This notice is published pursuant to the City and County of Honolulu’s Citizen Participation Plan for the CDBG and HOME programs.

Project Title and Description: Long-term Lease of the Kulana Nani Apartments
Eligibility and National Objective Citation: None
Activity Code: None
Funding Source: None
Phase: None.
Proposed Amount: None
Location: 46-229 Kahuhipa Street, Kaneohe, Hawaii
Proposed Accomplishment: Transfer of leasehold interest to private nonprofit corporation upon terms that preserve Kulana Nani as affordable, multi-family rental project.
Subrecipient: None.

The City and County of Honolulu purchased the leasehold interest in the 160-unit Kulana Nani project in Kaneohe, Hawaii, in 1986 with the intent of preserving it as affordable, multi-family rental housing. The City invested some $8 million in CDBG funds and $2 million in HOME funds in the project’s purchase and rehabilitation. The City is in the process of acquiring the underlying fee interest in the property. The City proposes to lease the project on a long-term basis to a private nonprofit corporation. The lease will be upon terms that preserve the original intent, use, and beneficiaries of the project. No CDBG funding is required for this sale.

Pursuant to the CDBG regulation at Title 24, Code of Federal Regulations, Part 570.611(d)(1)(i) and the HOME regulation at Title 24, Code of Federal Regulations, Part 92.356(d)(1), the following disclosures are hereby made:

o A potential conflict of interest exists in that the City’s managing agent may submit a bid to lease from the City the same project that it manages for the City; and,

o Pursuant to 24 CFR 570.611(d) and 24 CFR 92.356(d) and (e), the City intends to request the U.S. Department of Housing and Urban Development to grant an exception to the conflict of interest regulations, thereby allowing the City’s managing agent to lease the property from the City without first relinquishing its management contract with the City.

The City Department of the Corporation Counsel has rendered an opinion that the granting of an exception to the CDBG and HOME conflict of interest regulations will not violate State or City law.

The grounds for requesting the exception include the following:

o The City will ensure fair and competitive bidding on the project by making the managing agent’s records available at the request of other bidders.

o Granting an exception will not affect the benefits that Kulana Nani offers to its target renter groups.

o Granting an exception will benefit the City and the occupants of the project by maintaining continuity of management throughout the leasing process.

Interested parties may submit written comments prior to Monday, November 24, 2008, by addressing correspondence to:

Cyndy Aylett
Mayor’s Office
530 South King Street, 3rd Floor
Honolulu, Hawaii 96813

Questions regarding this matter may be directed to Cyndy Aylett at 523-4512.