The Board of Land and Natural Resources has decided that the two largest vessels plying the waters of Kane’ohe Bay must go under terms of the Kane’ohe Bay Master Plan.
The board’s decision, made at its April 11 meeting, was immediately appealed to Cir cuit Court by two closely allied boating com panies – Mid Pacific Hawai’i, Inc., and Kane’ohe Bay Cruises – and Seigfried Schuster, who with his wife, Toshiko, owns the companies. The lawsuit claims that Schuster, in his decision to purchase the vessel Royal Princess, had relied on assurances from the state that the vessel would be permitted.
In making its decision against the Royal Princess and the Ale Ale Kai, operated by Morning Star Cruises, Inc., members of the Land Board were clearly troubled by the actions of staff at the Department of Land and Natural Resources’ Division of Boating and Ocean Recreation. Hawai’i board member Chris Yuen summed up the feelings of the board:
“The department should apologize to the community for not implementing the master plan,” Yuen said following the close of public testimony on the matter. “There’s something else that really does bother me about this with respect to the commercial operators that are affected. There are two boats that should not be operating in the bay and I’m going to vote that way. But it does bother me a great deal and it’s a terrible thing that they did go to the DLNR, for which we are the board, and they did inquire and they have letters accepting their boats.
“We are now in a situation where we are confronted with this, and the fact is that it appears to be illegal. The question is, there’s no right thing to do, there’s no purely right thing to do.
“We’re going to have to do something that I don’t like, which is to go back on something that was said to you, an assurance that was apparently made, if I’m reading the letters correctly, to the operators. But we should follow the law.”
Shortly thereafter, the four members of the Board of Land and Natural Resources that were present at the end of a marathon meeting voted unanimously to void the per mits allowing the Royal Princess and Ale Ale Kai to operate in Kane’ohe Bay.
Exactly how the Land Board ended up in such a quandary – having to take action that rescinds permits granted by one of its own agencies – is a long, intricate story that, for most intents and purposes, begins seven years ago.
The Kane’ohe Bay Task Force
In 1990, the Legislature passed, and then Governor John Waihe’e signed, a bill estab lishing the Kane’ohe Bay Task Force. In passing the bill which became Act 208, Ses sion Laws of Hawai’i, the Legislature deter mined that Kane’ohe Bay “is a unique and treasured natural resource that must be preserved and protected for the continued enjoy ment of the general public.”
“Currently,” the Legislature further stated, “the bay is heavily used by the general public, ocean and marine research programs, and commercial ocean recreation operations, cre ating use conflicts. Use of Kane’ohe Bay by commercial operators is a privilege and not an exclusive right.
“Therefore, in order to resolve the con flicting use problem, the Legislature finds that a master plan should be developed which shall be used as the recommended guideline in the adoption and implementation of rules with regard to the regulation of all activities in Kane’ohe Bay.”
To develop this master plan, Act 208 established the Kane’ohe Bay Task Force. Members were to include the directors of the state departments of Transportation, Health, and Land and Natural Resources; the director of the University of Hawai’i Institute of Marine Biology; two members of the Kahalu’u Neighborhood Board; two mem bers of the Kane’ohe Neighborhood Board; the commander of the Kane’ohe Marine Corps Air Station; and two members to be appointed by the governor – one to repre sent commercial fishing interests; one to rep resent commercial ocean recreation activities.
In addition to directing the task force to develop a plan by October 1, 1991, Act 208 also established a moratorium on new commer cial permits: “Notwithstanding any law to the contrary, no new commercial permits for Kane’ohe Bay shall be issued after the effec tive date of this Act and no expansion beyond existing levels of commercial activities shall be permitted.”
Extensive Participation
Once the Task Force convened, its member ship altered slightly. The Marine Corps rep resentative advised he could participate in the discussions, but was not to vote on any issue. In addition, Task Force members invited representatives from the City and County of Honolulu departments of Land Utilization and General Planning to participate as ex -official members.
The Task Force’s work was divided among three committees: land use, water use, and long-range planning. Sitting on the committees were not only selected members of the Task Force, but also their alternates and interested community members. Subcom mittees were formed to delve into specific issues. The work of the water use committee, for example, was parceled out to three sub committees initially: commercial recreation; high-speed boating, mooring and berthing and sea planes; and fishing, diving, and pic nicking.
Over the next 15 months, the Task Force and the Office of State Planning, which was assisting in preparation of the master plan, held 21 meetings, all of them open to the public. In addition, from June through No vember 1991, an ad hoc committee met in mediated sessions to develop a plan for managing commercial recreation.
Because of extensive public participation, the deadline for submittal of the master plan was extended a couple of months. But by March 1992, a final plan was presented to Harold S. Masumoto, then director of the OSP. On March 19, 1992, Masumoto for mally accepted the plan. Thirty days later, Act 208 was repealed, under its own terms, and the Task Force was disbanded.
In 1993, the Legislature passed Act 317, whose purpose was to make the recommen dations contained in the Master Plan legally binding. The Kane’ohe Bay Regional Coun cil was also established by this law. Its duties were to “facilitate implementation of the Master Plan as it relates to ocean use activities” and to “advise and make recommenda tions to the state and the county on matters regarding the use of Kane’ohe Bay by the general public, marine research programs, and commercial ocean use activities.”
Act 317 also amended Chapter 200, the law that generally governs commercial boating activities. A new section was added to the chapter, requiring the state Department of Land and Natural Resources to limit permits issued “for the commercial operation of ocean use activities … to the number, by permit type and vessel and passenger capacity, provided in the Kane’ohe Bay Master Plan.” It also required the DLNR to adopt rules, pursuant to Chapter 91, Hawai’i Revised Statutes, set ting passenger capacity for snorkeling tours and glass-bottom boar tours.
Under its own terms, Act 317 is to be repealed July 1, 1998.
Terms and Conditions
Members of the Task Force identified the major issues by using a scoring system, in which the various types of uses of Kane’ohe Bay were ranked according to the impact they had on a wide range of identified resources. As described in the Master Plan, “thrill craft operations” – involving jet skis, high-speed towing of inner tubes, “banana” sleds, “water wienies,” and the like – “conflicting with other users and creating safety problems were rated among the highest” issues of manage ment concern. “Commercial recreation con flicts with other bay users, fishpond uses, and the need to protect the public interest were rated higher…. Commercial in-water activity conflicts with other bay users, the rural char acter of the bay, and impact on reefs were rated high.”
The Task Force placed a total ban on operation of non-commercial thrill craft in Kane’ohe Bay. In doing so, it specifically rejected state administrative rules for an Ocean Recreation Management Area in Kane’ohe Bay that had been adopted in October 1991 by the Department of Transportation. Perpetu ation of those rules, the Task Force report states, “would not resolve the problems and conflicts.”
