10/9/2012 Subtask 12.1 Deliverable (item 4 Part V) - Hawaii Natural ...

State Agency Land Leases 

Prepared for the 

U.S. Department of Energy 

Office of Electricity Delivery and Energy Reliability 

Under Cooperative Agreement No. DE-FC26-06NT42847 

Hawai‘i Distributed Energy Resource Technologies for Energy Security 

Subtask 12.1 Deliverable (item 4) 

Part V – Second Portion of Appendix C 

Bioenergy Analyses 

Prepared by 

William S. Richardson School of Law 

University of Hawai‘i 

And submitted to 

Hawai‘i Natural Energy Institute 

School of Ocean and Earth Science and Technology 

University of Hawai‘i 

October 2012

Acknowledgement: This material is based upon work supported by the United States 

Department of Energy under Cooperative Agreement Number DE-FC-06NT42847. 

Disclaimer: This report was prepared as an account of work sponsored by an agency of 

the United States Government. Neither the United States Government nor any agency 

thereof, nor any of their employees, makes any warranty, express or implied, or assumes 

any legal liability or responsibility for the accuracy, completeness, or usefulness of any 

information, apparatus, product, or process disclosed, or represents that its use would not 

infringe privately owned rights. Reference here in to any specific commercial product, 

process, or service by tradename, trademark, manufacturer, or otherwise does not 

necessarily constitute or imply its endorsement, recommendation, or favoring by the 

United States Government or any agency thereof. The views and opinions of authors 

expressed herein do not necessarily state or reflect those of the United States Government 

or any agency thereof. 

ii

APPENDIX TABLE OF CONTENTS 

APPENDIX A: 

DLNR………………………………………………………………………………………………………………………....A-1 

1. S-5731 ...................................................................................................................................................................... A-1 

2. S-5848 .................................................................................................................................................................... A-30 

3. S-6011 .................................................................................................................................................................... A-53 

APPENDIX B: 

DHHL…………………………………………………………………………………………………………………….…..B-1 

1. Notice – Negotiation………………………………………………………………………………………………………B-1 

2. Notice –Voice Bid………………………………………………………………………………………………………...B-70 

3. Industrial Template…………………………………………………………………………………………………...B-142 

4. Commercial Template………………………………………………………………………………………………..B-174 

5. Hawaii Homes Commission Act Statutes……………………………………………………………………..B-209 

6. Hawaii Revised Statutes……………………………………………………………………………………………..B-213 

7. General Lease No. 258………………………………………………………………………………………………..B-227 

8. General Lease No. 260………………………………………………………………………………………….…….B-265 

9. General Lease No. 262, 264………………………………………………………………………………………..B-302 

10. General Lease No. 284………………………………………………………………………………………………..B-341 



APPENDIX C: 

DOA-ADC………………………………………………………………………………………………………………..…C-1 

1. DOA Ag Park Lease Template……………………………………………………………………..……….…………C-1 

2. DOA AP Lease S-4936……………………….……………………………………………………………….………...C-45 

3. DOA NAP Lease S-3771………………………………………………………………………………………………..C-94 

4. ADC Lease LE-K1201…………………………………………..……………………………………………………..C-150 

5. ADC License LI-K1102………………………...……………………………………………………………………..C-182 

6. ADC License LI-K1101………………………...……………………………………………………………………..C-216 

7. DOA AP Lease S-4923……………………………………………………………………………………….………..C-254 

8. DOA NAP Lease S-3766………………………………………………………………………………….…….…….C-282 

9. ADC License LI-K1001……………………………………………………………………………………………….C-338 

10. ADC managed DLNR Permit S-7452………………………………………………………………………..…..C-377 

11. DOA Revised Teruya Interview Summary.…………………………………………………………………..C-390 

12. DOA NAP Parcel List 11 DEC 2007.……………………………………………………………………………..C-395 

13. DOA NAP Parcel List 9 AUG 2012…………………………………………………………………………….….C-398 

14. DOA Expression of Interest Form………...……………………………………………………………………..C-400 

15. DOA Leasing Application Package…………………………………………………………………..…………..C-402 

16. DOA Strategic Plan 12.16.08….………………………………………………………………………….………..C-429 

17. ADC Strategic Plan 15 OCT 2008…………………………………………………………………….…….…….C-435 

18. Kekaha Sugar Land Report……………...………………………………………………………………………….C-444 

19. ADC Tenant Application………………………...………………………………………………………….………..C-471 

20. Supplemental Table Comparing All Lease-License Terms and Provisions……………….…….C-480 

21. HAR Chapters…………………………………………………………………………………………………………….C-517 

iii

LTCENSE AGREEMENT NO. ],I-KIOOI 

between 

STATE OF HAWAIT 

AGRTBUSINESS DEVELOPMENT CORPORATION 

aS LICENSOR 

and 

SUNRISE CAPITAL, I}iC . 

a Hawaii corporation 

aS LICENSEE 

C-338

STATE OF HAWATT 

AGRTBUSTNE's DEVELo'MT*, ioonoRATroN 

LTCENSE AGREEMENT NO Lr-Kl00l 

THf S Lf CENSE made Julv, and 

2oog, issued 

bv thir. 

and n..*..r. AGRTBUSINESS rhe DEVELOPM'.V' ,;..# 

mailing IO*PORATTON, t,.. #" ,lj 

address of which is P]ACC 

235 

Of LU=i.,CSS 

S. ANd 

Honofulu' Hawaii g6B1t; eeretania 

hereinaraur-r 

Street, Room 205, 

suNRrsE cAprrAL, ca11ed ,,LrGENSOR,, 

rNC. , a Hawali .orporation, and 

the business and 

::::J.tt;."Xii;J" rl' n'.n" nr..j;_ 1j1'^tt ror purposes or 

hereinaf 

rhis 

ter calf ed ""r"u.oruJ.', DUx r282, Kekaha, Hawai i 96r$ , 

W I T N E S S E T H: 

WHEREAS, LTCENSOR 

cerrain p-'."r"-;'";.'o= 

rdenti fied 

:iJJ:r:;o .r.' HHfl:, "iflr1:::".?"::i. 

and rurrher "r;j;Jii::",ir.3X"":q;;"lg' 

Governor,s Executive orqi. :;;f, _Ti"i;,T"ffi,; 

Executive order 

No. itir, 

Nos. +iz1 

as modified 

and 4r6a,' 

by Governor,s 

hereinafter- referred to as 

:i: ;::'5r"'Jilr= iJ,i, ?."T""J.I; ro sranr licenses r", 

"I,IJ"X,=" 

agri "lT:ff3t ' LT.ENS.R has aqreed ro a11ow rhe Kekaha 

" c o op e r a . t ";"' ";::l ". 

" "li-, n 

_ " nl":*. li;; " :::. .,"*T;ff#: common infrastructure 

J ":,, :i: 

consideration "1 

the nrop..ao 

and other in 

agreed 

exchanqe 

upon for 

ter.ms,: 

mutual 

and 

'HEREAS, LT.ENSEE has requested a l:Lcense to use a portion 

of said property at Kekaha, Kauai for agrjcultural purposes,. 

NOW' THEREFORE, 

conditions in consideration 

herein containeO of 

to 

the 

be 

terms 

ob.er.reO and 

LT.ENSEE, LrcENSoR, and 

o"r"rrrr. to and as se1_ forth ,.o..n1t="Tt;li 

tfl::"i.1'.',i";fo.T1;f;._*"':$# e;

:i;J"JiJt".t;, i"'.11:'r'# J;.H::sement or rhe cooperarive or any 

The license of the premises hereby grranted by LfCENSOR to 

LT.ENSEE shalr be together-with the iin}ra to use, in conrmon with 

other licensees of other lands irr.r..-ral,r with the nrop.rao, the 

roadways providing ing'ress and egress to and from the premises 

and the ri'ht to use utility easen,ents serving the premi-ses 

(excluding such easements for common ir.r.-"tructure rmprovements 

that are under the exclusive controf, operation, and manag.ement 

of the cooperative or any ot,her entity, includins Licensor) 

THE TER},{S AND CONDTTIONS UPON WhiCh LICENSOR g.rANTS IhC 

af oresaid license, right, and privilegre ilre as f ollows : 

. Term. The term of this License is f, 

until such time as rrcni'rsn' ceases ..'"i"ffi#t!Jiiii;"lX 

or other permitted use, unless this License is sooner 

terminated as hereinafter provided. LT.ENSOR and LT.ENSEE arso 

may aqree to extend the term of thi;s L: cense any number of 

:iffir#lnjiinu":::;::" ". periods o f rime as "ic"rso* and 

License Fee- The base ficense 

550.00/acre/year 

fee fc,r 

for 

this 

usable 

License 

acres 

shal1 be 

usable acres, 

and 

payable $1.00 /acre/year 

in monthly 

tor non_ 

ins[aflments, on or before 

;::-rtl::t.:j=r':;n"i""'nn, 3 

LRr:ENS;;,.:il LTcENSEE asree rhar rhe 

non-usable acres ;=*p"=a "usable acres,, Tr"olf;r3':?"*1 

sha11 include 

measured all 

in 

po.rtions 

acres of the "#*#"., premises 

that 

aquaculture 

are suiteol 

ponds for 

or 

constructton 

cultivation in 

of 

ag'ronomic practices, accordance 

and 

wlth 

"non-usable 

normal 

portfons of the premises acre,, shal1 include 

measured in 

all 

for constnrction a.res 

of 

that 

aquaculture 

are not suited 

accordance porLds 

with normal 

or cultivacron 

agronomic an 

practices. 

Common rnfrastrgqq-_ilil_ rmprovement cosr:. rn addit-ion ro the 

base annuar license f"" provioEo in paragraph 2 above, 

LT.ENSEE shall also pay i[s proportionate share of the costs 

of operating-, managingr, and maintaining the common 

inf rastructure improve"man-a= (namely, r:he irrigatio' system, 

drainage system, electrical power s'ystem, and roadway system) 

that serve the property, including the premises (the ,.Common 

rnfrastructure fmprovement Costs,,) Unless otherwise agreed 

by LT.ENSEE, all such common rnfrastructure rmprovement Costs 

sha11 be on a ,,service at cost,, basis, shall not include anv 

0202239b.doc 

-') C-340

"mark-up" or profit (excepL for reasonable adminisLrative 

::i:ffi"' '.o-'uoil"tt^.::-t-, inc]ude ,-r.o cosrs or oblisarions 

i n r ra s t ru c t u r e I 1i.", " n'" i ;:' r,.il.1?,'*illi"o, Il . #"n."; :H:: 

For purposes of this aq-reeml^t, the Lerm ,,Common 

Inf ras tructure fmprovement Cos ts ,, shal l mean ( i ) the cos t of 

operatingr, managing, and maintaining the common infrastructure 

improvements, ress (ii) any income derived from the common 

infrastructure improvements received from third-party sources 

by the Cooperative (or any successor entity, including 

LT.ENSOR, which becomes responsible for operating., rnanagfngf, 

and maintaining the conmon infrastructure improvements) . 

rncome, fees , oT assessments received from or chargred to 

members of the cooperati-ve for the purpose of defrayingr common 

rnf rastructure rmprovement Costs s.rarr .ot --;;" 

income received from third-party 

considered 

sources. The Common 

*ff:i.;::i::" 

rmprovemenr Cosrs srrerrl be determined on an 

LICENSOR has disclosed to LfCENSEE, and LfCENSEE acknowledges, 

that LTCENSOR has entered into a Restated Memorandum of 

Agreement ("MOA"), dated April 1, 2008, between LfCENSOR and 

the cooperative pursuant to which LT.ENSOR has licensed and 

turned over to the Cooperative responsibirity for operation 

and maintenance of certain por [ions of ttre cornmon 

infrastructure improvements serving the property. ft rs 

contemplated that LfCENSEE shal1 be a member of the 

Cooperative and shala n:o rn"^n"-r=n-io dues or assessments 

pertainingr to the costs "r operatin;;" conmon infrastructure 

improvements subject to the MOA. 

LfCENSEE acknowledges that, pursuant to the MoA, the 

Cooperative is responsible for Ln" orreration and mafntenance 

of the portions of the conmon infrastructure subject to the 

MOA in accordance with the terms therercf . LfCENSEE shall have 

the option to join or not to join the Cooperative as a member 

and, if LT.ENSEE joins the cooperatirre, to discontinue such 

membership at any time. rn the event that LTCENSEE becomes 

(and as lonq as LICENSEE continues to be) a member of the 

cooperative, LT.ENSEE shall be or:,1igated to pay such 

membership dues or assessments as ,are chargreable to the 

members of the cooperative on a proportionate basis tor the 

cost of maintainingr and operating the common infrastructure 

improvements subject to the MoA, and the payment of such dues 

or assessments shall ful1y discharg-e r,rc'usne, s obligratrons to 

pay common rnfrastructure rmprovement Costs under this License 

Agreement. rn the event that LT.ENSEE does not become or 

0202239b.doc 

_2 

C-341

ceases to be a member of the cooper,ative, LT.ENSEE shall pay 

to the Cooperative such service .ti_.g,." as are assessed by the 

Cooperatlve on a "service at cosL" basis to non_member 

subscribers for use of the corTrmon infrastructure servr_cLtrS 

provided to Lf CENSEE by the CooperaLive; and Lhe pa\.ment of 

such service charqes strarl likewise ful1y dischargre LTGENSEE's 

obligations Lo pay Common rnfrast.rcture rmprovement costs 

under thj-s License Agreement. 

fn the event that responsibility for the conrmon infrastructur.e 

improvements subject to the MoA is, 1_or any reason, including, 

termrnation of the MOA in accordance with the terms thereof, 

turned over to an entity other than the Cooperatrve or 

re-assumed by LT.ENSOR, LT.ENSEE shal-L be obligated to pay, on 

a "service at cost,, basis, directly to such other entity or 

LT.ENSOR, LT.ENSEE',s proportionatl share of the cornmon 

rnfrastructure rmprovement Costs attr ibutable to said Common 

fnfrastructure fmprovements . 

A. Adjustmenfs I n Li ô-- 

rygru=i 

ree tor usable acres sr.arr-n" i.ra."-,""d -; 

or decreased, after: 

the first twelve months of the term of the MoA Lre'_rnroo- f,r-,,- 

L r cENSoR and rhe Coop era r i r. - 

uE=.it'il'. u"'r rrtl"- J??"ff tl":;";::= 

to the extent (hereinafter the ,,Common Infrastructure 

rmprovement Costs Adjustment " ) that trre amount (determined on 

a per acre basis f or usable acres;) assessed agrainst or_ 

chargred to r'T.ENSEE by the Cooperative or any other entity, 

(includinq LT.ENSOR) f or LrcENSEri , s share of cornrnon 

rnfrastructure rmprovement costs is more or less than 

$75 . 0 O / acre/year. fn the everrt that the Common 

rnfrastructure rmprovement cost Adjustment results in a 

reduction in the base annual license -ree, any such reduction 

shall not in any circumstances exceed on a per acre basrs the 

base annual license fee rhen payable for usable acres - 

The base annual ricense fee for usabr. acres shal1 thereafter 

be renegotiated after the third year oi the term of the MoA 

and every five (5) years thereafter duringr the term of the 

MoA, and shal1 be increased or decreeLsed to the extent that 

the amount (determined on a per acre .basis for usable acres) 

assessed against or charged to LTGENSEE by the Cooperative or 

any other entity (including LfCENSOR) for LfCENSEE,s share of 

Common rnfrastructure tmprlvement costs is more or less than 

$75 ' 0 o / acre/year, plus or mj-nus, dS the case may be, anv 

0202239b.dctc 

_A 

C-342 

,'

Common fnfrastructure 

taken into account. 

fmprovement Costs Adjustment previously 

The adjustment to the base annual 1 

this paragraph rcense fee specified 

4.A shall 

in 

be made 

adjustment 

independently 

specified in paragraph of any 

4."8 be1ow. 

Examples. The following e>rampres are intended to 

illustrate the foregoing license fee adjustments based on any 

resulting difference between actual Common fnfrastructure 

rmprovement costs and the initiaLl estimated amount of 

S75.00/acre/year. 

Example 1. By way of 

rnf rast.rrct.rte-Tmprorement 

example, if the Common 

costs charg.ed to LTCENSEE cooperative for the 

by 

first 

the 

twefve mc,nths of 

MOA amounted 

the term 

to 

of the 

$60. oo per acre (determined 

basis for usable 

on a per 

acres), 

acre 

the base 

usable 

annua] 

acres 

license 

for 

fee 

the 

for 

ensuingr two years would be increased 

(being 

by 

the differen.e- between 

$15 ' ',/acre/year 

$75 ' 0 0 / acre/year and the actual amount charqed by the 

Cooperative), so that the base annual ricense fee 

such 

for usable 

:::":^,-fot, 

ensuing two-vear perrod 

+or. uulacre /year. 

wourd be 

On the other hand 

rnfrastructure , if the Common 

rmprovement Costs charged 

first 

to LTSENSEE 

twelve months 

for the 

of the term ,ri the MoA amounted 

$90 to 

- 00 per acre (determined on a per 

acres), 

acre 

the 

basis for 

base 

usabre 

annual li-cense fee 

ensuing 

for usable 

two years 

acres r_or 

would 

the 

be decreased 

that 

by 

the base 

$15.00/acre/year, 

annual 

so 

license fee 

period 

fc,. such 

would 

ensuing 

be 

two-year 

$35.00/acre/vear. 

Example 2. ff the Common 

rmprovemet t- 

Infrastructure 

costs .rrarged to LrcENSirE f 

months 

or the f 

of the 

irst 

term 

twelve 

of the MoA amounted 

so that 

to 

the 

$90.00 per 

base annual 

acre, 

ricense 

was 

fee for 

reduced 

the next two years 

by 915-oo/acre/year 

usable 

to 

acres, 

s35.00/acre/year 

and 

for 

the Common rnfrastructure 

Costs chargred 

rmprovement 

to LTCENSEE for the 

the 

third 

MoA 

year 

amounted 

of the term 

to 

of 

$100. oo/acre /-year, the base annual 

usable 

1::::::-_4,." 

acres would be furrher reduced 

^l"t 

by an 

:::..:::":^ ,S10.00/acre /year (beins rhe dif f LIre erence berween 

> / 5 . UU / acre/year and the $100 . 

charged 

00/acre 

by the 

/year actually 

Cooperative, ress the $15.0 0 already taken into 

/ acre/year 

account in making 

the first year 

the adjustment 

of the 

after 

term of the MOA. ) 

0202239b.doc 

C-343

..^^Lr ^ _ Exaqple 3. The base annual license fee for 

usa.ble acres shall under no circunLstances be reduced berow 

zero (0) by reason of the adjustments specified in this 

Paraqraph 4 -A- According"ly, if the Common rnfrasrructure 

rmprovement costs charged to LrcENrsEE for the first twelve 

months of the term of the MoA amounted to $125. o0 per acre 

(determined on a per acre basis for_ usable acres), the base 

annual license fee for usable acres would be reduced by 

::: : !/,17re/vear (beins the dlf f erence berween rhe 

) / f ' uu / acre/ year and the $125 . 0o/acre /year actually chargred 

by the Cooperative) , so that the bas;e --rr.,.rrt*it.";" fee for 

the ensuing two*year period would be zero (0). On the other 

l?:*,-* -c:rnmon rnfrastructure rmprovemenr Cosrs 

Lrc-EiNSEE tor the 

charged 

first twelve 

to 

month,s of 

amounted 

the term of the MoA 

to s150.00 per acre (determined on a per 

f or usable 

acre 

acres basis 

) , the base annuar- f icense f 

.. zero (O), 

ee wour-d be 

::::::l_ 

bur nor ro a nesarive 

L1U'81\SOR would 

number, and 

not be required to pay 

LTCENSEE any 

to 

amounts to 

subs idi ze such excesis common 

rmprovement rnf ras 

Costs 

tructure 

charg'ed to LrclrNSEE or to ref rrnrl rn 

-ro base annual license fee amounrs previously 

T T^Frr^-l- LU 

::;i::::.0 

I 

Adjustments Rerated to Changes 

Values. 

in Fair 

Thmtiaerrse 

Marker Rentar 

f e. 

also be re-opened and re-determined 

5th 

at the 

and 

expiration 

10th years 

of the 

of the term tc take 

chanqe 

into 

in the 

account any 

fair market rentar value 

rncluded 

of 

in 

the usabfe 

the premises. 

acres 

::"i-1?.,o^n-irn, 

the base annuar licernse 

t)y 

fee may be increased. 

L-LU-trr\suR to the f air market renl_al 

acres 

value 

included 

of the usable 

in premises. rf LTTSENSOR 

unable 

and LTCENSEE 

to aqree on 

are 

the fair market rentar 

acres included 

value of the usabre 

in the premises at least four (4) months prior 

::_.:^1" e.ffecrive date of any such 

drrnua-' 

re_openrng. 

llcense 

of rhe base 

fee, the fair market 

usable 

rentar 

acres 

value 

shall 

of the 

be determined by a single 

shaf 1 be 

arbitrator who 

a licensed real estate 

procurement 

app.raiser. Subj 

requirements 

ect to any 

applicable 

laws 

to LTcENSoR 

of the State 

under 

of 

the 

Hawaii, the arbitrator 

by mutual 

sharl 

ag'reement 

be selected 

of LTCENSOR and LTCENSEE 

the event 

or 

that 

by a court in 

LTCENSOR and LTCENSEE ,are 

arbitrator 

unable 

by 

to 

mutual 

select the 

agreement. 

market 

rn determining 

rental varue 

the fair 

of the usable 

and 

acr:es, LrcENSoR, 

the LT.ENSEE, 

arbitrator shall take into 

is 

account that the LTCENSEE 

required under the terms of this License Ag.reement to Dav 

O2{)22-l9b.doe 

-6 

C-344

0202239b.doc 

the common rnfrasLructure rmproveme'ts cosLs alrocable to the 

Premises ' Except as provided in earagraph 4.A above, in no 

event shall the new base annual license fee be fess than the 

base annual license fee for the immeraiately preceding period. 

The fees and costs of the arbiar-a,r. shall be paid one_half 

(I/2) by LTCENSOR and one_half (f /2) bV LTCENSEE. 

The adjustment to the base annual li 

this parasrraph 4 .B shar l be ,".d;-':;;:""".;"=.T.. t".r.u 

adjustment specif ied in parag.raph 4. A be1ow. 

Examples ' The following examples are intended to 

illust.at"-ttre -rot.no.r.n 

license - f ee . adjustments ef f ective 

Ht:t"il;JJoo'nT"t"',iJ''.o.t tn" u.i-',.u-ii'"- ;:;'="'Ii' .n" rerm or 

has been no -uffir'' Tff f"::*"r;":?=11;,i1.:""."::: 

usable acres under paragrraph 4 . A arbove. Assume that the 

fair market value of the usable ,...= included in the 

Premises (as determined by the appraiser) increased by 

$3 5 . 0 0 / acre/year between the .on,r.r.""ment date and the 

expiration 

Agreement _ fn such cir-cumstances, the base annual license 

fee woufd be ir,.."rseJ from $SO. OOZacre/year for usable 

acres to sB5 ' 00/acre /year ' rn merking, the determination 

whether the fair mar*ei value of the rand increased duringr 

said five-year period, the appraiser sha11 take into account 

that the LfCENSEE is required uncler the terms of this 

Lrcense Aqreement to pay the Common rnfrastructure 

rmprovements Costs al10cab1e to the premises, meaning that, 

in determiningr the fair market vafue of the usabre acres, 

the appraiser sha1l consider onry .or*rr-nru transactions in 

whrch a tenant of agrriculturar land mist provide and pay for 

all irrigation, power, drainag,e,,-,r;;, and other similar 

infrastructure service costs. 

parasraph 4 . A 'ffi1f, ,,o ",.,'t"'=?o-'1. .i: ,.;';:.=:"1^r"ll 

license fee be less than the base,rrrr,_,rr license fee for the 

immediately precedingr period. Ther.efore, in Example f 

immediately precedi-ng, ri the apprais;er determined that the 

fair market value oi trr" usable acres decreased, instead of 

increased, by $3 5 . o o / acre/'year betwee. the cornmencement date 

of this License Agreement and the expiration of the 5rrL year 

of the term of Lhi,s License Agrreernent, the base annual 

license fee for usable acres during the second. five years of 

-7 C-345 

J;

ne term of the License Agreement would remain at 

$50.00/acre/year, the amount of the base annuaf ricense fee 

for usabre acres for the immediatell, preceding period. 

Example 3. This example assumes thaL, 

pursuant to paragraph 4.A above, th. base annual license fee 

for usable acres has been 

rerm or rhis License on,J.#ffTH ?:ri::,:);::,";:: ::il: 

acres to $100.00/acre /year as a result of differences 

between the common rnfrastructure rmprovement costs actua_L1y 

charqed to LT.ENSEE and the estimated amount of 

$75 . 0 0 / acre/year specified in paraqraph 4.A. This exampre 

also assumes that the appraiser determines that the fair 

market value of usable acres involved in comparable 

transactions in which the tenant is requrred to provide and 

pay for al1 irrig'ation, power, drainage, road, and other 

similar infrastructure service c,csts has increased by 

$35 ' 00/acre /year between the cor.rrTrencement date of this 

License Agreement and the expiration of the fifth year of 

the term of this License Agleement. Under such 

cfrcumstances, the base annuar license fee for usable acres 

for the second five years of the term of this License 

Agreement would be increased to $135.00/acre /year 

($100. O0/acre /year plus $35.0 O/acre/lzear) . 

