Less than 1 percent of the land nominally managed by the state Agribusiness Development Corporation is found on the island of Hawaiʻi, according to a pie chart in the agency’s most recent report to the Legislature.
That fraction is all in one small, 1.5-acre parcel near the mauka end of the Shipman Industrial Park in Keaʻau, just south of Hilo. The ADC purchased it in 2015 for $500,000.
Whether this land has, in fact, been managed at all in the nine-plus years since that acquisition is open to question. In the entire time the ADC has owned the land, it doesn’t seem to have collected any rent on it or leased it out to any party. County property tax records show the property is unencumbered.
Yet for years – at least seven, possibly more – the parcel has been used by Pacific Biodiesel Technologies, LLC, as a parking lot for its tanks.
Environment Hawaiʻi attempted to find out whether the private company pays rent for use of the state land and, if so, how much and to whom. Inquiries to Pacific Biodiesel and ADC were unanswered.
Just as Environment Hawaiʻi was going to press, the ADC produced a copy of a right-of-entry agreement, signed in August 2020, giving Pacific Biodiesel use of the property for parking and storage purposes. For this, Pacific Biodiesel pays no rent but is supposed to insure the state. ADC was asked if proof of insurance was ever obtained; no response was received before we went to press.
Why did ADC acquire the land in the first place? Questions to ADC about the rationale behind the purchase were referred to Becker Communications. According to Scott Ishikawa, a senior account director with the company, Becker Communications had “just been awarded a state contract to assist ADC with media relations.”
“The property had been purchased to house a proposed food waste treatment facility to handle items such as table scraps, outdated and off-spec produce, to create organic fertilizer,” Ishikawa replied. “However, project funding lapsed several years ago and has not been reappropriated.”
An Ambitious Project
More than a decade ago, the state, under the leadership of Governor Neil Abercrombie, was championing the idea of using crops and waste produce for biofuels. In April 2013, the governor’s office issued a press release announcing the award of $200,000 from the state Department of Agriculture to the Pacific Basin Agricultural Research Center, an agency of the U.S. Department of Agriculture. The award was to support PBARC’s “zero waste biofuel and high protein feed program,” the press release stated. (The award was actually made by the ADC.)
“Aside from the benefit of producing biofuel,” the press release said, “this technology has the ability to create another revenue stream for papaya and other tropical agricultural farmers… At full scale, more than 1,000 jobs are projected.
“While papaya was chosen as the initial feedstock, this technology can be applied to any plant material as a carbon source. In Hawaiʻi, other identifiable feedstock are unmarketable sweet potato, sugar cane, mango, albizia, and glycerol.”
Jimmy Nakatani, then head of the Agribusiness Development Corporation, is quoted as describing the project as “a major breakthrough that focuses on key components hampering the sustainability efforts of other micro-organism based fuel projects. … Using unmarketable plant and other waste materials drastically reduces this cost driver.”
A year later, in August 2014, Abercrombie’s office issues another press release, this time announcing the award of $1.6 million from ADC to PBARC.
On April 22, 2015, the ADC board heard a presentation urging approval of the Keaʻau parcel. Staffer Ken Nakamoto described this as an acquisition “needed in conjunction with our zero waste project.” According to ADC minutes, he told the board that the Legislature last session had allocated funds “to establish a zero waste demonstration facility on Hawaiʻi island for the purposes of scaling up the mini pilot project to determine if the heterotrophis algae/fungi can be produced on a commercial scale.
“ADC entered into a [memorandum of agreement] with Pacific Biodiesel to establish a temporary demonstration on PB’s property to work on the specialized equipment which may take months to assemble. ADC identified land in the W.H. Shipman Business Park to construct the permanent zero waste demonstration facility. The property is an ideal location to construct the facility because of its industrial zoning and its proximity to the PB facility.”
Scott Enright, chair of the Department of Agriculture, “commented that the land adjacent to Pacific Biodiesel in Keaʻau allows ADC to move forward. The original work was done by PBARC so now that we are taking it to commercialization but still in the demonstration phase this allows us to tie it in. The thought is that Pacific Biodiesel has the best track record to allow us to move forward just short of commercialization.”
The board approved of the purchase. The sale was recorded December 4, 2015.
Petering Out
The big plans to turn unsellable papayas, other produce, albizia, and who knows what else into fuel or feed seems to have fizzled.
In 2016, the Legislature appropriated $1.5 million for “plans, design, construction, and equipment for the Keaʻau facility to develop biofuel and animal feed in Keaʻau, Hawaiʻi.”
ADC’s reports to the Legislature for 2018 and 2019 report its expenditures on the zero waste project.
In fiscal year 2018 it had a budget of $25,000 for zero waste but spent $42,924. In 2019, the budget was again $25,000, but it spent $64,173.
Both reports contain an identical description of the accomplishments toward zero waste:
Reducing food waste, the reports state, is a strategy championed by UDSA PBARC. The ADC, PBARC, and Pacific Biodiesel Technologies “currently are engaged in a project regarding the development of algae grown on papaya waste as a biofuel and livestock feed.”
The sole achievement noted is the completion of plans and design for project-build out “in the adjacent lot to Pacific Biodiesel. The construction phase was put out to bid and did not receive any offers. As a result, the funds received for construction ($1.5 million) lapsed on June 30, 2018.”
— Patricia Tummons
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