A federal grand jury has charged Gordon Finlay and Finlay Testing Laboratories, Inc., both of Honolulu, with 24 counts of criminal acts under federal laws concerning the civilian use of radioactive materials and conspiracies to defraud. In the history of the Nuclear Regulatory Commission, the convening of a grand jury and the filing of criminal charges is an extremely unusual occurrence. The actions described in the indictment, on the other hand, are so flagrant and cavalier with respect to public safety that, if they are true, criminal prosecution is indeed warranted.
A Cover-Up
According to the indictment, Finlay Testing Laboratories and its president, Gordon Finlay, from 1981 to 1987, regularly violated NRC regulations and the conditions of FTL’s license, issued by the NRC, concerning the use and transportation of nuclear materials. “These violations included shipping nuclear materials on civilian passenger aircraft, … shipping nuclear materials without the proper protective packaging and without the proper radiation labels. There was an understanding that such conduct would be acceptable at FTL as long as it could be done without being detected by the NRC.”
Evidently, to prevent such detection, the indictment states, “the conspirators would falsify FTL’s records … to mislead the NRC and cover up the violations of FTL’s license and the applicable regulations.”
The lab uses radioactive materials for X-raying welds and performing other tasks related generally to quality control at construction sites. To minimize public exposure to radiation, holders of NRC licenses are required to ship these radioactive sources in special, clearly labeled packaging, and they are expressly forbidden from using passenger flights for transporting the radioactive sources from one point to another.
Yet, according to the indictment, when Finlay Testing Laboratories had jobs on Maui or on the Big Island, employees would carry their tools, including the radioactive sources, with them on inter-island flights.
And a Payoff
The indictment lists violations going back to 1981. In 1987, the Nuclear Regulatory Commission received a tip that Finlay and FTL might be engaged in illegal practices, prompting the NRC to begin an investigation that culminated with the suspension of the lab’s license. But, the indictment states, “in an effort to convince the NRC to reinstate the license, the conspirators agreed to lie to the NRC about corrective actions allegedly taken.” The indictment states that Finlay told the NRC that he had suspended the employee who had carried a radioactive source on board a passenger flight from Honolulu to the Big Island in February 1987, but in reality, the employee continued to work and to be paid for his services. The employee, Timothy Carroll, did not receive payroll checks, but, the indictment states, between September 25, 1987 and late October of that same year, three checks totaling $4,300, and made out to “cash,” were deposited into the checking account of Carroll and his wife.
When arraigned, Finlay pleaded not guilty. Trial is set for April 1993.
* * *
Years Late, Hamakua Seeks Stream Alteration Permits
In spring of 1989, a “catastrophic” collapse of weathered rock along the walls of Waipi`o Valley breached a tunnel in the Lower Hamakua Ditch water system. According to Hamakua Sugar Company, which owns the ditch system, “a thickness of about 25 feet of rock at the tunnel level broke away, exposing fresh rock. The break reached into and included the inner wall of the tunnel. All flow through the Lower Hamakua Ditch was disrupted at that point.”
After the rockslide, water in the tunnel simply joined in the cascades of Hi`ilawe Falls. The 29-million-gallon-a-day average flow that had provided water needed for operation of Hamakua’s sugar mill at Haina and for irrigation (among other uses) was cut off.
The company responded by making immediate repairs to the tunnel system. The lost portion of the tunnel was straddled with an unshielded sluice capable of delivering up to 50 million gallons a day.
But that was not all. According to an after-the-fact stream channel alteration permit application filed with the state Commission on Water Resource Management on April 30, 1992, “Hakaloa [sic] Falls was impacting directly on the remnants of the floor of the exposed tunnel. In order to facilitate the construction of the flume and assure the safety of the workers performing this task, the flow over Hakaloa Falls was diverted.” About 1,200 feet upstream of Hakalaoa Falls, Hamakua Sugar built channel to direct water in the unnamed stream that feeds Hakalaoa Falls into Lalakea Stream to the west, whose cascade over the pali forms Hi`ilawe Falls.