Setforthin"ffi,','.:ff::H""i.."::"il;'=:l:"n':.H-:: 

instead of increasing, the fair market rent for usable acres 

decreased by $3s.oo/acre/year by ther fifth year of the term 

of this License Agrreement. paragrr aph 4 .8 provides that, 

except as provided in paragraph 4.A ,above, in no event shalr 

the new base annual ficense fee be f,ess than the base annuar 

license fee for the immediately preceding period. 

According'ly, under the facts of this Example 4, the base 

annual license fee for usable acr€rs for the second five 

years of the term of this License Agreement would remarn at 

s100 ' 00/acre /year (computed as the lr.=" annual license fee 

of s50'00/acre/year for the first five years of the term as 

adjusted pursuant to paraqraph 4.A. ) 

ser rorrh in "ffi.=j -off:,"*:.3ti"::, r:: l=T' rrj;ff i: 

Example 3, the base annual ricense fee for usabre acres for 

the second five years of the term of this License Agreement 

has been increased ro s135. o0/acre /y

-Lnrrastructure rmprovement costs charged to LTCENSEE by the 

Cooperative amounted to $ros. o0liacre /year. pursuant to 

Paragraph 4-A, the base annuar_ lic,ense fee for usable acres 

would be reduced by $90 . 0 O / acre/ye>ar (beingr Lhe dtf f erence 

between the acLual amount of Common Infrasrructure 

rmprovement costs actualry charge. by the Cooperative and 

the 975 - 0 o / acre/year estimated ariounr- specified in paraqraph 

4.A) from $135.00/acre /year to $45.0 O/acre/year. 

(Paragraph 4 . A permits the base a.nnual license f ee to be 

reduced bel0w [he initial amount of $50.00/acre/year, but 

not below zero ( O ) , in the event that the Comrnon 

Infrastructure Tmprovement Costs exceed the initial 

estimated amount of $75. O O / acre/year . ) 

fnterest on " . The interest rate on the 

ptltt-ip-t-an'to'-ttt orffipaid or delinquent ricense 

fee payments shall be one percent (1%) per month, plus a 

service charg,e of FIFTY AND NO/100 DOLLARS (S50.OO) per month 

for each delinquent payment. 

IReserved. I 

similar rares, assessmenrs, 

every 

charsres, 

nature ""u-i'".J.td:] J.":L, ":? 

and kind whatsoever, 

of this License 

which sharl 

be 

duringr 

1awfully 

the term 

become 

charg,ed, 

due and payable 

ass"==ed, imposed, 

upon or in 

or 

the improvements 

respect of the premrses 

now on and 

thereon' 

or hereafter 

rn the 

erected by LT.ENSEE 

event 

assessments, 

that any taxes or 

chargres simifar 

, or 

rates, 

largrer 

outg,oingrs 

tract 

are 

of 

levied 

land or property, 

against any 

which includes 

including the property, 

the premises, 

shall 

LTCENSEE,s 

be based 

proportionate 

on the ratio 

share 

premises that the total 

bear s to the 

acreaqe 

totar 

of 

acreaqe 

the 

of -=-JJ qaxes, assess1:?g:s=, 

,and Uti1irls. L,_CENSEE shatl pay, if and 

:i;1, o:*orrr_onare share of alt ^1"._:_^"_.."I:^.u_': raxes ancr 

subject to any such 

r:';q=.T 

taxes, 

property 

rates, 

outgroings assessments, 

- Tn the event 

charges, 

that 

and 

LTCENSEE 

servrces from 

purchases 

a provider any 

other 

utrlity 

entlty (lncluding 

than the Cooperative 

LT.ENSOR) or 

responsible 

other 

corTimon infrastructure for management 

that serves 

of the 

be required 

the J?roperty, 

to pay, LTCENSEE 

when due, 

shall 

such 

all 

additional 

fees, charg,es, 

utility and 

servrces. 

costs of 

m: or suffer to he dnno 

!^_L 

!s 

^"^t-t^"*t11 L].urre, any willful or 

i-ha ne^-i^^- 

='nr.rniJ"'=-,' ;; 

shal-]-:": do or commir, or permir 

voluntary waste or 

Ehe premi s es, or any unra",r,,i';:''i;;;"JJJ ;J =ii?".'ni"X'1 

0202239b.doc 

-9 C-347 

"Xo"".'

(d/ r - \ T T^rnr^rr- Lruljl\s.EjE shall use the premises 

aqrrcurtural purposes, 

solely for 

ds set forth in L'GENSEE's 

plan arrached herero as Exhibir *c,. 

rr-LL'f,1\s'E''[',s '1?:*,:::lizarion use of the premi-ses 

any 

sha]r 

recorded 

ne-sun]ect 

covenants, lo 

con

I2 

13 

L0' Sublicensing' LTCENSEE shall not sub,ricense 

or any portion or 

of 

rent 

the premises the whole 

without 

LrcENSoR, which 

the prior 

consent 

consent 

may 

of 

be 

discretion' 

wiilrheld in LTCENS.R,s 

Any sublicensingr 

sole 

request 

writing 

sha1l 

to 

be 

LICENSOR, 

submitted 

Logether 

in 

sub-licensee's 

with a 

land 

copy 

utirization 

of the 

pJ 

schedule 

an and rentar payment 

for LTCENSOR's consideration. profit on any 

11 

:;f;*i:#:r 

LTCENSEE'" 

charges are neirher alrowe,c, nor shalr be sousrhr bv 

nservation practi-ces. Insof ar as 

t# f orth i-..'-ir,,"NSEF, q 

tand urilizarion plan) includes rhe ;:""';;?, 'i."1t:?lt":;; 

keeping of livestock or other animalrs, LTCENSEE shalr at af 1 

times practice qood husbandry with regrard to the use of the 

Premises f or the use permit;d. lrcnrvseB shall carry out a 

proqram of conservation based upon a conservation plan 

developed by LTCENSEE in cooperation rvith the approprrate soil 

and water conservation Distrlct. lrhe conservatiorr program 

sha1l be in accordance with a conservertion plan which shall be 

submitted to LT.ENSOR for acceptance within one ( 1 ) year 

followingr the date of this License. The conservatron plan 

shal1 include, but not be limited to, those practices such as 

f and clearing', croppinq system, irri

I4 

15 

l6 

building, structure, signs, or improvement, except with the 

prior written approval of LTCENSOR ar:Ld upon such conditions as 

LT.ENS.R may i-mpose. The preceding sentence shal1 not appry 

to any building, structure, signs, or improvement constructed, 

praced, maintained, or inst-alred o, the premises wrth the 

consent and approval 0f LTCENSOR urLder any prior permlt or 

ag'reement pursuant to which LrcENSirE or any of LTCENSEE's 

permitted assigns, sub-licensees, or permittees occupied the 

Premises before the effective date oI this License Agreement. 

All buildings' structures, signs, or improvements constructed, 

placed' maintained, or installed pu::suant to this paragraph 

shal1 be in accordance with a1r applicable federal, state, and 

county 1aws, ordinances, and rules. The ownership thereof 

shall be in LT.ENSEE until the expiration or sooner 

termination of this License, at which time the ownership 

thereof shall, at the option of LrcEIlsoR, vest in LrcENsoR or 

shall be removed by LT.ENSEE at LTGENSEE,s sole cost and 

expense. 

Wnts. LTCENSEE sharl, at its expense, 

Keep, repair, and maintain alr buildings, structures, and 

fmprovements now existingr or her:eafter constructed or 

installed on the premises in good order, conditron, and 

repair, reasonable wear and tear excepted. Except for the 

payment of common rnfrastructure rmpr.vement costs as provided 

in Paragrraph 3 above, LT.ENSEE shall have no obligatron under 

this License Aqreement to keep, repair., or maintain any cornmon 

rnfrastructure improvements . 

rnvoluntary Liens. LTCENSEE shalr not commit or suffer any 

act or neqlect which resufts in the premises or any 

improvement thereon becoming subject to any involuntary 

attachment, 1ien, charge, of encumbrance, and sharl indemnify, 

defend, and hold LICENSOR harmless trom and agrainst all 

attachments, riens, charges, encumbrances, and all resultingr 

expenses affecting the premises and caused by LT.ENSEE. 

Dwellin' Restrictions. the construct-Lon or placement of any 

structure ott th-pr.îses for residential purposes is strictly 

prohibited' LT.ENSEE, its agents, empl'yees, and invitees 

shall not use the premises as a temporary or permanent 

residence. 

I7 Non-Discrimination. LTCENSEE shal 

permat the premises to be used. in 

unlawfully discriminates against 

co1or, national origin, sex, or a 

0202239b.doc _ 1a 

!L 

C-350 

I not use the premises, nor 

support of, any policy thac 

anyone based upon creed, 

physical handicap. LfCENSEE

I9 

1B 

shall not practice any unlawfur d:Lscrimination based upon 

creed, color, national origin, sex, or: a physicar handicap. 

Preach or Default. rt is expressly aqreed that this License 

is contittgettt-uffi the continuing condition that, if LT.ENSEE 

fails to observe or perform substantial-ry the provisions 

cont-ained herein, and if LTCENSEE does not ;.rr.;;." to cure, 

and diligently continue to attempt to cure, such default 

within sixty (60) days, or thirty (3Cr days) where the default 

involves a fairure to make timely license fee pa\rments, 

including payment of any common rnfrastructure rmprovement 

costs (or any substitute assessment or charges specafied in 

Paragrraph 3 above) payabre directly to LrcENSoR, after 

delivery by LTCENSOR of a written nc,tlce of such failure by 

personal service or by registered or certified marr to 

LTCENSEE ; or, i f LTCENSEE becomes bankrupt or inso_Lvent or 

files any debtor proceeding,s or takes or has taken against it 

for good cause any proceedinqs of any kind or character 

whatsoever under any provision of the Federar Bankruptcy Code 

seeking readjustment, r€arrangJement, postponement, 

composition, or reduction of LTcENSEE's debts, liabi_Lities or 

obligations; then, in any such event-, LT.ENS.R may, ar fts 

optron' to the extent permitted by 1aw, cancel this License 

and thereupon take immediate possession of the premises, after 

a reasonable time or pursuant to anr/ rrgrht of acti-on which 

LICENSOR may have. 

. The acceptance 

LIUEiNSOR shafl 

of 

not 

rent by 

be deemed a waiver of any breach by 

::":T:"-"_-,:_t :r.o rerm, covenanr, or 

.,r 

co.dirion 

L-'L.'r\soR's 

of 

rrqht 

Jni= License, 

to re-entry f or br:each 

LTGENSoR's 

of 

right 

covenant, 

to 

or 

declare 

of 

and enforce 

breach; 

a forfeiture 

and the 

for any 

failure of LTCENSOR 

performance to rnsist 

of 

upon 

any 

strrct 

term, covenant, 

exercise 

or 

any 

condition, 

option 

or 

conferred 

to 

herein, 

as a 

shalr 

waiver 

not 

or 

be construed 

relinquishment of 

condition, 

any such 

or 

term, 

option. 

covenant, 

20 ' S-ec!-.Jity neposit. upon execution 

shall 

of this License, LTCENSEE 

deposit with LT.ENSOR an amount 

monthly 

equal 

ficense 

to two 

fee 

times the 

as security for the faithful performance 

::_.1:t^ôt_^.n,.::_-:^._:T= and condirions. rhe deposit wilt be 

::;.:-.,_=.:_ ^_:, _.r,t.")""l 

upon terminatiorL 

viaav 

of 

a! Lcr 

this License, 

d-L-L or tne 

but 

terms and conclitions 

Ag,reement of 

have 

this 

been 

License 

observed and perf ormed. 

0202239b.doc 

IJ 

C-351

21. Assignment. Except as expressly provided in this License, 

this License is not transferable. ia no time during the term 

of the License shall LICENSEE assigrn, mortgragre, or pledge its 

interest in this License , oT its interest in the rmprovements 

now or hereaf ter erected on the prermises, without the prior 

Ii#;;.:;T;i: jrt=.11."rT,'".., ;;;"n '...,"..,t may be wirhherd in 

22' Liability rnsurance. LT.ENSEE 

during tnE 

shar.1 

entlre 

procure 

period of 

and 

this 

maintain 

of commercial ii".rrr"" 

greneral a policy 

riability 

or poricies 

protect it from 

i-nsuranle 

and against 

srtr.cierrt 

any ii-ulity 

to 

personal injury' death, 

for 

and 

all 

property 

claims for 

out of the exercise 

damage 

of 

which 

rights 

may arise 

policies shal1 

nr.r.a"d hereln. 

cover the 

The policy or 

buildinqs ".riir. 

r?remises, inc-Luding 

' structures, improvements, all 

roadways or sidewalks and qrounds 

on or adjacent 

and all 

control 0r use 

to the premises 

of LT.ENSEE. The 

in the 

or policies minimum 

sha11 limia 

not 

oJ 

be less 

sard policy 

occurrence and 

than $500, 000 . o0 

S1, OOO, 000.00 for each 

company or 

aqrgregate, 

companies licensed 

with an insurance 

Hawaii - 

to 

Except 

do business 

for the 

ir. 

payment 

irre state of 

rmprovement Costs 

of Common 

as provided Infrastructure 

in pareLgrraph 

shal1 have no obligration 3 above, LT.ENSEE 

procure under 

or maintain 

this License 

any Ag,reement 

commercial general 

to 

wrth reg'ard to any actlvities 

liability insurance 

entity (including of tnl cooperative 

LT.ENSOR) or 

which 

any other 

time over any 

has 

of the 

control from 

common infrastruc.ure 

tfme to 

improvements. 

T I !r\-.,1\)-L'L, ^nrr-rF praor to entry and use of the premises or within 

;ii:;3.r,r' 

days f rom rhe ef f ecrive dare of i ts License, 

cerriri..t. r'"1. ";:;iil. :;", Ji.r.;li:ll^ ."".f"**ir.rliil l; 

f orce 

' keep the certilicate (s 

term of the 

) on 

License, 

deprosit 

and 

during 

furnish 

the 

like 

entire 

renewal 0f the policy(s) 

certificate(s) 

- 

upon each 

insurance The 

shalr certificate(s) 

contain or be 

for such 

the insurer 

accomparLied 

not to cancer 

by an assurance 

the irr=rri-r"", 

of 

the coverage, or fail 

limit 

or refuse 

the.scope 

to 

of 

after thirty (30) 

renew the 

days 

policV(s) 

written until 

LfCENSEE, except 

notice 

that, 

has been 

in 

g,iven 

the 

to 

terminated, said 

event 

insurance this Lrcense 

may be 

is 

termi nated on the same date 

liur:?:,."i.iilii;" policy sharr name LTcENSoR as an 

LTCENSOR shall 

coveraqe, form, 

02022-l9b.doc 

retain the rlOht at arry time to review the 

and amount of the insurance required by this 

_14 

C-352

-rrlcense - rf , in the opinion of LTCENSOR, the insurance 

provisions in this License do not provide adequate protection 

for LrcENSoR, LTCENSOR may require L_|CENSEE and any permrtted 

sub-ricensee to obtain insurance sufficient in coverag,e, form, 

and amount to provide adequate ltrotection. LICENSOR,s 

requirements shal1 be reasonabre arLd sharl be desigrned to 

assure protection for and against th,e kind and extent of the 

:::::_^:hich ,::::.:^ jr rhe rime a chanse in insurance is 

rveurrcLr. LI.ENSOR sha11 notify LTCENSEE in writing of 

changes in the insurance requirements and LTCENSEE shall 

deposit copies of acceptable insurance policy ( ies ) or 

certificate (s ) thereof with LrcElJSoR incorporating" the 

required changres within thirty (30) days of f_fCeNSUn,s receipt 

of the notice from LICENSOR requiringr the same. 

The procuring- of the required policy(ies) of insurance shall 

not be construed to limit lrcnNSEE's liability und.er this 

License. Notwithstanding the policy ( ies ) of insurance, 

LTCENSEE shall be obligated for the rlurr and totaf amount of 

any damaqe, injury, or ross caused by LTCENSEE's negrlrqence or 

neqlect connected with this License. 

23 . 

-Property rnsurqnce. At arr times 

License, 

cluring the term of this 

-LiEE\lsEE shalr at its ow:n 

state-owned 

c.st and expense 

improvements, 

keep any 

which are located on the premises 

and which are identified by LTCENSoR prior 

date 

to the commencement 

of this License Aqreement (but wl:rich 

the Cooperative 

are not 

p,lr=t,-rrt 

licensed to 

to the MOA) 

damagre , rnsured 

by 

ag.ainst loss 

f ire and 

or 

other hazeLrds, casualties, and 

f 

::l-:l.n"ncies 

or rhe f ul1 insur.able 

amprovements value of rhose 

' The policy shall name LTCENSOR 

insured. 

as an additional 

r,luENSEE sha1l f urnish to LTCENSC)R on or bef ore the 

cornmencement date of its License a certificate showing such 

policy(ies) to be in fu1l force and effect and shalr furnish a 

like certificate upon each renewal of the policy(ies). Each 

certificate shal1 contain or be accompanied by an assurance of 

the insurer not to cancel the insura.ce, rimit the scope of 

the coveraqe, or fail or refuse to renew the policy(s) until 

after thirty (30) days written noti.ce has beerr g,rven to 

LT.ENSEE, except that, in the er,.ent this License is 

termrnated, said insurance may be terminated on the same date 

as the License. The policy(ies) shal_L also provide that al1 

rights or claims of subrogration agrains;t the state of Hawaii, 

its officers, employees, and agents are warved. 

()2()ll-l9b.doc 1r 

LJ 

C-353

24 

25 

26 

Right to Enter. LTCENSOR reserves the rigrht for its ag,ents or 

representatfves, dt afr reasonabre times during the term, to 

enter and cross any portion of the premises at any time for 

the purpose of performing any public or officiaf duties. 

rnspection of premises. LT.ENSEE srrall permit LT.ENSOR and 

its agrents E -"pre=""tatives, dt arr_ reasonabf e times during 

the term, to enter the premises and examine the state of 

repair and condition thereof and the improvements, equipment, 

chattels, books, and record.s of LTCENSEE in connection with 

the administration of this Lrcense. 

surrender. At the end of the term or other sooner termination 

of this License, LTCENSEE sharl peaceably deliver unto 

LICENSOR possession of the premises, toqether with a1l 

rmprovements existing or constructed thereon, unless provided 

otherwise in this License. Furthermore, upon the expiration, 

termrnation, or revocation of this r,icense, shoufd LTCENSEE 

fail to remove any and alt of LTCEI.'EE's personal property 

from the premises, LT.ENS.R may remo!.e or dispose of any and 

all personar property from the premises and either deem the 

personal property abandoned and dispose of the personal 

property or place such personar p.op.rty in storage at the 

cost and expense of LICENSEE. LICENSEE shall pay all costs 

and expenses for removal, disposal, transportingr, and storage 

of LTCENSEE's personal property. the provisions of this 

paragraph shall survive the expiratiol or earfier termrnation 

of this License. 

2l Withdrawal for public pur ose,' Condemntrt ion 

o. Withdrawal for a Publlc purpose. LrcENsoR shalr have the 

right to rit any portion thereof, at any 

time duringr the term of this r,icensl with reasonabre notice 

and without compensation, except as provided herern , for 

public uses or purposes, f or const_ruct_ingr new roads or 

extensions, or chanqes in line or grrade of existing roads , for 

rights-of-way and easements of at1 kinds, and the premises 

shall be subj ect to the rigrht of LTSENS9R to remove sorl , 

rock' or grravel as may be necessary r-or the constructron of 

roads and rights-of -way within o, without the premises,. 

provided that, upon any withdrawal 0r taklngr which causes any 

portfon of Lhe premises to become unu:sable for the speclfic 

use or uses for which it was licensed, the base annuar rent 

shal1 be reduced in proportion to the value of the premises 

withdrawn or made unusable. rf any permanent improvement 

constructed upon the land by LTCENSE;| is destroyed or made 

0202239b.doc 1a 

! ll 

C-354

unusabre in the process of any withdrawal 0r taking, the 

proportionate value thereof sharl rce paid by LTcENSoR to 

LTCENSEE based upon the unexpired term of this Lrcense; 

provided that no withdrawal or Laking shal1 be had as to those 

portions of the premj-ses which are tt,en und.er cultivation with 

crops unrif 

::T.S.r::..".r 

such rrees or 

ulr-Le=s crops are l-ru-uÎSOR pays 

harvested., 

to LTCENSEE the value 

crops; of 

and provided 

the trees and 

further that, 

taking, 

upon any withdrawal LTCENSEE shall be 

or 

compensated 

arl permanent 

for the present 

improvements 

varue 

in place 

of 

or 

at 

taking 

the 

that 

tlme 

were 

of withdrawal 

1ega1ly constructed upon the premises 

LTCENSEE being withdramr by 

or taken or that are made 

wirhdrawal 

unusabfe 

l::::=",::__=rr"n 

or rakins. 

urups, 

rn rhe 

r,re-r;NSOR case 

shall pay 

of rree 

to LTCENSEE the residua-L varue of 

the trees taken and, if there 

value 

are un-harvested 

of the crops 

crops, 

also. 

the 

rf any ,,nrithdrawal 

LTGENSEE's reasonable 

or taking 

determinatlor:L 

in 

unusable 

makes the premrses 

by LTCENSEE for the purposres 

LTCENSEE is 

and 

then 

uses 

using, 

for which 

the premise!, LTcENSEE 

right to terminate 

shall 

this 

have 

License 

the 

Ag.reenLent, 

rishrs 

without 

of 

waiving 

LTCENSEE 

any 

::l::^ 

by reason of such wirhdrawal or 

vsJr!afv. 

B ' Condemnat-ion. rf at any time, 

r,iceniE-ag,reement, 

during the term of 

portion 

this 

";- 

of the premises 

condemned or required 

sha11 be 

for public 

government 

plrrposes 

or 

by 

any 

the Federal 

county or 

governmental 

city and county, 

agfency 

or any 

of either, the 

any 

nase 

other 

annual 

charges 

license fee and 

under this Licens;e 

LTCENSEE's proportionate 

Aqreement, rncruding 

share 

rmprovement 

of Common 

costs, 

rnfrastructure 

shalr be reduced 

of 

in proportion 

the portion of 

to 

the premises the value 

entitled 

condemned. LTCENSEE 

to receive shall be 

from the condem,ninq 

value of g'rowing 

authority (a) 

crops, 

the 

if any, ,"rriJr, -;;;;;;;" 

permr-tted to harvest, 

is nor 

and (b) tr.. proportionate 

LTCENSEE's permanent value 

improvements 

of 

so 1:aken 

that it bears 

in 

to 

the proportion 

the unexpired 

provrded, 

term of the 

that 

License Ag.reement; 

LT.ENSEE may, in 

relocate 

the alternative, 

its remove and 

-improvements to the 

occupred 

remainder of the premises 

by LTCENSEE. LTCENSEE shalr 

condemnation 

not by 

be 

reason 

entitled 

of the 

to any claim 

compensation 

;Lgrainst the LTCENSOR 

or indemnity 

for 

for the 

compensatron 

li,cense 

payable 

interest and 

or to 

arl 

be paid 

land 

for 

comprisingr 

or on account 

the premises of the 

sha1l 

by reas(ln 

be payable 

of the condemnation 

to and be the sole property 

The foregoinq of the LrcENSoR. 

rights of LTCENSEE 

other 

shall 

rights 

not be 

to 

excrusive 

which 

of any 

LTCENSEE may be entitled by law, and 

0202239b.t\oc _ 1'7 

LI 

C-355

2B 

29 

30 

LTCENSEE shal1 have the right to cf im and recover from the 

condemning authority, but not from LrcENSoR, such compensatlon 

as may be separately awarded or recorrerable in LTCENSEE'= owrl 

right on account of such condemnation of LTCENSEE,s interest 

under this License Aqreement and any improvements constructed 

by LfCENSEE on the premises. Wilere the portion of the 

Premises taken rend.ers the rema j.nder of the premises 

unsuitable for the use or uses for which the premises were 

licensed, LTCENSEE shall have the option to surrender this 

lease and be discharged and rerilved from any further 

liability; provided, that LT.ENSEE rnay remove the permanent 

rmprovements constructed, erected, and placed by it wrthin any 

reasonable period allowed by the LICENSOR. 

. F,or purposes of rnforming 

andappris.ing.thatp@onsoftheconditronofthe 

Premises preparatory to the proposecl disposition thereof at 

the expiration of the term or earrier termination of this 

License Agreement, LTCENSOR sha11 have the right to authorize 

any person or persons to enter upon and inspect the premises 

at all reasonabre times followinl an announcement at any of 

LTCENSoR's public meeting,s of any proposed disposition of the 

Premises; provided, however, that -lly entry and inspection 

shalf be conducted. duringr reasonabler hours after notrce to 

enter rs first g,iven to LTCENSEE, and shall, if LTCENSEE so 

requr-res, be made in the company of LTCENSEE or designated 

agents of LICENSEE. 

