$2.3 Million Fine Is Proposed For Reef Damage at Pila‘a Bay
The hearing officer in one of the largest Conservation District violation cases in state history is recommending that a company managed by retired Honda dealer James Pflueger pay $2.3 million in fines for runoff damages to the coral reef at Pila‘a, Kaua‘i. Retired judge Michael Gibson, the board’s hearing officer for the case against Pila‘a 400, LLC, found that the illegal bulldozing and construction undertaken in 2001 by Pflueger had caused tons of mud to flow across Pila‘a beach and onto the reef during and following a November 2001 rainstorm.
In his proposed Findings of Fact, Conclusions of Law, and recommendations, issued December 22, Gibson wrote that the mud on the reef was tantamount to “marine construction,” for which Pila‘a 400 had no Conservation District Use Permit.
“Given the elements of value … and in consideration of all the facts… [including] the range of values stated in scholarly papers for reefs, the probable costs of restoration of Pila‘a, the value of the coral destroyed, and the intrinsic value of Pila‘a Bay, and the costs of monitoring for five years beginning in 2005,” Gibson recommended a penalty of $2,315,000. Under his proposal, the money would be held in trust and applied to remediation, estimated to cost between $3 million and $5 million.
If construction costs of Pila‘a 400’s Conceptual Remediation Plans exceed $2 million, Gibson recommended that the company pay the balance. If construction and monitoring costs are less than the balance of the penalty not used to fund the Conceptual Remediation Plans and to monitor Pila‘a Bay for five years, that balance should be retained by the state, Gibson wrote. He also recommended Pila‘a 400 pay $69,996.93 in administrative costs.
According to Department of Land and Natural Resources staff, the Land Board is expected to hear final arguments in the case on March 29 in Lihu‘e.
Izu, Mamiya Leave DLNR
The Department of Land and Natural Resources lost the second of its two deputy directors with Yvonne Izu’s abrupt departure last month. Izu, who was the deputy director for the Commission on Water Resource Management as well as for the Division of Aquatic Resources, the Division of Boating and Ocean Recreation, and the Division of Conservation and Resources Enforcement, resigned in early February “for personal reasons,” according to a February 10 email from DLNR public information officer Deborah Ward.
But front-page reports on February 12 in both The Honolulu Advertiser and the Honolulu Star-Bulletin, tell a different story. The articles confirmed talk that Izu had planned to resign after the current legislative session ended, but quit on Wednesday, February 9, after refusing her boss Peter Young’s order to write testimony supporting Senate Bill 503 – a bill that many say would have gutted, if not killed, the Water Commission. The bill seeks to amend the state Constitution to transfer the commission’s key duties (protecting and conserving water and regulating its use) to the counties.
“I didn’t feel it was fair to ask Water Commission staff to prepare testimony that would dismantle the agency that they work for,” Izu told the Star-Bulletin.
As of press time, the bill had not been scheduled for a legislative hearing.
Izu is the second “water deputy” to leave the DLNR in less than a year. Her predecessor Ernie Lau left in May 2004 to head the Public Works Division of the Department of Accounting and General Services. Before DLNR director Peter Young took office, the DLNR deputy director who was assigned to the Water Commission had no other departmental duties. A second DLNR deputy assisted the director with tasks associated with DLNR divisions. But shortly after taking the job in 2003, Young added oversight of DLNR’s water-related and enforcement divisions to the Water Commission deputy’s duties.
Late last year, land deputy Dan Davidson left the DLNR to work for Campbell Estate development companies Kapolei Property Development, LLC and `Aina Nui Corp. When asked what the status of recruiting for the two vacant deputy positions was, the DLNR’s Ward responded, “We are interviewing candidates for DLNR deputy at this time. Dean Nakano [a longtime CWRM staffer] is taking the lead in assisting with CWRM issues.”
In the past nine months, four of DLNR’s eight division heads have retired, decided to move on, or were forced out:
- Division of Forestry and Wildlife administrator Mike Buck retired last June and was replaced by longtime wildlife program coordi nator Paul Conry.
