for the construction of a much-needed Maui office and laboratory facility on the slopes of Haleakala.

Expanding their existing facility -- an 80-year-old Waiakoa farmhouse crowded with lab equipment and offices -- was not a good solution because the owner of the adjacent property wasn't interested in selling. So institute officials spent several years looking unsuccessfully for a suitable new site. Parcels they initially thought held promise ended up lacking water or other infrastructure hookups or didn't have the proper zoning.

Then, in 2001, Maui developer Everett Dowling, also vice chairman of the UH Board of Regents, came to the rescue.

At a regents meeting in which institute officials spoke of their desire for a new Maui facility, Dowling mentioned that he had commercial property in Kula that was available, according to Larry Sakima, who at the time was the institute's assistant director.

"We had no idea Dowling had that site," Sakima said, "but it so happened that the property had all the zoning and water and infrastructure requirements. ... It was the perfect location."

The location may be ideal, but the circumstances surrounding the deal weren't.

Realizing the potential for conflict problems, Dowling -- to his credit -- sought and received an opinion last year from the Hawaii State Ethics Commission. The agency determined that no ethics breach would occur as long as Dowling did not participate in any discussions or decisions involving the project, either as a regent or as a developer. But the ethics opinion did not appear to address the critical question of whether the potential deal was unfairly steered to Dowling from the start.

It did not question a process by which the university came up with criteria, then determined that Dowling's was the only property that fit the requirements.

It also didn't address how a deal that was supposed to be just a land sale somehow became a broader proposal in which Dowling's company, Kulamalu Science (formed specifically for the deal), also would oversee the project's design and construction.

Why weren't other developers invited to submit proposals? Did UH sufficiently explore other options?

"That's exactly my concern," said Ted Hong, a UH regent recently appointed to the board by Gov. Linda Lingle. "Based on everything I've seen, I think the university administration has overstated the need to put that project on regent Dowling's property."

Real estate brokers on Maui, however, say UH would have few or no alternatives to the Dowling site if time is of the essence. They say other sites are available, but the properties typically would need approvals, which could take years, for a zone change or water development rights.

The brokers also say UH would be getting a good deal on the land price, which Dowling's company has offered at a 4.5 percent discount off the $1.8 million appraised value.

Time also is of the essence if UH wants to remain in the running for a solar observatory project that could bring up to $100 million to the local economy, institute officials say. Maui is one of six sites internationally being considered, and a modern facility with room to expand will be key to attracting the project, said Rolf Kudritzki, the institute's director. Two finalists will be picked later this year, he said.

Kudritzki conceded that questions about a conflict of interest in the Dowling deal were valid, but he believes the university sufficiently addressed those concerns by relying on the ethics opinion, which meant Dowling has not been involved in discussions since the initial overture.

Dowling declined comment, citing the ethics ruling.

Regents Hong and Kitty Lagareta, another Lingle appointee, raised questions about the potential transaction at a recent regents meeting.

As a result, a motion to authorize the administration to negotiate a deal with Kulamalu Science was changed to cover only the land acquisition. It did not include the construction portion of the project.

Instead, the regents instructed the administration to check with other developers to see if they might be interested in overseeing construction. If they are and the price appears to be in the same ballpark as Dowling's, the university will consider using another developer, eliminating the appearance of a conflict on that portion of the deal.

The construction portion represents more than $5 million of the estimated $7.5 million cost of acquiring the land and developing the facility.

The board should be commended for taking the extra steps to deal with the potential conflict issue.

Too bad similar care wasn't shown from the start.

http://starbulletin.com/2003/05/25/news/perez.html

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April 2, 2001

All the Princess’s men

By Rick Daysog, Star-Bulletin

The influence of Kamehameha Schools under the trustees ousted in 1999 was widespread. Here are a few of the key political players connected to the estate.

Former state Rep. Robert Herkes

>> Background: Hotel industry executive who won a seat on the Hawaii County Council in 1983 and represented the Big Island in the state House until last year.

>> What: Until recently was an executive at the estate's Kamehameha Investment Corp. subsidiary.

>> Status: Resigned from the trust and stepped down from the House last year and ran unsuccessfully for Big Island mayor.

Former state Sen. Milton Holt

>> Background: Kamehameha Schools graduate, former trust employee and longtime friend of ex-trustee Henry Peters.

>> What: Trust vendors allegedly laundered $30,000 of Holt's campaign bills in 1996, leading to state and federal investigations. Holt also used his Kamehameha Schools credit card for cash advances at Nevada casinos and to entertain several lawmakers at local hostess bars and restaurants.