The mediation effort concerning limits to commercial users resulted in an agreement eventually signed by all parties. Seven criteria were used as guidelines: reduction of conflict; retention of the rural character of the bay; safety; protection of reefs and submerged lands; preservation of the public interest; consistency with Department of Health Class AA waters; and provision of a “fair opportunity for commercial recreation,” so long as it would be consistent with the other six criteria.
The Master Plan sets forth several levels of commercial operation, each with its own type of permit. There would be four “full service recreational permits” allowed in Class AA waters of the bay. These operators would be allowed to offer customers a wide range of recreational options, including thrill craft, snorkeling, and high-speed towing. At the time of the plan’s adoption, there were five full-service operators in the bay: Mid Pacific of Hawai’i (owned by the Schusters), Morn ing Star Cruises (then owned by Kimo Hogg), Dina Morita & Associates/Windward Sea Yacht Charters (Bruce Morita), Club Kona, Inc. (Joe Pickard), and North Bay Wave Runners (Ralph Schrader).
Outside of Class AA waters, the Master Plan allows one more full service operator, but “only if the associated operational and supporting activities on the land meet all applicable land use laws and zoning ordi nances.” In addition, the capacity of this operator “is recommended to be established through the Conservation District Use Ap plication permit process, including a review of the certified shoreline and equipment al lowed.” Pending CDUA approval, an in terim capacity is recommended not to exceed 150 customers per day.”
“Large snorkeling tour permits” would be issued to three operators in service. At the time of the Master Plan, the three large snorkel tour operators were All Hawai’i Cruises, Inc. (owner Gabriel Siu), North Bay Boat Club (Ralph Schrader), and Kualoa Ranch.
“Small sail and snorkel tour permits” were limited to three operators. Those in service at the time of the plan were Hawai’i Blue Water Sailing (Bill Chambers), Dreamer Yacht Charters, Inc. (Donald R. Marcell), and Cap tain Leo’s Bay Adventure (Leo Williams).
Just one “tour and glassbottom boat per mit” was to be issued. At the time of the plan, two such operators were identified: Kane’ohe Bay Cruises, Inc. (Schuster), which operates the venerable Coral Queen; and North Bay Boat Club.
Full Service Operators
The Master Plan called for the largest of the two full-service operators (Mid Pacific and Morning Star) to restrict their operations to Checker Reef. Each operator was to be al lowed two “host vessels” with “an aggregate total registered vessel capacity of 150 passen gers” and the daily limit on passengers would be set at this number, too. In other words, no more than 300 passengers per day should be using Checker Reef.
The Master Plan set limits on the equip ment used by the full-service operators as well. Each would be allowed no more than seven jet skis (six for commercial use, one for administrative use); three runabouts with a capacity of six passengers or less (known as “six packs”); two equipment barges for non-motorized activities (snorkeling, paddling, diving) and for queuing up for jet-ski use; and “other non-motorized equipment … as needed, including kayaks, canoes, wind surf ers, small sailing vessels, and individual water sports equipment.”
In the vicinity of the Sand Flat in the Central Bay, two smaller full-service operators were authorized. Each would be re stricted to one host vessel, with a maximum vessel capacity of 70 passengers and a daily limit of 70 customers per permit. In this area, operators would be allowed no more than four jet skis (including one for admin istrative use), two runabouts, two equipment barges, and various non-motorized equipment as needed.
In all, full-service operators are allowed under the Master Plan to serve no more than 440 customers a day in Class AA waters of the bay. At Kualoa, an additional full-service operator was authorized to serve no more than 150 customers a day.
The three snorkel tour operators allowed under the plan were each limited to 70 pas sengers a day. The three small sail-snorkel tour operators were limited to 35 passengers a day per permit. Finally, there was just the one glassbottom boat operator allowed, and it was limited to 70 passengers per outing. (No daily limit was set for this type of tour.)
Transition Period
“During the initial offering of permits under this plan,” the Task Force report states, in cumbent permit holders of record on Octo ber 1, 1991, shall have right of first refusal in the permit category in which they are presently operating, as modified by this Master Plan… Permits not claimed in the initial offering shall be declared null and void, and the total number of permits allowed in Kane’ohe Bay shall be diminished.”
The Task Force anticipated that the Division of Boating and Ocean Recreation, whose administrator, David Parsons, was one of the signatories to the plan, would quickly adopt administrative rules to imple ment the plan’s provisions. “Administra tive rules implementing these provisions managing commercial recreation in Kane’ohe Bay shall be published and heard within one year of approval of this plan,” the Master Plan states. No more than a year’s transition period was anticipated: “The provisions of this plan shall be effec tive one year from adoption of implementing administrative rules.”
Pending adoption of rules, the morato rium on equipment and vessel changes would be in effect: “The moratorium on equipment and vessel changes used in com mercial operations shall remain in effect until the adoption of rules pursuant to this plan, other than replacement of existing equipment at equal or smaller capacity.”
Recognizing that some operations would need to be scaled back to reach the goals set in the Master Plan, the plan set limits on the transfer of operations. “Commercial jet skis and high speed activities are incompatible with AA class waters,” the Master Plan states. “However, as several operators are already in business in Kane’ohe Bay and have made substantial investments, those operators’ use of jet skis and high speed towing will be grandfathered until their businesses are sold or terminated through attrition. Owners or shareholders of record of permits which allow the use of jet skis and high speed towing as of the effective date of the rules implementing these provisions may transfer any interest in the business for up to one year following the effective date of the implementation of the same rules. Afterwards, any transfer or combination of transfers of a majority interest or greater by the owners or shareholders of full service recreational permits designated of record on the effective date of the rules implement ing these provisions shall automatically void the use of jet skis and high speed towing activities, reverting the permit to a snorkel tour. The purpose of this constraint is to bring commercial use within Kane’ohe Bay into compliance with the protected uses of AA waters without imposing undue financial hardship on existing businesses.”
Community Provisions
In a section of the Master Plan headed, “Community and Public Interest Protection Provisions,” the plan outlined proce dures that were to be followed when permit holders sought renewal of their permits (to be reviewed annually). “An application for permit renewal shall be publicized for pub lic and government agency comment 30 days before action on the renewal.” Among those whose comments were to be sought were the Honolulu Department of Land Utilization and the state Department of Land and Natural Resources.
Applicants would be required to have a clean record with respect to compliance with permit limits on capacity and opera tion; no history of repeated unsafe practices; and “no zoning violations associated with or attributable to the business or sup porting businesses of the permitted operation.”
In addition, environmental monitoring was to be conducted to evaluate the impacts of thrill craft on the reef and on water quality. This monitoring was to be inte grated with other monitoring programs recommended by the Master Plan.
“Proof of sewage pump-out contract is required for the life of the permit, and each base vessel is to be fitted with U.S. Coast Guard approved marine head facilities ap propriate to the number of passengers and record of pump-outs for prior periods.” In addition, vessel captains were to submit each week to the harbormaster at He’eia Kea pier “a daily log of operations,” includ ing numbers of passengers, fuel or sewage spills, pump-outs, refueling, other incidents on the water, and times of arrival and departure at the pier or operating area.