- Division of Aquatic Resources adminis trator Bill Devick retired in early 2005. Devick’s position has not yet been filled.
- Land Division administrator Dierdre Mamiya, who was 2003’s statewide Manager of the Year and has been credited as a driving force behind her department’s efforts to hold state lessees more accountable, officially left the DLNR in January, although she is staying on temporarily to advise her replacement Warren F. Wegesend. On January 28, at her last meeting before the Land Board, at-large member Tim Johns read a “resolution” honoring her good works. O‘ahu member Kathryn Inouye joked, “I move to deny her resignation.”
- Acting Historic Preservation Division administrator Holly McEldowney was transferred to State Parks. Her replacement is Melanie Chinen, who moved over from the governor’s office and who, until October 2004, had had no experience in the field of historic preservation.
Hilton Drills Wells
To Freshen Lagoon
On Friday February 11, the Land Board granted a right-of-entry to the Hilton Hawaiian Village to drill seven exploratory saltwater wells between its lagoon and the Ala Wai Boat Harbor parking lot. At the time of the board meeting, Hilton’s drill rig was already scheduled to start work the following Tuesday.
Concerns over the project’s impacts voiced by residents of the Ilikai Hotel and nearby recreational users led Land Division staff to amend its recommendation – which had been for the board to grant a right-of-entry for the drilling and a 55-year easement for the wells and a water circulation system including a discharge pipe – to be for a right-of-entry only.
“This 5-month long project appears to have a potential of a significant impact during construction and possible monitoring phases,” wrote Janet Mandrell, public liaison for The Makai Society, in testimony to the Land Board.
Mandrell and attorney Terrance M. Revere, representing the Association of Apartment Owners of the Ilikai Apartment Building, requested that the Land Board defer action on the Land Division’s recommendations to al low them time to explore potential impacts of the right-of-entry and the easement.
The wells, if proven viable, will eventually become part of Hilton’s planned circulation system for its land-locked lagoon. The system will include a pipe running under and across state land that discharges lagoon water into the Ala Wai boat harbor.
Hilton Hawaiian Village LLC, according to the Land Division’s report to the board, is planning to redevelop its property, including the lagoon. Data collection from the wells is expected to take 150 days and the entire project will cost $5 million, the report states.
If and when the easement comes before the Land Board again, the Land Division has recommended that no rent be charged.
The Land Board, on its staff’s recommendation, voted to declare that the project will “probably have minimal or no significant impact” and therefore Hilton is exempt from preparing an environmental assessment. Be cause the system involves discharging water into the Ala Wai board harbor, it’s likely Hilton will need a National Pollutant Discharge Elimination System permit from the state Department of Health.
Ha‘ena Family To Remove
Illegal Second Residence
The Irons family of Ha‘ena, Kaua‘i, has been fined $5,000 by the Land Board for violations stemming from unauthorized construction relating to two houses on the family’s Conservation District property.
In addition to the fine, the Land Board, at its February 11 meeting, ordered the family to tear down one of the houses – an unpermitted A-frame house — within two years, unless otherwise approved by the board; remove the kitchen from the A-frame immediately (failure to do so could result in a fine of $2,000 a day for every day a kitchen remains in the house); and submit a Conservation District Use Application for one single-family residence by mid-August.
In the early 1970s, the Land Board issued a Conservation District Use Permit for a 750-square-foot single-family residence on the property. As the permit was being processed, the landowner at the time built an A-frame storage shed that was later illegally turned into a second residence in 1979 by then-owners Gary and Corrine Eno. The Land Board denied a permit application submitted by the Enos that year, finding that the use conflicted with the objective of the limited subzone of the Conservation District. Some time after the Irons family acquired the property, the structure burned down.
In September 2002, the Ironses sought permission from the DLNR ’s Office of Conservation and Coastal Lands to rebuild the A-frame. OCCL staff responded that because the structure was illegally built and was never granted a permit by the Land Board, the house could not be rebuilt.