Since then, the famous twin falls of Waipi`o Valley — Hakalaoa and Hi`ilawe — have been only a memory. In rainy weather, Hi`ilawe flows alone. In dry weather, there is nothing.
Complaints
Although stream diversions require approval by the state Commission on Water Resource Management, Hamakua Sugar Company seemed in no hurry to seek approval. The permit applications filed in April of this year — one to amend the interim instream flow standard for the diverted stream; the second to alter the stream channel — were prompted, the applications state, by complaints over the lack of flow over Hakalaoa Falls.
It may have been more than that, in fact. In an April 30 letter to Rae Loui, director of COWRM, covering the two after-the-fact permit applications, Tim Lui-Kwan, attorney for Hamakua Sugar, states that the applications “are being submitted as a result of an investigative meeting between David Morgan of Hamakua Sugar Company and Yoshi Shiroma of your office on April 8, 1992, concerning a complaint filed with your office.”
Actually, Hamakua Sugar seems to have been considering “turning on” Hakalaoa Falls for some months before filing the permit. Late in 1991, a company employee, Steven Wishard, was asked to report on what would be required to protect the Lower Hamakua Ditch system if the flow over Hakalaoa Falls were no longer diverted. Wishard’s report, dated December 3, 1991, describes two options: encasing the existing sluice in reinforced concrete, or boring a bypass tunnel about 30 feet inside the face of the newly exposed rock.
The first option was less expensive, Wishard stated, although “there is a much greater risk to the workers.” The second option is described as “more permanent,” but might cost anywhere from seven to 15 times as much as the encasement. Whatever choice was made, permits to do the work were estimated to cost $100,000 (a Conservation District Use Permit would be needed, among others), and constructing a trail and base camp would require another $100,000. Wishard’s best guesses as to the respective costs indicate the encasement option would cost $265,300, while the bypass tunnel would cost $676,100.
The after-the-fact permits state that the company “would prefer to construct the bypass tunnel as it provides the longer term solution…. Nevertheless, Hamakua Sugar Company has agreed to construct either option as soon as funds become available.”
Does a Need Exist?
When will those funds “become available”? Will they ever? Hamakua’s filing for bankruptcy in August of 1992 suggests it may have difficulty finding the money to undertake either option.
But an even more fundamental question is: Are permanent repairs to the Lower Hamakua Ditch system warranted?
Given many of the disclosures made in relation to that filing, as well as the general skepticism expressed by attorneys for the chief secured creditor, Western Farm Credit Bank, about the long-term viability of sugar cultivation, questions as to the future need for the Lower Hamakua Ditch would seem appropriate.
If the sugar operations cease, there would no longer be a demand from the sugar mill for between eight million gallons a day and 11 million gallons a day. Nor would several million gallons a day over and above that be required for irrigating cane fields.
Use of ditch water for domestic purposes is likely to be phased out in any case. Only a few households in Pa`auilo use the ditch for domestic water supplies at the present. Next year, stricter federal regulations on surface-water systems go into effect, requiring treatment to assure water purity. Given the small number of users, it is not realistic to think Hamakua Sugar Company would install the treatment facilities required to meet federal standards.
In fact, the Kukuihaele Land Use Plan, prepared by Hamakua Sugar Company in connection with various zoning applications for the proposed resort, included a study comparing the relative advantages of surface-water treatment over drilling new wells and building a new ground-water domestic water system. The advantages were so marginal, and the disadvantages sufficiently great, that the Kukuihaele Land Use Plan states that “groundwater development is the preferred alternative to meet both potable water and irrigation requirements.”
Kaua`i’s Bird Refuges Are Stripped by Storm
The U.S. Fish and Wildlife Service operates three wildlife refuges on Kaua`i. Two — at Hanalei and Hule`ia, near Lihue — are wetland refuges, providing habitat for waterbirds. The third, at Kilauea Point, is famed for its abundant variety and populations of shorebirds.