Finally, the Division of Boating and Ocean Recreation would be responsible for submitting a Conservation District Use Application “and associated environmental assessment for the commercial use of sub merged lands.”
A Plan Ignored
The master plan was accepted by the state on March 19, 1992 – but this appears to have had little impact on actual management of boating operations. At the time of the sign ing, the Boating Branch of the Harbors Divi sion of the state Department of Transporta tion was preparing for its imminent transfer to the Department of Land and Natural Resources, where it was to be known as the Division of Boating and Ocean Recreation.
Well out of public view, the DLNR was also working to set the stage for this transfer. Both Parsons, head of the DOT Harbors Boating Branch, and William Paty, then director of the Department of Land and Natural Resources, had been signatories to the resolution of the Kane’ohe Bay Task Force that, in March 1992, had urged the Office of State Planning to approve the plan “and distribute it to the appropriate agencies for implementation.”
Yet a scant two months later, Paty and Parsons had agreed to assign to the new DLNR Division of Boating and Ocean Rec reation broad statewide responsibilities that, in fact, ran counter to the way drafters of the Master Plan anticipated its implementation. In a memo dated May 29, 1992, and addressed to DLNR divisions and offices, Paty described new “procedures for departmental review of commercial/recreational boating and other ocean-based activities affecting beaches and nearshore submerged lands.” Among other things, Paty determined that:
“Regulating and management of com mercial/recreational boating and other ocean -based activities affecting beaches and nearshore submerged lands shall be the re sponsibility of the boating program under the Division of Boating and Ocean Recreation (DOBOR) [which was to become part of the DLNR on July 1, 1992]. DOBOR shall be responsible for processing the particular boating or ocean-based activity for review and approval by BLNR. This includes undertaking or overseeing the environmental review process under Chapter 343, Hawai`i Revised Statutes, and the consultation with the divisions, other governmental agencies, and ap propriate citizen groups before submittal to BLNR for final review and approval (via the issuance of a permit or the adoption of an administrative rule).”
In addition, Paty directed that “DOBOR shall be solely responsible for the establish ment of mooring areas and the processing of individual mooring requests for approval by BLNR.”
Although the memorandum had far-reaching implications, it was never brought to the Board of Land and Natural Resources for approval. And although the memo did direct DOBOR to bring permits to the BLNR “for final review and approval,” in fact, ever since DOBOR’s transfer to the Department of Land and Natural Resources, not one boating permit under DOBOR’s jurisdiction has come before the Land Board for a vote. (DOBOR routinely brings other matters to BLNR attention, however. Most of these involve the management of dry lands that are part of the small-boat harbor areas under DOBOR jurisdiction.)
Discrepancies
As indicated earlier, the Legislature in 1993 revisited Kane’ohe Bay, passing Act 317. The stated purpose of the act was “to implement the recommendations of the Kane’ohe Bay Master Plan Task Force related to ocean use activities and facilitate ongoing cooperation between various parties involved with ocean use activities in Kane’ohe Bay.” Act 317 added a new section to Chapter 200 of Hawai’i Revised Statutes (the section of law dealing with ocean use activities).
The new section, which sets limits on Kane’ohe Bay ocean use activities, stipulates that permits issued by the DLNR for com mercial ocean use activities “shall be limited to the number, by permit type and vessel and passenger capacity, provided in the Kane’ohe Bay Master Plan.” It departs from the Master Plan, however, in allowing thrill craft permits to be transferred up to five years from the effective date of Act 317 (June 21, 1993), and in allowing transfers of such permits among family members to occur with no time limit at all. The Master Plan, on the other hand, provided for the transfer of thrill craft permits for just one year and made no special provi sion for transfers among family members.
Transfer Fees
These different approaches to ownership transfer contained in Act 317 and the Master Plan appear to have gone unnoticed or, at the very least, unremarked by the Division of Boating. In late 1994, DOBOR was presented with a request to authorize a transfer of Morning Star Cruises from the owner of record in 1990-James “Kimo” Hogg – to PY Investments, Inc., owned by Paul Yip.
Documents in files at DOBOR’s Hono lulu office indicate that Yip paid approximately $400,000 to purchase all of the com mon stock of Morning Star and most of its assets, including the 62-foot catamaran Aikane III, the 50-foot cat Hoku Ao, and a permit allowing the Hoku Ao to load and unload up to 49 passengers at a time from He’eia Kea pier.
In February, Steve Thompson, the O’ahu district manager for the Division of Boating, calculated the transfer fee payable to his agency. The transfer fee for sale of the permit to load the Hoku Ao at He’eia pier was set at $15,000; the fee for sale of the permit to load another six-passenger vessel was set at $5,000; and the transfer fee covering the sale of the Ocean Recreation Management Area permit (covering operation of thrill craft) was set at precisely $9,520.79 – an amount calculated to be equal to 2 percent of the gross income from one year of operation. (Calculating backwards, that would place the one-year gross receipts from Morning Star’s full-ser vice operations at $476,050.)
At the same time, the fee for Morning Star’s commercial operating area use permit went from a base of $75 per month or 2 percent of gross receipts (whichever is greater) to $600 per month or 2 percent of gross. (By comparison, the monthly fee assessed on the other large full-service operator in Kane’ohe Bay, Mid Pacific of Hawai’i, Inc., has re mained unchanged at $75 per month or 2 percent. The discrepancy in base fees charged the two operators has little practical effect, however, since the 2 percent cut of monthly gross receipts has exceeded $600 for each operator in every month for which Environ ment Hawai`i was able to review records.)
The Ale Ale Kai
In early 1996, each of the two large full-service operators began planning to upgrade their operations by purchasing larger vessels to be used as the “host” platforms for tours. By the end of the year, the Division of Boating had given the go-ahead for the substitution, but when the vessels finally arrived in Kane’ohe Bay, their presence sparked community pro tests that resulted, eventually, in the action of the Land Board described at the outset of this article.
But the Land Board action has not solved the puzzle of how the Division of Boating came to issue permits to such large vessels in the first place. In an effort to address this question, Environment Hawai’i has reviewed DOBOR files relating to the permits held by the two large full-service operators. What they reveal is described below.
When the moratorium went into effect, Morning Star Cruises would load 47 passen gers at a time onto the Hoku Ao catamaran and ferry them to the Aikane III, which was used as a host vessel. Both boats were sailing vessels, but neither had been sailed for some time, with auxiliary power used to propel the boats around the bay. The Hoku Ao’s Coast-Guard authorized passenger capacity was 47; that of the Aikane III was 134.