Extension of Time. Notwithstanding any provision to the 

contrary, wherever applicable, LrcENaoR , for grood cause shown, 

may allow additionar time beyond the time or times specifled 

herein in which LT.ENSEE may comply, observe, and perform any 

of the terms, conditions, drtd covenants contained ]_n this 

License. 

Q-uiet Enjolment' LTCENSOR covenants -nd ag.rees with LTSENSEE 

that, upon palament of rent at the times and in the manner 

specified and upon the observance;rnd performance of the 

covenants, terms, and conditions hr:reof on the part of 

LTCENSEE to be observed and performecl, LTCENSEE shalr have, 

ho1d, possess, and enjoy the premises for the term that the 

same are licensed to LTCENSEE hereunderr, without hindrance or 

rnterruption by LTCENSOR or any other person or persons 

lawfully claimlng by, throug-h, or under LICENSOR. 

31 Abandonment and Termination. 

r_nto service, LfCENSEE abandons If, after putting the premrses 

or ceases to use the premises 

02O2239b.tloc 

- 18 

C-356

for a period of four (4) or more consecutive monLhs, LTCENSOR 

shall have the rigrht to terminate th.is License Ag,reement. Any 

abandonment, termination, or cessat-Lon sharf not affect or 

release any liability of LT.ENSEE at such time exrsting by 

reason of a breach of any of the terms hereof. 

32' Ner]:lgerrgnly. LTCENSOR does not warrant the condition of the 

Premises , as the same is being licensed ,,as is . ,, LTCENSEE 

assumes a1r risks incident to its uise. Notwlthstanding the 

foregoing or any other provision of Lhis License Agreement, 

LT.ENSEE does not assume liabirity or responsibirlty for any 

hazardous materiaf craims resulting rrrom, arisinq out of , or 

relating to any hazardous materia-Ls- on--;;.,'=premises or 

hazardous discharge occurring' prior to the date of this 

Li cens e Ag'reement , and Lr.ENSO* (and/ or LT.ENSOR ' s 

predecessors in interest) shall be sorely responsrble for and 

in respect of any such hazardous materials claims. 

33 LTCENSEE's Risk. Any and all goods, wares, farm supplies, 

34 

35 

- UIJI' _L r e5 / 

lllllill. ^:qyln*.'.., .and personal properry of any kind or 

Jr arav Lltt: 

Asrreemenr_, res,,ardless of ownership of 

qrrnh vvvlrvr :::il :l^jl-.:.. nr^^^.FL. - "t::i:: 

JrraIJ l.JL 

-1' 

::::",_o_:on"_r?,_ _:1"_lr be ar rhe sote risk and hazard .u4q!u of ul. 

LT.ENS.R 

:j:"T:::,-:.rd 

shatt nor be liable or responsibte for 

:,:L*::= ::_"_11.. lf-d"*3n. rherero ."u="J o" in"i;;";#:;r=;, 

I;ill"l^,,.y:..",1,__l:-l:.:.t.," erecrric other ri,i"s, cause ;;' whatsoever 

;;";;':"; 

4ppliqable t-aw; Severability. rhis License shal1 be governed 

bv and interffi." rlan-.Jn" faws of rhe srare of 

Hawaii. rf any provision of this Lrcense is held to be 

rnvalid or unenforceable, the validi.y or enforceability of 

the other provisions shall remain unafl:-ected. 

Costs of Litigation. rf LT.ENS'R shall be made a party to any 

1i tigation c"mr,retrcea by or aqai-ns t LTCENSEE (other than 

condemnation proceedings), without any fault on LTCENSoR's 

part, LT.ENSEE shall pay alr costs and Lxpenses incurred by or 

:t:::="O orr LICENSOR, including,, bur no1_ timited ro, arrorney,s 

!ggJ - 

TF T T^-ra^-r -Lr LT.ENSEE shal1 be made a party 

by 

to 

or 

any 

agrainst 

ritigation commenced 

LT.ENS.R (other than 

without 

co'demnation 

any 

proceedings), 

fault on LTCENSEE's part, LTCENSOR 

costs and 

shal_L 

expenses 

pay 

incurred 

all 

including, 

by or imposed on LTCENSEE, 

but not limited to, dttornel.,s fees; pROVfDED 

any such THAT, 

litigation arises out of any damaqe or personal 

0202239b.doc -19 

C-357

injury resurting from wrongful or nerTligent acts or omrssions 

of LTCENSOR or LTcENSOR's empl0yees or agrents while actingr 

within the scope of their employment, and LrcENSoR,s liability 

for such damage or injury has been determined by a court or 

::n:.:::.:."n:?:1".::_by. LTcENSoR pv unr_es"-".,..,ri=" 

c- LU..rL/ derermined 

LTUEiNSOR shal1 pay for 

the 

such 

extent 

costs 

that 

and expenses to 

f unds theref or haLve 

appropriated 

been 

by 

authori 

the 

zed and 

Legislature of 

such purpose 

the state 

and 

of Hawaii 

such funds 

for 

have 

the 

been 

executive 

alfocated 

budqet process 

therefor by 

of the st-ate of Hawair. 

36 ' -rnder-nnity. LTCENSEE shall indemr:Lify, def end, and hold 

harmless the State of Hawaii, LTCENSOR, and their officers, 

employees, and agents f rom and ag,ainsl- any claim or demand f or 

loss, liability, damag.e, cost, expense, and attorneys , fees, 

rncludinq claims for property damage, personal injury, oT 

wrong.ful death, arising, out of any occllflgncs on the premises 

and roadways adjacent thereto, o, occasioned by any act or 

nuisance made or suffered on the premrses, or by any accrdent 

or fire .hereon, or qrowing out of or caused by any failure on 

the part of LT.ENSEE to maintain Lhe premises in a safe 

condition, or by any act or omission .f LTCENSEE, and from and 

agrainst all actions, suits, damag,es, and cf aims by whomsoever 

brought or made by reason of the non-observance or non_ 

performance of any of the terms, covenants, ancl conditions 

herein or the laws, ordinances, rules, and reg.ulations of the 

federal, state , or county g.overnments. The provisrons of this 

parag'raph shalf survive the expiration or earlier termrnation 

of this License. 

31 Huntrnq- No hunting sharl be arlowed on the premises duringr 

the term of this License. 

3B 

poulAarf Stat

40' Drainage Easements. The Premises shall be subject to drainagre 

and ffients now of reco'd or otherwise existing 

under raw as and to the extent that the same are appricabre to 

the premises as of the commencement date of this License 

Aqreement. The easement area(s) shall not be altered or used 

for any purposes which may obstruct flow or reduce the 

effectiveness of the drainage wdy, except with LTCENSOR's 

prior written consent which may be conditioned upon 

approprrate measures undertaken by LTCENSEE to divert, rQ_ 

direct, retain, or detain any stcrrm waters in a manner 

approved by LTCENSOR- LTCENSEE shall accept the srorm runoff 

draininq into and throug,h the easement area(s), respectrvely, 

and shall be responsible for the marntenance and protectron ot 

the drainage easements against de1:erioration or loss of 

functional ef fectiveness . 

41 . t= . The premi-ses 

to all existing 

shall be subj 

toadt-y--nd-tility 

ect 

e.rsements, 

shall be in favor 

which easements 

of property owrrers s;erved 

and to any 

by 

and 

such easements, 

all access and other erasements 

the premises over 

in 

and 

favor 

across 

of the CooperaLive or any successor -"1,-^rl r--r sunsrrrure entity or 

( including LICENSOR) necessary and 

appropriate f or the operatio^ and maintenance of the cor.rmon 

rnfrastructure serving the property, includlngr the premises; 

provided that LTCENSEE may cross and may have access over and 

upon al1 such easements located on the premises at any point. 

42 ' compliance with Laws. LT.ENSEE srrall comply with the 

r"q'ire*"ntE-T- -rr-f ederal, state, and county authorities and 

observe ar1 f ederal , state, and count-y laws, or.dinances, and 

rules pertaining to the premises which are now ln force or 

later may be in force. 

43. . LTCENSEE shall comply with all 

applicabre f ederal , s t-t", and counl-y environmentar, impact 

requlations, including but not limitecr to chapter 343, Hawaii 

Revised Statutes, dS amended, and rr:1es governingr historic 

preservation' LTCENSEE shall be respo,nsible for obtaining all 

necessary federal, state , o( county clearances. 

44 ' Hazardous Materi-als. LTCENSOR 

prior 

remalns responsrbre under a 

"gte"t'1e].tt tith the state DepartnLent Resources of Land 

for 

and 

addressing, 

Natural 

any issue 

occurred 

identified 

prior as havingr 

to or during Kekaha 

Premises 

sug,ar,s 

as 

occupancy 

reported 

of the 

in the Phase 

prepared 

1 rinvironmental 

by 

Assessment 

clayton Group 

("clayton 

services dated Auqus 

Report") 

t 7, 2oo3 

Any environmental issue occurrinq on 

0202239b.doc _ 1'1 

LL 

C-359

0202239b.doc 

Premises after the date of this Licer.Lse Agreement shalr be the 

responsibility of LTCENSEE. 

(a) During' the term of this License, LTCENSEE 

cause or permit 

shall not 

the escape, disposal, or release of 

:?X-^:-y:rdous mareriaf s, exc{3pr as permarred 

LTUENSEE shal1 

by taw. 

not allow the: storage 

materials 

or use 

in 

of such 

any manner not sanctioned 

the highest 

by law 

standards 

or by 

prevai-Ling in 

the 

the 

storage 

industry 

and use 

for 

of such materials, 

brought 

nor 

onto 

allow to be 

the premises any such 

use 

materrals 

fn the ordinary 

except to 

course of LT.ENSEE's 

then only 

business, 

after 

and 

written notic

Ar- 

AC: 

(b) LTCENSEE sharr be responsibler for and sharl indemnrfy, 

defend, and hord harmress LT.ENS'R and its emproyees, 

ag-ents, successors, and assigrns f rom and agrainst any 

loss, damagre, cost, expense, or liability directly or 

indirectly arising out of or attributabre to the 

g'eneratron, manuf acture , treatment , handl ing-, 

refining, production, proces;sing, storag.e, release, 

threatened release, discharge, disposal, or presence 

of hazardous materials occur-rinq oil, under , oy about 

the premises during the term of this License, 

including-, without limitation: (1) aIl foreseeable and 

unforeseeable consequential damages; (2) the costs of 

any requrred or necessary repair, clean_up , or 

detoxification of the premises and of the preparation 

and implementation of any closure, remedial, or other 

required plans ; ( 3 ) the costs of LICENSOR, s 

investiqation and handlrng of any hazard.ous materials 

claims, whether or not any lawsuit or other formar 

1egra1 proceeding' shal l have been commenced wi th 

respect thereto ; (4) the costs of LICENSOR,s 

enforcement of this covenant, whether or not a rawsuit 

is brougrht therefore,. and (5) a1l reasonable costs and 

expenses rncurred by LTCENSjOR in connection wrth 

cl-auses (1), (2), (3), and (4) including,, without 

limitation, reasonable attorney,s fees. 

(c ) The provisions of this paragrraph shall survive 

expiration or earrier termination of this License. 

Lerrol !svsr ono L/lrc \r,r /1\ Hazardous waE!€_ gyaluation. At any time duringr 

good :l:. cause, may require LTCENSEE to conduct at LTCENSEE's 

expense, owrl 

a Level One (1) Hazardous Waste 

complete 

Evafuation and a 

abatement and disposal , if necessary, 

the standards 

satisfactory 

required 

to 

by the Federal Environmental protectlon 

Aqency, the state Department of Healt_h, 

of Ag'riculture, 

the state Department 

and the state Department 

Resources, 

of Land and 

of 

Natural 

any hazardous materials and 

claims 

hazardous 

attributable 

materiars 

to the clischeLrgre 

materrals 

of arly hazarclous 

on the premise during the term 

terminati-on 

of this License. The 

of this License wilr not be approved by LTCENSOR 

unless this evaruation and abateme.t provisi-on 

executed have been 

where required. This prov:Lsion 

contrnue 

shall 

in 

survive and 

ef f ect af ter termination of thi-s License. 

Soil Erosion. LICENSEE shal 

I not enq.iqe in 

may result 

any activity 

in soil 

that 

erosion f rom water or wind. LTCENSEE shall 

0202239b.cloc 

AJ 

C-361 

F1-^ 

Latc

control soil erosion as completely as practicable by strip 

cropplnq and contouring., by fi1.1ing in or otherwise 

controllingr smalr washes or ditches that may form, and by 

adopting practices recommended by the Natural Resource 

Conservation Service (NRCS) . prior to the terminatron of this 

LTCCNSC, LICENSEE ShAII PrOVidC TO LICENSOR A NRCS APPTOVCd 

erosion control p1an. The terminat_Lon of this Lrcense wilr 

not be approved by LTCENSOR unles;s LTCENSEE is in fulr 

compliance with such plan to the sratisfaction of NRCS and 

LTCENSOR. 

47. Encumbrances. This License is subject to arl existing 

recorded and unrecorded encumbrances. At any time during the 

term of this License, LTCENSOR may create easements and 

encumbrances upon the premises in addition to any easements 

and encumbrances which currently affer:t the premises, provided 

that any such new easements or encumbrances do not 

4B 

49 

50 

51 

unreasonably restrict or interfere with LTCENSEE's use of the 

PrFmt qoQ 

Interpretation. The use of any gender 

genders. 

shall include al-1 

ff there is more than one LfCENSEE, 

in the 

all 

sinqular 

words used 

shall extend to al1 LTCENSEES. 

Paraqraph Headingrs. The article and paragraph headingrs herein 

are inserted only for convenience -rrii reference and sharl in 

no way define, describe, or limit the scope or intent of any 

provision of this License. 

IReserved. ] 

IReserved. ] 

52 Exhibits - Incprporation in Lrcense- 

in this Llcerrse are attached to this 

deemed incorporated by reference. 

O202239b.doc -24 

C-362 

All Exhibits referred to 

License and are hereby

q/l 

SPECIAL COND]TIONS: 

53 g. LTCENSEE shalt urrura 

f imoc rlrrrj-^ +r- 

at qL all o-LL 

- 

:_t,j:: ourrlg the , License term keep its cartle, 

other grazLng horses, and 

animals out of anr forest 

adjacent 

reserve, 

to the premises if any, 

and sharl 

precauLions 

take ar1 reasonabr_e 

to prevent forest fires, and, 

occur, 

in 

lt 

the event 

shalr 

fires 

use all reasonabr-e means 

under 

at its command 

its control to 

or 

have the fires s-peedily extinguished. 

55 

commercial Operations. LTCENSEE, 

guests, 

its emproyees, 

agents, 

customers, 

and/or invitees shall not display 

sell 

or 

any 

offer for 

:.11" 

article(s) or merch.andise 

rne premrses -"t whatsoever 

without 

within 

the prior written approval 0f LTCENSOR 

and upon such terms and conditions estabrished 

No by LrcENSoR. 

commercial activities whatsoever, including 

(exceptins 

activities such 

::^_f,"^:11".= 

a privare f eedlor desisned 

Lru.Et\s.F,-L's ro f eed 

owrr cattle) , dairy milkinq parlors, 

horses, 

or 

are permitted 

boarding of 

without the p'rt, written approval LICENSOR. 

of 

Abandoned vehicles. LTCENSEE shalr take ar1 steps rrecessary 

to prevent the placing or storing of ,abandoned vehicles within 

the Premises - Any and all aband.oired vehicles within the 

Premises shall be removed by LTCENSE.E at LTCENSEE,s cost and 

expense. 

56 Removal of Trash LTCENSEE sha11 

5',1 

5B 

removal of all i11egal1y dumped trash 

LICENSEE's cost and expense. 

be responsible for the 

within the premises at 

Prehistoric and Historic Remains. fn the event any 

unanticip-t ri., or archaeological sites 

or remains, such as shelf, bone, oL Charcoal deposits, human 

buriaf s, rock or corar alignments, par,,ings , or walrs are found 

ON ThC PTCMiSCS, LICENSEE ANd LICENSJEE'S AqCNTS, CMPIOYECS / 

and representatives shal r immediiete_Ly s top al l f and 

utilization and'/or work and contact the Historic preservation 

of fice in complia..ce with Chapter 6E, Hawaii Revisecl statutes, 

and shall notify LTGENSoR of these events. 

Lan4 cJearing- The premises have not had a completed 

archaeol-ogrical inventory survey. rf rand clearing or land 

alteration should need to occur in gurches or wastelands 

(gul1ies , valleys , ridg.es , and morrntains ) , the Historic 

Preservation Division (HpD) shall be contacted prior to any 

work. A field check will be requirecr and shalr be performed 

0202239b.doc 

LJ 

C-363

y the HpD staff archaeorogist prior to any work. Clearrng by 

hand is the pref erred method of wrf,rk. rf the arteration 

activity is on a large or significan[ scale or historic sites 

are found, then LTCENSEE shalr have an archaeologist inventory 

:,::I.o y":l::'".u by a qualified archaeotosisr prior ro any 

worK' A report documenting the archaeological wort shall be 

submitted to the HpD for review and approval. The report 

sha1l include: 

detailed drawings of buriars anLd deposits to scare. 

sketches and photogrraphs of all artifacts. 

analyses of all perishable and datable remains. 

S I ra t- ur:Jr i crranh i n nrn-F .i 't 

u|/rrrL _VrUI_L.l.eS ^^ that are drawn and made to 

an overafl map of the project area 

location of all historic sites. 

initial significance evaluacrons 

found, and 

which includes the 

for each historic site 

/ documentation on the nature and age of historic siLes 

If significant historic sttes are 

mitigration or preservation plans mustand 

approval. 

found, then proposed 

be submitted for review 

rf burials are discovered, a buriar treatment pran sharl be 

prepared for burial cliscoveries encountered during work, all 

in accordance with Hawaii Revised Statutes Section 6E-43. 

59 - wells. prior to expiration of the term of the License 

Agrreement, LICENSEE shal1, at LIC_ENSEE , s sole cost and 

expense, properly seal any unused and abandoned wells on the 

Premises, if any, that were developed by LTCENSEE or otherwise 

regrstered to and used by LTCENSEE during the term of the 

License Agrreement. Any such unused or abandoned wells shall 

be sealed in accordance with Hawaii admlnistrative Rule 13- 

168*16 and the Hawaii well Construction & pump rnstarlations 

Standards (Revised 2004) . LTCENSEE shall make and obtain 

application(s) and werl construction permits prior to the 

devefopment of any werrs and the start of any required work to 

seaf any unused or abandoned well,s. 

()202239b.d

60 

6I 

63 

Polihale Flood Diversion. LTCENSEE shall be aware that the 

irrigation 

floodwaters " 

ditch, 

from 

which 

portions 

redirects 

of Mana p-Lain 

Park, 

through the polihate 

causes washout of polihare Road and sedimentation. 

A-grrcultural preservation Easement. LT.ENSEE 

that aOprox 

shal1 be aware 

l 

lands 

#. 

is 

Kekaha 

siLuated 

agricultural 

within the Aqricultural preservatlon 

apl):oved 

::=:::-":,. 

by rhe Board of Land 

urr 

and 

lvray 

Narural Resources 

LZ , 2004. To the extent aptr-rlicabre to the premises, 

LTCENSEE shall be in ful1 compliance 

restrictions 

with the 

specified 

conditions and 

in the easement. 

62 Audits. LICENSOR reserves the ::igrht 

conductinq an audit, to examine, and to 

books, accounts, records, and receipt-s of 

its operations under this License. 

64 

65 

66 

67 

, for purposes of 

make copies of all 

T 7 

rJ_r^Fn1-r1- \,_Lr\>|,-L concernt ng 

r'e+d swqpping - LTCENSEE is allor,ved, but sharl not be 

obligated, to swap land for uses consistent with rts land 

utilization plan with any other licerLsees or revocable permit 

holder of any portions of the properllr sl no cost to LICENSEE. 

Passagre and Access. LTCENSEE shall not impede or restrict 

passage or access by other 1i-censees or the cooperative and 

rts agtent to other areas of the prr:perty or to.rny common 

rnfrastructure serving. the propertlz or any part thereof 

(including the premises) that may be iocated on the premrses. 

Holding Over. Any holding over by LICENSEE atter the 

exprration of the term of this License with the consent of 

LTcENSoR shalr be construecr to be a tenancy from month_to_ 

month at the rent herein provided for the last year of the 

term of this License and shalr otherurise be on the terms and 

conditions herein specified, so far as applicabre. 

Cropping' Changes. LTCENSEE sharr- consult with and obtain 

prr-or approval from LTCENSOR before ;Ldding or making changes 

to the t\rpe of crops to be 'rowrr as specified in its original 

business plan submitted with the ricenise apprication. 

lesgrdation. LTCENSOR and LTCENSEE ,aqree that this License 

Agreement or a short form or memorrr.a,_,r- hereof may be recorded 

ln the Bureau of conveyances of the;state of Hawaii or with 

the Assistant Registrar of the Land court of the state of 

Hawaii, as applicable, to give n.tice of this L'cense 

Agreement Lo third parties and of the license of the premrses 

O202239b.doc _ )'7 

al 

C-365

g-ranted hereunder 

specified herein. 

As used is this 

otherwise requrres: 

by LICENSOR F^ T Tnnar--r LU L lL,trl\SE.L f or the term 

DEFINTTIONS 

LJruetrse r i ^^-^ - Aqreem(3nt, unless the context 

"Property" means the approximately 12,5oo acres of 

aside to LT.ENSOR under Governor,s Executive order No. 

land set 

4007, ds 

modif ied by Governor's Executive order rr'os. 4034 and 4r 65, dated 

september 16, 2003, including buildings and improvements 

"Premises', includes the land hereby, licensed by LICENSOR to 

LTCENSEE and all buildings and improvernents now or hereinafter 

constructed and instarled thereon except for any burrdings or 

rmprovements specifically excluded from the description of the 

Prem_ises in the License Aqreement. 

"Sub-licens ing,,, 

rental of the property 

"Drainaqe easements,, and 

or improved drainage courses 

from one point to another. 

rncludes any longr_ term 

to a third party. 

" f lowagre easements " 

[hat serve to convey 

or short - term 

mean naturaf 

stream flows 

"Hazardous materials,, shall mean any pollutant, toxic 

substance, lrazardous waste, hazardous 

substance , or oil, includrng 

0202239b.doc -28 

any and all 

C-366 

6- L ^-^: _ l materraL, hazardous 

flammable explosives,

adioactive materials, asbestos, petroleum and oi1 and their 

products, orqanic compound.s known as polychlorinated biphenyls, 

chemicals known to cause cancer or reprod.uctive toxicity, 

pollutants, contaminants, hazard.ous wastes, toxic substances or 

related materials, as defined in or pursuant to the Resource 

conservation and Recovery Act, as amended", the comprehensive 

Environmental Response, compensation, and Liability Act, as 

amended, the Federal Clean water Act, or any other federal, 

state, or local environmental law, reg.r_Llation, ordinance, ru1e, 

or by-law, whether existing as of the date hereof, prevrouslv 

enforced, or subsequently enacted. 

"Hazardous discharge" means 

deposit, disposal, spi11, release, 

materials on, within, or under the 

any event rnvolvj-ng' the use, 

or di schargre of any hazardous 

Premises. 

"Hazardous materials craims " means and incrudes: (i) any 

and alf enforcement, clean-up, removal-, mitigation, or other 

qovernmental or regrulatory actions instituted or, to the best of 

LTGENSEE ' s knowledg,e , contemplated or t,hreatened, wi th respect 

to the Premises pursuant to any hazard.ous materials laws, and 

(ii; any and alr craims made or, to the best of LTCENSEE,s 

knowledgre, contemplated or threatened by any third party aqarnst 

LfCENSEE or the premises seeking damag:es, contribution, cost 

recovery, compensation, injunctive reLief, or other relief 

0202239b.doc _29 

C-367

esulting from any hazardous discharqe or from 

any hazardous materials on, within, or r_inder the 

Ehe existence of 

Premrses. 

"Hazardous material-s laws " means eind includes all f ederal . 

state, and local laws, ordinances, and regulations now or 

hereafter in effect relating to environmental conditions, 

industrial hygiene and/or hazardous matr=riars or, within, under, 

or about the premises, including, ,without limitatron, the 

comprehensive Environmental Response, Compensation and Liability 

Act of 1980, as amended, 42 U. S.C. S96Cr1, et seq. , the Resource 

Conservation and Recovery Act, 42 U.S.C. S6901, et seq., the 

Hazardous Materials Transportation Act 4Lg U.S.C. S1801, €t seq., 

the Clean Water Act, 33 U.S.C. S1251, et seq., the Clean Air 

laF Aa ACt/ 4z U'S.C. S7401, et seq., the Toxic Substances Control Act, 

15 u.s.c. ss260r through 2629, the safe Drinking water Act, 42 

u's'c' ss300f through 300i, the Emergency planning and Community 

Rigrht-To-Know Act, 42 U.S.C. SS11Oj1 througrh 11050, the 

Environmentaf Response Law, chapter r2BD, Hawaii Revised 

statutes, and any similar state or 1oc;rl raws, ordinances, and 

the requlations now or hereafter adopted, published, and./or 

promulgated pursuant thereto. 

