Foreclosures emerging as West Maui and state issue
LAHAINA — A few short years ago, if one went to a West Side community meeting on upcoming legislative issues, or on how funds could be spent in the district, or even increased for new projects and programs, the topics were mostly predictable, although still important and needing discussion.
They were, in no particular order, the budget, taxes, roads, school construction, school repairs, a West Side hospital/medical facility, Oahu centricity, the lack of affordable housing, crime, drugs, the wrecked sailboat by Lahaina Harbor, Front Street, homelessness, ocean pollution, flooding and sewers.
Most of these issues, or a variation on them, were raised and addressed at a community meeting attended by approximately 30 people on Thursday, Dec. 2, at the Kaunoa West Maui Senior Center on Lahainaluna Road from 5:30 to 7 p.m.
State Sen. Roz Baker and State Rep. Angus McKelvey hosted the meeting as part of their reports to constituents on upcoming legislative issues, legislation they each plan to introduce in their respective bodies and to hear from the public about their ideas, suggestions and concerns.
One issue was raised that had not made it onto the West Maui Top Ten in recent memory, and definitely not during the housing price run up that ended in the fall of 2008. That was the issue of foreclosures and foreclosure fraud.
A woman described her experience and what she knew of others who had experienced difficulty with banks when trying to prevent foreclosure on their homes. It was a process that did not often end well for the homeowner.
Baker and McKelvey were ready with answers and able to point to legislation that had passed by the last legislature. Lawmakers set up a Task Force on Foreclosures that is due to issue its report for the upcoming legislative session.
Baker supports the passage of legislation in the upcoming session that would clean up the non-judicial foreclosure process. She also called for more resources to counsel homeowners before they get into a foreclosure situation.
Baker noted, “How can we encourage banks to modify loans? The problem is off-shore banks, not local banks.”
McKelvey supports letting the homeowner choose either a judicial foreclosure, in which a judge ensures the process is legal and correct, or a non-judicial foreclosure, in which the holder of the mortgage stipulates the foreclosure was done properly. Currently, the mortgage holder — not the homeowner — decides which process to follow.
“We also would like to see an amendment to the Home Affordable Modification Program (HAMP) created by the Obama administration to help with loan modifications,” said McKelvey.
“We want to require that banks come out and negotiate in person, for example Bank of America, Chase, etc. They would have to come to Hawaii and negotiate onsite,” he added.
It is the non-judicial foreclosure process that has been the source of many of the fraud allegations emerging nationwide, including Hawaii, in which stipulations by lenders that correct and legal foreclosure processes were being followed has, in a growing number of cases, proven not to be true.
As a result, the Hawaii attorney general has joined with 48 of his colleagues nationwide to investigate mortgage foreclosure practices in their respective states.
McKelvey said the state should use some excess money to increase funding for RICO (Regulated Industries Complaints Office, State of Hawaii) to address mortgage foreclosure problems.
Baker pointed out that RICO was hit by the state worker furloughs, further reducing its ability to address this issue.
“The governor did not understand the impact on the citizenry,” Baker said, referring to the RICO furloughs.
Both Baker and McKelvey expect mortgage foreclosure legislation to emerge from the upcoming session.
Next year, the approach to the budget will be prudent, with a need to address unfunded liabilities in the State Employee Retirement System and the State Employee Heath Fund. Economic revitalization (read jobs) will be a critical issue for both Baker and McKelvey.
Don’t expect support for tax increases, but there will be a move to address tax credits for high-tech companies and a discussion of general excise tax abatement, perhaps in a Medical Enterprise Zone that could be authorized by the new legislature to spur the development of medical facilities and services in West Maui.
Baker and McKelvey both support the air ambulance. A portion of the current cigarette tax helps fund the service.
Sen. Baker will introduce legislation in cooperation with the Women’s Caucus in the Senate to protect women who are victims of domestic violence from being fired by their employer when they are told the woman employee has a Temporary Restraining Order (TRO) filed against her abuser.
The legislation passed the Senate last year but was stalled in the House when the Judiciary Committee chair declined to hold a hearing on the bill.
The proposed legislation is the result of evidence that women in West Maui have been fired as a result of obtaining TROs to prevent further injury.
Baker also plans to reintroduce legislation banning Human Trafficking, which was passed by both houses and vetoed by then-Gov. Linda Lingle.
School repairs came under discussion, and McKelvey wants more control for principals over school repair money. Baker concurred, saying that the Department of Education (DOE) wants a 20-year life for any repair, but that it is those with a five-year life that are needed most right now and not being funded.
Final land use approval for the West Maui Hospital & Medical Center is under review at the Hawaii Housing Finance & Development Corporation (HHFDC) due to a disagreement over what housing projects approved under a previous state affordable housing law (Act 15) can do with land that was part of that authorization. Baker is working with all the parties to try and resolve it.
McKelvey will again push to establish a Veteran’s Cemetery on the West Side and to create a Veteran’s Court that can take into account the impact of military service when issuing judgments regarding crimes committed by returning veterans.
And finally, THE SAILBOAT! It’s been there long enough to make friends with the ocean to the degree that a reef has grown up around its steel hull. According to McKelvey, the safest way to deal with it now is to cut the top off the boat and install buoys to let people know the boat’s hull is below the water’s surface.
A change order is at the Department of Land and Natural Resources (DLNR) to do just that, because according to McKelvey, to remove the entire boat will cause more reef harm and cost more than this revised solution.