Editorial

Oh, Give Me A Home: Rent-Free, Please, at Pu`uwa`awa`a

I can’t afford to buy a house in Hawai`i, and rent is expensive. But for a favored few, the state, bless its heart, has a subsidized housing program that allows them to live in neat homes, in a highly desirable and expensive neighborhood – rent free! Where can I sign up?

The area is Pu`uwa`awa`a, one of the most beautiful areas of the Big Island. At the nearby subdivision of Pu`u Lani, houses can sell for half a million dollars. But on nearby state-owned land, ranchers and others have been living for years in houses for which the state has not collected so much as a dime in rent.

How could this happen?

Well, it’s a long, three-chapter story, but anyone who knows the first thing about the state’s mismanagement of the Big Island ahupua`a of Pu`uwa`awa`a won’t be surprised to learn that the situation traces back to the days when F. Newell Bohnett was the lessee to whom the state entrusted more than 100,000 acres of rare dry forest and pasture land. Bohnett, let it be said, had little truck with rules and regulations; under his tenure, ranch hands were allowed to build houses on the leased land. In addition, he built a “party house” and a lovely guest cottage. None of this was legal – either under terms of his lease (which expressly prohibited expanded residential use of the land), or under state law (houses are strictly limited in the state Agriculture District). But Bohnett was not deterred. The houses went up, without so much as a building permit from the county.

To be sure, other actions of Bohnett caused the illegal houses to pale in comparison. Illegal koa logging. Illegal dumps, set up for the convenience of residents of his Pu`u Lani subdivision. Illegal bulldozing of a road up a steep cliff in the Conservation District. For pity’s sake, there was even the illegal construction of an airstrip.

Bohnett was eventually instructed to seek after-the-fact building permits from the county for the new structures. Files at the state Land Division suggest he took a stab at doing so but then encountered a catch-22 of his own making: before getting any county building permit, he had to obtain permission of the land owner (i.e., the state). But the state could not give Bohnett its approval for the houses, since that would violate state law and lease terms.

And there things stalled. Bohnett turned over his lease to the Pu`uwa`awa`a Cattle Company in August 2000, and while the state talks about going after him for the costs of cleaning up the vast quantities of junk he left behind, I’d lay odds on Bohnett walking away Scot-free. He’ll not pay for the cleanup, much less will he be forced to deal with the unpermitted structures.

Chapter Two: For the first nine months after Bohnett left the scene, the Pu`uwa`awa`a Cattle Company — formed by longtime ranch hands Miki Kato, Stephen DeLuz, and Ernest DeLuz – occupied the land on an extension of Bohnett’s lease. But in April 2001, the Land Board terminated the lease and voted to allow the ranchers to use about 17,000 acres of the Pu`uwa`awa`a land under a month-to-month revocable permit (RP). To accommodate residents of the houses, the Land Board directed staff to exclude from the ranch RP the land occupied by the more significant structures (some 15 acres for eight buildings). The Hawai`i District Land Office was to issue revocable permits for these as well as for the pasture land, just as soon as an appraisal of the land and structures could be made.¹

The state appraiser was asked to conduct the appraisals in May 2001. Since then, nothing has happened, except that the state appraiser has resigned. No RPs have been issued yet for land or houses.

Harry Yada, who has returned from Honolulu to head up once more the Big Island Land Division office, blames himself for much of the delay in getting the RPs issued. The intention has always been to have the rent on all the permits be retroactive to April 2001, he says, and he’s not too concerned that the occupants will welsh on the amounts owed for back rent, once rental rates have been set. Last year, he says, the ranchers actually tried to pay rent, but the DLNR couldn’t accept their check since no account had been set up to receive such payments.

But no matter how you cut it, for more than a year, the Pu`uwa`awa`a Cattle Company has grazed its livestock on state land without paying rent. Stephen DeLuz continues to occupy a rather swell house, on state land, without paying rent. Miki Kato lives rent-free in a more modest home. Three small houses near the fee-simple inholding formerly owned by Bohnett (and now by Jerry King) were occupied when a state land agent and a contractor visited them for a preliminary assessment last April, in preparation for the Land Board’s action. No rent has been paid on those – at least, not to the state.

And the list of outrages continues: For a while, two other houses at Pu`uwa`awa`a, further up the mountain, were occupied – by none other than state enforcement agents with the DLNR’s Division of Conservation and Resource Enforcement. They, too, paid no rent. (Their boss, Lenny Terlep, finally ordered them out.)

To be sure, not all the structures are illegal. Those that predate the state’s Land Use Law (1961), such as the three small houses and the DOCARE camp, are grandfathered.

More than a year ago, state land agents asked the tenants of Pu`uwa`awa`a what structures they wished to have permits to occupy. Stephen DeLuz claimed the house he was living in, Miki Kato claimed his, and the two of them, on behalf of Pu`uwa`awa`a Cattle Company, also asked for dibs on a hangar near the airstrip. King asked for permits to use the three older structures near his fee-simple land, intending to use them in connection with the retreat center he plans. No revocable permits have been issued to date for any of the structures.

But there’s still up for grabs the lovely unoccupied A-frame cabin fronting a reservoir and a nearby “party house” that’s ideal for baby luaus or family reunions (kane and wahine restrooms, kitchen, huge covered lanai, barbecue pit). There’s another cedar house, built about the same time as Miki Kato’s and apparently with the same set of plans. And don’t forget the upland ex-DOCARE houses, one of which was done up very nicely before orders came to move out.

Really, though, is the “dibs” system the way state properties should be rented out? Those who stand to benefit most are precisely those who have already benefited for years with free land rent. Should they be allowed to continue to occupy these houses without being charged something for all the years they’ve been living on land for which the state received annual rents of pennies per acre?

Chapter Three: In January, the Land Board turned most of the Pu`uwa`awa`a land over to the Division of Forestry and Wildlife. Jon Giffin of DOFAW’s Big Island office has no idea whether he’s supposed to take over rental management, and in any event, he says, he and his staff have neither the resources nor the expertise required. Land agent Wes Matsunaga says it is no longer up to the Land Division to manage the state’s assets at Pu`uwa`awa`a, be they land or structures.

Will the state collect back rent for the last year of grazing at Pu`uwa`awa`a? Just how quickly will a pasture RP be issued – and by what agency? Will taxpayers ever collect back rent for the occupancy of illegal structures?

Finally, will the state ever shape up and manage its resources at Pu`uwa`awa`a, be they precious or prosaic, with anything approaching due care?

If these questions are ever to be resolved, it will take a lot more effort and attention than the state has been willing to give Pu`uwa`awa`a in the many years it has nominally been managing the area. The chairman of the Land Board, Gil Coloma-Agaran, should immediately assign someone from DOFAW or the Land Division – maybe one from each – to stay with this issue like paint on bare wood. By the time DOFAW makes its report to the Land Board in August on its plans to manage Pu`uwa`awa`a, each and every one of these matters should be settled in a fair and equitable way.

1. As to what a fair rent for the pasture RP might be (should it ever be issued), I would suggest in the neighborhood of $21,000 a year. When the Pu`uwa`awa`a lease was in effect, the ranchers were paying about $33,000 a year for some 20,000 acres. Usually, the state allows a discount of about 25 percent for RPs, since they cannot be used to obtain long-term financing. So, if the acreage is reduced by about 15 percent, and the rent is reduced by about 25 percent, the $33,000 annual rent would become about $21,000.

— Patricia Tummons

Volume 12, Number 11 May 2002