Last May, the state Land Use Commission received an update on plans to develop about 1,000 houses on land near Lahaina, Maui. The LUC had first approved a project in this area three decades ago. In the intervening decades, ownership changed, as well as plans. But nothing had been built to bring the proposed Puʻukoliʻi Village any closer to completion than it had been back in 1993, when the LUC gave its blessing to the project.
As Environment Hawaiʻi reported in June, at the meeting where the LUC heard that update, representatives of the developer, Kaʻanapali Land Management Corporation — as well as members of the LUC itself — seemed to blame the state Commission on Water Resource Management for the long delays.
LUC Chair Dan Giovanni said at the time, “Seems like we’re prepared to move forward with this valuable project … but it’s all hung up with this water issue.” He went on to accuse CWRM, wrongly, of having made “a generalized priority to prioritize all the existing applications before they would consider something new.” In fact, as it turned out, the developer had not applied for any water use permit at all.
Brian Lee, another member of the LUC, asked why the LUC had to defer to CWRM: “If CWRM is going to be the obstacle, why are we deferring to them without any examination?”
With the Land Use Commission’s apparent – and astonishing – ignorance of the constitutional and statutory role of the Water Commission on full display at that meeting, a decision was made to have members of the Water Commission staff provide the LUC with an informational briefing on the responsibilities and programs of CWRM.
This was done on July 10, when several members of the CWRM staff briefed LUC members on the constitutional and statutory roles of the Water Commission.
At that meeting, commissioner Nancy Carr Smith wanted to know why CWRM would allow streams to flow unimpeded into the ocean. Recently CWRM staffer Ayron Strauch, of the Stream Protection and Management branch, met with members of the public in Waimea, she said. “The audience had a lot of different feelings about what should happen with the streams that go through Waimea and go down to the ocean. Some seemed to think that the water should just flow,” she continued. “Others think that it should be used upstream because when it just flows, it ends up in the ocean and it’s really causing a lot of issues to our reef and the fish.
“My husband and I go swim every weekend down at Wailea Bay. It’s been really bad this year because of the storms we had and the runoff. So what is the commission’s view on the stream water affecting coral reefs?”
Alexa Deike, legal fellow with CWRM, explained that streams in Hawaiʻi are very flashy, so what Carr Smith was describing is more a flash-flood event associated with high rain events. “The commission is very cognizant of the impacts on nearshore environments, coral reefs, and it is working closely with the Division of Aquatic Resources,” Deike said. “But also, for native wildlife, fish life, we need water to be flowing in the streams.” Mauka-makai stream flow, she said, was one of the public trust issues that the Water Commission is charged with protecting. Later on in her presentation of the constitutional mandates that CWRM must carry out, Deike noted that “maintenance of water in its natural state” was one of the four specified public trust purposes.
Katie Roth, head of CWRM’s planning branch, added that the Department of Land and Natural Resources’ Division of Forestry and Wildlife was involved with protecting and restoring upslope watersheds, “and that does play a role in erosion, sedimentation issues as well. … In re-establishing stream flow we do want to make decisions in coordination with agencies like DOFAW, in understanding what projects or initiatives they may have in the watershed, whether that’s invasive species removal of animals, reforestation efforts, fencing efforts – all of those things that keep soil on the landscape.”
In describing the constitutional role of the Water Commission, Deike pointed out that although other agencies may have overlapping jurisdiction in some areas, CWRM is the primary guardian over freshwater use and management. “These constitutional mandates and duties do apply to other state and county agencies,” she noted, “so whatever we are mandated, as primary guardian, also applies to the LUC or the PUC [Public Utilities Commission] and the counties as well.”
As Deike was describing the way in which the Water Commission issued water use permits in areas that are designated water management areas, LUC chair Giovanni asked, “So this – I don’t know what to call it – this set of rules came before us in a very recent case having to do with new development on West Maui. And I’d like … you to elaborate on the current state, because we were confused. Because existing water users have one year to reapply or apply to secure their original, or some form of water use permit. And that anybody else that never had water before has to wait until that process is completely finished and cannot even apply.”