Nearly two years later, the OCCL inspected the property and found that the family had rebuilt the A-frame house, and had also made unauthorized improvements to the main residence. Irons family attorney Randy Vitousek told the Land Board on February 11 that the family acknowledges the violation and plans to merge the two structures. The family would need a new CDUP for that. To get one, the family needs to expand its lot to at least 10,000 square feet, prove that a house larger than 750 square feet is allowable under the old CDUP, or have the DLNR’s rules on minimum lot size for single-family residences amended (a process which is estimated to take about two years, hence the two-year deadline to tear the illegal structure down).
Tradewinds Gets
License Extension
The controversial logging project that drew scores of concerned Big Island residents to the Land Board’s June 2001 meeting in Hilo is still tens of millions of dollars away from cutting the first tree from 9,000 acres in the state Waiakea Timber Management Area.
It’s been more than three and a half years since the Land Board granted Tradewinds Forest Products LLC a license to harvest tim ber from state land in Waiakea. And although the Oregon-based company has neither the startup capital nor commitments for much-needed timber on private land, the Land Board voted on January 28 to allow Tradewinds to keep its license, provided the company meets certain benchmarks in the coming months.
By the end of this month, Tradewinds must come up with $1 million, which it says will be used to jumpstart further fundraising. The project is estimated to cost $30 million.
Tradewinds recently enlisted investment banking firm Veber Partners, LLC, to help raise money for its timber mill and veneer processing plant on the Big Island’s Hamakua coast. At the Land Board’s January 28 meeting, Tradewinds principal Don Bryan said that wood-product company Louisiana Pacific has written a letter of intent to purchase Tradewinds products, and Kamehameha Schools had agreed to provide $5 million in equity, provided Tradewinds meets certain benchmarks.
A few short months earlier, at the Land Board’s October 8 meeting in Kona, the board’s staff had recommended that Tradewinds be found in default of its timber land license, which required Tradewinds to complete construction of a sawmill and veneer processing plant by the end of 2003 – or at least demonstrate that it was making a good-faith effort to complete the facility. Bryan pleaded with the Land Board for more time to complete product testing and obtain financial backing and commitments for a mill site and timber sources. The Land Board agreed to defer the issue until January 2005.
At the board’s January meeting, Bryan reported that he had completed product testing, but had yet to get the needed commit ments for additional land, timber, and money. Even so, Bryan felt Tradewinds could make the project work. He submitted a new schedule calling for Tradewinds to raise $1 million by the end of this month, obtain all of its funding by October, complete its permitting process by the first quarter of 2006, begin construction by November, complete construction by the end of 2006 and begin train ing workers in the first quarter of 2007.
While the Land Board voted to amend the deadlines in Tradewinds’ license to reflect this new schedule, at least one member of the public opposed the extension.
In emailed testimony to the Land Board, 30-year timber industry veteran James Quinn asked that the board cancel Tradewinds’ license and issue a new Request for Proposals. Quinn wrote, “The most likely opportunity for successful allocation of the timber resources in Hawai‘i will come from a combination of efficiently sawn lumber (for flooring, millwork and furniture), sliced veneers, and the processing of lower grades and smaller logs into chips for pulp and/or biomass for electric power generation. I do not believe that the Hawai‘i resource base is extensive enough to justify the high capital expense of a competitive plywood or a laminated veneer lumber operation. This is borne out by the fact that no experienced plywood producers have seen fit to invest in Hawai‘i.”
Quinn said that a new RFP would elicit bids that would “yield higher returns to the state in both the stumpage prices for timber and in earlier and more likely to succeed business ventures.”
When Land Board member Tim Johns asked Division of Forestry and Wildlife administrator Paul Conry whether Quinn’s testimony changed his staff’s recommendation to extend Tradewinds’ license, Conry replied, “We think there’s opportunity for both [Tradewinds and Quinn]. There are other state lands that may become available in the future.”
Kent Untermann of Koa Plus testified that while he believes Quinn’s comments should be respected since the man “has been in the business more than anybody in this room and more than anybody in this state,” he did not want the Land Board to derail Tradewinds’ progress.