On occasion, the loading permit would be shifted for brief periods of time from the Hoku Ao to the Aikane III, usually when the Hoku Ao was taken out of service for main tenance or repairs. Another unnamed six-passenger motor boat was permitted to use the pier for loading and unloading customers.
In mid-July, the Division of Boating was notified of Morning Star’s intention to make changes to its operations. On July 18, DOBOR received a fax transmittal of the specifications of the Ale Ale Kai, which was identified as a 125-passenger catamaran having an overall length of 100 feet. Four days later, Paul Yip, president of PY Investments (owner of Morn ing Star Cruises) wrote Thompson:
“We would like to transfer our current operating (loading) permit from the Hoku Ao to the Aikane III. In addition, we would like to replace our stationary boat the Aikane III with a new catamaran, the Ale Ale Kai… We will not have any new activities as a result of this change and will continue to observe all of the moratorium rules that are still in effect for Kane’ohe Bay. We would like to make the above changes effective on August 1, 1996, or sooner if your office can approve our request and complete all of the necessary paper work.
Yip appears to have visited Thompson the very next day, July 23. He did not arrive empty-handed. As described in a letter July 24, 1996, to Daniel Mollway, executive direc tor of the State Ethics Commission, Thomp son wrote: “Yesterday we were surprised to be given ten Mahalo Airline flight coupons… by a permittee from one of our boating facilities. I promptly brought the donation to the attention of our division administrator.
“The donor had a request pending before this office which had been authorized prior to the donation of the flight coupons. The donation of the flight coupons did not influ ence the authorization in any manner.
“Due to these fiscally hard times, we desire to retain these ten flight coupons for use on official interisland business. Is there an ethics violation if we retain them for official use?”
(Yip was purchasing the Ale Ale Kai V from Robert’s Hawai’i Cruises, Inc. The owner of that firm, Robert Iwamoto, is a part-owner of Mahalo Airlines. Another part-owner of Mahalo is Land Board member Michael Nekoba.)
The Ethics Commission frowned on Thompson’s request to keep the coupons. On September 13, the coupons were returned to Yip.
Musical Chairs
On July 29, Thompson gave Yip “condi tional authority” to bring the Ale Ale Kai V into service under a three-way switch. The Hoku Ao’s loading permit would go to the Aikane III, the Aikane III’s role as a “host” vessel would be transferred to the Ale Ale Kai, while the Hoku Ao would be taken out of service, with its permitted passenger capacity transferred to the Ale Ale Kai.
Still, this musical-chairs approach to vessel substitution had some problems. The Aikane’s passenger rating stood at 134, but it could load no more than 49 passengers at a time. (The Hoku Ao could have loaded 49 at a time had it been rated by the Coast Guard to carry that number. However, since its passenger rating was just 47, it was limited to that lower number.) “We understand that at this time you intend to keep Aikane’s passen ger rating at its current authorized level of 134,” Thompson wrote, despite the 49-pas senger limit on loading.
The day after Thompson’s “conditional authority” was issued, Yip purchased the Ale Ale Kai V from Robert’s Hawai’i Cruises for a stated purchase price of $100,000. (The year previous, Robert’s Hawai’i Cruises had pur chased the same vessel from a closely affiliated company, Robert’s Catamaran III, Inc., for $225,000. Given that that was not an arms-length transaction, the actual fair-market value of the vessel is difficult to derive.)
On August 8, a letter from Thompson refines the passenger-capacity issue. Under the new scenario, the passenger capacity of the Hoku Ao was to be transferred to the Ale Ale Kai V. In addition, a “six-pack” boat would be removed from service, and its ca pacity would also be added to the Ale Ale Kai, giving Ale Ale Kai a permitted passenger capacity of 55. “Please provide us with the USCG Certificate of Inspection that shows you had its [the Ale Ale Kai] passenger capac ity downgraded from its current 125 to 55, Thompson wrote. (This certificate, showing the Ale Ale Kai’s Coast Guard passenger rating at 55, was provided in January 1997.)
What would be done with the Hoku Ao? According to Thompson, Yip had informed DOBOR that he intended “to dispose of the Hoku Ao via a business arrangement with All Hawai’i Cruises,” another Kane’ohe Bay operator.
An outstanding issue remaining was the allowed passenger capacity of the Aikane. As Thompson explained it, “the Aikane III was originally certified for 149 passengers in 1974,” but at the time the Kane’ohe Bay moratorium went into effect, in 1990, it had been downgraded to 135 passengers (at other times, the passenger capacity was referred to as 134). It remained at the 135-passenger level, Thomp son continued, “until its October 26, 1995, inspection, when it was increased to 149.”
“We discussed the issue of the additional 14 Aikane III passengers at length. We agreed that you would have 30 days from the date of our August 6, 1996, meeting to provide us with appropriate documentation to warrant retaining the additional 14. It was understood that should you not be successful, Morning Star Cruises will have to reduce its passenger carrying capacity by 14.”
A mooring permit account was set up for the Ale Ale Kai on August 29. Soon thereafter, it was put into use as the “host” platform for Morning Star. The Aikane III began service as a ferry for passengers, and the Hoku Ao went out of service – although it remained available on a standby basis to be used when the Aikane was drydocked (as occurred in mid-September).
Sliding Numbers
The matter of the capacity of the Aikane was still unsettled in October 1996. On October 28, Thompson wrote Yip, reviewing the ef forts to arrive at some resolution of the issue. “On October 23, 1996,” Thompson said, “while attending the Kane’ohe Bay Regional Council meeting, I met with [Coast Guard] Commander Simonson and we discussed the issue of Aikane III’s change in passenger carrying capacity from 138 passengers to 149 passengers.” (Somehow the existing capacity had increased by three since August.) “Com mander Simonson informed me that the records at his disposal did not provide the information necessary for us to authorize you the eighteen [sic] additional passengers in question” (emphasis added). It remains an unsolved puzzle as to how Thompson came up with this last figure, but in any event, he allowed Yip until December 31 to come up with the “appropriate documentation … so that Morning Star Cruises will not have to reduce its passenger carrying capacity by eigh teen.”
When February 1997 rolled around, Yip was still trying to shuffle passenger capacity among the three vessels Ale Ale Kai, Aikane, and Hoku Ao – even though the last of these was, theoretically, out of service. In a letter dated February 5, Yip proposed to Thomp son “the following adjustments for capacity counts:” The Ale Ale Kai would be recertified for 100 passengers (upgraded from the artifi cially low level of 55 that had been set the month previous by the Coast Guard, at Yip’s request, although still well below the rated capacity of 125 in place when they purchased the vessel); the Aikane, whose capacity of apparently had been unable to increase to 149, would now be rated at 73; and the Hoku Ao – whose passenger capacity had been transferred in August to the Ale Ale Kai – would be rated at 20 passengers. In anticipation of a fixable response, Yip had asked the Coast Guard two days earlier to issue a revised capacity rating for the Aikane, increasing it to 138 passengers, two crew, and one master. (The revised certificate was issued on Febru ary 8.)