“This may have been how we handled permits prior, but in the case of Maui, we have taken existing and new use permits at the same time,” Deike replied. “I assume you’re referring to the Puʻukoliʻi development – “
“A couple,” Giovanni said.
“Those developments could come into us at this time with new use permit applications,” Deike said, “but we have not received a water use permit application from those.”
“So is there any sense of – I understand they can submit the application, but internally, within CWRM, is there any priority established in addressing those applications, whether it’s for an existing use or for a new use?” Giovanni asked.
“The way we are going to tackle all the water use permits in the Lahaina aquifer sector area is we’re going region by region, and our intent is to start with the region where those particular developments are located, in the Honokawai aquifer,” Deike said. “We have already reviewed all of the existing use permits and there is one new use permit as well. If we were to get a new use permit [application] at this time, we would address it at the same time.”
Commissioner Bruce Uʻu, whose term on the LUC had begun just 10 days earlier, seemed to think CWRM should be doing more. “We’re lacking serious housing on Maui,” he said. “Is there anything we can do to help aid our island back, in building, whether it be existing uses or new uses? Is there anything CWRM is doing to bring us back to some normalcy? … I understand that sugar cane was very thirsty, and there is none. I understand that we need stream flow – but at what cost? Housing, maybe? … You said there’s no priority for housing. But I know stream flow, I know people who have loʻi, loʻi farms. They have a lot of water, discharging to the ocean, like Commissioner Carr Smith brought up. And how does that equate to not having housing? I’m just trying to figure out how we balance bringing some housing back. Everyone on all islands is saying, CWRM, Land Use Commission, and now I’m joining the crowd. How can we assure our own people, our island. You’re the guardians of public trust, but also at the same time protect and manage for future generations. And just to let you guys know, our people are leaving. So I’m just trying to understand … your job is to balance that, right? And I see a lot of stream use going in the ocean, which is fine, but I don’t see that equating towards housing, or how we can utilize different waters, injection wells, whatever we need to come up with some solutions. Everyone on Maui is waiting for a few solutions and some guidance. I watched the last meeting. There’s a lot of confusion from Kaʻanapali Land, what they said, and what I heard here, it’s major confusion. … It’s like we’re not even on the same page, that’s for sure.”
Deike responded, thanking Uʻu for bringing up alternative water sources. “The threatened water resources in the Lahaina area that is something that was already on the radar in the late 1970s. We avoided designation early on, when we could have gotten a handle on it. But I appreciate you bringing up alternative water sources. …. Only when we require water use permits can we require water users to use alternative sources, which would be R-1 water, for example.
“In Honokowai, where we’re already over sustainable yield, we’re using groundwater to water golf courses, to irrigate landscaping of hotels and luxury homes. If we could substitute those irrigation needs with R-1 water, we could free up water to go to housing developments. … The other missing piece, which is not CWRM’s kuleana, is water source development. Maui County has not developed any new sources. It was always traditionally very dependent on the plantation systems, on surface water. … We’re still allowing Maui County to completely dewater a stream to use for drinking water in Lahaina.
“With climate change, conditions are getting more dire. You have diminishing rainfall, you have diminishing stream flow. So when your drinking water is dependent on stream water, you’re going to run into trouble.”
As the presentation by CWRM staff was concluding, Roth offered to the Land Use Commission elements that she suggested the LUC should consider in making its decisions. These included changes in water availability – including changes brought about by climate change, the end of plantation-era sugar cultivation, invasive species, updates to sustainable yields, and changes in the interim instream flow standards. The LUC should also be mindful of designation of water management areas and the requirement to give priority to public trust uses, she said.
Roth went on to suggest ways in which coordination between the LUC and CWRM might be improved. At present, she said, when an issue comes before the LUC, it is the Office of Planning and Sustainable Development that coordinates the official state response. The OPSD asks the DLNR and other agencies for comment. The Land Division of the DLNR then asks all the DLNR divisions for comment. “As you can see, there’s a lot of things that can get lost in that process. We may or may not receive that petition or receive your request for comment … in some cases, because it’s disguised on Land Division letterhead, it may not trigger for us that it’s a Land Use Commission issue.