Ray Rauch, project manager for the FWS refuges in Hawai`i and the Pacific Islands, provided this assessment of the damage caused by Hurricane Iniki:
At Kilauea Point, 40 percent of the nests and burrows of shearwaters are feared lost, although the birds themselves probably were able to ride out the storm. The population of red-tailed tropic birds, however, is estimated to have suffered a loss of 10 percent.
The hillside opposite the point, covered with booby nests, was stripped by the storm. Rauch put the loss of booby habitat at 100 percent.
Years of painstaking effort to eradicate introduced species of plants and restore native vegetation may have been undone by the hurricane, Rauch said. The FWS nursery was a casualty of the storm. He and others fear introduced species of plants may gain a foothold on the newly stripped land. The lighthouse survived with minimal damage, but the neighboring small building, housing a gift shop and displays, was wrecked.
At Hanalei and Hule`ia, the coot and gallinule population suffered losses of 10 percent or more. In addition, the refuges themselves were severely damaged. While many people may not realize it, wetlands refuges are usually intensively managed, and the ones on Kaua`i are no exception. The lining of the ponds was ripped out. Pumps and plumbing systems were torn out.
Rauch said that Fish and Wildlife Service personnel had a chance to look at some of the forested areas at higher elevations. Areas between 3,600 and 3,800 feet “looked good,” he said, and he was optimistic that native birds would “come out okay.”
* * *
Japan Responds To Plutonium Protests
Until the visit of the Greenpeace vessel Rainbow Warrior, the attention paid by Hawai`i’s mainstream media to Japan’s scheme to transport tons of plutonium by sea from France and England, for potential commercial energy-production use, was spotty at best — despite efforts by the governor’s office and Representative Neil Abercrombie to spark interest in the issue.
The arrival of the Rainbow Warrior finally seemed to do the trick. That caught not only the attention of the press, but also that of the Japanese government. Japan responded by dispatching to Hawai`i Takaya Sutoh, director general for scientific and technological offices of the Japanese Ministry of Foreign Affairs.
In a meeting with members of the press, Sutoh sought to dispel concerns that the casks in which the plutonium would be shipped were not up to the job. An information sheet, complete with four-color cartoon illustrations, on the various testing procedures to which the casks had been subjected was distributed. The procedures demonstrated, the Japanese said, that the casks exceeded standards set by the International Atomic Energy Agency.
Moreover, the Japanese stated, they had subjected the casks to an even more stringent round of tests: a drop test, in which the cask was dropped from a height of about 30 feet; a second drop test, in which it was dropped from a height of 40 inches onto a steel bar; a thermal test, exposing the cask for half an hour to a fire having an average flame temperature of at least 1,472 degrees Fahrenheit (actually, this is the standard established by the IAEA); and a water immersion test, in which the cask was submerged in about 50 feet of water for eight hours. The information sheet then describes “(Reference) Additional Test,” in which, it is stated, the government of Japan “performed a test under a hydraulic pressure equivalent to 10,000 meters depth, and confirmed that the specimen demonstrated its leak-tightness at the pressure.”
But the brief, cartoon-y descriptions of the Japanese government’s tests do not compare favorably with the serious report on the same subject prepared by the firm ECO Engineering, Inc., for the Nuclear Control Institute and Greenpeace International. That report compared the specifications of the casks, provided by Japan, to conditions known to have existed in accidents at sea. Shipboard fires, for example, have been known to last for days, with temperatures as high as 2,000 degrees Fahrenheit.
When Sutoh was asked whether the casks would withstand such conditions, he stated that the ship Aktasuki Maru was outfitted with special fire-fighting systems. But if the fire-fighting systems should be a casualty of the same accident leading to the shipboard fire, what then? The Japanese insist this cannot happen.
