A City Council committee yesterday deferred action on a scaled-down bill to control development near the city's proposed new mass transit line, setting the stage for Friday's showdown vote on what's being called the largest construction project in Hawai'i's history.

The Zoning Committee's move means there won't be any interim controls on transit development until at least next year.

Committee members yesterday approved, then deferred, further action on an amended bill to put a moratorium on development around proposed transit stations.

Proponents said the controls are important to prevent land speculation and other possible development abuses as the city moves forward with what's expected to be a $4 billion transit line from Kapolei to Manoa. The bill being considered is designed to prevent premature or inappropriate development in those areas.

However, committee members said an original proposal for a 12-month moratorium on all developments around the mass transit line went too far.

Zoning Committee Chairman Charles Djou said the panel will likely take up the measure again in January, after council members and city administration officials have had time to review the proposed changes.

"A lot of work still needs to be done to make sure we get this right," said committee member Nestor Garcia.

Djou said he hopes a final version of the bill can be voted on quickly, perhaps in January.

"Everybody agrees on the need. The sooner we get it done, the better," he said. "The big, big fear is that there are some very smart entrepreneurs out there who are already figuring out ways to exploit transit to their own advantage."

The amendment version introduced by Councilman Gary Okino would limit the interim controls anywhere within a quarter-mile of a proposed station to three months or until the city can come up with more permanent regulations to guide development around the transit stations.

The measure also would include exemptions for private, single-family homes, several large government agencies already planning projects, or for basic improvements such as roads, sewers and drainage facilities.

The full City Council is scheduled to vote Friday for a third and final time on the city's transit plans, picking a preferred mode and route for the system that will be funded in part by an increase in the state's general excise tax that goes into effect Jan. 1.

Reach Mike Leidemann at mleidemann@honoluluadvertiser.com.