“Can that consultation process be improved upon? I don’t think there’s anything that precludes our agency from working with LUC staff… If there are specific questions that need to be answered, we are happy to do that and we will make that a priority.”
Roth went on to suggest that, “in certain cases, CWRM should be the entity representing its comments rather than OPSD. Not to say anything negative about OPSD, but it is challenging with some of these issues. It’s difficult, but I think it would be better if one person from CWRM staff could attend a hearing. This is one of the things I noticed when I looked at the LUC recording of the meeting in May.”
Amending the LUC’s rules to specifically include consultation with CWRM might be a formal way of addressing this, she said. Alternatively, she added, the LUC and CWRM might agree to a non-binding Memorandum of Understanding that would set forth terms of consultation.
The Water Commission has agreements with other agencies, such as the Public Utilities Commission, Roth noted, which set out in a specific way opportunities for collaboration. “It’s something new we’ve done in the last few years to articulate the importance of interagency collaboration,” she said.
CWRM Weighs In
About six weeks later, on August 20, the Commission on Water Resource Management considered a staff proposal to authorize its chair, Dawn Chang, to enter into a memorandum of understanding with the Land Use Commission setting forth terms of collaboration between the two agencies. A draft MOU accompanied the staff proposal.
CWRM’s planning branch manager, Roth, provided commissioners with the background to the proposal. “In the last few months, there’ve been a number of petitions, action items before the Land Use Commission in which conversations about the role of the Water Commission – our process, protocols, policies, and our engagement and involvement in land use decisions – have come up,” she said.
“What we’ve learned from that experience is that our current engagement process, in terms of the LUC asking CWRM for input on various petitions and actions items is probably not sufficient.”
Roth explained the cumbersome process by which the LUC would obtain input, if any, from the Water Commission. The Office of Planning and Sustainable Development, a party to every LUC docket, is charged with putting forth the official position of the state, and it generally does this by asking state agencies for their comments or concerns before developing the state’s position, which it represents before the LUC.
The Department of Land and Natural Resources, to which the Water Commission is administratively attached, receives the OPSD queries. The DLNR’s Land Division then sends to each of the several DLNR divisions and the Water Commission a brief summary of the issue for which the OPSD is seeking comment. And this cumbersome process, Roth told the commissioners, “is probably not sufficient. … There’s a lot of ways that things can get lost,” including things that “have a direct effect on stuff happening at the Water Commission.”
“In speaking to LUC staff, we decided an MOU might be the best way to resolve some of those issues. We’ve laid out in the MOU things that we agree to do. None of it is binding. It’s basically just a promise to work more collaboratively together.”
Dan Orodenker, the LUC’s executive officer, spoke to the issue. “In the past, we have relied on representations of the petitioners” with respect to the availability of water, he said. “We have found that sometimes those representations have not been factual, but more ‘we hope’ situations. This has resulted in a couple of projects that have not been able to come to fruition because they claimed that they had water and they didn’t. So our resources go to fostering those projects, and then we find they can’t be built.
“This is our intent, to have a closer working relationship with staff at CWRM to find out if there are issues with regard to water before we approve a project…. so that we may have the ability to address them when we put conditions on our decisions and orders.”
The MOU, he said, “is purely so we can access information, share information. It has nothing to do with decision making. It’ s just to provide this commission and our commission with information necessary so they can render decisions.
CWRM member Lawrence Miike asked, “Why can’t you guys just talk to each other?”
Roth responded, saying that having something in writing would give “future staff, who may come and go, something to reference – a promise or commitment to share information. I don’t see why that hurts anyone to have that in writing.”
Orodenker added, “We found that information doesn’t get disseminated in a timely manner.” When the OPSD seeks comment from the DLNR, he said, “they send it to DLNR and it goes to the Land Division and the Land Division disseminates it to all – sometimes it take so long that we don’t get a response in time. Sometimes the OPSD does not recognize the same issues that we do, so direct communication with CWRM staff takes out the middleman.”
