State lease extension measure clears state Legislature

  • David Tarnas

A bill that cleared the Legislature on Tuesday would allow the state to extend leases on state lands by 40 years, a measure applauded by developers such as those for Prince Kuhio Plaza, but that would apparently not apply to federal leases such as held by the U.S. Army at Pohakuloa Training Area.

House Bill 499, sponsored by Rep. David Tarnas, a North Hawaii Democrat, and a slew of co-sponsors, is intended to extend leases past the current 65-year limit by adding 40 more years if the developer agrees to a plan that improves the property.

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The lease extension agreements, which must be worked out between the lessee and the state Department of Land and Natural Resources, would apply to “commercial, industrial, resort, mixed-use, or government leases, other than those to which the University of Hawaii is a party,” under the terms of the bill.

“Government use” means a development undertaken under a lease held by any agency or department of the state or its political subdivisions other than the University of Hawaii or any department, agency, or administratively attached entity of the University of Hawaii system, the bill states. That language would preclude lease extensions under the bill on the university’s 11,287-acre Mauna Kea Science Reserve.

The DLNR communications office was unable to clarify by press-time Tuesday that the bill would definitely not apply to military sites such as PTA, but Tarnas said Tuesday the Army’s lease of the nearly 23,000 acres of state land in the saddle between Maunakea and Mauna Loa wasn’t contemplated in drafting the bill.

“No, federal leases of state land have not been part of the discussion of HB 499,” Tarnas said. “I have not had any conversations with PTA about this.”

The lands, the largest contiguous live-fire range in the state, have been used routinely for military training since 1943, and the state-owned land has been leased by the Army since 1964. Under the lease, the Army paid $1 for the entire 65-year period.

The current 65-year lease between the military and state of Hawaii in 1964 expires Aug. 16, 2029, but work is already in progress, including a draft environmental impact statement expected to be published next spring. The Army last fall held scoping meetings and took the first round of public input for the lease retention.

“We are committed to strictly following all EIS procedures,” said PTA Public Affairs Officer Michael Donnelly. “If circumstances warrant, we will evaluate them accordingly.”

PTA is currently undertaking two projects, new troop barracks and drainage and utility updates, totaling $37 million.

HB 499 was supported by DLNR and also developers who said there’s little incentive to pour millions into renovations and improvements as properties enter the ends of their leases.

Daniel Kea, general manager of Prince Kuhio Plaza, the island’s only indoor shopping mall, said the shopping center’s future depends on its ability to extend its ground lease.

“While we intend to pursue further renovations of PKP, these renovation plans could be jeopardized if the term of our existing ground lease is not extended,” Kea said in April 7 testimony. “We cannot justify significant capital investments to PKP without the assurance that our leasehold interest will continue for the long-term.”

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The bill is opposed by a number of Native Hawaiian and environmental concerns, including the Office of Hawaiian Affairs, the Hawaiian Affairs Caucus of the Democratic Party of Hawaii, the Aloha Aina Party, the Native Hawaiian Legal Corp. and many others.

“So long as Native Hawaiian claims to ownership of the ‘ceded’ lands remain outstanding and unresolved, and so long as there remains manifold evidence of the State’s failure to meet its trust obligations to Native Hawaiians,” said Native Hawaiian Legal Corp. Executive Director Summer L.H. Sylva in April 7 testimony, “prudence demands that the state’s management and administration of the ‘ceded’ lands trust inventory manifest, at all times, its fiduciary duties of due diligence and undivided loyalty to its beneficiaries.”

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