Committee considers purchase of 105 North Market Street for CDBG‑DR office; appraisal and condition reviewed

The Budget, Finance and Economic Development Committee heard presentations and public testimony on proposed ordinances and a resolution that would authorize the county to buy the property at 105 North Market Street in Wailuku and issue bonds to fund the acquisition.

Administration staff said the purchase price would not exceed $3.2 million and that the county’s appraisal valued the property at roughly $3.15 million. The acquisition package in committee included Bill 63 (appropriating bond fund dollars for the purchase), Bill 64 (authorizing issuance of general obligation bonds) and Resolution 25‑10‑7 (authorizing the specific purchase and identifying the tax map key and lot size).

Budget Director Leslie Milner told the committee the administration prefers to use bond funds rather than carryover savings for this transaction so that carryover savings can be recognized in the fiscal year 2026 budget. Milner said the administration expects the facility to be rented to the CDBG‑Disaster Recovery (CDBG‑DR) program, which would occupy most of the building and help offset debt service while CDBG‑DR is in the space.

Miss Kahula, representing the Office of Recovery, said CDBG‑DR may ramp up to 56 staff and that the county will continue to provide services virtually and from other offices (including an existing Lahaina office). Finance staff and property consultants said the lot is 4,163 square feet with a two‑story building totaling about 7,348 square feet; the appraisal and a property condition assessment were provided to committee members.

Condition and costs: staff said the building is generally in good condition but flagged several items. A property condition assessment identified needs that staff estimated could require “several hundred thousand dollars” over time for improvements and reserves; one specific line item mentioned in testimony was an HVAC replacement estimate of about $106,000. Staff also flagged PV panels on the roof and some minor exterior repairs.

Parking and accessibility: the property has frontage and first‑floor ADA‑accessible entry; second‑floor access is by stairs only. Staff said employees and visitors would use nearby public street parking and the Wailuku parking structure.

Public comment: a community member who has used the building under previous operators described the property’s prior use as a psychosocial rehabilitation site and questioned how the county would use the space. Another testifier identifying as “Royal House of Hawaii” raised historical/ownership claims; committee staff recorded both comments in the public record.

Action in committee: a motion to recommend first reading of Bill 63, Bill 64 and adoption of Resolution 25‑10‑7 was made and seconded, but the transcript does not record a committee vote on those items before the meeting moved on. Committee members asked multiple technical questions about appraisal, condition, renovation timing and who would pay debt service. Milner said the general fund would pay debt service, and rental proceeds from CDBG‑DR would help offset that cost while the program occupies the building.

Next steps: the committee did not record a final committee vote on the acquisition package in the transcript; the bills and resolution were presented and a motion was made and seconded. Staff said they would continue due diligence and work with departments on any needed renovations and CIP assignments once acquisition moves forward.