Chang then mentioned her experience as a member of the Land Use Commission: “For me, one of the major problems wasn’t so much the initial application, but sites remaining dormant for like 10 or 15 years, so that conditions that were placed on the approval 10, 15 years ago may have changed dramatically. New development has occurred, other uses, but at times they’re relying on the same information they relied on 20 years ago to make decisions today. And, so, those for me were the more problematic ones – ones that come back on a reconsideration, or there’s a new developer, new owner who now wants to amend some of those conditions.”
Orodenker agreed. “That’s part of the reason why we want to open this line of communication,” he said. “Because 20 years – for instance, take the Lahaina area. Twenty years ago, the water situation there was much different than it was 30 years ago, and it’s different now. And we approved projects 30 years ago that still haven’t been built. So if they do come forward now, we need to reassess the water situation. We have one project completely dead and stalled in the Lahaina area because they can’t find water.”
Chang was skeptical. “Sometimes, from a legal standpoint, once you have it in writing you’re going to be bound by that. It’s easier – something not in writing gives you more flexibility.”
“If the commission is uncomfortable with having something in writing,” Orodenker replied, “the process is not going to stop. We will still communicate with CWRM staff.”
“You guys were already doing that?” Chang asked.
Roth responded. “We haven’t been until about a month ago,” she said, again explaining that the paperwork CWRM gets from the Land Division “may just have the title of the item or petition without details or background information.”
Orodenker added that the LUC was also now having to deal with the effect of recent Supreme Court decisions. “A lot of the concern comes from our obligations under the Public Trust Doctrine and Kapaʻa Kai, which under recent Supreme Court cases have been further expanded.” (Kapaʻa Kai, which dealt with an LUC decision back in the 1990s, basically said that state agencies may not delegate to others the obligation to protect the rights of Native Hawaiians. More recently, the Supreme Court held that all agencies must conduct an analysis of proposed actions in light of Kapaʻa Kai before rendering decisions.)
“We can’t use the excuse that nobody brought evidence forward anymore,” Orodenker said. “We actually have to take the initiative.”
Jonathan Likeke Scheuer, a former LUC chair who advises the Department of Hawaiian Home Lands on water issues, came forward to testify. While stating that he had not planned to weigh in on this matter, he nonetheless provided extensive extemporaneous testimony, based on his prior experiences at the LUC.
“I observed many instances, because I had a background in water resources management, where petitioners would come in and claim certain things about water availability or not, and I knew them to not be completely factual. Often… staff members from OPSD would just say nothing, even when questioned, until finally being asked if they had talked to the Water Commission staff. ‘No, you haven’t.’
“One of the things this has left us with, and this is acknowledged in the [Water] Commission’s own document, the Water Resources Protection Plan, particularly in the setting of sustainable yields, but also in other areas, there’s more land entitled in the state of Hawaii in all four counties if fully built out than there is water available to do it. So it’s certainly helpful to the LUC to know water availability… but it’s also helpful to you, too. Because you get involved in trying to adjudicate and allocate water resources in areas where now there’s excessive demand on that resource.
“This is not even in sight, keeping in mind that projects were approved when sustainable yields were higher, before the impacts of climate change were recognized. Some of the practical ways in which it might help – and I actually don’t have a particularly strong belief whether this is a great idea or something that could be passed on, but one of the practical ways a more formalized way would help you – you, as the Commission … only have the power to require dual water lines in designated water management areas. You can say you need to install dual lines, you need to use recycled water in this part and potable or surface water in this part. But in non-designated areas you lack that power. The Land Use Commission, however, has the power as a condition on an entitlement to say, as a condition for your getting approvals to do this, you are required to hook up to the nearest wastewater treatment plant and install a dual system on your property, which would mean that the water resources that you’re entrusted with protecting will have a better shot of being properly allocated.”
Scheuer went on to say he appreciated Chang’s concerns about putting things in writing. But, he added, “it seems like the history of ignoring the relationship between the Water Commission and Land Use Commission hasn’t necessarily gotten us to a good place. I’d rather put it in writing and fail rather than continue on current path and hope it works out.”
