Rushing to meet a self-imposed deadline, the Board of Land and Natural Resources, on December 29, 1994, met to hear closing arguments in the contested case held over the Conservation District Use Application of Haseko (`Ewa), Inc., to build a 400-foot-wide entrance channel to a proposed 1,400-slip, 120-acre marina.
The marina is a key element of Haseko’s plans to develop 1,100 acres in the area of Ewa Beach. In addition to the marina, Haseko is planning to build about 5,000 residential units, a 27-hole golf course, and up to 1,500 hotel rooms. Some of the most expensive houses are to be sited on an island in the middle of the marina.
The desire of the staff to complete the contested-case hearing process by the end of December was evident as early as June 9, 1994, when the Land Board was asked to rule on certain matters related to the contested case that would allow a pre-hearing conference to be held in July. “It’s a backing-up process,” Deputy Attorney General Linnel Nishioka said in explaining why the board was being asked to foreshorten the period in which interested parties would be able to file petitions to intervene in the process. If the period to file a petition to intervene were not shortened, then “the pre-hearing conference would be held without all the parties present,” she said.
And why was it so important to have the pre-hearing conference held by July 8?
Roger Evans, administrator of the DLNR’s Office of Conservation and Environmental Affairs, answered that. It was necessary to get the process under way by that date in order the board would be able “to come up with a decision and order by the end of December” — or, in other words, before Keith Ahue, the Land Board chairman appointed by Governor John Waihe`e, would have to leave office.
Like a Clock…
The Land Board did as staff requested on June 9. The pre-hearing conference was held on July 8. Indeed, up until October, everything related to the contested case on Haseko’s request for a marina was moving with clockwork precision toward a Land Board decision in December.
In late July, for example, the hearing officer (Land Board Chairman Ahue) accepted the motion of Haseko to waive consideration of what generally is regarded as the most important issue in relation to Haseko’s plans — that is, what effect the marina will have on the `Ewa caprock aquifer. Instead, the presiding officer determined “that the caprock issue … is an issue that can be considered by the Commission on Water Resource Management.”
In August, Ahue again sided with Haseko in denying a motion filed by attorneys for the Office of Hawaiian Affairs that the contested case hearing be conducted pursuant to Chapter 190D, Hawai`i Revised Statutes, rather than Section 183-41. Chapter 190D gives the Department of Land and Natural Resources authority to lease ocean waters and submerged lands for “mariculture” and “marine activities,” and OHA’s position was that this statute related more directly to Haseko’s proposed activity than did 183-41, which generally is geared to Conservation District activities on fast land. Ahue, in a minute order drafted by Nishioka, determined that because Haseko is proposing to dredge a navigational channel, the governing law was Section 171-58.5, which in turn provides for such channels to be dredged under terms of a permit issued pursuant to Section 183-41.
The case was heard on September 21, 22, and 29. On those days, witnesses appeared on behalf of the contestants and interveners, and all the parties were given a chance to present their arguments in the quasi-judicial setting of the contested case.
On October 5, 1994, Nishioka served on the parties a “post-contested case hearing schedule and procedure.” Closing statements were due October 10, she said, and proposed findings of facts, conclusions of law and proposed decision and order were to be delivered by October 28. The Land Board would issue its proposed findings of facts, conclusions of law and decision and order “on or before November 25, 1994,” she continued. Objections to those would have to be filed by December 2, oral arguments on the objections heard “at a time to be announced but prior to the December board meeting,” and, finally, “the Board will vote on their decision and order at its December 16, 1994,” meeting. Not coincidentally, that meeting was the last scheduled meeting at which Ahue would preside as chairman.
… Coming Unwound
The carefully timed process nearly came undone on October 28, 1994. On that date at the Baci Cafe on Kapiolani Boulevard in Honolulu, Sheryl Nicholson, an attorney for the Office of Hawaiian Affairs in the contested case, was dining with her husband at the end of a day that had seen her deliver OHA’s proposed findings of fact and conclusions of law to the DLNR offices.
By chance, Land Board member Libert Landgraf chose to dine that evening at the Baci Cafe. He and his wife were already seated as Nicholson and her husband were shown to a table just a few feet away.
Landgraf finished his meal, and before leaving the restaurant, strolled over to Nicholson’s table. Apparently mistaking her for an attorney for Haseko, Landgraf assured Nicholson that her client had nothing to worry about from “us” — a reference that Nicholson took to mean the Land Board. Nicholson reported the conversation to Ahue on November 18, along with a request that Ahue “promptly speak to Mr. Landgraf … and to the rest of the Board, in particular, to determine whether Mr. Landgraf and any other Board members had prejudged the facts on Haseko’s CDUA before the hearing process was completed…”
Nishioka’s reply, dated November 30, was hardly sympathetic. “I commend you for bringing this to the Board’s attention,” Nishioka wrote, “although I wish that you did not take three weeks to do so. Since receiving your letter, I have had a chance to talk with the Chairperson and with Mr. Landgraf. Mr. Landgraf does not agree with your account of the conversation although he does admit that a conversation between the two of you did occur at Baci Cafe on October 28, 1994.