" LTCENSEE ,, i ncf udes 

representatives, executors, 

permitted assrqns. 

0202239b.doc - 30 

LICENSEE, 

i 1-n 

ILJ 

admini s traLtors , 

C-368 

heirs, personal 

SUCCESSOTS, ANd

"waste" includes (1) permitting the premises or any portion 

thereof to become unduly eroded or fairure to take proper 

precautions or make reasonable effort_ to prevent or correct 

same; (2 ) permitting any materiar increase in noxious weeds or 

alien plant species in or on the premises or any portrons 

thereof; (3) faifure to employ all of the usabre portions of the 

Premises; and (4) abandonment of the premises. 

,'Days,, 

speci fi ed. 

shall mean calendar clays, unless otherwise 

THIS LICENSE AGREEMEMT TS SUBiTECT TO THE PROVISIONS OF THE 

ADDENDT'M ATTACHED HERETO. UIHICH MODIFIES CERTAIN OF THE 

FOREGOTNG PROVISTONS OF THTS LICENSE. IN CASE OF AI\[Y CONFLTCT 

BETWEEN TIIE FOREGOING PROVISIONS AIID THE PROVISTONS OF THE 

ADDENDUM' THE PROVISIONS OF THE ADDENDT'M SHALL BE COATI'ROLLTNG. 

rN wrrNESS WHEREOF, the parties hereto have caused these 

presents to be executed this 2lst day of July, 2009. 

LICENSOR 

STATE OF HAWATT, AGRIBUSINESS DEVELOPMENT' CORPORATION 

Rr.r 

"f 

0202239b.doc 

:-----\ 

Executive Director 

C-369

f ^Fnr--r 

SUNRISE CAPTTAL, TNC., 

a Hawaii corporatron 

ru 

Rrr 

Prr 

pJ 

ugu 

!uD 

e Chamberlain 

Praq i rlonF 

N. 

APPROVED AS TO FORM: 

Deputy Attorney General 

Dated: JuIy 2I, 2009 

0202239a.doc -32 

C-370

STATE OF HAWATI I 

) SS. 

CTTY AND COUNTY OF HONOLULU ) 

Agribusiness Development Corporation 

on rhis .ltrl day of rJql!, n 

me personally appeared .^ 

^ 

,^^' 20 c tl 

l^"t":: 

Personally known or .a"q,-,ffi.ffir, ji J; 

who executed the foreqoino 38 -page License Agreement 

No . Lr:KLoof , dated. ,i uttv lrrtTTalrernarive, 

undared ar .rr;ffirrrir-tio.rr llt .nl",'r:3: 

Judicial Circuit of the state of Hawaii as the free act and deed 

of such person, and if apprlcabre in tire capacity shown, having 

been . duly authorized to execute suich instrument rn such 

capacl tv - 

0202239b.doc 

n r'n 'tr 

U{\JJ -9,t twr,'"''t 

Notary public, State of Hawaii 

Print Name: 

My commission expires: _) '}L\1.> 

C-371

STATE OF HAWATI 

CITY AND COUNTY OF HONOLULU 

) 

) 

) 

SS. 

Sunrise Capita1, Inc . 

on this 9'" day of July , 2oog, before me personarly appeared 

G-bioRGE CHAMBERLATN, to me personally krLown or adequately proven 

to be the person in and who executed the foregoing thirty_eight 

(3 B ) page License Agreement No . , dag-ed U*lol,^.o 

>__a++er*a++r".e_,_ undated at Il lw( 

the time of notarizat.ion* in the First Judicial Circuit of the 

State of Hawaii as the free act and deed of such person, and if 

applicable in the capacity shown, havinq been duly authorized to 

execuLe such insLrument in such capacitv. 

STATE OF HAWATI 

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?,:.'t '"////lII||It\t\\\t' oF Hh'.,\\+ 

CITY AND COUNTY OF HONOLULU 

Not.ary Publi 

at.e of Hawaii 

Print Name: 

My commiss.ion exprres: 04/12/20L2 

) 

) 

) 

on this 9" day of Ju1y, 2009, before me personally appeared 

JAMES N. swEENEy, to me personarry known or adequat.ely proven to 

be the person in and who executed the foregoing thirty-eight 

(38) page License Agreement No , d*€€d 

--a++eraa+i+'=e; undated at 

the time of notarization* in the First Judicial Circurt of the 

state of Hawaii as t.he free act and deed of such person, and if 

applicable ln t.he capacity shown, having been duly authorized to 

execute such instrument in such capacitv. 

i,l 

..,,':iiii: I I u, :t.. 

j Jffifrt t=.,'2 i; 

#i,;*s's 

0202239a -34 

SS. 

Notary Publi ate of Hawaii 

Cothleen Y.l. Bocloon 

PrrnL Name: 

My commissj_on 

C-372 

expires: 04/12/20L2

The foregoing License Agreement and the provisions thereof 

shall be subj ect to the f ollowing prov'isions of this Add.endum, 

and, in the event of any conflict between the foregoing terms of 

the License Ag-reement and this Ad.dendum, the provisions of this 

Addendum shall be controllingr. unress otherwise specified, any 

capitalized terms used. in this Addenclum shall have the same 

respective meanings given to such czrpitalized terms ln the 

License Agreement. 

ADDENDUM 

1 ra^ 1 ' !S€ LTCENSOR acknowledges that LICENSEE 

varl-ous 

i-s involved 

tlpes of 

in 

aquaculture research and development 

rncreasing 

aimed 

the quality, 

at 

yield, prod.uctivity, 

resistance,disease- 

and sustainabirity of vaiious 

and 

specils 

other 

of shrimp 

fish and marine species, 

limitation 

including wrthout 

specif ic pathoqen free lo, ,,spF,,) 

broodstockshrimp 

and shrimp 

LTCENSOR also acknowledgJes that, with LrcENSoR,s 

consent and permission, LTCENSEE currently permits 

sub-permittees 

certain 

or sub-licensees to use portions 

Premrses for 

of the 

the planting and cultirzation 

crops 

of corn 

and for 

and other 

various t\rpes of agyribusiness 

development 

research and 

aimed at irrcreasing 

productivity, 

the quality, yierd, 

and sustainabirity of rrarious f 

and 

ruit, 

seed 

veqetable, 

crops. LTCENSOR also acknovuledgres that LTCENSEE 

disclosed has 

to LTCENSOR that LTCENSEE has entered into , or may 

hereafter enter into, one or more operatrng agireements 

one or more ag'ricultural 

with 

farming entiEies roi tnl jornt 

the Premises 

use 

for 

of 

aquacurture dnrl ag.ricurtuie purposes 

involvinq, among- other things, the development 

feed and 

of 

feed 

aquacurture 

additives. 

Licensee has disclosed to Licensor, and Llcensor acknowledges, 

:-1": _:_:.t^1i" aspecrs of rhe research and deveropmenr conducted 

',y L'LCENSEE and its sub-permittees, 

users 

sub-licenJees, and joint 

may involve the utilization of so-caf led ,,g,6nome 

scrence " and other f orms of 

qenetlcally 

birctsghnology to develop 

modified shrimp, fish, aLnd. 

and 

other 

crops 

harr.r" specres 

that, among other 

potentially 

attributes, are variously 

more resistint to diseaser and pests, 

levels of 

have 

herbicide 

higher 

torerance, lower 

produce 

rates 

greater 

or mortality, and 

yields. These aspects of LTCENSEE's 

and development 

research 

and the research aid cie.relopment of LTSENSEE,s 

sub-permittees, sub-licensees, and jcint .r="r= are or mav be 

0202239b - 35 

C-373

subject to regulation 

including specifically 

Administration ( "FDA" ) 

Agriculture ( ', USDA', ) 

by various 

rne Un].ted 

and Unitedt 

qovernmentaf agencies, 

St,ates Food and Drus 

States Department oi 

Research and development relating tc these tlpes of products 

(referred to as ',Reg,ulated products,,) is conduCted by LICENSEE 

and its sub-permittees, sub-licensees, ;"J-:-.i"J- ,r"..= in 

accordance with 10ca1, state, arrd federal regulations. 

LTCENSEE also conducts research, and developm..l-'lnvorvlnqf 

shrimp, fish, and other marine speci,:s and its sub_permittees 

and sub-ficensees arso conducl rr=search and dlvelopment 

involvingr crops, that are not subject to reguration by any 

g:X:::T:?:"t aurhoriries (ref erred ro as ,,Non_Resulared 

!rvsuuLD ). 

LTCENSOR and LTCENSEE aqree that the premises sha1l be used 

solely for aquaculture and agricultural actlvities, including 

the development of spF shrimp, fish, and other marine species, 

and the planting and cultivation corn, soy beans, corron, 

wheat, sweet corn, specialty green be'n crops , marze, and 

other vegetable crops, including both Regulated products and 

Non-Regulated products . 

ownership of -products. LTCENSOR hereby acknowledges and 

agrees that, because of the nature of the research and 

development enqaged in by LTCENSEE and r-ts sub-permittees and 

sub-licensees, incruding research a'd tlevelopment invorving 

Requlated p'oducts, any and all aquaculture -r.a ag,ricultural 

products thert LTCENSEE or its srr,b-p..*ittees, =.,6_licensee, 

and joint users breed, develop, p1int , or curtivate on the 

Premrses must and sharl remain the sore, absolute, and 

exclusive property of LTCENSEE (or its sub-permittees or sublicensees, 

as the _case may be) , and thar* LICENSOR shal_L have 

no rigrhts ir:L or claims agrainst any such prod.ucts, whether i-n 

the form of a landlord's lien or o-th.rri=., even in the event 

of any default hereunder by LTCENSEE. The Regulated products 

-ttq . Non-Regrulated products developed, bred, plantecr, or 

cultivated by LTCENSEE (or i!= sub-p-e,rmittees, =.,t_licelsees, 

or joint users) on the premises snirl be disposed of in the 

manner more lrarticularly specif ied bel-ow. 

Paraqraphs 2, 

rn liqht 

f Entrv 

of 

and fnspect_ions. 

1,he nature oi-r,rCBrtSns,s (ar,d its sub_permitt_ees, , 

' 

:::;.11::1:"":l 

, and j oinr users ' ) research and developmenr 

crL L-L vr L-Les / ITCENSOR' s rigrht to have reasonable access t_o the 

Lrcensed prernises for purposes of insp,e651ng the same sh;rl1 be 

sub j ect to the requirement that LTCE-IJSOR shal1 give LTCENSEE 

prior written not-ice of at least sevenJy-tro (72) hours of any 

such inspect,ion, and LTcENSoR shal1 conduct such inspections 

in accordance with such reasonabre grui delines as LTCENSEE 

shall providt= to protect the securit.y and integrity of such 

research and development activities. 

0202239b - 36 

C-374

. LfCIINSEE 

its 

(directly 

sub-permittees, or througrh 

sublricertcees, 

"no j assumes sole 

oint 

and 

.,.'"r= 

exclusive 

) hereby 

responsibility 

any and all 

for 

Regulated, productl 

tr.. a.sposal of 

deverrope-d, 

cultivated on 

bred, planted, 

any portions of 

or 

the pretmises. 

Notwithstanding Paragrraphs 26 and 2'l of the License Agreement, 

LTCENSOR understands, acknowledges, and agfrees that, in the 

event of any withdrawal of aiy 1:ortron of the premrses 

pursuant to paragraph 2l of the License Agreement, or upon 

expiration of the Lerm or earlier termination of this License 

Agreement, including by reason of arLy default on the part of 

LrCENSEE,any portions of the premiies that have been most 

recently used for the deveropment, breeding-, plantrnq, or 

cultivation of Regulated products srrarr not be released and 

surrendered to or withdrawn by LrcENSoR, and LrcENsoR shall 

not have any right to withdrair,', er.tei upon, take possession 

of, or otherwise repossess same, untir such time as LTCENSEE 

certifies that such fierds are free from any such Regulated 

Products in issue. 

rn the event that any portion of the premises 

purpose of planting 

are used for 

and 

the 

cultivating 

Requlated products, any crops that are 

LTCENSEE 

harvesting 

-gr".r=' 

of 

thJt, 

any 

r6tlowinq 

such 

the 

Regurated- products, 

directly LT.ENSEE 

or through 

(either 

joint 

its sub-permittees, 

users) sharl_!" 

sub-ricensees, 

required 

or 

io prir.L"a 

speed to mechanically 

with all defiberate 

tilr under 

residue 

arrd b..ry 

or 

any prant 

otherwise 

starks 

treat 

or 

such 

ensure 

fields 

that such 

with herbicr-d.es 

fields are free 

to 

from 

renewed 

possible 

grrowth ,"qr.r"r-tion 

of the Regulated pro,j-ucts 

or 

event in issue. f that LTCENSEE n the 

expiration .teqlires addiIional 

or 

time 

termination 

beyond the 

of this 

the premises License Agreement 

free from possible 

to render 

t.g;;=;-tion 

of any such 

or renewed grrowth 

Requlated Froducts, LTCENISOR 

to remain 

shall allow LTCENSEE 

in possession of the premises, 

basis, upon 

on a month 

the 

to_month 

same terms and 

License 

condit-lons 

Agrreement, 

as set forth 

for 

in this 

the sole purpose 

actions are appropriate 

of takingr whatever 

to ensure 

reg'eneratron 

thaL there is and 

or 

wilr be no 

renewed grrowth of the subj 

on 

ect Regulated 

:::3:::: 

rhe fields or porrions of rhe premises in 

\4UsD L r Lrtl . 

Paraqraph 62 -- Audits. Notwithstanding parag-raph 

License Ag'reement, lrcexson 

62 of the 

orshall 

make 

not be 

copies 

entitled to examine 

of any of 

sub*permittees' 

LTcENSEE's (or LTCENSEE,s 

, sub-licensees, 

proprietary , or joint users,) 

buslness 

confidential 

information, 

-t,rade 

copyrights, or 

secrets, 

other 

patents, 

intel]ectual 

'p.op..ay 

any audits or 

ln 

inspections 

connection with 

of the pri:mises 

inspections of 

or 

lrc.us'B'= 

any audits or 

books, accounts, records. and 

0202239b -37 

C-375

ot()2239b 

recefpts concerning LTCENSEE's operations on the premises 

covered by the License Agrreement. 

- 38 

C-376

401 6 

l. 

STATE OF HAWAII 

DEPARTMENT OF LAND AND NATURAL RESOURCES 

LAND DIVISION 

KNOW ALL IVIEN BY THESE PRESENTS: 

REVOCABLE PERMIT NO. 3-7452 

This Agreement is executed this ___!st_duy of _@20ro , 

by and between the STATE oF HAWAII, hereinafter referred. to as the ,,State,,, by its Board of 

Land and Natural Resources, hereinafter called the "Board," and Leslie p. Milnes, married to 

Anne L' Milnes, as his separate property, hereinafter "uil"d the ,,permittee,,,whose mailing 

adtlress is 6277 Puuopae Place. Kapaa, Hawaii 96746. The parlies agree that commencing on 

thc fsl davor --Ngv"{ber' --, 2.r'.--_;a:;;;;;"ementcrare,,), 

Pennittee is permitted to enter and occupy, on a nlonth-to-month basis only, pursuant to section 

I 7l-55, Hawaii Revised Statutes, that ceitain parcel ol'public lantl (and uny'i,11prouemerts 

located thereupon) situate at wailua, Lihue, kawaihau, Kauai, Halvaii (Kalepa), .fax Map 

Key: (4) 3-9-2: Portion I and 20, as indicated on the map attached l.rereto as pxniuit ..A,,,and 

made a part hercol, containing an approximate area of 58i acres (unit E), which parccls are 

hercinafter refemed to as the ,,premises." 

TFIIS I'ERMIT IS GRANTED UNDER TFIE FOLLOWING (]ONDI'f IONS: 

A. Thc Pemrittce shall: 

348691 I DO( 

occupy and use the pre'rises lbr the fbilowing s;pcciriecr pulposes onry: 

Pasture, equestrian pasture and accessory uses. 

Pay, at the Departrnenr. ol-l.ancr anrl NatLrral Resources Fiscal ollrce, p.o. Box 

621, Honolulu, Ilarvai'i 96g09, rnonthly rcnt in thc sum ol-oNE tIUNDRFID 

'I'WENTY-'IHRITE DOLLARS AND NO/CI,tN.IS ($123.00) payable rn 

advance by the first of each and every ntontli. 

'['he interest rate ott arly unPaicl or tlclinclucnt r'cntals shallbe at one per ccrt (l()6) 

pcr rnonth. 

If monthly rent is not rccciveci at the above adclrr:ss on or belbrc the llrst clay of 

the nronth Ibr rvliich it is chre, the n a sen,ice charge ol. FIFTy AND No/l00 

DOI-LARS ($50.00) a month for each clelinqucnipaynent shall be assessed and 

payable' The service charge is in arjdition to interesion unpaid or delinquent 

rentals. Interest sirall not accrue on the serv.ice charge . ,r',_.-- _*".\.i., 

- I' 

C-377 

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J. 

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T. 

5. 

6. 

7 

3(+8697 I D(X 

Paynent of such service charge shall not excuse or cure any default by permittee 

under this Permit. 

Upon execution of this permit, cleposit rvith the Board an amount equal to two 

times the monthly rental stated above in paragraph 2, as security for the faithful 

performance of all of these terms and conditionLs. 

The deposit will be returned to the Permittee upon termination or revocation of 

this Permit, if and only if all of the terms and conditions of this permit have been 

observed and performed to the satisfaction of arn authorized representative of the 

Department of Land and NaturalResources (.,DLNR"). otheiwise, the deposit 

may, at the option of an authorized representative of the DLNR be applied toward 

palment of any amounts owed hereunder, without waiving any of the-Boarcl,s 

other rights hereunder. 

At the Permittee's own cost and expense, keep the government-owned 

improvements located on the premises insured agai"nst loss by fire and other 

hazards, casualties, and contingencies, for the fui-l insurable value of those 

improvements. The policies shall name the Slal.e of Hawaii as an additional 

insured and shall be filed with the Board. In the event of loss, damage, or 

destruction of those improventents, the Board shall retain lrorn the proccetls of the 

policies those amounts it deems neccssary to cover the loss, darnage, or 

dcstruction of the govenlment-owned improvenrents and the balance of those 

procecds, if any, shall be clelivercd to the penniltee. 

Give the Board twenty-five (25) calendar clays n,otice, in writing, before vacating 

the Prcmises. 

Pay all real property taxes assessed against the F'renriscs from the conrnrcncenrcnt 

date of'this pcnnit. 

At its ow'cost and expense, observe, perlbrr, arcl cor-.pry wrth all laws, 

ordinances, rulcs and regulations of aligovcmnr,cntal autliorities pow or at ary 

future tirlle during the tcrnt of this Perrnit applicable to thc premises, inclucling, 

without linriting the gcnerality olthe tbrcgoing, the Amcricans rr'ith Disabilitics 

Act of 1990 and all rcgulations prontulgatccl ivith respcct thcrcto, as well as any 

other la\vs, ordinatlces, rules ancl rcgulalions inrp,osing any requrrenrcnts that tlie 

Prernises be nlade accessiblc to pcrsons rvith clisabilitts; an,:, intiepurily Lhe State 

of Flawaii against all actiotts, suits, clamagcs ancl claims by lvhonrsocvcr brought 

or nlade by reason of the nonobscrvance or nonperfomalrce of any of said la.,is, 

ordinances, rules anti regrrlatior-rs or ol-thrs covenarnt. 

Repair and matntain all buildings or other inrprovenrents norv or hereafter on the 

rremlses. 

'z- '-\ 

C-378 

/. 

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tr."t'. """*;l

1486S7 l DOa 

9. obtain the prior wntten consent of the Board b,efore making any major 

improvements. 

10. 

ll. 

12. 

l3 

14. 

Keep the Premises and inlprovements in a clean, sanitary, and orderly condition. 

Pay all charges, assessments, or palments for rvater, other utirities, and the 

::L::!:-" of garbage as may be revied, chargecr, or be payable rvith respect to the 

rretntses. 

Not make, permit, or suffer, any waste, strip, sJloir, nuisance or unrawfur, 

improper, or offensive use of the premises. 

At all times with respect to the premises, use clue care for pubric safety. 

Procure and maintain, at its own cost and expense, in full force and effect 

throughout the term of this Permit, comprehinsive general liability insurance, in 

an amount acceptable to the Chairperson of the Board with an insurance company 

or companies licensed to do business in the Stal.e of Hawaii. The policy or 

policies of insurance shall name the State of Hawaii as an additional insured. The 

insurance shall cover the entire Prcmises, including all grounds and all roadways 

or sidewalks on or adjacent to the Prenrises in the ur" oicontrol of the permittee. 

Prior to entry and use of thc premiscs or within fiftecn (15) ciays afler the 

commcncement date of this Pennit, whichever is sooner, fumish the State with a 

certificate(s) shorving the policy(s) to be initially in force, keep the certificate(s) 

on deposit during the cntire permit term, and furrrish a like cerlificate(s) upon 

each renewal of the policy(s). This insurance srrall not be cancelletl, limited in 

scope of coverage' or nollrenewcd Lrntil after sixty (60) days written noticc has 

bcen given to the Srate. 

Thc State shall retain the right at any trme to revicw the coverage, fbnn, ard 

amount of the insurance requirecl by this pernrit. If, in the opinion of thc State, 

1he insurance provisions in this Pernrit clo not prcvicie adequate protcction for t6e 

State, the State rnay require Pennittec to obtain insurance sufficicnt in coverage, 

fonn, and anlottnt to provide adcquate protcction. The State's requirements sh.ll 

bc rcasonable but shall bc designed to assure pro,tection lbr ancl agaipst the kincl 

artd extent of the risks lvhich exist at thc tirnc a c:hangc in insurance is recluired. 

The Statc shail notify permittec i' rvriting of cha,'geJ in thc insurance 

rcquircmcnts and Pernrittec shall dcposit copies ,rl:acceptable nsurancc policy(s) 

or certificate(s) thereol' rvith the State incorporating thcchanges wrthin thirty (30) 

days alter receipt of the noticc. 

The procuring of the required policy(s) of insurance shall not be construed to lirnit 

Permittee's liability under this Perniit nor to releaLse or relieve the permittee of the 

indemnification provisions and requirements of this permit. Notr.vithstanding the 

policy(s) of insurance, Pemrittee shall be obligated for the full and total amount of 

,2"--*-'r 

-3- / Ar.*'u \ 

{ ':'ill"'": ij, } 

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'- 

C-379 

/ \./ \-- 

-i'

all damaSe, injury, or loss caused by permitte,e's negligence or neglect connected 

with this Permit. It is agreed that any insurance maintained by the S,ur" *,ir ufpry 

in excess of, and not contribute with, insurancr: providecl by permittee,s policy. 

The insurance cerlificate(s) shall be mailed to: 

State of Hawaii 

Department o1'Land and Natural Resources 

Land Division 

Box 621 

Honolulu, Hawaii 96809 

In case the State shail, without any faurt on its part, be made apartyto any 

litigation commenced by or against the permittr;e (other than condemnation 

proceedings), the Permittee shall pay all costs, ;inciuding reasonaute attomey,s 

fees, and expenses incurred by or imposed on the State. 

The Permittee shail pay ail costs, inclurring reas,onabre attorney,s fbes, and 

expenscs which may be incurred by or paid by the State in enfbrcing the 

covenants and agreentcnts of this permit, in rec,cvering possession of the 

Premises, or in the collection of clerinquent rentar, taxes, anir any and a1 other 

charges. 

B. Additional Conditions: 

3. 

l. 

148697 I t)oc 

l5 

16. 

This Pemit is issuecl and effective on a month-to-month basis. The perrnit shall 

automatically tennilrate one year fronr the comrnencement date, unless earlier 

revoked as provided below, provided further that thc Board may allow the permit 

to cotttinuc on a ntonth-to-ntonth basis for aciclitrional one year pc'ocls. Any such 

extcnsion shall havc thc same terms ancl conclitions as this permit, except lor the 

conlmenccnlent clate eind any antcttdments to ther tenrs, as reflectecl in tle Boarcl 

minutes of the meeting at whiclr the Board acts. pennittee agrees to be bound by 

thc tcnns and conditions of this Penlit ancl any anrendnrents to this perrnit so long 

as Perntittee contitlucs to hold a pernrit hlr tirePrenrises or continues to occ'py or 

rrsc thc Pr-e.rrriscs. 

l'hc Board nlay revoke this Pernrit for any reason wlratsoever, upop wltte' notice 

to thc Pcnlrittee at least thirty (30) calenclar clays prior to the revocatior; provided, 

however, that in the evetlt paynent of rcntal is cleiinquent Ibr a perrocl of ten (10; 

calenclar days or lllore, this Pennit nray bc revok,:cl ,pon uu,i,r., ,oticc 1o the 

Permittee at least lrvc (5) carencrar clays prior to the rlvocati.n. 

If the Penlittee lails to vacate the Prernises upon revocation or terminatio' of the 

Permit, the Pen'ittee shall be liable for and shall pay the previously applicable 

monthly rent, computed ancl proratecl on a daily b,asis, for each day the permittee 

remains in possession. 