Chang suggested that the agreement be that any agreement she would sign off on be brought back to the full commission for its approval and be reviewed by the Office of Attorney General. She also wanted to have a copy of the draft be provided to the Office of Planning and Sustainable Development.
With that, commissioners voted to approve the staff recommendation, giving Chang authority to work out details of a MOU with the Land Use Commission.
Thumbs Down at the LUC
On September 5, the Land Use Commission was presented with the draft MOU, again with the proposal to delegate to the LUC chair, Dan Giovanni, the authority to finalize it following talks with his opposite number at the Water Commission.
The draft MOU, made available on the Land Use Commission website, now included a prefatory statement, stating that the purpose of document “is to establish an agreement for further cooperation between” the two agencies. “Water is Hawaiʻi’s most important natural resource. Its protection and preservation require [sic] coordination between various agencies and entities. As the state approaches the limits of its water resources and demands for housing and new developments increase, careful consideration and more effective coordination between land use and water planning is needed.”
Ahead of the meeting, the LUC received written testimony from Ana Tuiasosopo, representing the Operating Engineers Local Union No. 3, and David Arakawa, on behalf of the Land Use Research Foundation. Both were opposed to the proposed MOU.
Tuiasosopo’s testimony stated, “We understand the need for greater coordination with the different commissions within the state, but this MOU would give one commission preference over other commissions and state departments.”
Arakawa was present at the meeting to elaborate on his group’s opposition to the MOU, which he described as “another attempt at a power grab by the Water Commission.” This MOU, he said, was in keeping with past episodes of the Water Commission attempting to expand its powers, citing House Bill 1088 in the 2023 legislative session (vetoed by the governor) and proposed changes to the LUC’s rules that he said had been rejected by the LUC in late 2023.
(House Bill 1088 would have authorized CWRM to declare water shortages and emergencies. Although the bill was part of the administration’s legislative package, Governor Green vetoed it, stating that sufficient emergency powers already existed in the laws establishing the Water Commission. The proposed change in LUC rules to which Arakawa referred would have required petitions that come before the commission to include certification by the Water Commission that issues related to water availability are addressed and mitigation measures are identified. Last November, the LUC voted to suspend action on the rules for three months, at the request of the Office of Planning and Sustainable Development.)
There was no need for the MOU, Arakawa said, stating that the real problem was “due to an internal problem at DLNR or CWRM – one department or division not talking to another.”
He went on to say that the MOU was not necessary, “because departments should be communicating with each other anyway, and the current EIS process and the LUC district boundary review process provide ample opportunities for input.”
Arakawa concluded, “We believe the MOU would expand impermissibly and perhaps unconstitutionally the powers and duties of CWRM in relation to the LUC.”
Katie Roth joined the discussion, emphasizing that the information sharing anticipated went well beyond commenting on particular projects, but also touched on updates to sustainable yields, declines in water resources due to climate change, and other issues that come before the Water Commission – “things like that that are not officially part of a formal review process, but are things that we feel are important for us to communicate on, to be more proactive in our engagement, given the nexus between land use planning and water resource management.”
Commissioner Carr Smith suggested that the reason the LUC didn’t understand water issues was the fault of the Water Commission. “Isn’t it your kuleana to respond [to notices received via the Land Division] and, if appropriate, bring matters to our attention or be at our meetings to testify?”
Roth replied that CWRM was not always getting notice via the DLNR Land Division. While CWRM was trying to work out issues with the Land Division, “this MOU is intended to add an additional layer of insurance that we are understanding and aware of issues before the LUC,” she said.
Katia Balissiano with the OPSD said that her agency would sometimes try repeatedly to obtain comment from agencies before presenting the state’s position to the LUC. “But we respect the internal processes agencies use to generate comments,” she said. “We believe those internal routing processes are intended to keep managers aware of policy decisions and staff workloads. We understand that it’s for recordkeeping, consistency of requests and responses, it helps managers assess staff performance and knowledge, and it confirms that responses are correct and complete when, you know, it passes through this process and perhaps different people have to review something before it gets formally to the OPSD. And then as we collect information from the various agencies, because we’re the ones who represent the state’s position, sometimes we need to work with the agencies to reconcile different perspectives, and we do that, and everything that we find we send along to the LUC as part of our testimony. So that is the process that’s used.