“I have reviewed section 131-1-39, [Hawai`i Administrative Rules], and even assuming arguendo your account of the incident, technically, it is not ex parte communication under the Board’s rules. However, in an abundance of caution, we feel that the better course of action is for all parties, including the Board members, to refrain from any communications with any of the parties concerning the `Ewa Marina case… Likewise, I ask all parties to kindly remind the Board members that you cannot talk with them about this case and to immediately terminate any conversation with them. I think this would do much to mitigate any further problems.”
Nishioka told Nicholson that she had advised Landgraf to recuse himself from further participation in the `Ewa Marina case — a request that, she said, he immediately agreed to.
On December 2, Nicholson filed a motion for recusal of the entire board and for a rehearing of the matter. Should that not be granted, Nicholson sought a reopening of the contested case hearing. The motion was heard on December 9. Ahue rejected the request for rehearing, but did agree to allow the hearing to be reopened “for the sole purpose of conducting an investigation and discovery on the matters raised by the Board member Landgraf’s comments.”
That hearing was held on December 15.
Behind the Curtain
At the hearing of December 15, Deputy Attorney General Nishioka opened with a statement that reveals some of the behind-the-scenes workings common to all contested case proceedings. We quote from her statement:
“On November 17, 1994, at a duly noticed board briefing, the board met in executive session with myself to discuss the legal issues in the `Ewa Marina contested case hearing. The purpose of the November 17, 1994, meeting was to find out from board members that given all the evidence, the submittals by the parties, what was the initial impression of the board concerning the permit so that the proposed findings of fact, conclusion of law and decision and order could be issued. The board members present at the briefing were Mr. [William] Kennison, Mr. [Herbert] Apaka, Mr. Landgraf, and Mr. [Christopher] Yuen. The chairperson and Mr. [Michael] Nekoba were not present at the briefing. In executive session, the board members were polled on whether to grant or deny the CDUA permit. The board was advised that this was a non-binding poll and no commitments were being sought on the ultimate decision. It was just that because the proposed decision and order had to be issued by the board, it was necessary to at least get an initial polling on the board members’ impressions of the proceeding. The meeting lasted approximately 30 minutes.
“On November 18, at the board meeting, I did receive the November 18, 1994 letter from Ms. Nicholson to the chairperson. I left the meeting for a short time to call Ms. Nicholson and I did tell her that I would immediately look into the matter, but that any ultimate action would have to wait until the chairperson returned to the office, which my understanding was Nov. 28, 1994.
“During Nov. 18, 1994 through Nov. 30, 1994, I did speak to all board members except one, and I did send a letter on Nov. 30, 1994.
“On Dec. 2, 1994, the Department received OHA’s motion … The motion was heard on December 9, 1994, and minute order No. 3 was issued on December 9…
“On Dec. 12, 1994, the department received a request for deposition of the board members and a further continuance and stay of the proceedings by OHA. Our office at the request of the chairperson responded to OHA’s request, denying depositions of board members. This hearing is for the purpose of questioning board members pursuant to minute order No. 3.
“On Nov. 14, the department received a request for production of any documents that would be introduced at this hearing, that they be made available, and a request for the financial statements filed with the Ethics Commission. I made the documents in my possession available to the parties this morning, which were the affidavit of Mr. Landgraf and the statement of the chairperson. I have also made additional statements of all the board members — have been distributed to the parties.
“This brings us up to today, which is the reopening of the contested case hearing.”
Nishioka went on to ask the board members (except Landgraf) a series of questions centering on whether they had arrived at a decision on the Haseko application before having heard all the evidence, and whether they had discussed the matter with Landgraf. All indicated that they had an open mind going into the proceeding; no one acknowledged any substantive discussion of the case with Landgraf.
In the end, Ahue determined that there was no bias shown on the part of any board member other than Landgraf. Closing arguments were scheduled for December 29.
A Puzzled Public
At that last meeting, attorneys for all parties presented brief oral arguments, objections and comments on the Land Board’s proposed findings of fact, issued on December 23.
Alan Oshima, attorney for Haseko, urged the board to make a decision quickly, noting that it had been the understanding “of all parties” that the application would be voted on by the end of 1994.
Nicholson, OHA’s attorney, highlighted two aspects of OHA’s objections. First, she objected to the board “sitting in judgment of itself” on the matter of OHA’s request for disqualification of board members rather than appointing an independent hearing master. Second, she repeated OHA’s objection to the proposed finding on the question of the conformance of Haseko’s development with the public purpose requirement of Section 5F of the Admissions Act.
Carl Christensen, attorney for Save `Ewa Beach `Ohana, repeated many of Nicholson’s objections to the procedural handling of the request for disqualification of the board. One point he raised concerned — again — the insistence on the part of the DLNR that the process be concluded by the year’s end as strengthening “the perception that the board is engaged in a rush to judgment:”
“From the beginning, when it appeared that constraints on the availability of board members might limit the time available to take testimony, Save `Ewa Beach `Ohana and OHA expressed our preference that this contested case hearing be conducted before a hearing officer. This request was denied.
