Just how strict should the state be on Alexander & Baldwin, Inc. (A&B), and its subsidiary, East Maui Irrigation Company, Ltd. (EMI), when it comes to policing the permits that allow them to divert tens of millions of gallons of water a day from East Maui watersheds?
With the closure of Hawaiian Commercial & Sugar’s sugarcane plantation in December 2016, the companies don’t need to divert anywhere near the volume of water they used to. Recognizing that, the Commission on Water Resource Management decided in June to require either full restoration or the maintenance of 64 percent of median base flows in about two dozen East Maui streams that were the subject of a contested case hearing initiated nearly two decades ago.
But the pressure to keep A&B’s 36,000 acres in Central Maui green has led the Board of Land and Natural Resources and the department it advises to simply take the companies’ word that they have complied with permit terms. That, at least, is what the Sierra Club of Hawai‘i, the Office of Hawaiian Affairs, and an attorney with the Native Hawaiian Legal Corporation argued at the board’s November 9 meeting, where it approved the renewal of holdover permits to EMI and A&B to continue their diversions in four state license areas for another year.
To address some of the concerns about A&B’s and EMI’s compliance, the board conditioned the approval on the establishment of a small advisory group to facilitate communication among the companies, residents of East Maui, and state experts on aquatic life over the next year and, perhaps, beyond.
But that fell too short for the Sierra Club, which had warned the board earlier in the meeting that it would seek a contested case hearing on the permits if the board failed to include conditions adequate to protect public trust resources. On November 19, the group filed a written petition with the Department of Land and Natural Resources requesting a contested case hearing.
“In public testimony, we presented eye-witness accounts and photographic evidence of dry streams where there should be water, large pieces of twisted metal in and along stream beds, and the lack of connection between severed parts of streams such that native species cannot complete their natural life cycle. We have demonstrated that the applicant has not complied with prior permit conditions and they should not be granted a renewed permit, at least not without ensuring complete compliance first,” the petition stated. Whether or not the Land Board grants the contested case hearing remains to be seen. Even if it does, the diversions would likely continue while the case proceeds, absent a restraining order. As the DLNR’s Land Division stated in a report to the board, the revocable permits that were in place before Act 126 went into effect are in “continued holdover status.” (Act 126 was passed by the 2016 Legislature in response to a Circuit Court ruling invalidating the revocable permits the Land Board had been issuing to A&B and EMI for years. The legislation allowed those diverting water under revocable permits to continue to do so for up to three years, while they pursued long-term leases for their diversions.)
“Although the permits were invalidated by the Circuit Court, the ruling was stayed pending [an appeal to the Intermediate Court of Appeals],” the division wrote, adding that it was recommending approving the holdover permits under Act 126 anyway, “in an abundance of caution and in the event the decision is upheld on appeal.”
Progress
At the board meeting, A&B vice president Meredith Ching and Darren Strand, the company’s manager for diversified agriculture, reported on the company’s efforts to transition its lands from sugarcane to diversified agriculture and to continue to provide the county with water for domestic and agricultural uses in Upcountry Maui. About 5,000 acres have been dedicated to raising cattle, the Maui County Council has approved the acquisition of just under 300 acres to expand its agricultural park, a lessee growing pongamia intends to expand to 250 acres, 600 acres have been set aside for a biogas and feedstock production partnership with the Kahului wastewater system, and the company has leases or partnerships with other farms spanning 800 acres, they said.
That said, they announced that A&B is pursuing a farming partner from California that plans to grow food crops on nearly the whole footprint of the company’s agricultural lands, “very similar to what we proposed,” Strand said.
Ching said the group was in final stages of a feasibility analysis. Should it take over the company’s lands, planting could begin as soon as next year, she said.
Whoever ultimately controls the lands, Ching, Strand, outgoing Maui mayor Alan Arakawa, and representatives for local farm bureaus all testified to the need to continue the diversion of stream water from East Maui.
Arakawa said the diversions, which provide cheaper water than the county can provide, are necessary to fulfill the community’s goal of keeping the former plantation lands in agriculture. “We have to grow farmers. It doesn’t happen overnight,” he said.
With regard to the county Department of Water Supply’s reliance on the diversions, Arakawa added, “Long-term, we’re going to have to look to East Maui for water as continued growth on Maui occurs.”
The county has an agreement with A&B that requires the company to provide water from its system to meet domestic and agricultural needs in Upcountry. Arakawa said it would cost too much for the county to develop its own diversion system or to condemn a portion of EMI’s.
Instead, the county is exploring ways to install pipes in the EMI system using the state’s authority. “The state has, by contract with A&B, the use of the EMI system, which is what I would like the state to convert to the county, so the county would have the ability to use the EMI ditch system,” he told the board.
Ultimately, the county’s goal should be to develop lateral tunnels that take sub- surface water that can be piped to Central Maui, “but that’s going to take billions of dollars and that’s going to take decades to create,” he said.
