Alexander and Baldwin has a potential partner who wants to grow various crops on “the entire footprint,” of A&B’s agricultural holdings on Maui, a company official said Friday.
“We’re pursuing and have had inquiry from a farming partner out of California, and they have an interest in farming nearly the whole footprint of land. We’re in discussions with them looking at growing a whole variety of food crops,” A&B’s general manager of diversified agriculture on Maui, Darren Strand, told members of the Board of Land and Natural Resources during the Nov. 9 meeting. The statements were part of A&B’s request to renew the permit that allows it to take 80 million gallons per day of stream water from state lands.
“This group has an aligned vision with ours, they have extensive farming expertise, a solid source of funding, established marketing channels, and also an interest in the entire footprint, which is a combination of promising attributes that we haven’t seen from the any of the hundreds of other parties that we’ve talked to in the past,” A&B Vice President Meredith Ching told the board. “They’re in their final stages of feasibility analysis of a farming operation, at the end of scale, to plant the entire plantation footprint and if they decide to proceed, planting will possibly begin in 2019.”
Strand told the BLNR that A&B, as a publicly traded company, could not disclose details of these discussions. However, he stated that A&B has been sharing “extensive data” with the California group during recent months.
“We can talk about the plans we have this year,“ Strand said. “There’s an expansion of the pasture area, an area of beverage crops or coffee on the Kihei side, orchard crops and tropical fruits, and row crops on the West Maui portion: greens, alfalfa, berries. There’s land set aside for local farmer candidates and the agricultural park. The plan is to grow food crops, and we understand the nature of the local markets so the plan is to provide food for the local market as well as export.”
The California group has “a lot of expertise on the global food market,” Strand added.
Although his remarks would seem to conflict with the heavily circulating rumors that a Canadian pension fund is finalizing plans to buy 55,000 acres of A&B’s agricultural holdings on Maui, informed sources suggested that the pension fund is the source of the funding for A&B’s “farming partner.” The rumor largely originated from remarks made by a high-ranking state official to a group at the Hawai’i Farmers Union Convention in October. Individuals who overheard the comments said that the partner had a contract with Starbucks to grow coffee on some of the acreage.
As A&B executives discussed their plans with the DLNR board, spokesman Darren Pai was less forthcoming than his colleagues about A&B’s California partner. Instead, in his remarks to MauiTime on Friday about the rumors, he addressed complaints from local companies and organizations who were in discussions with A&B to purchase the Central Valley agricultural lands for farming and now say that their negotiations with A&B have stalled.
“We are not actively marketing our agricultural lands for sale,” he said. “We are engaged in discussions with agricultural users who are interested in farming substantially all of the acreage. Our primary goal since the shutdown of HC&S has been to find third parties with viable farming plans, and we believe we are making progress in that regard.”
“If the discussions are successful,” Pai added, “these farming initiatives could result in a lease or sale of lands, or a combination. We will need to conclude those discussions before we can substantively engage with any other group or individual. It is important to note that since we ceased sugar operations we have engaged with hundreds of parties, both local and from the mainland, as we have worked to find viable farming activities.”
When asked for further details about the unnamed California partner or the rumors of a Canadian pension fund, Pai responded that the company had nothing to add at this time.
Alexander and Baldwin is the largest private landowner on Maui, and since the cessation of its sugar operations in 2016 has been the subject of much speculation and interest regarding the fate of the 36,000 acres previously used to grow sugarcane.
“I am disappointed that they move ahead in such secrecy without involving the community,” Councilmember Kelly King, a frontrunner to be chair of the new County Council-elect, told me “I understand that it’s private property, but it involves everyone in Maui County. We would have hoped that as a parent company, and one that participates in the community on so many other levels, that they would be concerned in wanting the community involved in the discussions leading up to the decisions, instead of making these decisions and then dropping them on the community without so much as holding a public meeting.”
“Where the land goes and who owns it affects everybody on the island,” she added, “and I have concerns about who that’s going to be, what they’re going to be farming, and what chemicals they may be using – and all these things should really be coming to the community.”
As of press time, Mayor-elect Mike Victorino did not respond to a request for comment.
Bill Greenleaf, a farmer, co-owner of Greenleaf Farms, and former Hawai‘i Farmers Union chapter president, has been concerned about the future of the Maui’s Central Valley ever since the sugarcane operations were shuttered.
Greenleaf says although off-island investors understand the power of profit, “People who live on Maui understand the opportunity that a well-developed plan around food security offers.”
“After all these years, isn’t it incumbent on A&B to consider the future of the people of the Island of Maui?” he asked.
When Greenleaf heard the comments made by the State of Hawai‘i official regarding the sale of 55,000 acres of A&B’s Maui land holdings, he wrote a letter to Governor David Ige.
He questioned why an “Eco Development group from Chicago who have 40 years of experience in the business of repurposing large tracts of land” was suddenly shut out of negotiations.