-4- 

C-380 

I .'*,t-, ,'. -..,, 

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\,, ,rrt':r'r''' ; 

-'-*#/ ,/

7. 

l0 

ll 

1.18(r97 I DOC 

If the Permittee fails to vacate the Premises upon revocation or termination of the 

Permit, the Board,.bv t]r agents, or representatives, may enter upon the premises, 

without notice, and at permittee's cost and expense r.*ou. and dispose of all 

vehicles, equipment, materiars, or any personar property remaining on trre 

Premises' and the Permittee agrees to pay for aLli .ort. und expenses of removal, 

disposition, or storage. 

The Board may at any time increase or decreas,e the monthly rental by written 

notice at least thirty (30) business days prior to the date of change of rent. upon 

such notice, the Permittee shall deposit with the Board any additional monies 

required to maintain an amount equal to two tirnes the new monthly rental as 

security for the faithful performance of all of these terms and contlitions. 

Except as otherwise provided for in this permit, any major irnprovements, 

including but not limited to buildings and fences, erected on or moved onto the 

Premises by the permittee shall remain the property of the permittee and the 

Permittee shall have the right, prior to the termiinat-ion or revocation of this 

Permit, or wrthin an additional period the Boarrl in its discretion may allow. to 

rerlove the improvements from the Premises; p'rovided, however, hurin trr. a."u"n, 

the Permittee shall fail to remove the improvements prior to the temination or 

revocation of this Permit or within an acllitionalperiotl the Board in its discretion 

may allow, the Board may, in its sole discretiorr, elect to retain the inrprovements 

or nlay remove the same and charge the cost of removal and storage, if uny, to the 

Perntitte e. 

'l-he Board resenzes.the right for its agents or representatives to enter or cross any 

portion of the Prcmiscs at any time. 

'fhis Permit or any rights hereunder shall not be solcl, assigned, conveyeci, le.se

1-l 

3.18(r97 i D(X 

12. 

lJ. 

Ary and all disputes or questions arising under this permit shall be refemed to the 

Chairperson of the Board and his determination of these disputes or questions 

shall be final and binding on the parties. 

Pernittee shall 'ot cause or permit the escape, disposal, or release of any 

hazardous materiars except as permitted by raw,. i..miit., shall not allow the 

storage or use of such materials in any manner not sanctioned by law or by the 

highest standards prevailing in the industry for the storage and use of such 

materials, nor allow to be brought onto. the Prernises any"such rnaterials except to 

use.in the ordinary course of Permittee's business, and t-hen only after written 

notice is given to the Board of the identity of such materials and upon the Board,s 

consent, which consent may be withheld at the Board,s sole and absolute 

discretio'. If any lender or governmental agenr;y shall ever require testing to 

ascertain whether or not there has been any rele,ise of hazardous materials by 

Permittee, then the permittee shall be responsible for the costs thereof. In 

addition, Permittee shall execute affidaviis, representations and the like from time 

to time at the Board's request concerning the permittee's best knowledge unJ ' 

belief regarding the presence of hazardous materials on the premises placed or 

released by Permittee. 

Permittee agrces to indcmnify, clefencl, ancl holcl the State of Hawaii, the Boarcl, 

and their officers, employees, and agents hamrless from antl against all liability, 

loss, damage, cost, and expensc, incrucling all attomeys' fees, and a1 claims, suits, 

and denrands therefore, arising out of or resulting from the use or release of 

hazardous materials on the Premises occuming,"t-rit. pennittec is in possession, or 

elsewhere if caused by permittee or persons acting under permrttec. .r.hese 

covenants shall survive the expiration, revocatic,n, or termination of the permit. 

For the purpose of this penlit "hazardous material" sliall mcan any pollutant, 

toxic substance' hazarclous waste, hazardous material, hazardous substance, or oil 

as defined in or pursuant to the Rcsource conservation antl Rccovery Act, ns 

antended, the cornprehensive Environmental Rerspo'se, compensation, and 

Liability Act, as .rnended, thc Fecleral Clean water Act, or any other fcderal, 

statc, or locerl environnrentar rar,v, regulatron, orclinancc, rule, or bylar.v, r.vhetSer 

cxisting as of thc date hcreol, previcxrsly cnlorcccl, or subsequeltly cnactccl. 

Prior to tenttinatiotl or revocation of thc subject pennit, per-rnittee shall conduct a 

Phasc I ctrvirontllcntal sitc asscssr.nent ancl conclict a complete abatemc't a'd 

clisposal, if 'ecessary, satisfhctory to the stanclarrls requircd by the Fecleral 

En'irornrental Protectio'Agency, the Deparlnrent of Heahh, anc.l the D[,NR. 

FailLrre 1o corrlply with tire provisions of this panlgraph shall not extencl thc tern-r 

of this Permit or autonratically prevent tennination ol revocation of the per'iit. 

Tlrc Board. ltt its sole optiorr. may refirsc to appr()ve terrninatjon or revocatiou 

unless this evaluation and abaternent provisiori has been perfbrmed. In adcltion 

or in the altemative' the Boardrnuy, ut its sole oprtion if permittee does not do so, 

-6- 

C-382 

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arrange for performance of the provisions of this paragraph, all costs and 

expenses of such performance to be charged tc, and puia Uy permittee. 

Permittee shall indemnify, defend, and hold harmless the State of Hawaii, its 

offrcers, agents, and employees from and agairrst all riability, loss, clamage, cost, 

and expense, including all attorneys' fees, and all claims, suits, ancl deminds 

therefor, arising out of or resulting from the acts or omissions of the permittee or 

the Pennittee's employees, agents, or officers under this permit. The provisions 

of this paragraph shall remain in full force and effect notwithstandingine 

revocatton, expiration, or termination of this Pennit. The purcha.. oltiubility 

rnsurance shall not relieve permittee of the obligations described herein. 

Unless otherwise agreed by the Board in its sole discretion, payments received 

will be applied first to attorneys' fees, costs, assessmentr, ,"ir property taxes, or 

other costs incurred or paid by the Board with respect to ihe premises, next to 

service charges or interest. next to any other charges due or owing under the 

Permit' next to delinquent monthly rent, and next to current rent. 

Any notrce required or pennitted to be given hereunder shall be in writing, give' 

by personal delivery or by first class miil, postiige prepaid. Notice to permittee 

shall be delivered or addressed to the acldress stated ubour. Notice to State of 

Hawai'i shallbe delivered or addressed to the Chairperson of the Board at I l5l 

Punchbowl Street' Room 130, Honolulu, Hawai'i 96813. Mailed notices shallbe 

dcerned givcn upon actual receipt, or two busin,ess tiays following deposit in the 

mail' postage prepaid, whichever occurs first. Ilither party niay by notice to the 

other specify a different adclress for notice purposcs, p.oui,l"d tlrat permittee,s 

mailing address shall at all times be the same for uotti billing and notice. In the 

cvent there are multiple pennittees hereuncler, notice to one pen,ittec shall be 

tlcemcd notice to all permittces. 

a' Permittee shall not be held liable for e:xisting conditions which may be 

associated with previous use of the land by lmtac. 

b. Permits will subordinate to any long_term leases. 

c' By acceptance ol' this Permit, Permittee represents that the premises 

have been inspected and permittee accepts the premises as is. 

d' Permittee shall maintain the existing l'r:getative buffer zones along the 

plateau and valley rims. Any clearing o. trimming activities stral Ue 

upon approval of the district land agent for the Fourth Land District, or 

a designee, in consultation with the Division of state parks and Division 

of Forestry and witdrife of the Department of Land and Naturar 

Resources. 

-7- 

C-383 

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e' Permittee shall be required to maintain that part of the irrigation 

system that is within the Premises in its current condition, by ke"eping 

the ditches free and clear of vegetative overgrowth and/or destruciion 

by livestock. Except for routine nnaintenance, alteration of these 

irrigation ditches, including but not limited to, filling ditches rvith any 

solid materials, shail not be permitted without prioi written approval 

from the State Historic Preservation Officer anilthe district land agent 

for the Fourth Land District, and compliance with ail applicabte lawi. 

f. A development and use plan shall be developed and submitted to the 

district land agent for review and approvar. upon approvar of the 

development and use pran, such pran shail become incoiporated into 

this Permit by reference as furttrer conditions and failure to 

substantially comply with the development and use plan shall be 

grounds for revocation of this permit. 

g. In the event that a water user group slhall be organized or required by 

the Board to be organized to manage and/or op..ut. a water system that 

provides irrigation water to the premisei,, permittee shail be ^ 

participating member of such water user group. The water user group 

shall manage such water as may be permitt"d o. licensed for the* user 

group's use, and shall operate and manage the water system necessary 

for the storage, transport, and derivery or such water, incruding, but 

limited to, reservoirs and main transmission ditches. 

h' Along with other permittees in the vicinity of the premises, permittee 

shall be responsible, on a fair share basis, for ilre maintenance of 

common area roadways. 

i. water, reservoirs and main transmission ditches, as may be identified 

by the water licensee, shall be under the control of the rnui.;. user group. 

The Permittee agrees to collectively be responsible for the maintenance and 

operation of the infrastructure necessary to support the use of the land. 

Permittee shall conrply rvith all larvs ancl governmental regul:rtions'' and,, 

upon request, sh:rll cooperate lvith the inrplernentation of governmental 

progr:rms such as, but not limited to, culturall and historical site 

identification, miconia eratlication, and the expansion of state parks. 

As recomme'ded by the Historic preservatiorn Division: 

a. In former sugar cane lands, the plantation era historic sites such as 

bridges and irrigation ditches shall be preserved or shall be maintained. 

IfPermitteeproposestodestroythesehistoricsites,thentheState 

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Historic Preservation Division shall be contacted to determine what 

requirements must be met. 

b' Prior to any land clearing or land alteration in the gulches or wastelands 

within the Premises, permittee shall first obtain the approval of the 

Historic Preservation Division of the Drepartment of Land and Natural 

Resources. Permittee shall submit a proposal for land clearing or land 

alteration to the Historic Preservation Division, which shall conduct a 

field check to determine if historic sites may be affected. If historic sites 

may be affected, an archaeological inventoiy survey shall be conducted, 

at Permittee' s cost and expense, by a qualified arciaeologist, who shall 

submit a report on such survey to the State Historic preservation 

Division for review and approvar. such report sha[ identify any 

significant historic sites and recommend a mitigation plan, if n...rru.y, 

for the protection of the historic sites. If the Stite Historic preservation 

Division determines that mitigation measures are necessary, permittee 

shall submit a detailed mitigation plan to the State Historic preservation 

Division for review and approvar. The approved detaired mitigation 

plan shall be successfully executed prior to any land cleariog o", any land 

alteration. 

c. If burials exist, the procedures ouflined in Hawaii Revised statutes, 

Chapter 6E and associated administrative rures shail be foilowed. 

This Permit is subject to the co-existence pran, dated May 14,200g, 

between the Kalepa Koalition and the Green Energy Team, LLC, designated 

as Exhibit "B," attached hereto and made a part heieof. However, items 

numbered 1,4,5, and l0 on the pran are sub.iect to approvar by both the 

Board of Land and Natural Resources and the Agribusiness Development 

corporation or lvhichever entity has jurisdiction over the matter. 

Unless the text indicates otherwise, thc use of any gencler shall include all genclers 

and, if the Pernrittee iltcludes nrore than one person, the singular shall signily the 

plural and this Permit shail bind the persons, anrd each of thcnr iointlv and 

scvcrally. 

Such other ternrs and conditions as nray be prcsr:ribecl by thc Chairperson to best 

scrve the intercsts of the State. 

-9- 

C-385 

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IN WITNESS WHEREoF, the srATE oF H,AWAII, by its Board of Land and 

Natural Resources, has caused the seal of the Department of lland and Natural Resources to be 

hereunto affixed and the parties hereto have caused these presents to be executecl the day, month 

and year first abovc written. 

Approved by the Board of 

Land and Natural Rcsources 

at rts rneeting held on May 23,2009. 


Datccr: 1 ,/01 

148697 I I)o(. 

Attorney General 


t'fgrrperson of the Bggrd of Land 

Natural Resources /rL 

PERMITTEE 

-10- 

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Leslie P' Milnes, to me personally ktio*n, who, being bv -. duly sworn or affirmed, did say 

that such person executed the fbregoing instrument or th" frer: act and deed of such person, and if 

applicable in the capacity shown, having been cluly authorizerl to execute such instrument in such 

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Summary of Interview with: 

Randolph Y. Teruya, Agricultural Asset Manager 

Agricultural Resource Management Division 

State of Hawaii, Department of Agriculture 

Tuesday, 10 July 2012 

The Agribusiness Development Corporation (ADC), although administratively a part of the 

Department of Agriculture (DOA), is an autonomous entity that succeeded the Governor’s 

Agriculture Advisory Council. 

o Unlike the DOA, which is restricted by statute to agricultural commodities and ranching, the 

ADC will deal with any agriculturally related industry. 

o The ADC does not lease land, and its administrative rules do not refer to leases. The ADC 

does not convey land by way of leases. 

o Instead, the ADC issues licenses, usually of 10 years duration. Consequently, it is very 

difficult to borrow against property licensed from the ADC. Licenses are legal documents 

that do not convey a real property interest in the land and therefor, makes it difficult for 

collateralization. 

o For information on ADC licensing policies, practices, and procedures, the ADC must be 

contacted separately. 

The DOA does not generally lease land from other agencies or private entities. 

All lands leased by DOA were acquired from the Department of Land and Natural Resources 

pursuant to governor’s executive order (EO) from ca. 1989. There are roughly 21 33+ EOs 

transferring land from DLNR to DOA, about half issued under the Abercrombie administration. EOs 

issued by the current administration are available via the governor’s website. EOs from previous 

administrations should be on file with the office of the lieutenant governor. Land transfers from 

DLNR to DOA are expected to continue for roughly another 5 to 10 years—much longer than 

originally anticipated. indefinitely. Once lands are transferred from DLNR to DOA, DLNR retains no 

role in their management. 

While relevant statutes and rules describe at least five categories of land in relation to the DOA 1 , 

only two categories, Agricultural Park (AP) land and Non‐Agricultural Park (NAP) land are relevant 

to DOA land leasing. 

o AP lands under control of DOA 

All AP lands managed by DOA were transferred to DOA for the specific purpose of 

AP creation. 

Although HRS § 166‐1 implies that APs are developed on IAL, most APs are on 

marginal lands. There is, however, a new AP in planning on prime land. 

APs generally consist of smaller lots ranging from 5 to 20 acres. The lots are usually 

developed in clusters of up to 3 or 4 dozen contiguous lots. 

1 The five categories are: (1) land managed by the ADC, (2) Important Agricultural Land (IAL), (3) Land acquired by 

the DOA under HRS § 155‐4(11) (i.e., via foreclosure, voluntary surrender, etc.), (4) Agricultural Park (AP) land, and 

(5) Non‐Agricultural Park (NAP) land. 

C-390 

Formatted: Font color: Auto 

Formatted: Font: Italic 



Formatted: Font color: Auto

APs are generally intended to foster new farmers/start‐up agricultural producers 

and accommodate displaced farmers (e.g., those required to relocate for H3 

interstate highway). 

AP lands are leased for 15 – 55 years (avg. 35), and the leases are not renewable. 

APs are for start‐ups, not established producers. 

There are currently 10 APs owned and operated by DOA consisting of 227 total lots. 2 

(There are also a handful of private APs over which DOA has some responsibility, but 

they are on private land and thus not germane here.) DOA has NO responsibility 

over Private Ag Parks. 

o NAP lands under control of DOA 

NAPs are usually on non‐contiguous lots spread widely across the state, ranging 

from 2 to 5,000 acres. The larger lots are generally used for ranching. Unlike APs, 

which are mostly developed on marginal lands, NAPs are developed on a wide range 

of lands, contingent on intended use. 

NAPs are for use by established farmers and ranchers. 

The term “Non‐Agricultural Park” is potentially confusing: NAPs are for agricultural 

purposes, but just not designated as APs under statute. They serve a separate 

purpose and certain lease terms are different. 

NAP lands are leased for 15 – 65 years (avg. 35), and the lease can be renewed. 

DOA has statutory authority to develop APs and NAPs in joint venture (JV) with other agencies and 

private entities. While the DOA has been approached with such proposals, there are no JVs 

currently in operation. 

DOA leasing and land use restrictions: Although statute and rule allow DOA to exempt APs and 

NAPs, whether developed by the DOA alone or in partnership with governmental and/or private 

entities, from all county‐level land use restrictions, the DOA strongly prefers that lessees conform to 

county ordinances whenever possible. This paragraph is misstated…the reference to “exemptions” 

are with respect to the DOA’s ability to develop the AP only. DOA strongly prefers to develop APs in 

consonance with the county building/subdivision codes so that the roadways within the AP may be 

dedicated to the county, thus providing lessees with the ability to receive county services (e.g. public 

utilitites, refure collection, street lights and police patrols). Additionally, the U.S. Postal Service may 

assign street addresses to receive mail. 

o Failure to meet county standards and requirements in developing APs and NAPs often 

results in: 

Inability to dedicate roads and obtain street addresses 

Problems with trash collection and utility companies 

No police patrols 

The leasing process for APs and NAPs is the same, although certain lease terms differ. 

Statute and rule authorize DOA to lease AP and NAP land via 4 3 methods: 

o (1) public auction, (2) negotiation, and (3) public drawing, and (4) conversion 

Conversion applies only to NAPs 

2 Number of total AP lots taken from http://hawaii.gov/hdoa/arm/arm_agparks/arm_agparks. 

C-391 



Formatted: Strikethrough 


Formatted: Strikethrough

o Selecting a method turns in part on the number of lots up for lease and the number of 

qualified applicants seeking to lease them. 

o (1) Public auction: the DOA has not leased AP or NAP lands via public auction for at least 

the last 16 years. In theory, auction would be useful in cases where very few lots were up 

for lease; however, auction is a non‐preferred method and has not been used by DOA for 

several years because it functions contrary to DOA’s mission. DOA’s job is to assist farmers 

and educate the public. DOA does not seek the highest or best use, in an economic sense, 

for AP and NAP lands. Doing so would drive up rents and increase food costs. This is a 

notable difference between DOA and DLNR leasing practices, as DLNR is required by statute 

to hold public auctions. achieve highest and best use. 

o (2) Negotiation is the method preferred by DOA when there is only one qualified applicant 

(QA) for a given lot. However, where there are more than one QA, QAs are requested to 

submit sealed bids and by rule the high bidder is wawarded the lease, assuming the bis is 

judged sustainable in light of the economic position of the bidder and/or the revenue 

expected from the lot. 

o (3) Public drawing is used when there is more than one QA for a lot. QAs submit sealed bids 

and by rule the high bidder is awarded the lease, assuming the bid is judged sustainable in 

light of the economic position of the bidder and/or the revenue expected from the lot. 

o (4) Conversion allows a current lessee of an NAP lot to renew the lease without competition 

and can occur within 5 – 10 years of expiration of the current lease. Generally speaking, 

conversion results in an additional term of 35 years being added to the average 35‐year 

original lease. Conversion is not one of the methods of disposition within the statute or rules. 

Rather, it is a rule relating to NAP leases only. 

All lease awards must be approved by the Board of Agriculture (BOA). There is no public hearing 

process for lease approval. Awardees are announced at a BOA meeting, after which the public 

usually has 20 days to file a challenge, contingent on the method of disposition. 

For both AP and NAP lots, whether disposed of by negotiation or public drawing, the DOA 

establishes a minimum rental value by in‐house independent appraisal. That value can be 

challenged by potential and renewing lessees (the procedure for same set out in HAR and HRS). The 

value established for lease dispositions CANNOT be challenged. Once a lease is awarded and fully 

executed, independent appraisals are used to establish rents for “reopening” periods as delinated in 

the lease terms. 

Prior to signing a formal lease, the prospective lessee (either the high bidder at public drawing or 

the sole QA interested) is given a 6‐month right of entry to the parcel to prepare whatever is 

necessary to meet pre‐signing conditions. 

Several conditions must be met prior to signing a lease with DOA, including: 

o Procurement of liability insurance 

o Obtaining a performance bond in cash or surety equivalent to 2 years of rent 

o Clearance and background check to ensure the bidder can meet financial obligations. 

o Submission and approval of a farm layout for the lot 

o Approval of a conservation plan (CP) covering soil and water 

C-392 







Completing the CP within 6 months is usually the most difficult condition to meet. 

The intended lessee has four options for preparing a CP: 

Work with Oahu Resource Conservation & Development Council (ORCD), a 

non‐profit, to prepare a CP. 

Hire a private civil engineering firm: most expensive option. 

Self‐create a CP using the Natural Resources Conservation Service (NRCS) 

website. NRCS is an agency of the U.S. DOA. 

NRCS will work with the intended lessee in preparing a CP, but the average 

wait time is 1 – 2 years, making this option unviable unless one can 

somehow speed up the process. 

The resulting CP must be approved at a Soil and Water Conservation District 

meeting. 

Usually approval is not a problem. Getting the plan together is the real 

challenge for most prospective lessees. 

Other lease conditions include: 

o Lessee must complete 50% of lot development within 2 years of signing a lease for AP or 

NAP lands. 

o 100% of lot development must occur within 3 years. 

o Lot must achieve 100% production within 3 years. 

o Any structure built on the land must be approved by DOA and insured by the lessee, unless 

the structure is a small storage or processing shed without utilities. (Often, farmers will 

construct small shelters to keep their workers out of the sun and these are usually exempt.) 

What happens to the structure upon lease expiration is usually determined at the 

time the structure is approved by DOA and is later set out in the lease. Typically, 

larger and more valuable structures will be hauled off the lot by the lessee, 

assuming that such a removal has been negotiated and approved. All other 

improvements vest in the lessor (i.e., DOA) at expiration. 

Unless a parcel is developed as a JV (of which there are currently none), the lessee 

bears the risk of loss in case of destruction of leasehold property. 

Permitting as it relates to the leasing process 

o DOA generally requires that construction and use permits be obtained before the lease is 

signed. There are no permitting requirements at lease execution, only upon lessee’s 

proposal to construct an improvement on the land and after receiving prior approval from 

the Board of Agriculture. 

o Permitting from federal agencies and state department of health pertinent to health and 

safety issues usually takes place after the farm is up and running. 

Property lists 

o Providing a list of AP lots should be relatively easy. 

o A list of NAP lands is more difficult to provide as the list is constantly changing. 

o The way that information is electronically stored by the state makes generating any list of 

DOA‐ or DLNR‐managed lands somewhat troublesome. 

C-393 


DLNR maintains the records for all such properties, but you cannot simply ask for a 

list. Typically one gives DLNR a tax map key (TMK), and DLNR advise whether the 

parcel is state managed. 

C-394

NON.AGRICULTURAL PARK LANDS PROGRAM 

LEASES FOR TRANSFER FROM DLNR. PER ACT90: SLH 2003 

v'l.0:1211112007 

ISLAND OF OAHU 

Doc No. Lessee Name TMK 

ql429B WALTER & ANN LIEW (1) 4-1-010:003-0000 

q\4297 RAMIREZ, MIGUEL & VALERIE 1\ 4-1-010:004-0000 

q13794 KAWANANAKOA. ABIGAIL K 1) 4-1-010:005-0000 

o13793 RITA. ROBERTA A.N 1) 4-1-010:006-0000 

q13764 SUGITA ENTERPRISES LTD (1) 4-1-0'10:008-0000 

q13753 S.G.V.G CORPORATION (1) 4-1-0'10:031-0000 

015657 MIYASHITA, ED K. 1\ 4-1-010:037-0000 

o13787 YEE, WARREN Q.K. & ELLEN 1\ 4-1-010:038-0000 

o13858 YEE, WARREN Q K. & ELLEN 1) 4-1-010:039-0000 

o13758 GRIFFIN, GLENN & KELLY 1) 4-1-010:041-0000 

o13759 ULTIMATE INNOVATIONS, INC 1) 4-1-010:042-0000 

o13760 TANAKA. KANAME & ETHEL (1\ 4-1-010.043-0000 

q13761 WINDWARD PLANTS COMPANY (1\ 4-1-010 044-0000 

q15707 ALL TREE SERVICES, INC. (\ 4-1-010:048-0000 

q15496 PROGRESSIVE LANDSCAPI NG. INC (1) 4-1-010:081-0000 

q15214 GREEN THUMB, INC (1\ 4-1-018:040-0000 

q15328 GREEN THUMB, INC 1) 4-1-018:047-0000 

q15643 VAHEY. PATRICK 1) 4-1-018:051-0000 

o13856 ALATINI, HEMALOTO & LEONA 1) 4-1-024'023-0000 

o14009 CHAR HUNG SUT FISH FARMS. INC. 1\ 4-1-024.054-0000 

o13860 HAWAIIAN SUNSHINE NURSERY (1\ 4-1-024.62, & 63 

o13859 OKABE. FAITH KIYOKO 1\ 4-1-025.22. &23 

q14133 

o13782 

RYAN. JR.. JOSEPH & TAMARA 

SANANIKONE, PUONGPUN 

1) 4-1-026.015-0000 

'l) 4-1-026:017-0000 

q13780 CAVASSO, CAMPBELL 1) 4-1-026 01 9-0000 

q14011 MATSUMOTO, TRUSTEE. MATSUKO 1) 4-1-027 004-0000 

o13779 SHARON'S PLANTS LTD 1\ 4-1-027.006-0000 

o13778 SHARON'S PLANTS LTD 1\ 4-1-027'007-0000 

q13777 SHARON'S PLANTS LTD 1\ 4-1-027.008-0000 

q15577 STATE OF CALIFORNIA 1) 4-1-027'.009-0000 

o13774 41-672 CORP. 