All totaled, this arrangement would give Yip a passenger capacity of 193, which, he stated in his letter to Thompson, was still within “the capacity limitations set during the moratorium.” (In fact, it would appear that this arrangement would slightly in crease the moratorium levels. At the time of the moratorium, the Aikane was rated at 134 or 135, the Hoku Ao at 47, and an unnamed runabout at six, for a maximum of 188 passengers.)
On February 24, a letter from the Depart ment of Attorney General to several members of the state Legislature cast into doubt the legality of many of the permits issued by the Division of Boating to Kane’ohe Bay operators. In light of that, on February 28, Thomp son responded to Yip’s most recent substitution proposal: “For our numerous discussions regarding our concern with respect to your February 5, 1997, request, and in light of recent developments, this letter is to confirm my … verbal notice to you the processing action on your request has been suspended.”
In another letter dated February 28, Boating administrator Parsons gave Morning Star Cruises notice that its commercial use permit, expiring that day, would be extended for a period of no more than 30 days. This, Parsons said, would give the Board of Land and Natural Resources an opportunity to address the concerns raised by the attorney general.
The permit was extended another 30 days on March 27. On April 11, the Board of Land and Natural Resources determined that the Ale Ale Kai V would no longer be allowed in the fleet of permitted Kane’ohe Bay commercial ocean recreation vessels. The next work ing day, April 14, Morning Star filed a change of inventory in their vessels, indicating that the Ale Ale Kai V would be deleted and the Aikane III would be added. (The Aikane III, however, does not seem to have ever been taken out of service in the first place.)
The Royal Princess
In a vessel inventory dated February 22, 1996, Mid Pacific of Hawai’i, Inc., indicated it had in service a 62 foot catamaran, the Hula Kai; a 62-foot cat, the Ono Mana; two staging platforms or barges, two 19-foot runabouts; a 30-foot sloop; 14 jet skis; and assorted non-motorized craft, including three Hobie cats, two Hawaiian canoes and assorted sleds, tubes, and water skis.
The vessel Ono Mana was used to load up to 49 passengers at a time at the pier, although its rated passenger capacity was 126. The Hula Kai, rated at 149, was a host vessel.
On February 26, Clayton Hanagami, sec retary-treasurer of Mid Pacific, informed Steve Thompson by letter that the company was looking for a vessel to substitute for the Hula Kai. “We would appreciate a written letter from your office indicating the param eters for the vessel substitution,” Hanagami wrote.
On April 12, 1996, Thompson responded. “Our parameters include vessel size (length, draft, beam, height), type, maneuverability, purpose, passenger carrying capacity, propul sion, impact on the facility and bay, etc.,” Thompson wrote. “As you know, and per our discussions, we are mandated by law to not authorize any expansion of commercial activ ity on Kane’ohe Bay.”
Within the week, Mid Pacific had faxed to Thompson’s office specifications for the “Royal Prince,” a 160-foot excursion vessel certified for 300 passengers and outfitted to accommodate up to 250 people for sit-down dining. Whereas the Hula Kai was a sailing vessel equipped with auxiliary power, the Royal Prince was a motor vessel, with twin 900-horsepower diesel-fueled motors.
The initial response of DOBOR was not encouraging. On May 13, 1996, Thompson wrote Hanagami, “Your request is pending due to the evaluation of possible increased activity at the pier from your proposed change in vessels. There is also the matter of substitut ing a motor vessel for an auxiliary powered sailing catamaran…
“Since Hula Kai is now used as a non-moving platform when in service to her pas sengers, do you intend the same identical usage for Royal Prince? If not, please provide us with your detailed plan for the vessel.
“Should you provide us with the requested additional information that proves satisfactory, we will complete a comprehensive pas senger count study to determine what we may authorize as a passenger carrying capacity on the new vessel as it would relate to Mid Pacific’s inventory as it exists at that time.” Enclosed with the letter was a copy of Act 208, Session Laws of Hawai’i 1990.
An Eye-Pleasing Vessel
Hanagami responded on May 17. “We can appreciate your concerns in what appears to be an attempt to increase our activity in Kane’ohe Bay,” he wrote, “however, as we had stated in earlier discussions, our intent in substituting the vessels is to maintain a quality edge over the other commercial operators… Our objective of having the Royal Prince is to provide our customers with more space, luxury, and comfort while on our tour.
Hanagami went on to say that the Royal Prince was unique – “a strikingly eye-pleas ing vessel that personifies the feeling of luxury and comfort.” In addition, he said, the Coast Guard was growing tougher in their inspec tions of wooden vessels, such as the Hula Kai. “We anticipate the maintenance cost to in crease considerably in the future and would prefer to replace the Hula Kai instead of sinking monies in repair and maintenance costs.”
As to concerns that the larger vessel would lead to increased pier activity, this was a misconception, Hanagami said, “as it is the passenger count that determines the activity at the pier regardless of the vessel that the passengers are being transferred to.” He then went on to describe how the Ono Mana could load 49 passengers at a time and the Coral Queen – the glass-bottomed boat owned by the affiliated Kane’ohe Bay Cruises (but, up to this point, not thought to be part of Mid Pacific’s operations) – could load 72 passengers at a time. In a chart showing the number of trips of the Coral Queen and the Ono Mana needed to ferry varying numbers of passengers out to the host vessel, Hanagami showed it was possible to carry up to 314 passengers from the pier to the host vessel with just two trips of the Ono Mana and three trips of the Coral Queen.
“In the above scenarios,” he wrote, “it does not make a difference which vessel is being used as a platform … as the transfers can be made to either vessel without any difficul ties.
“It would appear that the perceived prob lem in allowing or not allowing the substitu tion is the Royal Prince’s present passenger carrying capacity and its size … Its certified passenger capacity of 300 … has a connotation that leads you to this… this is the amount of passengers we will have everyday. The num ber of passengers that we can carry is limited by the number of jet skis we are allowed to operate. We allow each customer to ride a jet ski for approximately 5 minutes. Therefore each jet ski would carry 10 people an hour, and in a five-hours day, 50 people. By law we can only operate six jet skis at any given time, which would allow us to service 300 people a day. If we had the capability to carry 500 people, we would have to cut the jet ski time to approximately three minutes per customer or extend our tour by almost four hours. In either instance, the number of complaints we would receive would be against our business philosophy – to satisfy our customer.”
In July, Hanagami provided additional information to Thompson, intended to allay concerns over the Royal Prince’s maneuver ability at the small He’eia Kea pier. A letter from a marine surveyor attested to the Royal Prince’s “good maneuverability.” The vessel could be accommodated at the pier “by positioning the vessel on the pier face bow-out, with only 10 or 15 feet of bow extending past the seaward end of the pier and the balance of the vessel extending past the harbor side.”