“I’m a potential competitor of theirs, al though I don’t think we need to be a competitor. I think there’s plenty of resource to go around. I think the challenge, as you folks have said, is how do you support something that is really a big deal without losing too much opportunity while you wait for what may not happen or may happen,” he said. Support Tradewinds, but within a reasonable amount of time, he said.
Another issue was raised by Guy Cellier, owner of Forest Solutions, which manages land owned by Kamehameha Schools and leased by PruTimber. He warned the board that PruTimber’s 21,000 acres of eucalyptus forest may not necessarily be available when Tradewinds finally opens for business. According to Tradewinds’ business plan, the company needs timber not just from state land, but also from land managed by PruTimber, which is currently in the process of being sold. Before the Land Board’s vote in January, Cellier told the board that while he is not sure who the new owners of PruTimber are going to be, he is sure they are not going to wait around to sell their timber to Tradewinds.
“They will sell their timber as quickly as they can to whoever will pay a fair price,” he said. “I would go along with Kent that we support all forest industries if they are well run and clean and neat and tidy, within reason, within a limited time, because holding up the resource for something that may or may not happen is not in the industry’s interest.”
Chandlers Contest
Proposed $237,000 Fine
The last time William Chandler was before the Land Board to address Conservation District violations on his Kane‘ohe property, board members made it clear that they wanted him to restore the Conservation areas to the department’s satisfaction within the time frame they set.
In June 2003, the Land Board found Chandler and his wife, Joyce, had violated Conservation District rules when, in the course of building their house, they con ducted unauthorized grading and grubbing and built a parking area and driveway on their property, part of which was in the Conservation District and the remainder in the Urban District. The Land Board fined them $7,000.
Shortly afterward, the Chandlers incurred a second round of violations on the same property when their bulldozer operator graded, removed dirt and cleared a road in the Conservation District. The Land Board fined them $8,000 in January 2004 for those violations and gave them a month and a half to restore the property or face up to $2,000 a day in fines until the restoration was done.
The Chandlers failed to meet the deadline and requested extensions from the DLNR’s Office of Conservation and Coastal Lands. On May 14, 2004, the Land Board voted to extend the remediation deadline to August 14, 2004. On September 10, at William Chandler’s request, the Land Board voted 4 – 2 (Board member Johns and Ron Agor opposed the motion) to give him until September 24 to implement an intermediate restoration plan and until December 10 to do a complete restoration.
Chandler did not complete his intermediate plan until November 28. And when OCCL staff inspected the Chandler property on December 16, staff found that full remediation was not complete and that additional grubbing and grading had occurred in the Conservation District.
Frustrated by Chandler’s year and a half of noncompliance, OCCL staff recommended on January 28 that the Land Board impose severe fines.
“It should be noted for the record that throughout this case, Mr. Chandler has made representations that these improvements were not being maintained to facilitate the construction of the SFR[single-family residence]; that they were inadvertent, unintended or done by others,” OCCL planner Dawn Hegger wrote in her report to the Land Board.
She recommended that the Chandlers be fined $2,000 a day for the 65 days (September 24 through November 28) that they had failed to implement his interim remediation plan for a total of $130,000.
For their failure to meet the December 10 deadline, Hegger recommended the maxi mum fine of $2,000 a day from December 11 until the Land Board’s January 28 meeting for a total of $98,000.
Finally, she recommended $6,000 in fines for the recent grading and road widening in the Conservation District ($2,000 for grubbing and grading, $2,000 for road widening, and $2,000 for violating a January 2004 Land Board order that there be no more work in the Conservation District), and $3,500 in administrative costs.
Hegger’s recommended grand total: $237,500.
Instead of appearing before the board in January to face these violations, the Chandlers, through their attorney Ben Tsukazaki, filed a written request for a contested case hearing the day before the meeting. Because of the request, the Land Board deferred action on the matter; a month later, the board voted to approve the selection of a hearing officer for the case.
