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  From Pacific Business News, Monday, Oct. 11, 1999:

Three road proposals would impact Coco Palms
By Timothy Ruel
PBN Staff Reporter

Four lanes of state highway, proposed to run between Coco Palms Resort and Wailua Beach, could become a major roadblock to efforts to reopen Kauai's oldest resort.

The suite Department of Transportation, looking to relieve traffic congestion, is planning a permanent bypass for Kuhio Highway from Hanamaulu to Kapaa. The department has settled on three options for the highway, says Kenneth Au, advanced planning engineer.

One option goes directly in front of Coco Palms in Wailua along the current two-lane highway, bringing it up to six lanes. This means expanding into the Coco Palms parking lot, says Steve Morikawa, design engineer with the state highways division on Kauai.

The other two options would direct the new highway around the hotel, one by its tennis courts, the other completely off the property. Neither would affect the hotel as much as the first, but might be more expensive for the state, Morikawa says. The project, estimated between $150 million and $200 million, will receive 80 percent of its funding from the federal government.

The state Transportation Department still needs to draft an environmental impact statement and pick a consulting engineer. Au expects the project to take more than a year. Morikawa notes the options for the highway may change, mostly to avoid impact on neighboring wetlands.

Officials at Wailua Associates, Coco Palm's San Francisco-based owner, would not comment.

Hurricane Iniki closed the Coco Palm in 1992, and landed Wailua Associates in an $18 million suit with its insurance company, Aetna Casualty and Surety Co., over the damage. The companies finally settled the long-standing suit earlier this year.

Wailua Associates officials have long maintained they hope to reopen the hotel, and have been waiting on the suit to make their next move.

Wailua Associates is now negotiating with a developer in Southern California to become a venture partner, but will not name the company until the contract is signed.

Many on Kauai question whether Coco Palms, opened in 1953, will ever open again. Some businesspeople, who requested anonymity, say the latest development with the highway is yet another roadblock to Wailua Associates.

Despite the potential impact on Coco Palms, business owners in the neighboring town of Kapaa look forward to the bypass. Traffic has been a major problem there, says Ann Leighton, vice president of the Kapaa Business Association and co-owner of Kapaa motorcycle shop Two Wheels.

Kapaa, home to nearly 300 businesses, could become another Lahaina once the highway is finished, says Larry Barton, manager of Kela's Glass Gallery.

Reach Timothy Ruel by e-mail <truel@amcity.com> or by phone at 955-8042.

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