The Honolulu Authority for Rapid Transportation says to complete the nearly $10 billion rail project as designed, it must move toward the condemnation of an industrially zoned property in Kalihi.

To that end, HART’s Governmental Affairs-Legal Matters committee Thursday unanimously recommended to the HART board of directors that a resolution — called Resolution 4 — be advanced. If passed by the board of directors, Resolution 4 would inform the City Council of the transit agency’s intent to seize by eminent domain the property at 1829 Dillingham Blvd., despite its owners’ objections.

Owned by the Takara family, the 7,855-square-foot parcel, at the southeast corner of Mokauea Street, is also home to Service Printers Hawaii Inc., a commercial printer in business since 1964. The full property’s total assessed value is about $2.9 million, according to the city’s Real Property Assessment Division.

Walter Takara, one of the owner’s sons, objected to HART’s effort to take his family’s property.

“Reason No. 1, this property has been in our family for three generations with a very rare, fortunate case of having just one tenant for 43 years in Serv­ice Printers Inc.,” Takara told the committee prior to its vote. “Throughout these years we have built a great relationship, and Service Printers has proved to be an outstanding business member serving the greater Kalihi community and customers islandwide.”

Takara added that Service Printers employs 30 and has “a multitude” of vendors.

“However, their future is currently unknown at best,” he said.

During the meeting, transit staff laid out its planned eminent domain action — typically done by governments to take possession of private property in exchange for compensation, but without the property owner’s consent — after the rail agency said it had sought a financial agreement with the Takara family since 2014.

In that year, HART said, it presented an acquisition offer to the property’s named owner — Jennine Hatsue Takara — for the parcel’s full acquisition. That offer, however, was rejected.

“Subsequently, a partial acquisition was pursued whereby HART would acquire a portion of the property,” HART reports state. “And a portion of the adjacent property would be sold to the owner to replace lost parking and office space.”

Over the years, the transit agency said, it negotiated terms of that partial acquisition with the owner. But in 2020, HART asserted that the owner asked it to explore the possibility of purchasing the full property. HART reports state that the “full fee acquisition was determined to be necessary to meet the needs of the project.”

In 2022, HART said, the Federal Transit Administration provided environmental clearance to acquire the full property, and by December a written offer was again provided to the owner.

“The owner was given a reasonable time to consider the offer,” HART reports state. “To date the owner has not provided a response or counter-offer to HART. In order to adhere to the project construction schedule, it is necessary to refer the property to condemnation.”

Meantime, HART said efforts will be made to continue negotiations with the owner even as it advanced approval of Resolution 4.

Now “the City Council has 45 days to approve or object to condemnation by adoption of a resolution of the notification to acquire the property,” HART reports state. “Upon approval or no action by the City Council, the Board of Directors will be requested to approve a resolution authorizing the acquisition of the property by eminent domain.”

Besides being in the family’s possession for three generations, money is the second reason HART should stop its efforts to take away the property, according to Walter Takara.

“For the last seven years, we have worked tirelessly and incurred significant personal expenses in working with the last two HART administrations to reach a win-win resolution for everyone involved,” he told the committee Thursday.

Takara noted that an agreeable solution to all parties had once been on the table.

That agreement, he said, would see HART acquire only a piece of his family’s land — along the frontage of the building facing Dil­lingham Boulevard, which would then be demolished. Takara said HART was to then sell to his family “a similar-sized, empty, undeveloped dirt lot” adjacent to their property on the Diamond Head side — owned by HART — to replace the lost square footage on Dillingham Boulevard.

That plan, he added, would see HART build new office spaces on the empty lot as well as maintain “a perpetual driveway easement” to the new office’s parking lot.

“A more than fair plan to replace and build what was taken,” said Takara. “More importantly, the proposed plan and funding agreement was already approved by the FTA, the City and County of Honolulu and the City Council, with funds earmarked by HART.”

He said that “innovative plan” would have resulted “in substantial savings to HART and, more importantly, the taxpayers,” compared with full acquisition of his family’s property.

At the meeting, board member Anthony Aalto asked Takara whether his family was still in negotiations with HART.

Takara replied, “We have consistently related to HART our intent to obviously not sell.”

To that, board member Michele Chun Brunngraber said she was led to believe the Takara family agreed to sell the whole property to HART in 2020.

In response, Takara said, “That was not the case. Our position has been steadfast. … That’s why I’m here today, to make sure our voices are heard … and preserve Service Printers going forward.”

Nate Meddings, the rail project’s director, said any further delay in acquiring this property would increase the rail project’s expenses, as currently designed.

“There’ll be severe cost implications if we have to change that design,” he said. “The design is on the critical path for the Dil­lingham infrastructure contract.”

Meddings added that any delay on Dillingham Boulevard infrastructure work “results in a day-for-day delay of the entire project” that amounts to $10 million to $12 million per month in overhead costs.

Although Takara eventually said his family would continue to talk with HART, the committee voted to pass Resolution 4.

HART’s board is expected to address this matter April 27.