AKAMAI LANDSCAPE & MAINTENANCE 

1) 4-1-027'010-0000 

915658 SVC INC (1\ 4-1-027 .011-0000 

q13776 CHAILLE, CLAUDIA M 1) 4-1-027'.012-0000 

o15708 LANDSCAPE HAWAII 1\ 4-1-027.016-0000 

q15168 AKAMAI LANDSCAPING & 1\ 4-1-027 .018-0000 

q13771 PACIFIC FOLIAGE INC 1) 4-1-027'.019-0000 

q14007 ALOFA CORP (1) 4-1-027'.23, &24 

q13770 IKENE. HIROSHI & SALLIE 1) 4-1-027'025-0000 

o13769 CHANG, MUN ON & ROSALIND 1\ 4-1-027.026-0000 

o13768 KAWABATA, STANLEY S. 1) 4-1-027'027-0000 

q13767 YAMADA, KAZUTO & AYAKO n\ 4-1-027:028-0000 

q13766 UKUI, RODNEY H. & IRIS T. (1) 4-1-027:029-0000 

ql55'16 SEKIYA, FRANK F (1) 4-1-027:030-0000 

(1) 4-1q15368 

ALOHA FIRST 

1 0:80,96,97,98,99 

o14877 SUGITA. TOSHIO & K. IBARA 1) 8-5-005:009-0000 

C-395

ISLAND OF HAWAII 

v1.0i 1211112007 


o14446 EUNICE NURSERY, INC, H (3 2-4-049-002-0000 

q14637 PANAEWA TROPICALS, INC. (3 2-4-049:004-0000 

q14366 MAYEDA. PAUL H & MAXINE N. (3 2-4-049:006-0000 

o14447 HUNTER, DONALD J. & CAROLYN (3 2-4-049:007-0000 

q14638 BIG ISLAND PLANT & FOILAGE. INC. (3 2-4-049 009-0000 

o14455 PALMS, INC. (3 2-4-049:010-0000 

q|4225 KITAGAWA. MITSUO & YAEKO (J 2-4-049.011-0000 

o14456 GERVAIS. JR. JULES & SOONTAREE (3 2-4-049'.012-0000 

s14364 PUNA CERTIFIED NURSERY. INC. (3 2-4-049.017-0000 

q14634 HUNTER, DONALD & CAROLYN (3 2-4-049:020-0000 

q15615 HAWAI I FOILAGE EXPORTS, INC (J 2-4-049.021-0000 

q14636 CKAZAKI, RONALD TAKEHIKO (3 2-4-049.022-0000 

q15540 BIG ISLAN D AGRICULTU RAL (3 2-4-049.024-0000 

o14445 GREEN POINT NURSERIES, INC (3 2-4-049'026.27 .28 

q14205 FLOWERS INCORPORATED (J 2-4-049:031 -0000 

q|4632 PUNA CERTIFIED NURSERY, INC IJ 2-4-049:032-0000 

q14548 PENOVAROFF. JR . ALEXANDER (J 6-6-005:021 -0000 

q14549 HIRAKO FARMS, INC (3 6-6-005:026-0000 

o15510 SEASIDE. INC (3 2-1-016:001-0000 

nl6A?Q MOUNTAIN MEADOWS, INC (J 2-2-056:020-0000 

q15549 HAMAKUA-NORTH H LO AGR COOP (J 4-4-001:-001 -0000 

q15551 HAMAKUA-NORTH H LO AGR. COOP (J 4-6-003 1.2. &20 

q15553 HAMAKUA-NORTH H LO AGR COOP (J 4-3-003:2,3,4,5,6,7 

q15554 HAMAKUA-NORTH H LO AGR. COOP (3 4-6-001 7.8. & 18 

o15567 SALFEN, SCOTT JAMES (3 1-2-006.073-0000 

ro7024 TROPICAL HAWAIIAN PRODUCTS (3 1-2-006:015 & 016 

re7173 RANDOLPH SOLOMON (J 4-6-002:001-0000 

ro7174 J.J. ANDRADE SLAUGHTHOUSE (J 4-6-002:007-0000 

ro7370 DIAMOND HEAD PAPAYA CO (3) 1-3-002:099 & 12Por 

ISLAND OF MOLOKAI 

s!4340 AKEA FARMS. INC (2) 5-2-001:009-0000 

o14372 USDA-NRCS (2) 5-2-001:007-0000 

ISLAND OF KAUAI 


q15367 SUNKISS SHRIMP LTD (4\ 1-2-002 022-0000 

q14654 SYNGENTA SEEDS. INC Q\ 1,2-002.035-0000 

q15470 PIONEER HI-BRED NTERNATIONAL (4\ 1-2-002'.043-0000 

q14741 PIONEER HI-BRED NTERNATIONAL (4) 1-2-2'1,42 

ql4913a PIONEER HI-BRED NTERNATIONAL (4) 1-2-2 1,6 

q14938 NONAKA, DEAN H & NICOL U. (4) 1-9-001 :003 

q151 13 NONAKA, DEAN H & NICOL U (4) 1-9-001 014-0000 

ro7317 CHU, HELEN B.H (4) 1-9-002.019-0000 

nl?OAfl MIYABARA, HITOSHI & HATSUE (4) 1-9-2'1,20 

rp7366 MONSANTO COMPANY (4) 1-9-2.13,45 

rp7045 NAGAMINE. SHOICHI (a) 1-9-003:006-0000 

rp7342 N4ISSION, FRANCIS P AND LAURA (4) 1-9-003.010-0000 

ro7259 SANTOS, FRANK & ABIGAIL (4) 1 -9-7 "5,7,28,29, 30 

q15397 CORR. RICHARD (4) 1-9-012'.028-0000 

q15480 NISHEK, LELAN & BARBARA (4) 4-4-002"031-0000 

C-396

ISLAND OF MAUI 

v1.0;1211112007 


rp5932 KANOA. JR. ISAAC (2) 1-1-003.028-0000 

ql421O KIMOKEO, LINCOLN ALIILOA (2) 1-1-003.059-0000 

o14209 DANLEY DEANNA (2) 1-1-003.070-0000 

ro7327 KANOA. ISAAC A & GLADYS R. (2) 1-1-3.33,43,44 

rp6229 KAAUAMO, JR, SOLOMON & HANNAH (2) 1-1-4:13,30 

(2) 1-1- 

5.17,25,34,41,45,54, 1 -1 

rp6721 YOUNG, JOSEPH H 

6.70 

rp5231 YOUNG, JOSEPH (2) 1-1-005:036-0000 

rp6821 DAY. JOSEPH J (2\ 1-1-006:038-0000 

rp7305 MARTIN. JR.. NORMAN D (2) 1-1-6.41,43 

r14016 MAHEALANI FARMS, INC (2) 1-3-4'6,20 

r13857 EADE. COILA (2) 1-4-003 001-0000 

r15310 FRELINGHUYSEN, PETER H B (2) 1-6-007:010-0000 

'p6602 BOWMAN. MISHA (2) 1-6-009:017-0000 

'p6750 HERTZ, M D. & MRS. HERTZ, RALPH (2\ 2-1-005.122-0000 

'p6649 FLECK, JR , PHILIP & GLORIA (2\ 2-2-017:017-0000 

115614 OTANI. BRYAN (2)2-3-003:006-0000 

t14272 MILNER. MICHAEL P (2\ 2-7-008.015-0000 

o14519 DAVID KAPRALIK (2) 2-7-015:026-0000 

ro6180 BROWNE, SUSAN & ROAN (2\ 2-9-001:020-0000 

rp6690 PALOMINO, ANNA MARIE & D BOWKEFI (2\ 2-9-001:033-0000 

'o7268 DORRIS, STEPHEN (2) 2-9-003:008-0000 

'p6766 LOOMIS JAMES C. (2) 2-9-003:040-0000 

r15587 ELLIS, INC (2) 2-9-5 20,32 

rlSAQQ HUI O MOKUPAPA (2) 2-e-6 2 22.23.24 

"p5402 HOOPII, RICHARD (2) 3-1-004:1 16-0000 

rp5214 A&B-HAWAII, INC. (2) 3-8-001:046-0000 

rp5485 A&B-HAWAII, INC (2) 3-8-003:022-0000 

'p7382 MAUI PINEAPPLE COMPANY, LTD (2) 4-4-4.9,11,1e 

C-397

PROPERTIES TRANSFERRED FROM DLNR TO HDOA BY GOVERNOR'S EXECUTIVE ORDER 

as August 9,20L2 

OAHU HAWAII 

TMK 

(1 ) 4-1-009:269-0000 

(1) 4-1-010:003-0000 

(1) 4-1-010:004-0000 

(1) 4-1-010:005-0000 

(1\ 4-1-010:005-0000 

1) 4-1-010:006-0000 

(1) 4-1-010:006-0000 

(1\ 4-1-010:007-0000 

(1\ 4-1-010:007-0000 

(1) 4-1-010 008-0000 

(1\ 4-1-010 008-0000 

(\ 4-1-010:026-0000 

1) 4-1-010:029-0000 

(1\ 4-1-010:030-0000 

(1\ 4-1-010:030-0000 

(1\ 4-1-010:031-0000 

(1) 4-1-010.031-0000 

1) 4-1-010:034-0000 

(\ 4-1-010:034-0000 

(1) 4-1-010:037-0000 

(1\ 4-1-010:037-0000 

(1) 4-1-010.038-0000 

(1) 4-1-010:038-0000 

(1\ 4-1-010.039-0000 

(\ 4-1-010:039-0000 

(1) 4-1-010:040-0000 

(1\ 4-1-010:04'l-0000 

(1\ 4-1-010 042-0000 

(\ 4-1-010:043-0000 

(1\ 4-1-010 044-0000 

1\ 4-1-010:046-0000 

1) 4-1-010.048-0000 

(1 ) 4-1-010:080-0000 

(\ 4-1-010:081-0000 

(\ 4-1-010:088-0000 

(1) 4-1-010:096-0000 

(1) 4-1-010:097-0000 

1) 4-1-010:098-0000 

n) 4-1-010 099-0000 

(1) 4-1-018:040-0000 

(1) 4-1-018:047-0000 

(1) 4-1-018:051-0000 

1) 4-'1-018:048-0000 

(1) 4-1-024"023-0000 

(1\ 4-1-024'054-0000 

(1) 4-1-024'.062-0000 

TMK 

(3) 1-2-006.015 & 016 

(3) 1-2-006:073-0000 

(3\ 2-1-016:001-0000 

(3) 2-2-056.020-0000 

(3\ 2-4-049.002-0000 

(3) 2-4-049:004-0000 

(3)2-4-049:006-0000 

(3) 2-4-049.007-0000 

(3) 2-4-0a9:009-0000 

(3\ 2-4-049 010-0000 

(3) 2-4-049:01 1-0000 

(3) 2-4-0a9:012-0000 

(3) 2-4-049:017-0000 

(3) 2-4-049:020-0000 

(3) 2-4-049:021-0000 

(3) 2-4-049:022-0000 

(3) 2-4-049:023--0000 

(3\ 2-4-049.024-0000 

(3) 2-4-049:031-0000 

(3) 2-4-049:032-0000 

(3) 2,4-049.026-0000 

(3) 2-4-049:027-0000 

(3) 2-4-049:028-0000 

(3) 4-3-003:002-0000 

(3) 4-3-003:003-0000 

(3) 4-3-003:004-0000 

(3) 4-3-003:005-0000 

(3) 4-3-003:006-0000 

(3) 4-3-003:007-0000 

(3) 4-4-001 :001-0000 

(3) 4-6-001:007-0000 

(3) 4-6-001 008-0000 

(3) 4-6-00'1 :0'1 8-0000 

(3) 4-6-002:001-0000 

(3) 4-6-002:007-0000 

(3) 4-6-003:001-0000 

(3) 4-6-003:001-0000 

(3) 4-6-003 020-0000 

(3) 4-7-004 009-0000 

(3) 5-5-007.005-0000 

(3) 6-6-005:021-0000 

(3) 6-6-005:026-0000 

(3) 6-6-005:028-0000 

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MAUI 

TMK 

z 1-1-003:028-0000 

2 1-1-005:017-0000 

I 1- 1-005:025-0000 

z 1-1-005:034-0000 

2 1- 1-005:036-0000 

2 1-1-005:041-0000 

2 r L-005:045-0000 

I l- 1-005 :054-0000 

2 1- 1-006 :070-0000 

2 l-3'004:006'0000 

2) 1 3--004:020-0000 

I 2-3-003:006-0000 

MOLOKAI 

TMK 

(2)5-2-001:007-0000 

(2)5-2-001:009-0000 

KAUAI 

TMK 

4) 1-2-002:001'0000 

41 1-2-002:O01-0000 

4) 1-2-002:006-0000 

4l I-2-OO2:022-0000 

4) 1 2-002:035-0000 

41 1-2-OO2:042-0000 

41 1.-2-002:043-0000 

4) 1-9-002:001-0000 

4) 1-9-002:013-0000 

41 L-9-002:020-0000 

4\ I-9-OO2:045-0000 

41 1,-9-OI2:028-0000 

4) 4-3-004:001--0000 

4) 4-3-004:014-0000 

4) 4-3-004:017-0000 

4) 4-4-002:031-0000 

4) 4-4-004:004-0000 

4) 4-4-004:005-0000 

4) 4-4-OO4:043-0000 

41 4-4-OO4:O44-0000 

4) 4-4-004:051-0000 

4) 4-6-005:011-0000

(1) 4-1-024.063-0000 

(1\ 4-1-025.022-0000 

(1) 4-1-025:023-0000 

(1) 4-1-025'.057-0000 

(1) 4-1-026.015-0000 

(1) 4-1-026.017-0000 

(1) 4-1-026.018-0000 

(1) 4-1-026:019-0000 

(1) 4-1-027:001-0000 

(1) 4-1-027.002-0000 

(1\ 4-1-027.004-0000 

(1\ 4-1-027.006-0000 

(1\ 4-1-027.007-0000 

(1) 4-1-027.008-0000 

(1) 4-1-027'.009-0000 

(1) 4-1-027 .010-0000 

(1) 4-1-027 .01 1-0000 

(1) 4-1-027:012-0000 

(1) 4-1-027 018-0000 

(1) 4-1-027 019-0000 

(1) 4-1-027.025-0000 

(1\ 4-1-027 026-0000 

(1) 4-1-027'027-0000 

(1\ 4-1-027.028-0000 

(1) 4-1-027:029-0000 

(1) 4-1-027:030-0000 

(1) 5-6-006:056-0000 

(1) 5-6-050:018-0000 

(1 ) 8-5-005:009-0000 

(1) 9-4-012.001-0000 

(1) 9-4-012.002-0000 

(1 ) 9-4-012.003-0000 

C-399

C-400

C-401

C-402

C-403

C-404

C-405

C-406

C-407

C-408

C-409

C-410

C-411

C-412

C-413

C-414

C-415

C-416

C-417

C-418

C-419

C-420

C-421

C-422

C-423

C-424

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C-426

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C-428

Increase Markets and Product Value 

Bridge sanitary and phytosanitary barriers to markets 

-approved treatments for mainland and foreign markets 

-coordinate approval efforts with marketing efforts 

PI, ADD, QAD 

Promote Hawaii products in local, domestic and foreign 

markets 

ADD, ADP 

Establish analytical, diagnostic, and inspection services to 

assure safe and high quality products and fair commercial 

practices 

ADP, QAD, AI 

Provide tools to assist marketing and add value 

-branding, truth in labeling, statistics, market intelligence 

ADD, MS, QAD 

Provide market research and analysis to identify new 

opportunities to produce agricultural products for different 

markets 

ADD 

Address transportation issues 

Ad hoc: ADD, AI, Admin., PI, 

Hawaii Department of Agriculture 

Overview of Strategic Plan 

Updated December 16, 2008 

Admin = Chairperson’s Office AI = Animal Industry Division 

ADC = Agribusiness Development Corporation MS = Measurement Standards Branch 

ADD = Agriculture Development Division PEST = Pesticides Branch 

ADP = Aquaculture Development Program PI = Plant Industry Division 

Ag Loan = Agricultural Loan Division QAD = Quality Assurance Division 

-1- 

C-429 

Increase Production Value 

(volume, profitability, crop) 

Tighten biosecurity to protect agriculture, environment and 

human health 

-prevent introduction; control or eradicate diseases and 

pests affecting livestock, aquaculture and crops 

AI, ADP, PI, Admin 

Facilitate development of value added products and other 

activities to increase farm income; strive to achieve the 

most efficient and productive use of the state’s lands to 

attain the state’s food and energy objectives. 

ADD, ARM, Admin. 

Assure land, water and financing for farming 

ADC, Ag Loan, ARM, Admin. 

Provide tools needed for production agriculture 

-pesticides, risk management, disaster response/recovery 

ADD, Ag Loan, AI, Admin., ARM, PEST. 

Support research to solve production problems, improve 

varieties and performance 

ADC, ADD, PI 

Address labor and agriculture worker housing issues 

Ad hoc: ADC, ADD, Admin. 

Lead and co-lead divisions for the accomplishment of goals and objectives are identified in bold font, support divisions are identified in regular 

font.


Strategic Plan 

Updated December 16, 2008 

Mission: To lead the State’s effort to maintain the agricultural sector of Hawaii’s economy, including livestock 

production, forestry, crops and aquaculture, in a strong and competitive condition by providing policies, 

services, loans, subsidies, environmental protection, land and water, operations, facilities, advice, coordination, 

and information so as to achieve appropriate rates of growth, high levels of employment, reasonable returns on 

investment, and steady gains in real personal income. 

Goal 1 


Objective 1: 

Bridge Sanitary And Phytosanitary Barriers To Markets 

Activities: 

Negotiate export agreements for specific products and 

markets; 

Facilitate discussions for a private sector development of a 

second irradiator in Hawaii to be located on Oahu; 

Identify industry needs for export and import phytosanitary 

requirements; 

Facilitate discussion between the United States Department 

of Agriculture and the private sector for the use of a private 

treatment facility for the sterilization of fruit fly pupae; 

Establish a data management system (“Invicta”) to more 

efficiently track the movement of pests from foreign, domestic 

and island sources to strengthen Export Certification 

Programs; 

-2- 

C-430 

Objective 1: 

Goal 2 


Tighten Biosecurity To Protect Agriculture, Environment 

And Human Health 

Activities: 

Establish a joint use inspection facility at Honolulu 

International Airport for the inspection of agricultural products 

and other regulated commodities by State and Federal 

Quarantine Programs; 

Establish a system of transition inspection facilities for sea 

containers to assure the more efficient handling and 

inspection of cargo arriving in Hawaii from domestic ports; 

Assign and advance dairy and beef herds in the Voluntary 

Johne's disease (VJD) control and status program; 

Control and reduce the prevalence of bovine tuberculosis 

(BTB) in feral swine; 

Conduct surveillance for high impact disease agents, i.e., 

avian influenza, West Nile and classical swine fever viruses, 

by performing pathological examinations and collecting 

appropriate specimens for laboratory testing; 

Register livestock premises as part of the National Animal 

Identification System to facilitate rapid disease trace back; 

Conduct statewide surveys to delineate infestations of 

regulated pests for control or eradication.

Goal 1 


Objective 1: (continued) 

Develop food safety certification procedures and standards 

and assist producers to incorporate them into their daily 

operations; 

Assist Kauai papaya farmers to reopen the Kauai Tropical 

Fruit Disinfestation Facility; 

Contain, control and/or eradicate plant pests that enter the 

state through chemical and mechanical means or through 

biocontrol strategies; 

Seek federal and private sector funding to conduct foreign 

explorations to search for and introduce potential biocontrol 

agents of targeted weeds and plant pests; 

Upgrade biocontrol facilities and/or investigate the potential 

for building new modernized facilities to increase the 

biocontrol program’s capabilities to respond to new emerging 

and established pests. 

Objective 2: 

Promote Hawaii products in local, domestic and foreign 

markets 

Activities: 

Develop and promote the Hawaii Food Safety Center website 

to assist buyers seeking food safety certified supply chain 

members and products; 

Facilitate development of higher-end farmers’ markets to 

showcase the high quality of Hawaii’s agricultural and valueadded 

products; 

Conduct sales generating activities in selected target or niche 

markets with the highest demand for selected agricultural 

products and value-added processed products in local, 

domestic and international markets; 

Continue the Hawaii Export Readiness Training (ERT) 

Program. 

-3- 

C-431 

Goal 2 


Objective 1: (continued) 

Reduce the risk of Brucella suis infections in domestic swine 

herds and maintain Hawaii’s Swine Brucellosis Free status in 

domestic swine; 

Expand the aquatic animal broodstock and seedstock 

products segment of the aquaculture industry; 

Apply new information on rabies virus and public policy to 

analyze the quarantine program and respond to needs of 

users and the general public. 

Objective 2: 

Facilitate development of value added products and other 

farm income activities; support energy and food security 

Activities: 

Develop open ocean aquaculture; 

Develop the freshwater and marine aquarium products 

segment of the aquaculture industry; 

Support and sustain the livestock industries in Hawaii; 

Continue to administer the livestock feed reimbursement 

program; 

Facilitate development of ag-tourism as a complementary 

activity to farming.

Goal 1 


Objective 3: 

Assure safe and high quality products and fair 

practices 

Activities: 

Identify and implement technologies designed to provide food 

safety traceability, risk assessment and certification for 

farmers, distributors, shippers and retailers; 

Implement more efficient and accurate measurement 

technologies to increase consumer confidence; 

Establish recall procedures in the event of bioterrorism or 

other bacterial or chemical contamination; 

Create hybrid internet system designed to reduce on-line 

advertising costs; 

Register livestock premises according to requirements of the 

National Animal Identification System (NAIS) to facilitate 

trace back of animals. 

-4- 

C-432 

Objective 3: 

Goal 2 


Assure land, water and financing for farming 

Activities: 

Actively manage lands transferred from DLNR to DOA under 

the Non-Agricultural Parks program; 

Identify, transfer, and manage important public agricultural 

lands and additional public agricultural lands within the 

Agricultural Parks and Non-Agricultural Parks programs; 

Monitor the Galbraith Estate land purchase and support the 

land acquisition for agricultural purposes; 

Improve the reliability, capacity, and operational efficiency of 

existing state operated irrigation systems and appurtenances; 

Explore the development of new or additional water sources 

for activation during emergencies or drought; 

Increase the utilization rate of lands within the existing 

Agricultural Parks program and develop the Kunia 

Agricultural Park; 

Increase the overall number of loans and dollar amount 

loaned over time and to increase private lenders’ involvement 

in participation loans; 

Create or preserve a minimum of 100 

agricultural/aquacultural jobs and expand or preserve 250 

acres of agricultural lands annually. Generate $3,000,000 in 

annual farm income from new borrowers.

Goal 1 


Objective 4: 

Provide tools to assist marketing and add value 

Activities: 

Identify agricultural products (or groups) with high revenue 

growth potential and related target or niche markets; 

Provide timely, accurate and useful statistics of Hawaii’s 

agriculture to support production, marketing, policy, planning 

and research functions; 

Promote the Seals of Quality program to protect Hawaii’s 

brand cachet in local, domestic and international markets; 

Expand the Buy Fresh, Buy Local call-to-action campaign to 

raise awareness and increase consumption of local produce 

by local consumers and visitors. 

-5- 

C-433 

Objective 4: 

Goal 2 


Provide tools needed for production agriculture 

Activities: 

Manage pesticides use to minimize environmental effects and 

maintain important pesticides uses. 

Promote AGR-Lite insurance program; 

Complete repairs to the irrigation systems damaged by natural 

disasters.

Goal 1 


Objective 5: 

Provide market research and analysis to identify new 

opportunities to produce agricultural products for different 

markets 

Activities: 

Provide relevant market reports, analyses and other pertinent 

information to support understanding of agricultural 

commodity markets. 

Objective 6: 

Address transportation issues 

Activities: 

Explore and identify various consolidation and distribution 

venues to deliver products to identified target or niche 

markets in the most efficient manner; 

Expedite and simplify procedures for the movement of dogs 

and cats to and from the State. 

-6- 

C-434 

Objective 5: 

Goal 2 


Support research to solve production problems, improve 

varieties and performance 

Activities: 

Facilitate continuation and expansion of Federal/State 

sponsored offshore aquaculture research on species, 

systems, environmental impacts and economic benefits; 

Continue the matching fund program request for proposal 

(RFP) process to attract a larger pool of research funding 

applicants and to ensure greater effectiveness, transparency 

and accountability; 

Fund research to enable informed decision-making on 

pesticides potential to leach into the water supply; 

Support research for the development of a tea industry on the 

Big Island. 

Objective 6: 

Address labor and agriculture worker housing issues 

Activities: 

Facilitate discussions with federal, county, state, and nonprofit 

organizations concerned with rural housing; 

Partner with organizations to establish agricultural housing 

units; 

Coordinate with DLIR in identifying pools of available farm 

labor.