As to Thompson’s concerns about the weight of a sewage pump-out truck required to service the Royal Prince, Hanagami indi cated that the owner of one such truck had said his truck fully loaded would weigh ap proximately 24,000 pounds – less weight, Hanagami contended, than the fuel trucks which routinely delivered to the vendor at the pier.
Combining Capacity
By late July, Thompson had given Hanagami “preliminary approval,” but had sought de tails on how the passenger capacity would stay within the limits of the moratorium.
Hanagami sought to address this question in a letter July 24, 1996, to Thompson. In effect, he sought to have the capacity of Mid Pacific as of the date of the moratorium combined with that of the other Schuster-owned company, Kane’ohe Bay Cruises, and then resubdivided among the two entities after shifting part of the capacity of Kane’ohe Bay Cruises over to Mid Pacific.
The total carrying capacity of the two companies at the time of the moratorium was 379, Hanagami said – 275 for Mid Pacific; 104 for Kane’ohe Bay Cruises.
“In prior discussions with you,” Hanagami wrote, “we were informed that the passenger carrying capacity can be reallocated among companies with the same ownership provided that the combined passenger carrying capacity does not exceed the carrying capacity prior to the moratorium.”
The vessel Nani Kai had been used by Kane’ohe Bay Cruises prior to the morato rium, Hanagami said, but had since been taken out of service and sold. “We would like to delete the Hula Kai’s and the Nani Kai’s passenger carrying capacities from their re spective companies and apply them to the Royal Prince… The passenger capacity [149 for the Hula Kai; 31 for the Nani Kai] of 180 would require the down grading on the Royal Prince by 120 passengers… We are willing to reduce the carrying capacity to 180 provided we have the opportunity to adjust its capacity in the future as long as the total combined passenger carrying capacity does not exceed 379 or when and if the moratorium is lifted.”
On July 29, Thompson gave Hanagami conditional authority to substitute the Royal Prince for the Hula Kai. “Your request to incorporate Kane’ohe Bay Cruises’ passenger count from the vessel Nani Kai towards the vessel Royal Prince is also authorized.”
In early November, DOBOR received from Mid-Pacific corporate minutes of a meeting of the board of directors of Pacific Tour System, Inc. At that meeting, held September 27, Tomoko Scott, company president, re ported that she had sold all shares in the company to Toshiko Schuster and that the company had been inactive since February, “with the consolidation of activities by Waialua Associates, Inc., when it obtained its PUC license.”
Toshiko Schuster was elected president, while Hanagami was elected secretary, trea surer, and director. Seigfried Schuster was elected vice president and director. Following election of officers, the minutes state, “the new president then stated that they are look ing to purchase… [the] Royal Prince and lease the vessel to Mid Pacific of Hawai’i, Inc., for its water sports operations…. The purchase price of the vessel is approximately $650M with an additional $100M… needed to bring the vessel in optimal operating condition. The Schusters will personally loan the com pany the funds required to complete the transaction. Being the nature of the business will change to an ocean activities operation, it was unanimously approved that the corporate name be changed to Royal Princess Cruises, Inc.” (In this context, $650M and $100M mean $650,000 and $100,000, respec tively.) On October 4, the vessel lease agreement was signed, with Mid Pacific agreeing to a two-year lease of the Royal Prince (rechris tened the Royal Princess) for $144,000 a year. Signing as president to Royal Princess Cruises was Toshiko Schuster, who also signed as president of Mid Pacific of Hawai’i.
‘Maximum Level’
Soon thereafter, Mid Pacific sought to have the passenger rating of the Royal Princess adjusted to reflect the 180-passenger limit – while not jeopardizing the vessel’s marketability as a 300-passenger vessel. Hanagami outlined this in a memo November 4 to Coast Guard Commander R.C. Simonson. “As we had discussed at the Kane’ohe Bay Regional Council meeting on October 23, 1996, we would like to maintain the certified passenger carrying capacity for the Royal Princess at its maximum level in the event we would like to sell the vessel. However for our State of Hawai’i issued permit, we are only allowed to carry 180 passengers… To address both issues, we would like to maintain the maximum passenger carrying capacity for the vessel but have an endorsement.”
As proposed by Hanagami, the ‘endorse ment’ would say that so long as the vessel was operating under an Ocean Recreation Man agement Area permit issued by the state of Hawai’i, “the vessel is allowed to carry no more than 180 passengers.” The certificate of inspection was issued, with the identical lan guage on passenger counts proposed by Hanagami – in a document dated October 25, or 10 days before Hanagami’s written request.
Setting Sail
On November 6, Hanagami sought permis sion from the He’eia Kea harbormaster, Earl Omoto, to bring the vessel to the pier for an hour on November 13. “This will be for the caterers from Hyatt Regency, who will be doing the food and beverage service for the open house on Thursday, November 21.”
Not until December 5 did Hanagami for mally ask DOBOR, in a memo to district manager Thompson, for permission to sub stitute the Royal Princess for the Hula Kai. Accompanying the memo was a permit appli cation indicating that the vessel Hula Kai would be deleted while the Royal Princess would be added to Mid Pacific’s ocean recre ation management commercial registration application.
But all was not well at DOBOR. On December 17, Thompson fired off to Hanagami a two-page letter whose apparent intent was to notify Mid-Pacific of DOBOR’s dissatisfaction over several problems that Mid Pacific had caused for the division. At the head of Thompson’s concerns were Schuster’s reported comments to the Sun Press, pub lished in the November 14-20 edition, that Mid Pacific was seeking liquor and restaurant permits for dinner cruises.
“As I’ve noted to you on several occa sions,” Thompson wrote, “we were quite surprised with the content of the Windward Sun Press article… At all times, we understood that ‘Royal Princess’ would be em ployed solely as a floating platform… During the months-long laborious and detailed pro cess of determining suitability of authorizing the substitution of the ‘Royal Princess’ for the ‘Hula Kai,’ under the variety of laws and rules for Kane’ohe Bay, we informed you that we would deny the request should you request to use the vessel in a manner other than as a floating platform.”
Thompson was also upset at a proposal to have the Royal Princess load passengers at the He’eia Kea pier. DOBOR “conditionally agreed to a trial period of bringing the ‘Royal Princess’ to the Kahuku end of the main loading pier” during non-peak times for pur poses of flushing holding tanks and taking on water and supplies, Thompson wrote, but that was contingent upon “proof that the vessel could safely access the pier and not be an operational problem.” However, Thomp son said, the Royal Princess had had difficulty approaching and docking on the afternoon of the open house. “The weather and sea conditions were ideal and there was no other boat traffic in the area, and yet the docking was quite difficult for your crew and did not demonstrate the vessel’s suitability to access the pier,” he noted.
Thompson voiced his pique with Schuster’s introduction of him at the open house, during which Schuster thanked Thompson as “the one responsible for allow ing the Royal Princess into Kane’ohe Bay.” “For the record,” Thompson informed Hanagami, “I took exception to his com ment. As you know, the authorization pro cess was a lengthy one… In fact, early on into the process, I had advised you against consid ering the Royal Princess.”
