[In November 2018, MauiTime first broke the story of the $267-million sale of 56,000 acres of Alexander & Baldwin sugarcane land and watershed to Mahi Pono, a joint venture between California-based Pomona Farming and a Canadian pension fund. Our Changing Maui: Mahi Pono series examines all facets of the sale and the chages it will bring to Maui. It is part of Changing Maui, a larger series about changes facing Maui County.]
[Note: A version of this story was previously posted online. It has since been updated.]
In the film classic Chinatown, private eye Jake Gittes (Jack Nicholson) confronts the politics of water in 1930s Los Angeles. By film’s end, Gittes’ personal devastation by power and perfidy is summed up in two words: “It’s Chinatown.” In 2019’s Honolulu, the same elements are swirling around the State Legislature, where a recent surge of backroom maneuvers rival any movie plot twists.
In the past week, new water bills have appeared, then disappeared. Water experts have made surprising declarations, then suddenly changed their minds. The only sure thing is that there’s no sure thing.
In the end, however, it all comes back to Maui and its water.
Late last week, HB1326 – the so-called Corporate Water Theft Bill – suddenly was joined by a separate but almost identical piece of legislation, HB1171. Let’s call it the New Sneakier Corporate Water Theft bill. It’s a distasteful bit of legislative razzle dazzle seemingly designed to placate Alexander & Baldwin – one of the state’s most powerful corporations.
HB1326 extends the controversial use of state-issued one-year “holdover permits.” which allow companies (one on Maui, four on Kaua‘i, and seven on the Big Island) to “temporarily” divert stream water while they fulfill the legal environmental requirements for obtaining permanent long-term water leases – which they have postponed for years. The current law regulating this practice expires in June.
The biggest procrastinator is A&B, which was ordered last year to stop diverting water from a number of East Maui streams, but continued to divert from others (even though it had stopped growing sugarcane). It never completed the long-term lease application process, leaving that to Mahi Pono, which bought 41,000 A&B acres in December for $267 million.
The $62-Million Rebate
Buried in the A&B/Mahi Pono purchase and sales agreement is a condition that many believe led to the creation of HB1326. If Mahi Pono can’t get the water it needs within eight years of its 2018 purchase, A&B must rebate $62 million of the purchase price. So A&B has flexed its considerable lobbying muscle with lawmakers in an attempt to extend the practice of holdover permits to 2026 and ensure it won’t owe Mahi Pono a cent. Mahi Pono is also lobbying hard for the legislation, though many say the company has plenty of water right now for its growing plans. That’s a mystery best saved for another story.
HB1326, in fact, extended temporary holdover permitting for another seven years, to 2026, neatly coinciding with A&B’s need for that window. That version zipped through the House and into the Senate. But opposition grew and the bill’s progress slowed. A hearing before the five-member Committee on Water and Land was cancelled and, instead, the bill was sent to a joint committee: Water and Land, and the 13-member Committee on Ways and Means.
Then the Democratic Party of Hawai‘i wrote lawmakers urging the termination of HB1326, saying companies like A&B shouldn’t use holdover permits “to steal public water resources for their own purposes,” adding, “halt this bill immediately.”
Strong stuff. And that’s when things grew murkier still, according to those familiar with the Legislature and individual lawmakers.
Committee on Water and Land Chair Kahele strove to make the now-stinky HB1326 more palatable, adding a flowery introduction about “ecological balance and scenic beauty.” But the big change was buried deeper: Kahele shortened the permits’ expiration date from seven years to three, which assuredly didn’t sit well with A&B, for about 62-million reasons.
Gut and Replace
Enter Sen. Donovan Dela Cruz, powerful chair of the ways and means committee and a master of an ugly maneuver known as “gut and replace.” Lawmakers “gut” the entire contents of a bill that has already cleared legislative hurdles and insert completely new language, leaving only the original bill’s number. Critics say the practice prevents the public from participating in the legislative process.
Here’s an example: The fictional HB123 is a butterfly protection bill. The public has testified, it’s passed a number of House votes and now moves to the Senate, where it lands in Sen. Backroom Deal’s committee and undergoes a “gut and replace.” The new HB123 authorizes the construction of a 10-foot wall around Waikiki – something that had never been voted upon nor opened to public input.
Sound sleazy? Common Cause and The League of Women Voters thought so and sued the state over the practice, calling it unconstitutional. Gut and replace defenders said it was necessary to protect bills from dying due to legislative deadlines. A judge ruled against Common Cause and The League of Women Voters in January, deeming the practice legal. Now the two groups plan to appeal that decision to the Hawai‘i Supreme Court.
In the meantime, Sen. Dela Cruz’s ways and means committee has become a kind of gut and replace factory. Honolulu Civil Beat’s Chad Blair reported in early March that Dela Cruz had already gutted and replaced three bills this session, less than two months after the judge’s ruling.
Last week, Dela Cruz turned his attention to holdover water permits. He gutted a funding bill, HB1171, and replaced its contents with language similar to HB1326, only this bill restores the expiration date for holdover permits back to 2026, the seven-year date supported by A&B. The blowback was significant and within two days HB1171 disappeared from sight, though it is not yet dead. HB1326 had its joint committee hearing Tuesday, where senators opposing the bill wrested some interesting admissions from state officials.
Said Sierra Club of Hawai‘i’s director Marti Townsend, “We learned that small water users will not be harmed if [HB1326] does not pass. We also learned that Upcountry usage on Maui won’t be harmed if the bill does not pass.” Both are keystone arguments by bill supporters.
The joint hearing ended Tuesday without action; a vote is scheduled for April 4 on HB1326 and there will be additional changes to the bill. Keep a close eye on the expiration language, the time limit could again change in A&B’s favor.
Townsend’s comments add new texture to Maui, where Mayor Michael Victorino maintains his drumbeat of doom for Upcountry water supplies if HB1326 doesn’t pass, despite comments made at a recent water board meeting by his own water director, Jeff Pearson. Pearson told the board, “I don’t think it’s a panic” [if HB1326 fails] and “I am quite confident we are going to still have water available.”
However, county spokesman Brian Perry issued a dramatically different statement the following week: “Department of Water Supply Director Jeff Pearson has affirmed Mayor Victorino’s statements… Director Pearson says that without passage of House Bill 1326, water may not be diverted… and [the water department] would experience water shortages and have unreliable delivery of water to Upcountry residents and farmers.”
Community activist Lucienne de Naie, author of the 2005 report “Maui’s Water Future,” was surprised by Pearson’s sudden turnaround. “He was correct [at the meeting] when he said that a great majority of our water does not come from [Mahi Pono land] in the East Maui watershed.”
I asked Perry about Pearson’s about-face since his Water Board testimony. Perry said he had nothing to add to the official statement and could not reach Pearson for clarification.
It’s Maui, Jake.
Image courtesy of flickr/Will Scullin