Mission Statement 

Agribusiness Development Corporation (ADC) 

Strategic Plan 

October 15, 2008 

The mission of the Agribusiness Development Corporation (ADC) is to acquire, and 

manage in partnership with farmers, ranchers, and aquaculture groups, selected highvalue 

lands, water systems, and infrastructure for commercial agricuitural use and to 

direct research into areas that will lead to the development of new crops, markets, and 

lower production costs. 

Goal 1: Transition 

former plantation land 

and water systems for 

diversified agriculture. 

Objective 1: Acquire and 

manage selected highvalue 

agriculture lands, 

water systems, and 

infrastructure. 

Objective 2: Acquire 

agricultural conservation 

easements to protect 

certain valuable 

agriculture lands. 

Objective 3: Organize 

farmers and users into 

cooperatives to coordinate 

their common interest and 

collective efforts. 

Objective 4: Form 

subsidiaries to create 

private and public 

partnership. 

Goal 2: Initiate 

development of facilities 

and provide support as 

necessary for successful 

diversified aqricu lture. 

Objective 1: Assist in the 

acquisition or construction of 

processing and/or treatme,nt 

facilities to enhance 

producers' ability to take 

advantage of export or value- 

added opportunities. 

Objective 2: Inform, educiate 

or train farmers on various 

areas to include food safelly, 

pesticide application, 

production techniques, ag 

theft, and land issues. 

Objective 3: Coordinate and 

cooperate with other 

government agencies, 

educational institutions, or 

private organizations to 

advance aqriculture. 

C-435 

Goal 3: Provide 

solutions to certain 

bottleneck issues facing 

the agriculture industry. 

Objective 1: Conduct 

research and 

demonstrative projects to 

facilitate the transfer of 

knowledge or technology. 

Objective 2. Conduct 

economic and feasibility 

studies relating to 

agriculture.

ADC Strategic Plan, Page 2 of 9 

10t15t2008 

Background 

The Agribusiness Development Corporation (ADC) was established pursuant to Act 

264, SLH 1994 to coordinate the development of Hawaii's agricultural industry and to 

facilitate its transition from a dual-crop (sugar and pineapple) industry to a diversified, 

multi-crop and animal industry. More specificallv, ADC is responsible for devising 

means by which arable sugar and pineapple lands and their production infrastructure 

can be used again by a diversified agricultural industry and for providing marketing 

assistance that can lead to the development of local, national, and international markets 

for Hawaii-grown products. 

ADC's enabling legislation, HRS Chapter 163D, was written with a broad purpose to 

promote agribusiness development. Certain exemptiorrs and powers were given to 

allow ADC to expedite projects and act more like the private sector. Some of the 

exemption and powers include the following: 

. Being a state agency and allowed to be convert,ed to a private non-profit 

organization 

o Exemption from HRS Chapter 171(public lands) 

. Exemption from the Public Utilities Commission regulations 

o ExernFtion from civil service 

o lssue bonds 

. Form subsidiaries 

. Acquire real and personal properties 

A Board of Directors consisting of 3 ex-officio and 8 private-sector members appointed 

by the Governor heads ADC. For administrative purposes, ADC is attached to the 

Hawaii Department of Agriculture. 

Vision 

Values 

ADC contributes to the diversification of the Hawaii's economy by providing the 

necessary basic ingredients, such as land and water, for the agricultural industry 

to succeed 

ADC creates management models to handling liarge tracts of agricultural lands 

and infrastructure 

ADC demonstrates the use of leading edge tecl'rnology to control, direct, and 

measure water flows; protect irrigation systems and structure; and minimize 

system losses 

ADC provides solutions to solve bottleneck issures relating to agriculture. 

. Always see the big picture 

. Entrepreneurialspirit 

C-436



o Fair 

o Innovation 

o Stewardship 

Key Strategies, the ADC approach 

ADC specializes in the management of irrigation systems and the handling of large 

tracts of agricultural land. Our flexibility also allows us to work with and form alliances 

with many and to do research and demonstrative projects on a wide variety of topics. 

Although Chapter 163D, HRS allows ADC to be involved in many areas to assist with 

the development of agriculture, ADC faces challenges on (1) having limited resources, 

and (2) duplicating efforts of other state agencies or non-profit organizations. Unless 

required by law, ADC strongly believes that it should orrly take on projects based on one 

or more of the following criteria. 

1. The project requires the unique advantages available through ADC; 

2- ADC brings value to the project because of our r;tate agency status, resources or 

expertise; 

3. ADC is in a position to help others by facilitating or filling in a niche; 

4. The project is or has the potential to become finiancially self-sustaining; 

5. The project has a major economic impact or could benefit many; 

6. The project has long-term value. 

Some of the characteristics of ADC projects: 

1. Every project is treated differently or uniquely to optimize its potential; 

2. Users are often organized into Cooperatives to coordinate their common interest 

and collective efforts; 

3. ADC assets are often managed, operated, and rnaintained by Coops or nonprofit 

organizations; 

4- Sometimes our efforts may only have a narrow and regional audience, rather 

than appealing to all farmers statewide. 

Project Selection Criteria: 

1. The project requires the unique advantages available through ADC; 

2. ADC brings value to the project because of our:;tate agency status, resources or 

expertise; 

3. ADC is in a position to help others by facilitating or filling in a niche; 

4. The project is or has the potential to become financially self-sustaining; 

5. The project has a major economic impact or could benefit many; 

6. The project has long-term value. 

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Summary and Description of Current projects 

Goal 1. Transition former plantation land and water systems for diversified 

agriculture. 

objective 1: Acquire and manage selected high-value agriculture lands, water systems, 

and infrastructure. 

Objective 2: Acquire agricultural conservation easemernts to protect certain valuable 

agriculture lands. 

Objective 3. Organize farmers and users into cooperatives to coordinate their common 

interest and collective efforts. 

Waiahole Water System (VVWS). Pursuant to Act 1 1 1 , SLH 1998, ADC purchased the 

Waiahole ditch from Amfac JMB/Hawaii in 1999 as Oalru Sugar Company, the former 

operator of the ditch, ceased its operations a few years earlier. The system has daily 

usage of about 5 million gallons of irrigation water distributed to 5,600 acres of land on 

central Oahu. lt was estimated that the agribusinesses; that use WWS water collectively 

generated an agricultural production value of approximately $95 million per year and 

employed about 2,000 individuals based on 2000 statis;tics. With Del Monte's departure 

from the island, ADC worked with the landowner, the Kunia Water Cooperative and the 

various agencies to transition the land from pineapple, plantation-style operation to 

diversified agriculture. The recent acquisition of thousands of acres of agriculture land 

from Campbell Estate by various agribusinesses has h,elped to ensure that these land 

parcels in Kunia will continue to stay in agriculture. 

As a result of the Waiahole Combined Contested Case, the \AA//S is required to provide 

flow data and usage information to the Commission on Water Resource Management 

monthly. A water use permit for system loss was also ir;sued to ADC. 

Upon taken control of the ditch system, ADC has replaced three deteriorated wooden 

siphons and performed many repairs on various parts of the system. ADC is currenly 

working with the U.S. Army Corps of Engineers and ther Hawaii Department of 

Agriculture (HDOA) to line Reservoirs 155 and 225 wittr a non-permeable liner under a 

65/35 cost-sharing arrangement between the federal government and the state. Since 

Reservoir 155 has a regulated dam, all repairs and alte,rnation work must first be 

approved by the Department of Land and Natural Resources (DLNR). lt was estimated 

that the cost of lining the reservoirs wourd be around $6 million. 

Kekaha Ag Land and Infrastructure. As Kekaha Surgar Company ceased its 

operations in 2001 , ADC has since been involved in the management of the 12,500 

acres of state-own agricultural land and related infrastrr.rcture including two irrigation 

systems, an extensive drainage system fitted with two pump stations, an electrical 

C-438



system with two hydroelectric plants, and many miles of roadways. ADC is also 

responsible for the integrity and safe operation of threer reservoirs/dams which are part 

of the irrigation system infrastructure. In 2005, ADC wias awarded a 3-year contract 

from the Navy to operate and maintain the pump stations and drainagscanals within the 

Pacific Missile Range Facility (PMRF). A new S-year contract was awarded to ADC in 

September 2008 for similar work. 

From 2001 to 2005 ADC completed about $4.5 million of projects to refurbish a 

hydroelectric plant, replace six drainage pumps, strengthen the pump station structure, 

replace transformers and improve the drainage channerls at or near Kekaha. These 

improvements, funded by the U.S. Navy, were critical irr controlling and reducing the 

severity of flooding at the Mana plain and the nearby Kekaha town. By taking on tfris 

responsibility, ADC has helped to lower the overall maintenance expenses for the 

Kekaha common infrastructure and make farming affordable in this area. 

ADC formally assumed management responsibility of tlhe Kekaha agricultural lands in 

late 2003 when Executive Order No. 4007 was executeld. Subsequenily ADC has 

executed an agreement with the Kekaha Agriculture As;sociation (Coopj for the 

operation and maintenance of the common infrastructure and issued long-term land 

licenses to several of the tenants. A combination of favorable climate, tertite soil, and 

availability of water makes Kekaha one of the most productive farming areas in the 

state. An economic analysis performed by the HDOA estimated the farm gate value of 

crops produced at Kekaha between $35-50 million. 

Kalepa Lands. The Kalepa lands reverted back to DL.NR management when Lihue 

plantation ceased its operation in 2001. Revocable permits were issued to various 

ranchers and farmers on a temporary basis. At its March 18, 2005 meeting, the ADC 

Board agreed to accept the Kalepa property and the Eerst Kauai water system as a 

project when the water users and tenants approached ,ADC. 

ln 2007 , the Green Energy Team, LLC, proposed to talle 2,000 acres in Kalepa to grow 

albizia, an invasive species, for energy production. The proposal generated a lot of 

opposition at the Board of Land and Natural Resources; (BLNR) meeting. ADC was 

tasked to convene a series of co-existence meetings between the revoCable permit 

holders and the energy company. As a result of the meetings, the Green Energy Team 

agreed to reduce its acreage request to 1,000 acres and to grow eucalyptus, instead of 

albizia. The various tenants agreed to give up a portion of their permitted area to the 

energy project. DLNR agreed to issue new revocable permits to the various parties. 

On May 21,2008, the BLNR approved to (1) recommerrd to the governor the set aside 

of the 6,200 acres of Kalepa land to the ADC, and (2) is;sue a management right of entry 

to the ADC for the property The set aside will not take place until a previously 

approved subdivision of land to the Division of Fish and Wildl6e (DOFAW) is iompleted. 

C-439



East Kauai lrrigation System. Since 2001 ADC has provided state funding for the 

operation and maintenance of the East Kauai lrrigation System. ADC has continued to 

work with the East Kauai Water Users' Cooperative to,cperate, maintain, and improve 

the irrigation system. Although the set aside of the ditc;h system to ADC has been 

under consideration at the BLNR for sometime, it will not take place until water use and 

other issues involving hydroelectric plants of the Kauai lsland utitity cooperative (KIUC) 

are resolved. 

Kau Water Sources. When the sugar plantation departed, deterioration of the water 

system infrastructure in the Kau district has put the continued availability of irrigation 

water for agriculture in question. What makes this projrect unique is thai the irrigation 

water sources (tunnels) are on state land but the water transmission pipelines felong to 

private landowners. At the March 1,2007 meeting, the ADC Board of Director. "gr"!d 

to take on this project as it fits well into ADC's goal of preserving agricultural 

infrastructure abandoned by former plantationJ. ADC began to-woit< with the water 

users on the formation of a master cooperative which would handle management of the 

state-owned water sources and the various private watrer systems. 

At its January 11 , 2008 meeting, the BLNR approved the set aside of the various Kau 

District irrigation water sources and a management rigl'rt of entry to ADC. Before an 

executive order for the set aside can be executed, ADC needs to prepare a CAD map 

with metes and bounds descriptions of the water sources. 

Wahiawa lrrigation System. In the fall of 2006, ADC vuas approached by Dole Food 

Company, owner of the Wahiawa irrigation system (WltS), to iook at the feasibility of 

having the state (ADC) to take over the irrigation systern which services about t b,000 

acres of former plantation lands on the North Shore of ()ahu. ADC commissioned an 

engineering study of the irrigation system which includers the Wahiawa Reservoir (Lake 

Wilson), with objectives to evaluate the cost to repair the system and the potential 

liabilities if ADC decides to take on the system. 

Besides deteriorated infrastructure requiring a budget for short-term and long-term 

repairs, there are complex issues involving a high-hazard dam and water quality. A 

considerable amount of money, expertise, and effort will be needed to run this iystem. 

Negotiation between Dole and ADC is on going. 

It is estimated that the WIS service area supports about $3g million of agricultural 

production and about 635 full{ime and part-time jobs. 

Farm and Ranch Land Protection Program (FRPP). The federal Farm and Ranch 

Land Protection Program (FRPP) is funded through the farm bill and is an important tool 

for states and private entities to protect agricultur-l lands under development pressure. 

In August 2006, ADC executed an agreement with the [J.S. Department of Agiiculture,s 

Natural Resources conservation service (NRCS) and obligated $1.g million of federal 

C-440



funds for the purchase of an agricultural conservation c'asement in Kunia under this 

program. In June 2007, ADC was also able to secure $1.1 million from the Legacy 

Land Conservation fund managed by the DLNR as matching fund for the feOeral money. 

ADC continued to work with the various agencies and the landowner on issues relating 

to the purchase of the easement which is expected to r:lose in 2009. 

Galbraith Estate Land. Act234, SLH 2008, established various provisions and 

mechanisms to allow the ADC to acquire agricultural larnds and authorized ADC to 

acqulre specific agricultural lands located on Oahu and owned by the Galbraith Estate. 

The Galbraith Estate lands comprises of over 2,000 acres of prime agricultural land in 

central Oahu, including a 50oh interest in Lake Wilson. The $13 million Clp funding 

appropriated for this purchase, which needs to be released by the Governor, will be 

matched with funds from various partners including ther U.S. Army, Honolulu City and 

County, OHA, and the Trust for Public Land. 

Goal 2. Initiate development of facilities and provide support as necessary 

for successful diversified agriculture. 

Objective 1: Assist in the acquisition or construction of processing and/or treatment 

facilities to enhance producers' ability to take advantage of export or 

value-added opportun ities. 

Objective 2: Inform, educate or train farmers on various areas to include food safety, 

pesticide application, production techniques, ag theft, and land issues. 

Objective 3. Coordinate and cooperate with other government agencies, educational 

institutions, or private organizations to advance agriculture. 

Kauai Tropical Fruit Disinfestation Facility. In addition to obtaining a lease from the 

University of Hawaii (UH) for the facility, ADC refurbished and upgraoLd the treatment 

chambers, instrumentation, and the fruit-fly free packing area. ADC is managing a 

$250,000 grant-in-aid awarded to the Kauai Economic Opportunity (KEO) and continues 

to work with other partners (County of Kauai, KauaiAgriculture Development 

Corporation and CTAHR) on the training of papaya farrners/disinfestations facility 

operators and recertification of the facility. Goal is to relopen this facility so that the 

papaya farmers will have a facility to treat and pack therir papaya for exporting to 

mainland and foreign markets. 

Development of a Tea Industry. CTAHR's Tea Project Team has partnered with other 

agencies and private individuals to create a tea industry in Hawaii and to establish a 

demonstration farm and pilot processing facility at the tr/ealani Experiment Station. The 

processing facility is being used to develop and fine-tune commercial-scale processing 

methods for locally grown products, and also serves as the industry's interim pro"es.i-ng 

C-441



plant until a permanent facility is built. ADC executed ia Memorandum of Agreement 

with crAHR to provide $100,000 in funding to assist with this project. 

Goal 3. Provide solutions to certain bottleneck issues facing the agriculture 

industry. 

Objective 1. Conduct research and demonstrative projects to facilitate the transfer of 

knowledge or technology. 

Objective 2: Conduct economic and feasibility studies relating to agriculture. 

Past projects: 

Inter-lsland Transportation Study. ADC contracted'with the Manufacturing Extension 

Partnership (MEP) of the High Technology Development Corporation to conduct a study 

on inter-island transportation of agricultural products. lFocus of the study was on lessthan-container 

load cargo service and its potential impact on agriculture in the event 

that this service was discontinued. The report was cornpleted in early 2008. 

Solar Water Pasteurization Project. ADC teamed up with CTAHR to demonstrate the 

use of solar energy to disinfest irrigation water. Another objective of the project was to 

evaluate the feasibility and operating costs associated with this technology in a remote 

farm setting The demonstrative unit was assembled ernd operated at a farm in the Kula 

Ag Park on Maui in 2006. Test results showed a signif icant microbial reduction in the 

water treated by this method. lt was concluded that a solar pasteurization unit could be 

used as an alternative to chlorine, ozone, or UV treatmrents. 

Current projects: 

Animal Feed Demonstrative Project. The objective of this project is to demonstrate 

an alternative feed production method which uses locally available resources and at the 

same time mitigates normal environmental issues associated with piggery operations. 

ADC has contracted with CTAHR extension personnel in Hilo to evaluate the feasibility 

of producing animal (pig) feed using a specialty organiro fertilizer manufacturing 

machine. Raw ingredients, including green wastes, mill by-products, and slop collected 

from local restaurants are heated up and fermented with beneficial microorganisms in 

the process. The project also includes feeding trials ofthe end product against 

commercial feed at nearby farms. 

Design of a Waste Stream Management System. !\/aste disposal has become a 

challenging task for various segments of the agricultural industry. The objective of this 

project is to provide practical and holistic solutions to the sustainable reutilization of 

waste products generated from local food production. ADC agreed to assist on funding 

C-442


1 0i 1 5/2008 

the design of an anaerobic bio-digester which could be, used to handle waste stream 

from a slaughter house or other commercial sources. ,Although the design is intended 

for a facility on Maui, it could easily be used for other locations around the state. 

Browse Feeding Project. Beef production in Hawaii is currently at a crisis stage 

owing to both high feed costs which limit local finishing of cattle with imported feeds and 

high transportation costs which limit the transport of H;rwaii cattle to mainland U.S. and 

Canada feedlots. Browse feeding, a practice which has become a standard procedure 

in central and northern Queensland, Australia, is a potr:ntial long term solution for 

Hawaii. Dr James Brewbaker from CTAHR has selectr:d and improved advance 

generations of leucaena leucocephala (haole koa) for this purpose and has supplied the 

Australians with his breeding material under royalty agreements. In addition to its high 

nutrient content, leucaena's nitrogen-fixing property brings tremendous benefits to the 

pastures. 

With help from CTAHR, ADC plans on bringing experts; from Australia to conduct 

browse feeding workshops on the islands and sponsoring a trip for Hawaiian ranchers 

to visit the Australian operations in 2009. 

Mobile Slaughter House. As the cattle industry in Hawaii converted to cow-calf 

operations and shipped their calves to the mainland, tl^re infrastructure for slaughtering 

and processing livestock deteriorated over time. Most, if not all, of our facilities are old, 

obsolete, and not operating efficiently to support our lil'estock industry's efforts to 

expand local marketing. 

It was suggested that a mobile slaughter house may work for some of the smaller 

ranches on the islands and is an alternative to permanent and more costly facilities. A 

mobile slaughter house has the following advantages: (1) relatively low cost to set up 

as compared to larger permanent facility; (2) production of a higher quality meat due to 

its "stress free" environment as the cattle are slaughtered at the ranch; (3) reduction of 

cattle transportation costs; (a) the unit can be easily sold to another rancher or operator 

if the owner decides to exit the business. 

The objective of this project is to demonstrate the feasibility of slaughtering cattle in a 

mobile slaughter unit on the islands The project involves purchasing the mobile 

slaughter house, getting the necessary permits, operating the mobile slaughter house, 

conducting economic analysis, and providing recommendations to the industry. The 

demonstrative project will have rancher collaborators on Oahu, Maui, and Kauai to test 

run the unit. The concept of using a mobile slaughter house, certifiable by the USDA, 

has been successfully demonstrative at various locations on the mainland. 

C-443

Department 

of Agriculture 


An Economic 

Assessment 

of the 

Former Kekaha Sugar 

Company Land and 

Infrastructure: Its Current and 

Potential Economic Capability 

FINAL REPORT 

October 6, 2005 

By 

Mana K. Southichack, Ph.D. 


Agricultural Development Division 

Market News Section 

C-444

An Economic Assessment of the Former Kekaha Sugar Company Land and Infrastructure 


Acknowledgments 

Appreciation is extended to Mr. Alfredo Lee, ADC Executive Director, and Mr. 

Sam Lee, ADC Kauai Representative, for arranging the study and providing 

extremely helpful information. The paper also benefited from Alfredo’s 

comments on the first draft and from Mr. Mark Hudson, Director, Hawaii 

Agricultural Statistics, for clarifying HAS data and for helpful suggestions. The 

cooperation of the tenants for making the time for interviews is greatly 

appreciated. They include Mr. Charles Okamoto, Director of Finance & Property 

Management, Gay & Robinson; Mr. Kenny Chicoine of Syngenta Seeds, Inc.; Mr. 

Maurice Munechika, Treasurer and Investor, Wines of Kauai; Mr. Steven Kai, 

Plant Manager, Parent Seed-Kekaha, Pioneer; and Mr. Wally Johnson of Far West 

Ag. All errors and omissions are the author’s responsibility alone. 

Disclaimer 

All views and opinions expressed herein do not necessarily represent those of, nor 

endorsed by the Hawaii Department of Agriculture (HDOA). 

C-445 

i

Executive Summary 



Given the existing infrastructure left by the former Kekaha Sugar Company (KSC) and a 

favorable climate, the Kekaha agricultural land has considerable potential for generating income 

and employment for the people of Hawaii. 

The combined output potential of all farms, excluding Ceatech’s shrimp farm and Wines of 

Kauai, increased as a result of land acquisition by some existing tenants, from $19.5 in 2002 to 

$34.9 million in 2004 (Table 3). The actual output value in aggregate has also increased 

moderately, from a range of $14.7-$15.6 million in 2002 to a range of $16.4-$19.9 million in 

2004. Due to rapid capacity expansion, the combined actual output value as percent of its 

potential declined from a range of 75-80% in 2002 to 47-57% in 2004. Farm employment 

declined slightly over this brief period with the phasing out of the remaining sugar plantation, 

from 387 to 375 full- and part-time positions. In 2004, there were 100 full-time (19 managerial 

and professional positions, 38 skilled technical positions, and 43 hourly-paid laborers) and 275 

part-time and seasonal workers. 

Based on the land area existing tenants intend to hold, by 2010, the potential farm output in 

aggregate could grow to approximately $38.4 million, providing 60 full-time and 345 part-time 

and seasonal jobs. However, actual output could be in the range of 60-70% of its potential (in the 

2010a scenario). With the multiplier effects, farm activities originated in Kekaha’s former sugar 

land as described could contribute approximately $71 million in total to Hawaii’s Gross State 

Product (GSP) and provide about 834 full-time and part-time jobs. If the most productive 

cropland, approximately 58% of the entire 12,592 acres complex, were fully utilized (in the 

2010b scenario), the aggregate farm gate value of output could rise to approximately $50.8 

million, providing about 73 full-time and 440 part-time and seasonal jobs. With the multiplier 

effects, the Kekaha former sugar land could contribute about $95 million in total to the GSP and 

provide about 1,056 full-time and part-time jobs. 

Major advantages for farm operations in Kekaha include relatively long annual production 

period, relatively low rent, abundant and inexpensive water supply and hydroelectricity power 

generated using hydraulic power from the irrigation system. Disadvantages include a limited 

local market, relatively high input costs, and scarce skilled farm workers. The extra costs for 

shipping in the many necessary inputs and shipping out the products are major constraints for 

farming in Kauai. However, the supper ferry, which is expected to begin operation in 2007 will 

help to offset some of these costs. 

The major challenge for the managing agency is to maximize the potential of this agricultural 

production asset to generate income and employment for Hawaii’s residents. Managing the 

number and type of tenants in the Kekaha agricultural land may prove to be the most challenging 

point for the managing agency. A minimum land size requirement that is too large for leasing, 

designed to keep the number of tenants small, could result in much of the land being left idle 

while small farmers who need farm land the size less than the existing minimum requirement of 

300 acres would be left out. On the other hand, too many small, independent farms producing 

diversified products in a given region could create logistical problems associated with pest 

control, which could affect crop yields in the whole area as well as food safety. 

