Geothermal relocation funding requests moving forward
Neighbors of Puna Geothermal Venture might not have to wait much longer to get money for their homes as Hawaii County catches up on the flurry of relocation requests it received over the past two years.
The county has 27 pending requests with the relocation fund, established in 1996 with geothermal royalties to purchase homes of people adversely affected by the geothermal power plant, finished about four years earlier. Many came in during 2012 when more homeowners became aware of the option when geothermal again became a hot political topic.
To handle the influx, the county Planning Department contracted with Prudential Orchid Isle Properties — recently purchased by Clark Realty — earlier this year to process the requests and help make property value determinations.
Progress has been slow, but it could soon pick up.
Rose Delfin, Realtor with Clark Realty, said she expects to soon contact homeowners in the first group of five that the county plans to purchase.
Delfin said the large amount of paperwork that goes with it and the transition to new ownership were both reasons for the slow progress.
“Everything right now is a work in progress,” she said.
The relocation program allows for homes to be purchased for up to 130 percent of their assessed value. To date, each of the five homes purchased under the program have been bought for that amount, for a total cost of $646,407.
Four have been re-sold for a total of $216,100.
Joaquin Gamiao, planning administrative officer, said homes in good condition will likely be purchased at the full amount allowed.
Relocation applicants say the higher purchase price helps them cover what’s left on their mortgage, particularly if more is owed than the homes are worth.
After being purchased, each home would then be auctioned, with proceeds going back into the fund to cover additional acquisitions.
How quickly the county can move through the pending requests will likely depend on auction proceeds.
Currently, the fund has nearly $2.8 million, not counting $1 million that’s held in reserve. The Planning Department plans to purchase five homes at first, and acquire more when, or if, it has the funds.
In total, the Planning Department estimates the 27 requests will cost more than $5 million, based on a purchase price of 130 percent of assessed value, Gamiao said, which could result in the purchases taking years to resolve.
The relocation fund receives about $600,000 a year from geothermal royalties.
The County Council has also authorized the fund to be used for “community benefits,” such as capital projects and other services for lower Puna.
But with so many pending requests, Gamiao said there isn’t enough for other uses.
Previously, the fund had been tapped for a Pahoa council office and by Hawaii County Department of Parks and Recreation for security at Isaac Hale Beach Park and the Pahoa Community Center.
Parks and Recreation has since funded those services from other sources. The council office is being relocated to a county-owned building.
The requests will mostly be dealt with on a first come, first served basis, with those who purchased their homes before 1989 given priority.
Of the requests, two involve homes that were purchased in 1988. Of the other 25 homeowners seeking relocation, 21 bought their homes since 2000.
One purchased a home in April and applied for relocation in July. Another lives in Arizona and bought the home for a retirement property.
Gamiao said each of the 27 requests meet qualifications, which are essentially that their is a home on the property. Two others were rejected because they involved vacant land.
Previously, the Planning Department had limited relocations to homes purchased before Oct. 3, 1989 and are within a mile of PGV.
But since then, the ordinance had been interpreted to only give those properties preference.
All of the pending requests appear to involve land within about a mile of the plant.
On the application forms, not all give reasons for their requests.
Those that do cite issues over noise and health effects, with some writing that they felt duped about impacts from PGV when buying their home.
Michael Hale is one of them, writing that he felt a “bit hoodwinked.”
Hale, a 43-year-old business consultant, bought his home in Leilani Estates in 2000 and said in a phone interview that the humming sound from the plant at night is a constant irritant.
“It became a problem actually the first couple of weeks of moving in,” he said.
“It was basically you hear it every night.”
Hale said he lives in a low spot and worries about the possibility of hydrogen sulfide, which is denser than air, leaking from the plant and collecting near his home.
He said he was aware of PGV when he bought the home but didn’t know it was that close.
“I didn’t realize I was going to hear it,” Hale said.
He said he would have a hard time selling the home on the market with more awareness of PGV, and thinks the relocation fund is a good option for homeowners in the area.
Whether he sells to the county, will depend on how much it can offer.
“Basically, I’m kind of looking at it whether it pays my mortgage or not,” he said.
“If their offer comes in and it can pay my mortgage, I can do it.”
Jeffrey and Portia Ownbey said they believe the 130 percent rate is fair.
“I don’t think anyone should feel bad for relocating,” Jeffrey Ownbey said.
“I don’t want to move. You got to protect yourself and your family.”
The couple moved to their home on Lauone Street in 2011. At first, they didn’t hear the plant.
But that changed shortly with drilling that lasted for months. Jeffrey Ownbey described it as “living next to an airport.”
Afterward, the couple said they noticed a humming sound from the plant that hasn’t stopped since. They also noticed a rotten-egg smell, a sign of hydrogen sulfide, during heavy rainfall.
“We thought we were making a good decision,” Jeffrey Ownbey said.
“We figured it would be the last place we’d buy.”
Noise levels at PGV can exceed 56 decibels — the plant’s authorized limit is 70 decibels.
Mike Kaleikini, senior director of Hawaiian affairs at PGV, said the plant is still looking at adding noise-reduction barriers to dampen the sound. Additionally, he said PGV supports efforts by the county to increase hydrogen sulfide monitoring, though it believes current levels are adequate.
“Personally, I think we were doing a very good job of the monitoring and the capabilities that we have,” he said. “But again … we support the county’s initiative to have additional monitoring.”
To prevent abuse of the program, Gamiao said the county will prevent the homeowners from applying for relocation again. It also may take additional steps to prevent sellers from stripping their homes, as was apparently done with the last relocation in 2012.
Still, any other safeguards or restrictions may be politically difficult to achieve.
Puna makai Councilman Greggor Ilagan introduced a bill last May that would have prevented additional relocation requests from being accepted within 90 days of its adoption.
Ilagan said he received a backlash against the bill from constituents and removed it from consideration.
“I didn’t want to see people buying foreclosed property and then turning it around and relocating them and taking advantage of the county,” he said.
Ilagan also said he was concerned about the large number of requests preventing the funds for being used for community benefits. He said he doesn’t have plans to bring forward any other legislation.
“I think it was difficult because it’s a touchy subject,” Ilagan said.
Email Tom Callis at email@example.com.