“The briefing schedule, particularly as exemplified by the limited time available to respond to the proposed findings of fact and conclusions of law [less than six days], indicates that the controlling factor has been a desire to complete these hearings before Mr. Ahue leaves office…
“The board’s attorney’s role in supervising the presentation of testimony to the board raises additional questions about the fairness of the proceedings.”
After the closing arguments, the four board members present — Apaka, Kennison, Ahue, and Nekoba — then retired into executive session.
Some 40 minutes later, the board reconvened in open session. Ahue stated that in light of the closing arguments, the board had made “certain changes” to the proposed findings of fact and conclusions of law. Nicholson asked Ahue for a description of those changes, “so we know exactly what it is that the board is voting on right now.”
Deputy Attorney General Nishioka refused to provide them, saying, “We have already gone through that comment period… The board has considered the objections… We don’t go through a comment period on their issuing the final order.”
After noting Nicholson’s and Christensen’s objections, Ahue polled the board members, all of whom voted in favor of Haseko’s application, and then adjourned the meeting.
Rubber Stamping
Immediately afterward, Nishioka handed out copies of the board’s 43-page final findings of fact, conclusions of law, and decision and order. OHA Trustee Kina`u Kamali`i and others were skeptical that the document reflected any point raised in the morning’s oral arguments.
“I am shocked, absolutely in a state of shock, that they cannot read to us what they decided in executive session,” Kamali`i said.
“We carried out our responsibility in accordance with the law,” Ahue replied.
Other members of the angry crowd accused Ahue of lying to the extent he led them to believe that the board had made changes on the basis arguments heard that morning. As Christensen noted, “It also suggests that any arguments we made could not have been incorporated into this” final decision.
Ahue said he had no knowledge of when the final decision and order had been printed up — a comment that caused one observer to remark: “Mr. Ahue, are you lying to this room? You don’t know when this was printed up and you don’t know if it was printed in the last forty minutes?”
The Bottom Line
The final findings of fact, conclusions of law, and decision and order sets 32 conditions on Haseko’s dredging of the marina entrance channel. Among other things, Haseko must comply with Department of Health Water Quality Certification rules; must begin construction within five years of the approval and complete it within 10 years; must “make at least fifty percent of the boat slips available to the general public at reasonable market rates; must dedicate to the state a boat launching ramp complex, consisting of at least seven ramps, 150 trailer parking spaces, a public parking area, boat wash-down areas, restrooms, and outdoor showers.” In addition, Haseko is to provide “sewage pump-out facilities for boats using the marina” — facilities that the state fails to provide boaters at most of its own marinas.
The Next Step
Attorneys for at least one of the contestants have promised to appeal the Land Board’s decision to Circuit Court, although no complaint had been filed by press time.
Meanwhile, the Commission on Water Resource Management has decided to hold a contested case hearing on Haseko’s application. As of mid-January, the commission had granted standing to two individuals — Jeff Alexander and Anna Marie Kahunahana-Castro Howell — who asked to be contestants at a public hearing held in November. In addition, the commission has directed staff to initiate the necessary preliminary proceedings for a contested case.
In that regard, the commission published legal notice in January informing the public that any party interested in participating in the contested case as an intervener had until close of business on January 26 to submit the necessary petition.
After that, commission staff say, the attorney general’s office will be asked for its recommendations on whether standing should be granted to the intervener petitioners as well as to the remaining parties who filed in November for a contested case — parties that include the Save `Ewa Beach `Ohana, Ka Lahui Hawai`i, Hawai`i’s Thousand Friends, Save Our Surf, the Nanakuli Surf Club, Na `Opio Aloha `Aina, and the Sierra Club.
Landgraf Out, Matsumoto In
Libert Landgraf has resigned from the Board of Land and Natural Resources. Landgraf, who served as the board’s at-large member, has been replaced by Colbert M. Matsumoto, an attorney with the firm Matsumoto LaFountaine & Chow.
As described above, the furor over Landgraf’s inappropriate comments to a lawyer representing a party in the `Ewa Marina contested case hearing gave rise to his resignation. Landgraf’s remarks were first reported in the December 1994 article of Environment Hawai`i.
Matsumoto, 41, is president of the Honolulu Chapter of the Japanese-American Citizens League and a director of the National Asian Pacific American Bar Association.
Keppeler Out, Coloma-Agaran In
Jack Keppeler is no longer deputy director of the Department of Land and Natural Resources, a position he held from 1992 to the end of December 1994. He has been replaced by Gil Coloma-Agaran, 32, who had been an associate attorney with the firm of Carlsmith Ball Wichman Murray Case & Ichiki since 1987. The Wailuku native graduated from Yale University and went on to receive his degree in law from Boalt Hall at the University of California at Berkeley.
DLNR Deputy Dona Hanaike left in November to become head of the Honolulu Department of Parks and Recreation, under the administration of Mayor Jeremy Harris. Her position in the department has been eliminated.
Ahue Returns To HGEA
Former Land Board Chairman Keith Ahue may be found, after February 1, back at the Hawai`i Government Employees Association, his employer before he joined the DLNR as a deputy director in 1990.
Volume 5, Number 8 February 1995