Big Island lawmakers are hopeful they can get a struggling program to revitalize parts of Hilo back on track.
After a program launched in 2018 that would allow lessees of state land in the Kanoelehua Industrial Area to extend their soon-to-expire leases by up to 40 years if they made certain improvements to their properties, lawmakers hoped the ailing and decrepit industrial area would be rejuvenated.
However, that rejuvenation has been slow in coming.
Hilo Rep. Chris Todd said that 12 applications were submitted to the Department of Land and Natural Resources in 2021, but only one of those has been granted an extension so far.
Several lease applicants have been blindsided by abrupt changes to application requirements set by the Board of Land and Natural Resources.
For example, in 2019, HPM President and CEO Jason Fujimoto submitted three applications for lease extensions for three parcels of state land and eventually reached a development agreement. But in 2021, the BLNR presented new, modified lease terms.
In order to clear up the process, Todd and other lawmakers have introduced a solution: a series of bills reducing the power of the Board of Land and Natural Resources to withhold lease extensions.
“These bills are sort of clarifying our statement of intent for what we did five years ago,” Todd said. “We’re saying, ‘This is what we were trying to do.’”
House Bill 273, a new bill introduced by Todd and Reps. Mark Nakashima and Richard Onishi, notes that the 2018 bill creating the lease extension program does not explicitly include language that allows the BLNR to unilaterally amend terms and conditions of extended leases. However, the BLNR has made unilateral changes anyway, ostensibly “to conform to the most current lease form and leasing practices and policies of the board,” according to the bill.
To fix that, HB 273 directly states that the BLNR cannot make unilateral amendments to the terms and conditions of a lease for public lands.
Senate Bill 79, a parallel measure introduced by Hilo Sen. Lorraine Inouye, who also co-introduced the 2018 bill, would go further and remove the BLNR from the process altogether so that only the Department of Land and Natural Resources itself would need to approve an extension, which it would be required to complete within 180 days. Nakashima introduced an identical bill in the House.
Todd said the bills are not specific to the Kanoelehua Industrial Area, and could be applied to other leases for state land, such as parcels on Banyan Drive and elsewhere on the Waiakea Peninsula, where lessees are reluctant to make expensive repairs to deteriorating property because of uncertainty about whether they can extend their leases.
“It doesn’t feel like there’s a complete, comprehensive plan for the area,” Todd said. “We have all these boundaries between county and state jurisdictions that don’t really benefit anyone.”
Divisions like that, Todd said, are why all the banyan trees on Banyan Drive are now infested with invasive parasitic gall wasps, which could, if left unchecked, destroy the trees.
“The county says it’s a state issue, and the state says it’s a county issue,” he said.
Todd said he hopes that HB 273 could pass this year in light of the DLNR’s efforts to find a new long-term lessee for the former Country Club Condominium Hotel.
“I think this is something we should work out before we start handing out 65-year leases,” Todd said.
Email Michael Brestovansky at mbrestovansky@hawaiitribune-herald.com.