Winding things up, Thompson noted that although Mid Pacific had agreed to take the Hula Kai out of commercial service, “you have elected to continue to moor it in Kane’ohe Bay,” and, similarly, the other major operator, Morning Star Cruises, had kept its out-of-service vessel, Hoku Ao, in the bay. “As we have discussed on numerous occa sions,” Thompson wrote, “because of these actions, there is a public perception that additional commercial boats have been added to the bay.”
Despite Thompson’s tirade, on January 31, 1997, the Division of Boating received Mid Pacific’s application for a renewal of its commercial operating area use permit for the period March 1, 1997, through February 28, 1998. On February 28, 1997, however, Mid Pacific was notified by Parsons, DOBOR administrator, that the “special circum stances” arising from the opinion of the attor ney general, issued four days earlier, “have resulted in the extension of your commercial use permit… for a period of no more than 30 days.”
The permit was renewed at the end of March, for no more than another 30 days. By April 12, the permit was still in force, but the Royal Princess was out of operation.
The AG Weighs In
As suggested above, the event that finally got the Division of Boating and Ocean Recre ation to halt its routine processing and ap proval of operators’ requests was a letter issued February 24, 1997, by the Department of Attorney General. That letter, authored by Deputy Attorney General William Tam and signed by state Attorney General Margery Bronster, reported Tam’s determination that DOBOR was not complying with the Legislature’s requirement, in Act 317, that DOBOR carry out the Kane’ohe Bay Master Plan.
Tam’s letter immediately resulted in DOBOR holding off on its plans to issue one-year permit renewals for the Morning Star Cruises and Mid Pacific Hawai’i. In addition, the Board of Land and Natural Resources arranged on short notice a board “briefing,” held on March 13, at which Tam and DOBOR administrator David Parsons made presenta tions and answered questions from board members. (Public testimony was not allowed.)
At the briefing, DOBOR administrator Parsons was asked by Michael Wilson, chair man of the BLNR, at what point Parsons’ division “would start moving toward the limit set in the master plan?”
“We would hope to get on the administra tive rules to convert the recommendations to the rule-making process,” Parsons responded. “And that was programmed for later this year or perhaps next year.”
Wilson then asked why there was such a delay.
Parsons answered: “The law states that administrative rules were supposed to have been implemented within one year of accep tance of the master plan. The master plan was approved in March of 1992. During the fiscal year 1991-1992, our boating program was in the process of being transferred from the Department of Transportation to the De partment of Land and Natural Resources. And the priorities given to my boating branch by the Department of Transportation was to provide emphasis on preparing for the trans fer to the DLNR, which happened on July 1, 1992. And then, after we got there, again, the priority was placed on us trying to get accli mated and integrated within DLNR and tran sition all the activities from DOT over to DLNR. And that took about a year.
“Coincident with that, just prior to our transfer, we had statewide public hearings on administrative rules to raise our rates. Unfor tunately, the rules did not become adopted prior to the transfer, so right after the transfer, we got advised by the attorney general’s office that we had to go through the hearings again and adopt the rules as DLNR rules. And that took up to February of 1994 to become effective.
“In the interim, in 1993, Act 317 was passed, creating the Kane’ohe Bay Council. At that time, it was suggested that we not initiate rule-making until the council was in place, but the law that established the Kane’ohe Bay Council called for appoint ment of the members by the governor, to be confirmed by the Legislature, which had to wait until the following year, when we could get the recommendations in for the Legisla ture to approve.
“So, basically, the council began its exist ence formally about July 1, 1994. And then, of course, that’s when we ran in to all the RIFS – hiring restrictions, budget cuts, and so on. In that reduction-in-force, I lost the position of a second vessel regulations officer, which would have helped to put these rules in effect. So, that’s basically the background.”
Cutbacks
Parsons handed out a list of existing permits that indicated how they would be affected if Tam’s reading of the master plan – and the law – were put into force. Mid Pacific would be limited to 150 passengers a day. As things stand, Parsons said, its permit allows it to serve 354 passengers a day.
Morning Star Cruises, operator of the Ale Ale Kai, also would be restricted to 150 pas sengers a day, down 80 from the 235 passen gers Parsons said it now is allowed to serve.
Dina Morita & Associates/Windward Sea Yacht Chargers would see a loss of 39 passengers a day. All Hawai’i Cruises, Inc., would also stand to lose 39 passengers. Most smaller operators would not be affected. Just one operator – Club Kona, Inc. – would see an increase: to 70 from 59 passen gers a day.
Members of the Land Board seemed eager to have Parsons prepare the rules for public hearing before the July 1, 1998, sun set date of Act 317. Parsons mentioned that “legislation being heard now would elimi nate the sunset provision,” but Wilson re sponded that the board wanted to have the rules in place by that time in any event.
“We’re at a point where, it’s the middle of March. The notion that we can pass rules by July, if they’re fairly straightforward, doesn’t seem to be necessarily unreasonable,” Wilson said.
Cracking Down
By April 11, the Board of Land and Natural Resources was scheduled to make a decision on whether the big boats would be allowed to continue operating in Kane’ohe Bay. The meeting began at about 9 a.m., with members of the Kane’ohe Bay community turned out in force. Not until some six hours later, however, did the BLNR finally turn its atten tion to the matter of commercial operations on the bay.
Before the BLNR was a recommendation from the Division of Boating that had four main elements. The first would require DOBOR to expedite processing of adminis trative rules for Kane’ohe Bay, with a deadline of August 1 established for presentation of the draft rules to the Land Board and a deadline of October 1 for the first public hearing. The second element for which board approval was sought allowed DOBOR to extend existing permits, “subject to the limitations of the Master Plan,” for up to seven months or until the new rules would take effect, whichever comes first.
Third, DOBOR recommended that the Land Board require permits reissued before February 24, 1997, also be subject to Master Plan limitations on passengers and equip ment.
The fourth element was the most com plex. DOBOR was recommending to the Land Board that it require each commercial operator “to reduce the total number of ves sels being operated to the number specified in the Master Plan.” In addition, those vessels remaining “shall be reduced in size not [to] exceed the size of vessels permitted on the date of acceptance of the Kane’ohe Bay Master Plan (March 19, 1992).” The DOBOR report to the Land Board provided a list of eight vessels that would probably be affected were this recommendation to be approved. They included two vessels belonging to Mid Pacific (the Royal Princess and Mills II, a 30-foot sloop), and the Ale Ale Kai of Morning Star.
Size or Capacity?
The Master Plan makes no mention of vessel size. Limitations on operators are defined in terms of passenger capacity. The very ability of the Land Board to restrict vessel operations based on size alone was therefore an issue hotly debated in the testimony presented to the board.