“This group and its consultants have met with A&B. They have shared their plans and history with A&B. This group would like to begin and cannot as A&B has not been willing to share their asking price. A&B has discussed leasing the land to the Maui group but has recently shut them out of the discussion,” he wrote.
“The story changed at the HFUU State Convention,” Greenleaf continued. “It was revealed that A&B is nearing completion of a sale to a group who are not from Hawaii. This revelation brings up some questions. Why is A&B ignoring a responsible and respected group with an offer? Who is the group A&B is making a deal with? What will they grow? Will it feed the people of Hawaii or be non-food crops? Will their cultivation practices add more run-off to our reefs and CO2 to our air?”
Governor Ige’s office did not respond to a request for comment.
One organization, Food Security Hawai‘i, has been interested in the possibility of purchasing the Central Valley land to lease to farmers for local food production. This would include the Pu‘unene sugarcane mill, which would be used for processing infrastructure and a food hub.
“We have a master plan for farming in the Central Valley,” said Susan Campbell of Food Security Hawai‘i. “We did an extensive land search in the Hawaiian Islands and this [Important Agricultural Land] in the Central Valley is the only land that has the ability to create food security for the Hawaiian Islands. It is the only land that has the right the combination of elevations. It also has the infrastructure already inside – it has roads, there’s a mill that could be turned into feed mills. One of the problems in the Hawaiian Islands is that we don’t have the infrastructure: We don’t have mills, we don’t have slaughterhouses – We don’t have that, and that’s the plan that we had put together.”
Charlotte O’Brien of Food Security Hawai‘i is bound by a non-disclosure agreement with Alexander and Baldwin, but stated, “We’re on good terms with A&B. We hope to be next in line to bring our farmers to the table to discuss with A&B the potential of buying that land. The former sugarcane lands are ideal for food security because there are very few large-scale agricultural lands that still have water.”
She added, “I have heard the rumors. I have no idea if they are true or not, but if it’s true that another large, foreign corporation were to come in and buy that land for exploiting any specialty crop it would be a travesty and a theft from our children’s future.”
“I keep hearing similar rumors and it’s not a surprise to me,” Maui Tomorrow Executive Director Albert Perez said. “[Alexander and Baldwin is] a real estate investment trust. They are not an agricultural company. I never believed their plan they were presenting for the stream flow standards contested case; I never believed that was real and I testified to that effect. It’s not a plan. It’s more of a sketch, and they’re not making that much progress. So I’m not surprised at all.”
At the Nov. 9 meeting, the BLNR approved A&B’s request for a third holdover permit to continue water diversion of East Maui streams, with an amendment that included the formation of an “interim committee to discuss water usage issues in the license area.” The committee will consist of five members representing Alexander & Baldwin, Farm Bureau, Office of Hawaiian Affairs, Native Hawaiian Legal Corporation, and the County of Maui, and will meet once a month for the first quarter, then at least quarterly thereafter.
This begs the question, why is Alexander and Baldwin allowed to continue diverting water from state lands if the company’s intent is to sell its agricultural holdings?
“I just wonder if the BLNR is really facilitating agriculture in the future or if they’re just facilitating a higher profit for a real estate transaction for this real estate investment trust called A&B,” Albert Perez said. “Here’s why: The land is worth much more with water. It’s really complicated, but the bottom line is that they already have plenty of water even without this water; they have over 50 million gallons just from lands they own in fee that are not in subject of the leases.”
The Sierra Club Hawai‘i verbally requested a contested case following the BLNR’s decision, citing a lack of information about A&B’s water usage and future land use plans. “The Land Board has a legal obligation to ensure they are approving permits for water uses that is reasonable and beneficial,” said Lucienne de Naie, vice chair of the Sierra Club of Hawai‘i. “A&B has not presented specific information about their current water needs from the East Maui streams, their current water use from other sources not subject to these permits and leases, nor a timetable for their future needs. We have no idea how much water they used last year and no idea what they will need for next year.”
“[A&B’s] justification was that they need the 80 million gallons because they have this new California partner who will be farming,” de Naie added, “But this lease is for the next year and they said this partner ‘might’ be planting in 2019. They didn’t mention acreage.”
Papers for the contested case will be filed by the end of the week, de Naie said, and BLNR will determine whether a contested case hearing shall proceed.
“We want to make sure the Land Board get the facts they need to manage the public’s resources like the valuable assets they are,” said Marti Townsend, director for the Sierra Club of Hawai‘i. “There is no point in imposing conditions if there is no way for the Land Board to verify actual compliance.”
Photo 1 courtesy Wikimedia commons
Photo 3 by Forrest and Kim Starr
Pieces of this story were covered as reports emerged. This is the version that appears in print in the 11/15 issue of MauiTime Weekly. See previous coverage here:
Discussion 11/16/2018: Should Alexander and Baldwin hold public meetings regarding the future of the old sugarcane land?
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