“Whether this MOU would help, we’ve not been party to the conversations pertaining to this MOU, so perhaps those conversations can go on. But we’re under the impression that there are, as Ms. Roth says, no statutory obligations associated with this MOU. I guess we’d be concerned if CWRM shares preliminary information with LUC staff and it’s later revised when it comes up through standard DLNR channels that there may be conflicting information out there. But we trust that CWRM, DLNR, LUC staff would bring us into those conversations in a timely manner so that we can be party to it and do our job before the LUC in representing the state’s interest.”
Giovanni noted that CWRM said that this process is broken. “What is the process by which you get information from CWRM? You’re not getting in directly, we’re hearing that.”
“DLNR has many divisions,” Balassiano said. “We’ve been instructed by DLNR’s chair to send things to DLNR and, as Ms. Roth suggested, it goes to the Land Division and then it goes to another six, seven different entities for their comment. So unless DLNR tells OPSD that they would like to have the correspondence sent to them directly, we are abiding by what we’ve heard from DLNR.”
Giovanni asked if it might be possible for OPSD to send correspondence directly to CWRM, eliminating the middleman.
Yes, Balassiano said, adding that it was not clear an MOU would be needed for that. “We would be happy to work out something … to see if there’s a different routing system that could be used,” she added.
Carr Smith observed that the OPSD seemed to give agencies ample time to respond to requests for comment. “If people don’t respond, that’s their problem, not really OPSD’s or LUC’s,” she said.
Orodenker then reminded the commission of the background to the discussion of an MOU in the first place. “I think you have to look at why this whole thing evolved,” he said. “There was some criticism in a couple of periodicals about the fact that the Land Use Commission didn’t seem to be able to understand and have all the information in front of it with regard to water. Which is why we asked CWRM to make the presentation. And as the chair stated earlier, water is very important. It’s part of our public trust obligations. That’s why we had CWRM come and talk to us, to explain to commissioners how their processes worked. There are a number of ways to improve the situation. The MOU is just one way to do it.”
Commissioner Brian Lee voiced his objections to the MOU, which he said circumvents existing authority, deliberation, and chains of custody and command. “An MOU adds additional liability,” he said. “There’s already processes in place. An MOU can make us run afoul of established authority and procedures,” he said. “If the problem is in internal routing, that’s not our problem.”
Carr Smith moved to deny the MOU and withhold any authority of the chair to work any further on it. Commissioner Lee seconded.
Commissioner Michael Yamane supported the motion, but added that he appreciated the presentation by CWRM and wanted to leave the door open to hearing more from them. “Whether we invite them quarterly, or our staff comes up with a way to work with them, and somehow get that information to the commissioners – we need to come up with some kind of solution,” he said.
Chair Giovanni commended CWRM and Roth specifically for trying to address the real problem of a lack of communication between the agencies. “Let me very strongly encourage OPSD to tell this commission, when it comes before us, how this issue has been addressed,” he added. “I want to make sure that if we flag an issue” concerning water management “that it doesn’t get lost … that it makes its way to CWRM so we can have their input and feedback before we make any decision.”
With that, the LUC voted unanimously to reject the MOU.
***
Amended Financial Statements
In our June article on the LUC, we noted that Commissioner Carr Smith had not mentioned her husband’s income on her 2024 financial disclosure form, filed in April.
On June 15, both Nancy Carr Smith and her husband, Riley Smith, a member of the Board of Land and Natural Resources, filed amended financial disclosure statements. The amended statements of both now include spousal income – in the case of Riley Smith, income from Lanihau Properties (ranging between $150,000 and $250,000), and in the case of Carr Smith, income from Aloha Kohala Realty, LLC (ranging from $100,000 to $150,000).
— Patricia Tummons
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