In general, owners of the large vessels and their allies – including Dante Carpenter, former mayor of the Big Island, who is a registered lobbyist on behalf of one of the companies – argued that because the Master Plan contains no size limits, it is inappropri ate, if not illegal, to use size as a limiting factor.
Clayton Hanagami, with Mid Pacific, in formed the board of the long negotiations that his company had had with DOBOR before purchasing the Royal Princess. “We feel that we acted in good faith and followed the proper procedures as set forth by DOBOR… We would never have purchased the Royal Princess if we had not received permission to use this vessel as part of our operations…. Because of a state error, we are being penalized for owning an ‘illegal’ vessel that the state gave us their approval to pur chase.”
Many of those who participated in the plan’s drafting took a different tack. Peter Nottage, chairman of the Task Force’s Water Use Committee, pointed out that while the plan had no specific size limit on vessels, it did require operators to keep to the same or smaller vessel size, capacity, and equipment constraints as existed at the time of the mora torium. “The matter of size in boats … is kind of an arbitrary thing,” he said, noting that an 80-foot boat is not necessarily twice as large as a 40-foot boat. “When we said same size, we meant generally same size.”
As far as the limit on passengers, Nottage said, “we meant 150 passengers per day” for the large full-service operators.
John Reppun told the Land Board that the Task Force debated long and hard on the matter of whether the full-service tour opera tors should be allowed to continue at all, much less increase their size. “There were some of us out there saying absolutely no to fixed-based operators. And by fixed-based operation, I’m talking about the circuses out there. They’ve latched onto a reef area and have claimed it, and although they are de scribed as non-exclusive, they are exclusive. You cannot go out there and go diving, for example – you’ll get run over…
Another concern mentioned by Reppun was the Land Board’s failure to exercise oversight of the Division of Boating. “Everything else, even Department of Transportation per mits, come before you folks. Divisions don’t rule, you make the decision. But we didn’t even know about these permits [for the Royal Princess and the Ale Ale Kai] being applied for, and yet they were well in the works back in July… For several months the negotiations were going on.
“When an application comes before you, for a CDUA or whatever, and we have the opportunity to file for a contested-case hear ing, my understanding is we have to file when the application is in front of you. But how do we do that? How does the public get any input at all before these permits are granted?
“Did you ever delegate the authority to a division to give out a permit? And, whether you did or not, rescind it. Pull it back to the Land Board – especially in the case of Kane’ohe Bay.”
By the end of the day, the Land Board had done just that – at least with respect to the Royal Princess and the Ale Ale Kai. Board members generally agreed that the informa tion on the other boats identified in Parsons’ submittal was not sufficient to justify any action at the time and asked Parsons to come back with additional information at a later date.
The remaining recommendations were accepted without changes.
Epilogue
The “eye-pleasing” Royal Princess goes on gracing the bay at its mooring near He’eia Kea, as does the Ale Ale Kai. Since April 11, however, neither has been in commercial use.
The tours continue, but no one at the Department of Land and Natural Resources could say whether or not the either or both of the two large full-service operators are re stricting the number of customers to 150 each per day, as the Master Plan – and Land Board action to implement it – would seem to require.
On April 14, the DLNR, Parsons, and Thompson were named as defendants in a lawsuit filed by Kane’ohe Bay Cruises, Mid Pacific, and Seigfried Schuster. The com plaint cites three claims for relief: first, DOBOR’s written approval of the substitu tion of Royal Princess for Hula Kai was reasonably relied upon by the plaintiffs to their substantial detriment, thereby impos ing liability upon the defendants under the doctrine of promissory stopped;” second, DLNR has refused to enforce the ban on non commercial users of Kane’ohe Bay, resulting in selective enforcement that violates the Fifth and Fourteenth amendments to the U.S. Constitution, concerning due process, and Article I, Section 5 of the state constitution; finally, by rescinding the Royal Princess’ permit, DLNR violated the same sections of the U.S. and state constitutions.
Relief sought includes monetary damages, a temporary restraining order and prelimi nary injunction allowing the Royal Princess to resume operation, and a preliminary and permanent injunction preventing the DLNR from issuing rules to implement the sections of the Master Plan relating to commercial operators so long as they do not issue rules to implement the Master Plan’s provisions affecting non-commercial users.
Finally, as Environment Hawai`i went to press, the Division of Boating and Ocean Recreation had just prepared a report to the Land Board, for presentation at its April 25 meeting, on vessel substitutions involving boats smaller than the Royal Princess and Ale Ale Kai.
The staff recommendation accompanying the report asked the Land Board to allow “a deviation in length of a replacement vessel,” based on a percentage formula (which DOBOR suggests be between 12 and 18 per cent). In other words, a 30-foot-long vessel could be replaced by one as long as 34 feet, based on the 18 percent value.
Second, the staff recommended that the Land Board set a maximum size for the host vessels that are part of the full-scale commer cial operations.
The third and last recommendation was “that the board amend its prior action on recommendation number 2 on April 11, 1997″ so as to authorize “the reissuance of the per mits for those operators whose permits had not been reissued prior to February 24, 1997,” subject once more to the limits of the Master Plan.
One question outstanding at the end of April was whether or not the commercial operators on Kane’ohe Bay were restricting the number of passengers taken out each day to the limit set at the time of the moratorium or the much lower limit set as the goal in the Master Plan. Items I and 2 in the staff recom mendation, which was approved by the board, would seem to restrict the number of passen gers to limits set in the Master Plan.
Boating administrator Parsons was asked, through a DLNR spokesman, whether operators had been instructed to stay within those lower limits of the Master Plan. Parsons’ response, as relayed through the spokesman, was that he was expecting the operators to provide a daily count of the number of passengers in a weekly report. He was confident, the spokesman said, that a lot of people in the area would be watching the tour operators and would be reporting any violations.
As to whether instructions had been given to operators, Parsons was reported to have said that the operators had been informed of the attorney general’s opinion, “that the law is in effect, and the operators are limited to 150 people per day for larger carriers and 70 people per day for the smaller carriers.”
To verily that these lower limits were being used, Environment Hawai`i asked to see the daily passenger counts, supposed to be submitted weekly, for the four largest commercial operators, for the week of April 14 through 18, representing the first week the operations were in business after Land Board action.
The request was routed once more through the DLNR’s chairperson’s office. According to Clifford Inn, a public information specialist with the chairperson’s office, Parsons indicated that that the information was not yet available. “The operators need to be collecting data,” Inn quoted Parsons as saying. “When all the details are worked out, we’ll plug the data into reports, and then they [the operators] will submit them.”
Parsons went on to say, according to Inn, that, “some smaller, some larger steps need to be taken before the reports are ready to be accepted.”
Inn was questioned about the implication that DOBOR would somehow be negotiating with the operators on the reports they are to submit. He had no answer.
Volume 7, Number 11 May 1997
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