>> Status: Served one-year jail sentence after pleading guilty to a federal mail fraud charge.

Former state Sen. Marshall Ige

>> Background: Kaneohe legislator served in House with ex-trustee Peters.

>> What: Wife's company leased agricultural lands in Haiku area from trust. Trust vendors allegedly laundered $18,000 of Ige's campaign debts in 1996.

>> Status: Lost re-election bid in 2000. Interim board canceled Haiku lease due to delinquent payments. Has settled the state's criminal complaint alleging he abused campaign finance laws. Separate theft and money laundering charges are pending.

Larry Mehau

>> Background: Longtime friend of ex-trustee Richard "Dickie" Wong and Democratic Party power broker. Associate of former Govs. John Burns and George Ariyoshi.

>> What: Former trustees paid his firm, Hawaii Protective Services, $470,000 a year to provide security services at Kamehameha Schools' Kapalama Heights campus. Also attended a 1999 meeting with Wong and four state senators who voted to oust then-Attorney General Margery Bronster.

>> Status: Estate's interim board terminated Mehau's security contract in 1999.

State Rep. Joseph Souki

>> Background: Former state House speaker and Maui friend of ex-trustee Lokelani Lindsey.

>> What: Maui developer Everett Dowling paid Souki a $132,000 commission in 1998 after the estate bought a 100-acre Maui parcel from Dowling.

>> Status: Still serving as Democrat representative for Maalaea-Wailuku.

Yukio Takemoto

>> Background: Former state budget director and part of former Gov. John Waihee's inner circle. Resigned as budget director in 1993 after special state Senate committee investigated nonbid contracts issued by Takemoto. Joined the estate soon after as a consultant and was later named principal executive for budget and review.

>> What: In 1998 the state Attorney General's Office alleged that Takemoto helped funnel improper campaign donations from trust vendors to the Holt campaign. The state later determined there was insufficient evidence to charge Takemoto but said he should not have been engaged in political fund raising.

>> Status: Under recent trust reorganization, serves as director of the Kamehameha School's Facilities Development and Support Division.

Former state Rep. Terrance Tom

>> Background: Attorney and former chairman of the House Judiciary Committee. Served with Peters in House.

>> What: Former trustees paid Tom a $4,000-a-month retainer for questionable legal work.

>> Status: Lost re-election bid in 1998. Estate's interim board terminated his legal retainer.

Former Gov. John Waihee

>> Background: Longtime friend of ex-trustee Gerard Jervis.

>> What: Former trustees paid Waihee's Washington, D.C.-based law firm, Verner Liipfert Bernhard McPherson & Hand, more than $1 million to lobby against federal law limiting trustees' pay. Also conducted extensive research into moving the trust outside of Hawaii.

>> Status: Trust Chief Executive Officer Hamilton McCubbin terminated Verner Liipfert last year.

http://starbulletin.com/2001/04/02/news/story3.html

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Everett Dowling is expected to testify with regard to his business, political, professional and personal relationships with Kamehameha Schools/Bishop Estate; Robert Kihune, Gilbert Tam, Sandwich Isles Communications; Hawaiian Home Lands; Joseph Souki; Dan Inouye; Daniel Akaka; Patricia Zell; Karl Rove; Gale Norton; Jack Abramoff; Office of Hawaiian Affairs (OHA); Bank of Hawaii; First Hawaiian Bank; American Savings Bank; Robin Matsunaga; Calvin Say; Henry Peters; Linda Lingle; Bob Awana; Robert Katz; James Haynes; James “Kimo” Apana; Margery Bronster; Maui County Council; Maui County Planning Commission; Lokelani Lindsey; Judith Neustadter Fuqua; Ray Fuqua; Mark Recktenwald; Akaku, Maui Public Television; Oceanic Time-Warner; Steve Case; Guido Giacometti; Ed Case; Jeffrey Case; University of Hawaii; University of Hawaii Foundation; Beadie Dawson; Art Woolaway; Patty Woolaway; Dee Jay Mailer; The Nature Conservancy; The Hawaii Chapter of The Nature Conservancy; Oprah Winfrey; Barack Obama; Faye Kurren; Mary Lou Woo; Steven Guttman; Robert Kessner; James Duca; Joseph Sugarman, The Maui Weekly; George Ariyoshi; John Waihee; Ben Cayetano; Ed Case; Steve Case; Suzanne Case; Jeffrey Case; Micah Kane; James Paul; James Nicholson; David C. Farmer, Dr. Chiyome Fukino, and other entities to be named upon discovery.