In the meantime, A&B reported that it has been diverting 20 to 25 mgd from East Maui, a portion of which is delivered to the county.
‘Scout’s Honor’
However important the diversions might be, East Maui resident Lucienne de Naie, who is also vice chair of the Sierra Club Hawai‘i Chapter, had a problem with how the permits were being managed.
“Everyone supports sharing water on a reasonable basis, but I think that your job is to have accountability as you apportion public resources. We find the accountability is sort of missing in this process,” she told the Land Board, adding, “We really don’t know a lot about how these conditions are being met. It’s sort of a scout’s honor kind of thing.”
Under the permits approved in 2016 and 2017, A&B and EMI were not only prohibited from wasting diverted water, but they also had to take steps to ensure that aquatic organisms could migrate up and down streams that have diversion structures on them, and that garbage and debris in the permit areas were removed, among other things. What’s more, Act 126 specified that the board could only approve a holdover permit if the use complied with the public trust doctrine.
In approving the first two holdovers under Act 126, the Land Board abstained from specifying an enforcement mechanism to ensure that, at the very least, the companies weren’t wasting water.
Last month, the DLNR’s Land Division revised its recommended conditions for the permit to mirror requirements imposed on the companies last June by the state Commission on Water Resource Management. At that time, the Water Commission amended the interim instream flow standards of the streams that were part of the contested case filed by Na Moku Aupuni O Ko‘olau Hui in 2001. Rather than keep the previously approved cap of 80 million gallons per day, the Land Divison was now recommending that “any water diverted under the revocable permits shall be for reasonable and beneficial use and always subject to compliance with the amended IIFS.”
Again, the division was silent on how permit conditions should be enforced. More than a decade ago, in the course of the contested case hearing, the Land Board tasked the division with the job of monitoring whether or not the companies were providing East Maui taro farmers with the amount of water the board had allocated on an interim basis. For various reasons, the scheme never really worked and dissatisfied members of Na Moku went so far as to open up one of the streams’ diversions themselves.
At the board’s meeting and in written testimony, the Office of Hawaiian Affairs (OHA) echoed the Sierra Club’s concern about the lax enforcement.
“While the submittal does provide some holdover conditions that ostensibly seek to ensure that any diverted water is used responsibly and for ‘beneficial uses,’ the lack of mechanisms for monitoring and compliance verification risks rendering such conditions practically meaningless,” OHA stated in its testimony to the board.
A&B’s October 16 compliance report to the DLNR provided a single short paragraph with regard to the waste/beneficial use conditions. It simply stated,“Total water diverted from East Maui streams approximated 20-25 mgd throughout 2018. All water was used to meet the needs of the County of Maui for its Upcountry and Nahiku public water systems, the Kula Ag Park, and fire suppression needs, as well as for diversified agricultural needs on former sugar lands in Central Maui.”
OHA complained that the Land Division’s recommendations failed to require field inspections, water meters, or “publicly accessible, live reporting of diversion and consumption amounts.” Also, the division’s report provided no clear description of “what, where, and how diverted water may be used,” OHA added.
De Naie also pointed out that A&B’s and EMI’s efforts to ensure the streams allow aquatic organisms to migrate — by simply installing pipes across diversions, in most cases — were inadequate.
“The pipe at Puolua stream, it does not allow for any fish. It’s an 8-inch pipe. The fish would have to swim across the road. Someone should be out checking these things and giving you real factual information so that you know how those conditions are doing. The public could be a good step in that,” she said.
She added that Hanehoi Stream, which A&B promised in 2016 to fully restore, had not been, and she showed photos to prove it.
“It has diversions at four different elevations. The only diversion that is open is the bottom gate. … If it’s supposed to be completely restored, you need a way of not diverting at those top three diversions. A&B tried to get a permit. It didn’t happen for two years. Finally, in July of this year, it was decided that they could close those gates without a permit as a regular maintenance activity,” she said. Even so, the other three diversions are continuing to divert water, she added.
In an October 24 letter to Land Board chair Suzanne Case, A&B’s Strand reported that the company had received all neces- sary regulatory approvals to permanently abandon 15 of the diversions on streams that serve taro farmers. “That work will proceed immediately,” Strand wrote.
Even so, OHA recommended that the Land Board require the companies to post a performance bond or provide some other kind of financial assurance. Both OHA and the Sierra Club recommended several conditions that would satisfy their concerns.
“If you’re going to say ‘only use for ag services,’ why not [have A&B] provide productivity reports?” asked OHA’s Wayne Tanaka. “This is actually a really critical opportunity to look forward to the long-term lease,’ he added.
Other Streams
In addition to the reported problems with enforcing permit conditions, the Sierra Club, OHA and Alan Murakami of the Native Hawaiian Legal Corporation (which represents Na Moku) argued that the Land Board was failing to consider the impact the diversions have on those streams not addressed by the Water Commission’s June decision.