Kaua‘i Man Wins Hearing
On Easement Request
Michael Miller’s 20-year fight for access to his landlocked Wai‘oli property has finally given him a contested case hearing before the Land Board. But whether the hearing process will gain him an easement across state land, one that allows him to build a house and install utilities, remains to be seen.
At its January 28 meeting, the Land Board voted to appoint a hearing officer for the contested case. Miller has been trying to get a long-term easement across private and public land to his property since the mid-1980s. In the summer of 1998, after hearing arguments from several people that an easement would degrade the valley’s rural character, historic sites, and natural resources and was too narrow for vehicles and utility wires, the Land Board denied Miller’s request for an easement (which would have run directly through taro farms) and his subsequent request for a con tested case hearing, which is similar to a court hearing.
In the course of Miller’s ongoing efforts to gain access across state and private lands, the Fifth Circuit Court directed Miller to seek an easement from the Land Board for an alternate route. He did so in July 2003, but the Land Board rejected this request as well and told him that any future requests must be accompanied by an environmental assessment of the potential impacts of an easement through the area.
“Opting for the easement route he originally requested, which was a shorter, more direct route affecting fewer parcels, Miller subsequently requested a ruling by the Fifth Circuit Court on the Department of the Attorney General’s opinion that [Miller] was not entitled to a contested case hearing,” states a January 28 report DLNR Land Division report by land agent Gary Martin.
In documents submitted to the Fifth Cir cuit Court, the state argued that Miller’s property, which originated as a royal patent grant, was not a kuleana parcel and did not “contain a reservation of rights of native tenants,” including a right of easement. Despite the state’s arguments, Fifth Circuit Judge Clifford Nakea ruled on December 27, 2004, that Miller is entitled to rights set forth in Section 7-1 of Hawaii Revised Statutes, which states that those who have allodial titles to their lands have a “right to drinking water, running water, and the right of way.” As a result, Nakea wrote, Miller was also entitled to a contested case hearing on his 1998 easement application. However, Judge Nakea also stated that Miller was not necessarily entitled to an easement because his deed “explicitly provides that the parcel has no access.”
Taro farmers and the Wai‘oli Corporation (a large landowner in the area) have long opposed any easement through the rural valley and have argued that granting one would facilitate urbanization. Following Nakea’s ruling, attorney Donald Wilson, representing the Wai‘oli Corporation, wrote the Land Board asking that the contested case hearing officer be instructed to require Miller to submit an environmental assessment of the easement’s effects before the officer or the board takes any action.
“Significant environmental issues were raised in the previous proceedings on the Applicant’s easement request and the board unanimously agreed at the July 11, 2003 hearing that no further consideration would be given to any application filed by the Applicant for easement rights through Wai‘oli Valley unless such an application was accompanied by an environmental assessment,” Wilson wrote.
Miller’s attorney Joe Moss, however, argued in a January 27 letter that the EA instruction was for the alternate route, not the original route involved in the contested case hearing. Furthermore, Moss wrote, if Miller were required to prepare an environmental assessment before any action by the hearing office or the Land Board, that would contradict the court’s order.
While it may be months before the case is concluded, deputy attorney general Linda Chow had this to say about Miller’s easement: “Assuming Plaintiffs can show an easement, either pursuant to HRS Section 7-1 or as an implied easement, the use of the easement would be fixed at the time of the original grant of the parcel, in 1856. Plaintiffs are not entitled to a use of any access beyond the access provided with the original grant of the parcel. If at the time of the original grant, the access was a foot path, then Plaintiffs are only entitled to a foot path,” she wrote in her October 2004 pre-hearing statement filed in Circuit Court.
Board Amends Koke‘e Plan
Following Public Outcry
“What becomes strikingly clear from even a casual read of the [Koke‘e and Waimea State Park Draft] Master Plan is that excessive emphasis has been placed on unrealistic revenue generation at the expense of the cultural landscape and tight-knit community that has existed here for generations,” wrote National Tropical Botanical Garden director and Koke‘e State Park cabin lessee Chipper Wichman in his January 13 testimony to the Land Board.