The Japanese government maintains that the ship will make the trip from France to Japan with no stops. However, information released by Greenpeace disclosed that the same Aktasuki Maru (under a different name) had in fact stopped in Honolulu Harbor on March 2, 1991, while it was thought to be transporting to France a shipment of spent nuclear fuel.
Sutoh paid a courtesy call to Governor John Waihe`e, who has made no secret of his concerns over Japan’s planned plutonium shipment. A press release issued by Waihe`e’s office indicated the meeting adjourned without those concerns having been allayed.
* * *
Hilo Botanical Garden Loses Battle over Trail
The Hawai`i Tropical Botanical Garden has suffered another legal setback, with the state of Hawai`i deciding that an old road leading to the shoreline at Onomea Bay belongs to the public, not to Dan Lutkenhouse, the garden’s founder and owner of the land on which it sits.
A letter from Jack Keppeler, a deputy director of the state Department of Land and Natural Resources, informed Lutkehnouse that pursuant to the Highways Act of 1892, the trail was a public right-of-way. That act placed in public ownership the land traversed by all roads then in use by the public.
Contested ownership of the trail was a factor in Lutkenhouse’s withdrawal of plans to expand the garden into a 40-acre area north of land now occupied by HTBG.
According to a report in The Hawai`i Tribune-Herald of July 19, 1992, Lutkenhouse has “sent an ’emergency bulletin’ to garden patrons across the country seeking their help in lobbying the government for relief from state shoreline access laws. The patrons have responded with numerous letters to various officials criticizing the government’s handling of the matter.”
* * *
Chidiac to LUC: I’ll Be in Touch
When last heard from, Charles Chidiac, the on-again, off-again would-be developer of the Hawaiian Riviera Resort, was off to France to lick his wounds. Having had the approval of the rezoning of his land in Ka`u remanded by court to the Land Use Commission, and having been forced by financial troubles to turn the title to most of the development site over to the Norwegian bank that held the first mortgage, he announced he was taking a break to regroup his forces.
But he’s back — or at least, he’s threatening to return. On September 17, he wrote the Land Use Commission that while “the bank required that Palace assign to the bank its governmental approvals (to the extent legally assignable) which pertain to the transferred property, Palace is still the owner in fee simple of the balance of the property containing a substantial portion of the development, including the support community, road access and that portion of the waterfront development which is included in ‘Lot 2.’
“Palace is now considering its alternatives for continuing its retained portion of the development and is reviewing possible new sources of equity to finance its activities. As soon as it is ready to discuss its plans in more detail, Palace will request the opportunity to present its plans and position to the commission.”
* * *
A How-To Manual For Hawaiian Plants
The Office of Environmental Quality Control has published “How to Plant a Native Hawaiian Garden,” a guide to the selection, propagation and cultivation of 19 native Hawaiian plants and three introduced Polynesian species. Author of the text is Kenneth Nagata.
The plants included in the manual were selected according to three criteria: the feasibility of their propagation, feasibility of cultivation, and availability from nurseries or other sources. No endangered or threatened species are included. Among the plants included are wiliwili, palapalai, three types of `ohi`a, `ilima, naio (or sandalwood), kukui and koki`o `ula`ula.
Copies of the manual have been sent to all schools in the state as well as all public libraries.
A helpful accompaniment to the manual may be found in the “Directory of Sources for Native Hawaiian Plants,” published by the Hawai`i Plant Conservation Center of the National Tropical Botanical Garden.
This directory is based on a poll of commercial nurseries in the state; the NTBG has not verified their information. An updated directory was to be published in the fall of 1992, although it is not clear whether that schedule is on track in the wake of Hurricane Iniki.
The directory costs $4. For order forms and other information, write Colleen Lopez, education coordinators, Hawai`i Plant Conservation Center, NTBG, P.O. Box 340, Lawai, HI 96765.
Volume 3, Number 3 October 1992