Murakami said the board needed to assess the extent to which the diversions affect native Hawaiian traditional and customary practices “that may or may not be practiced by the members of Na Moku.”
Dean Uyeno, head of the Water Commission’s stream protection and management program, testified that the IIFS decision dealt with only a third of the East Maui streams, and that the agency’s goal was to eventually set new IIFS for the remaining ones.
“There are streams between Honopou and Maliko Gulch that are being diverted, as well, outside of the license area,” he said.
In its petition for a contested case hearing, the Sierra Club’s Marti Townsend noted that the Huelo license area has no public water supply and “communities there along Kailua, Hanawana, Hoaloa, Waipio, Waipio Iki, Mokupapa, Honokala and Ho‘olawa streams need sufficient water in the stream year round for residents living downstream to use water from the stream to meet domestic and recreational needs as well as kuleana rights. None of these streams are included in [Na Moku’s IIFS] petition.”
“There are many more streams in this watershed, on public land, that need to be restored for the sake of the ecosystem and the people who rely on it. The Land Board is the only entity responsible for ensuring these additional streams are wisely used and fully protected. Yet it is clear from the record so far that the Land Board does not have the information it needs to make informed decisions about the fate of these streams,” Townsend stated.
Round Table
Given that a number of testifiers pointed to the need to allow the affected communities to help monitor and/or facilitate stream restoration efforts, Land Board member Stanley Roehrig suggested that a permit oversight committee be formed and include representatives from the East Maui community and the diverters.
Murakami said Na Moku would welcome something like that.
A&B’s Ching had announced earlier in the meeting that there was no way the company would be able to secure a long-term lease before the permit expires and Act 126 sunsets at the end of 2019. Draft and final environmental impact statements for the lease still need to be completed, and that alone will take until the end of 2019, she said. After that, the DLNR needs to conduct an appraisal and prepare lease documents. “The process is going to extend to 2020,” she said.
“You need to go back to Legislature?” board member Keone Downing asked.
“It appears that’s necessary. Not only us, but nine others [water diverters] including farmers on the Big Island, the Kaua‘i utility …” she replied.
To this, Murakami said later that he was “totally against any extensions [of Act 126] in the Legislature.”
Even so, Downing encouraged the parties involved to work together toward a long-term solution.
“We need to involve all community, all aspects of community… Not Honolulu, not the Legislature,” he said. Otherwise, the fight over the water will continue. “It becomes billable hours for attorneys and consultants and we lose as Hawai‘i. There’s no gain for us. … Please, let’s try to move forward as a community,” he said.
In making his motion to approve the holdover permits, Roehrig seemed to agree with some of the testifiers that A&B and EMI had fallen short in their duties. “I didn’t hear one word from the applicant about how much water they’re going to use and that disturbs me because they have the burden of proof,” he said.
However, he balked at adopting the many conditions recommended by the Sierra Club and OHA. “We can’t put 100 conditions on this RP. That’s not our job and we wouldn’t even get ‘em right if we did. I’m not in favor of endless conditions. I’m in favor of a committee and you folks tell us what’s important,” he said.
The Sierra Club had asked that such a committee, if formed, meet quarterly to discuss A&B’s plans for stream restoration projects, but Land Board member Chris Yuen suggested that only one meeting be held during the permit period and that the Native Hawaiian Legal Corporation could be the point of contact for the taro farmers.
Yuen supported the idea of establishing a committee once a long-term lease is in place, but seemed hesitant to do it just for permits that will expire in a year.
To this, Downing pointed out, “This is not a short-term [permit]. Even though it’s an RP, we know it’s going back to the Legislature. We start this process now, it’s a process that could help the Legislature [and] maybe it helps the community that is in distrust.”
“Nothing’s going to get done in one meeting. Questions are going to be asked, but that’s it,” he said.
“Before you stop the war, you have to have a cease-fire meeting. Maybe it takes two before you get to talking about the serious matters,” Roehrig added. Like Downing, he seemed to think the committee should be formed sooner than later. “I’m not interested in waiting another year,” he said.
In the end, the board agreed to establish a five-member committee to discuss water issues in the license areas. OHA and NHLC would each designate members, as would the farm bureau, A&B, and the county. A staff member from the DLNR’s Division of Aquatic Resources would be made available to provide expertise to the committee. The committee would meet monthly for the first quarter of next year and meet quarterly thereafter.
With that added condition, the board approved the permits. (Maui board member James Gomes, whose employer works with A&B, recused himself.)
While the establishment of a committee seemed to address one of the Sierra Club’s initial recommendations, the group was nowhere near satisfied. In its petition for a contested case hearing, Townsend argued that the holdovers were inconsistent with the public trust doctrine, among other things.
She reiterated many of the concerns raised at the November board meeting and asked that the permits be denied because the applicants had not justified their diversions. Should the permits be granted, the group asked that 11 conditions be imposed. They included measures to obtain more data on water use and stream restoration activities and to ensure enforcement of permit conditions, among other things.
— Teresa Dawson