“Families that have consistently cared for their lease-hold property as if it was their own
are being penalized and punished for taking such good care of the ‘aina. Our family has
been residing on the same property over 100 years. Generation after generation as we have cared for it diligently even after the controversial auction of 20 years ago in which the state claimed ownership of the homes we have built there with our own money and labor….
“And what is the reward for such diligent love and care? Simply put, the MP proposes that because our homes are so well cared for, they will be exploited and used to generate as much REVENUE as possible via short-term five-year leases? Is this pono or right?” he asked.
When the DLNR released its Koke‘e and Waimea State Parks Draft Master Plan, prepared last December by R.M.Towill, roughly 100 Kaua‘i residents, including Wichman, showed up in opposition at a January 13 Land Board briefing held at the Kaua‘i War Memorial convention hall. Some worried that the plan was a “done deal,” and that Land Board would approve it no matter what the public had to say.
That would have meant erecting an entry gate and fee-collection booth on the park’s access road, charging an average of $5 for each vehicle entering the park, and managing as vacation rentals a substantial portion of the park’s 105 rustic cabins, leases for most of which are set to expire by next year.
It would cost the state $28.3 million over 20 year to fulfill the master plan, which includes improvements to lookouts, trails, roads, the Pu‘u Ka Pele picnic area, Pu‘u Lua Reservoir, and the recreational and residential cabins, R.M. Towill wrote. Entry fees, cabin rentals, concessions, maintenance and service fees, and miscellaneous permits would net $1.5 million a year.
On January 14, the Land Board, apparently moved by the overwhelming public testimony over the previous night, voted to approve the plan, but with several significant amendments. Kaua‘i Land Board member Ron Agor wanted to move forward with an environmental impact statement for the plan. But to make sure the public’s concerns were addressed, he offered the several following amendments to the plan:
- Have the plan’s mission statement include preservation of Native Hawaiian cultural and gathering rights;
- Delete references to a physical gate, which was originally considered “an essential component.” He added that the consultant must “take [testifier] Juan Wilson’s proposal very seriously.” (Wilson, an architect and planner, proposed removal of the gate, a traffic island and guard house restricting entry to the park. In their place, he suggested building a ranger station and parking for staff and the public, in emergencies. Vehicular traffic, except for cars belonging to cabin lessees and park staff, would end at the lodge; if members of the public wished to go further to Kalalau Lookout or trailheads, they would be able to rent bicycles, hike, or use park-provided shuttle buses.)
- Have State Parks staff and R.M. Towill work with the six non-profits that use the cabins and consider them separate from the residential leases,
Explore the possibility of constructing a lodge for short-term rentals (another idea floated by Wilson); and - Consider anyone with a local driver’s license exempt from fees and look at other ways of collecting fees.
Agor added that while he didn’t have enough information to render a decision on how to deal with the expiring cabin leases, he advised parks staff and the consultant to “take to heart” the public the testimony and “come up with a workable solution for everybody.” Some lessees argue that the cabins belong to them, not the state, and have sought ways to obtain direct leases and/or be compensated for improvements they’ve made.
In seconding Agor’s motion, at-large board member Tim Johns added that he’d like to make sure that Wilson’s alternative was evaluated in the environmental impact statement, as well as comments from leaseholder Wayne Jacintho and Hui O Laka. Like Wilson, Jacintho recommended in written testimony that there be a lodge with 20-30 rooms. He also suggested that the Land Board designate Koke‘e as a Historical Cultural Community, negotiate new leases, retain the 12 state rental cabins, auction the dozen or so lots vacant since 1985, “and learn just how many really are out there who wish to have their own mountain cabin. Develop the empty lots near the water tank and see if there really is a demand for weekly rentals.”
Jacintho also suggested a 50 percent rent increase and a monthly maintenance fee of $50 for the lessees. The maintenance fee would generate $60,000 a year, which, with volunteer labor and equipment, would be enough to mix the badly rutted roads, he said.
— Teresa Dawson
Volume 15, Number 9 March 2005
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