C-446 

ii

Table of Content 



1. Introduction 1 

2. Historical Background and Description of the Land 1 

Page 

Changes in Employment and Crops since the Plantation Closure 2 

3. Kauai’s Competitive Products 

Competitiveness Based on Yield 

Revealed Competitiveness 

4. Economic Potential of the Kekaha Former Sugar Land 7 

Estimation Method 

Direct Potential Economic Contributions 

Total Potential Economic Contributions 

5. Constraints and Challenges 

Advantages and Disadvantages 

Diversification Constraint 

Cost Constraint 

Market Constraint 

Potential Water Shortages and Floods 

The Unexpected 

6. Conclusion 16 

Interviews 

References 

Appendix 1 Kauai’s Agricultural Production and Yield in Comparison with State’s 

Average Yield for Selected Commodities 

Appendix 2 Commodity Briefs 

Appendix 3 County Comparison: Farm Characteristics, Expenses and Income in 2002 

Appendix 4 Technical Notes on Estimation Method 

C-447 

3 

3 

5 

8 

9 

11 

11 

12 

12 

13 

13 

15 

15 

17 

18 

19 

20 

21 

22 

iii

List of Tables 



Table 1 Hawaii's Crops with High Dollar Value Yield 4 

Table 2 Kauai's Share in Honolulu Market: 2004 6 

Table 3 Economic Potential of the Former Kekaha Sugar Land: Direct and Total 

Contributions to Hawaii’s Economy 10 

Table 4 State of Hawaii's Agricultural Status 2002: Cross-County Competitiveness 

Comparison 13 

List of Figures Page 

Figure 1 Average Yield in Dollar Value of Selected Commodities: 

Kauai Versus State 5 

C-448 

Page 

iv

1 Introduction 



Approximately 12,592 acres were assigned to the Agribusiness Development Corporation 

(ADC) in October 2001, for management. This is a portion of the 27,720 state-owned land 

located in Kekaha, Kauai County, where the Kekaha Sugar Company operated sugarcane 

plantation for about a century until November 2001, when the mother company Amfac officially 

announced the closure. This portion of the land is the focus of this study. The study’s main 

objective is to assess the current and potential economic capability of this agricultural asset. 

Hawaii’s agricultural development trend is one of increasing product diversification, necessitated 

by the changing market forces that resulted in a decline of sugar and pineapple plantations, 

which have dominated state’s agricultural landscape for more than a century. Diversified 

agriculture has been widely accepted as a way to assure the state’s agricultural needs. Thus the 

assessment of economic potential of this particular agricultural production asset is consistent 

with this on-going agricultural trend and accepted view. As ADC is the managing agent of the 

Kekaha former sugar land in question, including infrastructure in place, since the plantation 

closure, the assessment ultimately is an assessment of ADC’s contribution to the county’s and 

state’s economy. 

Section 2 provides a brief historical background and description of the property, with a review of 

changes in production and employment that have taken place within the property. Section 3 

examines Kauai’s competitive products. Section 4 analyzes the economic potential of the 

property, its direct (farm) and total contribution to Gross State Product (GSP) and jobs. Section 5 

discusses challenges and constraints faced by farmers in Kekaha. Finally, Section 6 concludes 

the study. 

2 Historical Background and Description of the Land 

The former sugar land in Kekaha is located on the northwest portion of the Kauai Island. 

The state-owned land was under the management of the Department of Land and Natural 

Resources (DLNR) since the sugar plantation time until October 2001, when the Board of Land 

and Natural Resources (BLNR) handed a master lease to ADC. 

The land has a relatively long history in commercial agriculture. The land and infrastructure 

designed specifically for sugarcane plantation were developed by the Kekaha Sugar Company, 

which was formed in 1898. Thus, sugar was the single dominant crop in the entire region until 

recently, when Kekaha Sugar Company (owned by AMFAC) closed down in February 2001. It 

was a single major crop for which the economy and livelihood of the people in Kekaha depended 

on for about a century. In fact, Kekaha is a town started by the sugar plantation workers where, 

in 2000, 3,178 people lived, about 5.4% of Kauai’s total population. An average Kekaha resident 

earned $17,117 in 2000, about 80% of state’s average. 1 

1 Income is stated in 1999 dollar. Census 2000, U.S. Census Bureau. 

C-449 

1



The land is extensively irrigated, as average annual rainfalls range from 20 inches in the coastal 

area to 40 inches on the ridges while sugar plantation requires approximately 90 inches of rain. 

Originally, three main ditches (Kekaha Ditch, Kokee Ditch, Waimea Ditch) formed the irrigation 

network that diverts water to the sugarcane field, with approximately 2,668 acres in the highland 

area and 5,090 acres in the coastal Kekaha-Mana plain. 

The Kekaha Ditch, 27 miles long, was built in 1907. The ditch carries water from an altitude of 

about 500 feet from the Waimea River to Kekaha. The Kekaha Ditch provides water to users 

beyond the subject land, including Kikiola Land Co. and Knudsen Land Co. The Kokee Ditch, 

approximately 21 miles long, diverts water from Mohili Stream and the headwater of the 

Waimea River in the Alakai Swamp at an altitude of 3,400 feet. The Waimea Ditch was 

abandoned about 14 years ago due to a landslide. 

The Kekaha plain was once mostly marshland. The drainage system, with two pumps at the 

Kawaiele and Nohili pumping stations constantly running to lower the groundwater table, which 

made possible for sugarcane cultivation. Today, these pumping stations must continue running to 

keep the groundwater table from rising too high, which could result in root rots and hence low 

crop yields. During storm season, with five inches of rain in one day would result in flooding. 

These pumping stations help shorten the time required for the water table to return to its normal 

level. 

The pumping stations are run with hydroelectricity generated within the subject land, which also 

provides relatively inexpensive electricity for other uses for farm operations. The 

hydroelectricity is generated using hydraulic power provided by the irrigation system. Three 

generating plants were originally constructed, including Kekaha power plant, Waiawa Hydro, 

and Mauka Hydro. The Kekaha plant has been shutdown together with the sugar mill, leaving the 

other two plants in operation to provide electricity to the existing tenants. 

Changes in Employment and Crops Since the Plantation Closure 

Other crops besides sugar were grown in the subject land before the plantation closure. 

Since the closure of the Kekaha Sugar Company in 2001, the Kekaha agricultural lands have 

supported besides sugar cane, the production of seed corn, sweet corn, melons, tropical fruits and 

various vegetable crops. Some of the agricultural activities have proven successful, while others 

are still in their trial period. 

Seed crops, of which corn seeds make up more than 90% in sales value at farm gate price, have 

been grown in the area since the late 1960s. They have proven to be profitable agricultural 

products in Kekaha, in place of sugarcane. Shrimp farming has also been attempted, but failed. 

After years of struggle over finance, an outbreak of the white spot syndrome virus prompted the 

shrimp farm company Ceatech USA Inc. to destroy its entire shrimp population in the farm, 

shutting down operations in 2004, and filing for Chapter 11 bankruptcy protection in early 2005. 

Vegetables (cucumber, cabbage, kaichoi, daikon), melons (seedless and water melon) and fruits 

(grapes and mangoes) are also being grown on the former sugar land. 

C-450 

2



In 1997, the Kekaha Sugar Company’s operation provided 465 jobs. 2 After the plantation 

closure, the six legitimate farm tenants together, which occupied approximately 40% of the 

12,592 acres, provided 432 jobs in total, including 157 full time jobs and 275 part-time and 

seasonal jobs for a relatively short period of time. 3 The closure of Ceatech shrimp farm 

operations in 2004 eliminated 33 jobs and the phasing out of the remaining sugarcane plantation 

under Gay & Robinson will result in a total loss of between 60 and 70 full time jobs. 

Gay & Robinson, which initially occupied 3,500 acres after the plantation closure, has reduced 

the size of its land holding to 1,750 acres by April 2005. The acreage will continue to decline 

throughout the year as harvest progresses. The company will retain 400 acres for sugar seed 

crop, according to the company’s Director of Finance & Property Management. 

3 Kauai’s Competitive Products 

To assess the economic potential of the Kekaha agricultural land, it is useful to first 

identify products that are currently thriving in Kauai. The level of competitiveness of a product 

depends on its per unit production cost. Although data on production costs are unavailable, 

competitiveness of a given agricultural product produced in Kauai can be assessed by inferring 

from its per acre yield in dollar value relative to the same products produced elsewhere. In 

addition, the product’s marketing information can also provide its “revealed” competitiveness. 

The reason is simply that, if a product is not competitive, it will not last in the market over a long 

period of time. For this, the Honolulu market supply data (inter-island inshipment to Honolulu 

plus Honolulu’s own supply and inshipment from the Mainland) for fresh produces are utilized. 

Competitiveness Based on Yield 

For the purpose at hand, yield per acreage used (or allocated) for a given crop, which includes 

fallow land, is the most desirable unit measure as it reflects the total cost of land. However, in 

Table 1, due to data availability yield per acreage harvested is reported for most crops. Yields 

for seed crops, pineapple and taro are reported with different acreage definitions, causing 

inconsistency. In HAS’s statistical reports, land information for certain crops contain only 

“acreage harvested,” others contain only “acreage used for crop” or “acreage in crop” with 

acreage harvested. Acreage harvested accounts for only part of the total land a farmer must pay. 

Whether or not part of the land within a given farm allocated for a specific crop is left fallow, for 

any reason, there is a cost to it. Cultural practices differ for different crops and, often, across 

farms growing the same crops. Different crops have different time requirements for maturity and 

for land rotation. Thus, fallow land left for rotation purpose and acreage not harvested as a 

proportion of the total acreage varies across crops and farms. Therefore, even if yield is 

measured as the output value per acreage harvested for all crops used for productivity (with 

respect to land) comparison, inconsistency remains. 

2 The figure is reported in an article titled “Kekaha Sugar’s Demise Leaves West Kauai Water System in Limbo,” 

Vol. 11, No. 8, February 2001, Environmental Hawaii, Inc., www.environment-hawaii.org/201cov.htm. 

3 Part-time farm laborers, according to the interviews, generally worked between 30 and 35 hours per week 

throughout the year. Seasonal workers also worked more than 30 hours per week, 2.5 to eight months, depending on 

which farm they employed at. 

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Table 1 shows some commodities that have been grown in the state and in Kauai with per acre 

yield in term of dollar value above $5,000. 4 The value for each commodity is the average across 

farms and over a specified time period as indicated in the parenthesis following the name of each 

commodity. Only four of Kauai’s high value yield commodities are compared with statewide 

averages, as data for Kauai’s other commodities are not available. 5 

Starfruits, rambutan and longan are still in their early phase of commercial production in Hawaii, 

as they have just appeared in the market and are not widely visible. The relatively small amount 

of total supply in the Honolulu market, revealed in Table 2, indicates that these products either 

have a limited market or still in their early stage of marketing. Thus their existing per pound 

dollar value may still be unstable. That is, per unit dollar value sold in the market may be too 

high. The cases of longan and rambutan, their prices in the market, as of April 2005, are most 

likely too high to be used for profitability calculation in making an investment decision. 

Table 1 Hawaii's Crops with High Dollar Value Yield 

Commodities 

Selected Crops, valued at farm gate prices 

Acre Statewide Average Kauai Average 

Specification lbs/acre $/acre lbs/acre $/acre 

1. Ginger Root (00-04) a 

Acre Harvested 44,500 25,899 na b na 

2. Tomatoes (99-03) Acre Harvested 32,500 17,245 na na 

3. Seed Crops (99-03) Total Acre c 

1,593 d 

12,880 na na 

4. Pineapples (00-04) Acre Used 34,016 10,453 na na 

5. Papayas (99-03) Acre Harvested 27,241 8,105 26,413 10,358 e 

6. Taro (00-04) Acre In Crop 14,850 7,951 16,534 8,750 

7. Vegetables & Melons (99-03) Acre Harvested 14,864 7,302 6,508 6,482 

8. Cucumbers (99-03) f Acre Harvested 13,775 6,201 18,058 8,320 

9. Starfruit (99-03) Acre Harvested 1,882 5,482 na na 

10. Rambutan (99-03) Acre Harvested 5,358 5,045 na na 

11. Longan (00-03) Acre Harvested 1,473 5,009 na na 

Data Source: Calculated from data reported in “Statistics of Hawaii Agriculture 2002” and other commodity annual summary 

reports, HAS. Notes: For those values that are reported by measures other than per acre harvested are due to the lack of data. 

a Numbers in each parenthesis indicate a period for which the average is calculated. For example, (00-04) indicates that the 

statewide and Kauai averages are for the 2000-2004 period. b There is no report for Kauai, see footnote 5. c Total acre refers 

to the total acre owned and leased by seed crop farms. d This is outshipment volume only; part of the output is normally 

retained for research activity. e Value is combined with Maui. f Figures for cucumber are Kauai and Hawaii combined. 

Figure 1 shows Kauai’s farm productivity, in dollar term, relative to state’s average for selected 

commodities, with some not included in Table 1. 6 On a per acre dollar value basis, yield for 

some products (papayas, cucumbers, sweet potatoes, green beans, sweet corn, watermelons) 

shown as Kauai’s are combined with other counties. Although the values for these products do 

4 The list in the table is by no mean exhaustive. There may be other, relatively new products that produced above 

this dollar value yield, but are not included in the Hawaii’s agricultural statistics. 

5 In some cases, HAS refrains from reporting county data in order to avoid disclosure of specific operations. This 

usually applies to a case in which there are few operations in any given county. 

6 Selection is based on data availability. 

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4



not represent Kauai’s competitiveness, they are still useful for assessing Kauai’s 

competitiveness. For instance, Kauai’s yield for watermelon is combined with Hawaii and Maui. 

Since Honolulu is the only county remaining, the higher state’s average yield must be due to 

Honolulu. Thus, a farmer can be cautioned about whether he should grow watermelon in Kekaha 

and hope to sell his product in Honolulu. A similar precaution can be made for green bean. 

Other products that may thrive in the market if they are fertile in the Kekaha agricultural land 

can be inferred from the Honolulu market supply data collected by the Market News Section, 

ADD, HDOA. Commodities that have been shipped from Kauai to supply the Honolulu market 

are shown in Table 2. Kauai, where 4.8% of Hawaii’s 1.2 million residents lived in 2000 and 

10.6% of approximately 60.1 million total state’s visitor days spent in 2002, has relatively small 

share in the total intrastate inshipment to Honolulu market in 2004 for all products familiar to the 

Honolulu consumers, except for wet land taro for poi processing, which had 92.8% market share. 

Other products that Kauai has relatively large share in Honolulu market include longan (47.7%), 

rambutan (27.8%), starfruit (81.8%), and caimito (100%). These latter products are relatively 

new to the Honolulu consumers, and the market demand for them in 2004, as indicated in the far 

right column in Table 2, was relatively limited. 

USD/Acre 

12,000 

10,000 

8,000 

6,000 

4,000 

2,000 

- 

Figure 1 

Average Yield in Dollar Value of Selected Commodities: 

Kauai Versus State 

Papayas 

Taro 

Cucumbers 

Veg. & Melons 

Potatoes (sweet) 

Commodity 

Beans (green) 

Corn (sweet) 

Kauai 

State 

Watermelons 

Data Source: Calculated from data reported in “Statistics of Hawaii Agriculture 2002” and other 

commodity annual summary reports, HAS. Notes: Papayas: Averaging over 1999-03; Kauai and 

Maui combined. Taro (fresh and processed): Averaging over 2000-04. Cucumbers: Averaging over 

1999-03; Kauai and Hawaii combined. Vegetables and Melons: Averaging over 1999-03. Sweet 

Potatoes: Averaging over 1998-02; Kauai, Hawaii and Honolulu combined. Beans (green): 

Averaging over 1998-02; Kauai and Hawaii combined. Corn (sweet): Averaging over 1998-02; Kauai 

and Hawaii combined. Watermelon: Averaging over 1998-02; Kauai, Maui and Hawaii combined. 

Revealed Competitiveness 

Kauai’s share of the total in-state supply in the Honolulu market in 2004 for processed lettuce 

(28.7%) was relatively large, but its share in the Honolulu total market supply of 6.06 million 

pounds, which includes imports from the Mainland, was a tiny fraction 0.1% (Table 2). The 

relatively high share in the in-state supply reveals that Kauai is competitive in producing 

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5



processed lettuce relative to other counties, while its’ very low share in Honolulu’s total market 

supply indicates that there is an opportunity for import substitution of processed lettuce in the 

Honolulu market. Table 2 also indicates that Kauai has revealed competitive advantage in sweet 

corn and seedless melon, as well as room for producers in Kauai to compete with the Mainland 

imports in the Honolulu market. 

It is noticeable that the only product for which Kauai clearly has a competitive advantage over 

other counties is taro, which Kauai has higher per acre yield than state’s average in both output 

and dollar value (indicated in Table 1). For taro, Kauai has a substantially large share in the 

Honolulu total market supply in 2004, 92.8%. For cucumber, which Kauai seems to have higher 

per acre yield than other counties in both output and dollar value, Kauai’s share in the in-state 

supply and total supply in the Honolulu market was only 0.8% and 0.7%, respectively. In 2004, 

76.5% of the 2.5 million pounds of cucumber in the Honolulu market came from Maui County. 

Specifically, 74.8% of the 2.5 million pounds came from Molokai, part of Maui County. 

Table 2 Kauai's Share in Honolulu Market: 2004 

(Volume) 

Commodities 

% of State's 

Supply 

% of Total 

Market Supply 

Total Market Supply in 

Honolulu (1,000 lbs) 

1 Avocados 8.8 2.6 1,845.2 

2 Guava (processed) 0.01 0.0 1,619.6 

3 Longan 47.7 21.2 15.7 

4 Lychee 0.3 0.0 93.5 

5 Papayas 0.2 0.2 14,597.6 

6 Pineapples 0.05 0.0 17,268.8 

7 Rambutan 27.8 27.4 18.7 

8 Starfruit 81.8 16.6 15.8 

9 Tangelo 0.4 0.0 138.2 

10 Beans (green) 0.02 0.0 596.7 

11 Cabbage (Chinese) na na 5,611.7 

12 Cabbage (head) na na 8,681.6 

13 Cabbage (Pak Choi) 0.2 0.1 356.2 

14 Caimito 100.0 100.0 0.01 

15 Corn (sweet) 17.1 1.4 1,315.1 

16 Cucumbers 0.8 0.7 2,472.7 

17 Ginger Root 1.1 0.9 1,102.7 

18 Lettuce (head and semi-head) na na 7,290.4 

19 Lettuce (processed) 28.7 0.1 6,062.7 

20 Lettuce (specialty) 2.1 0.1 667.1 

21 Luau Leaf 0.1 0.1 83.7 

22 Melon (seedless) 100.0 21.5 1,946.3 

23 Melon (watermelon) 0.7 0.6 5,990.9 

24 Potato (sweet) 0.1 0.1 3,040.6 

25 Taro (processed, poi,) 92.8 92.8 2,799.6 

26 Tomatoes 0.01 0.0 8,415.8 

27 Unspecified 14.1 0.1 21,438.8 

Data Source: Market News Section, ADD, HDOA 

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4 Economic Potential of the Kekaha Former Sugar Land 

Given the existing infrastructure (irrigation system, hydroelectricity power stations, road 

ways and other support structures) left by the former Kekaha Sugar Company and a favorable 

climate for crop production, the Kekaha agricultural land has considerable potential to generate 

income and employment for the people of Hawaii. The question is not whether it will make a 

positive net contribution to the state’s economy. Rather, it is by how much could the Kekaha 

agricultural land contribute to the county’s and state’s economy. The answer lies upon how the 

land is used and for what commodities it is used to produce. 

Hawaii’s agricultural trend is one of increasing product diversification, necessitated by the 

changing market forces that resulted in a decline of sugar and pineapple plantations, which have 

dominated state’s agricultural landscape for more than a century. Diversified agriculture has 

been a force of growth in Hawaii’s agriculture for more than a decade and is widely accepted as 

a way of assuring state’s agricultural needs. Thus, this paper examines the economic potential of 

the Kekaha agricultural land in question consistent with on-going agricultural trend in Hawaii. 

Because the term “diversified agriculture” can be interpreted slightly differently by individuals 

of different occupation and professional background, to avoid misunderstanding, the meaning of 

the term “diversified agriculture” in this report is clarified. 

Diversified agriculture is generally understood as agriculture that is characterized by multiple 

product varieties. In Hawaii, it is viewed as agriculture comprising of a variety of profitable 

agricultural products that are replacing sugarcane and pineapple plantations, which have become 

increasingly less profitable. There is a difference in perspective regarding diversified agriculture 

between a farmer, region, and state. For a particular farmer, diversified agriculture means 

producing a variety of crops and, in some cases, including crop rotation. Thus, a farmer 

producing a single crop on a sizeable agricultural land is not diversifying his business. If it 

happens that this farmer is the only one in an agricultural region of any county, then the region is 

not diversifying its agriculture. Nonetheless, given such a scenario, state would still be 

diversifying agriculture as long as there are many other farmers producing many other products 

in other agricultural regions in the state. Thus, even if there were only a single type of crop being 

grown in the entire Kekaha agricultural land by a single producer, as long as it is not sugarcane 

and pineapple, Hawaii’s agriculture is being diversified while Kekaha’s agriculture is not. 

However, Kekaha former sugar land has actually been diversified. As of April 2005, six 

legitimate farm tenants, with five active, producing more than five crop varieties commercially, 

occupied most of the more productive 7,758 acres former sugar land. However, approximately 

46% of that would become unutilized as the phasing out of Gay & Robinson’s sugarcane 

cultivation approaches completion by the end of 2005. Although part of the remaining land 

within the 12,592 acres, after subtracting 7,758 acres, has not been cultivated by the Kekaha 

Sugar Company, it may be productive for certain crops and other agricultural products. 

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Estimation Method 



While both actual and potential production capacities are important information, for several 

reasons, the estimation emphasizes potential economic contributions of the land. First, while an 

estimation of the actual production would be useful for evaluating resource utilization, or for 

establishing a basis for tax, or for GSP estimation purpose, they are not the purposes of this 

study. Nonetheless, the estimations of actual farm production value for 2002 and 2004 are 

attempted and summarized in Table 3 for comparison with the corresponding potential values. 

Second, this study takes the economic asset management perspective. As Kekaha former sugar 

land is in transition, an objective analysis of its potential will be useful for decision making by 

policy makers and the management agency, ADC, for management planning and execution. 

Two levels of potential economic contributions of the former sugar land are estimated: direct 

contributions and total contributions. Direct contributions include farm output value and farm 

employment. Total contributions to the economy by farm operations in the Kekaha former 

sugar land include farm output value plus economic value produced through the linkages effects, 

to be explained further later, and farm and non-farm employment. 

Estimates for potential direct economic contributions of the Kekaha former sugar land are based 

on land area, Kauai and state average yield and price for each crop. Each farmer is assumed to be 

able to achieve an average yield for each crop by using common farm practices, management and 

technology that are common to farmers in Kauai and elsewhere in State of Hawaii and sell output 

at an average price specific to Kauai or State of Hawaii. The area of land used in the estimation 

is for the 7,758 acres, which are considered to be among the most productive land within the 

12,592 acres complex under ADC’s control. Land productivity is assumed to be identical for 

each acre. Estimates for potential total economic contributions of farm operations originated in 

the Kekaha former sugar land are based on the estimates of direct economic contributions and 

multiplier coefficients produced by DBEDT and adjusted for Kekaha’s agricultural production 

context. 

To minimize the effects of annual yield and price fluctuations, both the average yields and 

average prices used for estimation are the averages of annual averages across farms over a fiveyear 

period. For sugarcane and vegetables and melons, yield and price averages are Kauaispecific; 

for seed crops, due to the lack of Kauai-specific data, they are statewide averages. 7 

Readers should be aware that although HAS’s data are used to calculate the averages used for 

estimation, the estimated results for any given commodity and year in this study are differ from 

those of HAS, for three reasons. First, the average yield used in this study is the average of 

HAS’s average yield in each year over five years. Second, the average yield used in this study is 

the output volume per acre of “area in crop” or “area use” based on leasehold, not on output 

volume per acre of “area harvest.” To account for the opportunity cost of agricultural land, farm 

output is estimated based on the "total acreage holding or use" rather than on the “total acreage 

harvest” or "total acreage farm.” HAS output per acre is based on harvested or bearing acres. 

Depending on individual farm practices, land area under the lease that is not farmed may serve 

7 Per acre yield in output for crops used in the estimation are derived from HAS’s annual reports, calculated in terms 

of yield per “acre in crop” and “acre use,” not in terms of per acre harvest as commonly reported by HAS. 

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various functions for the area that is farmed, such as roadway, buffer zone (to prevent crossbreeding), 

wind blocker, etc. Whether or not all acres under the lease are used for any purpose, 

once the land is taken by one farmer it is no longer available for others. Third, the estimation in 

this study emphasizes the potential economic value of an agricultural production asset while 

HAS’s estimates are for actual output of the past. 

Interviews of existing farm tenants were made in mid-April 2005 as part of the overall 

assessment of production and employment possibilities of the farmland and its infrastructure. 

Complementing the interviews used for the analysis are published and unpublished data from 

various units within the HDOA and published data from the National Agriculture Statistics 

Service. 

Direct Potential Economic Contributions 

Table 3 provides a picture of economic potential of the Kekaha agricultural land in terms of farm 

output value—farm output measured at average farm gate prices—and employment creation. All 

farm potential output values are estimated based on land holding (row 9), crop types (row 10), 

and average yields and prices as explained earlier. 

In 2002, with approximately 5,000 acres allocated for sugarcane, seed crops, vegetables and 

melons, the aggregate potential farm output value is estimated at $19.5 million (row 1). Actual 

output value in aggregate is estimated to be in the range of 75-80% of the potential value (row 

2). All together, farm operations in 2002 employed approximately 387 jobs, with 112 full-time, 

and 275 part-time and seasonal jobs. Although shrimp and other crops were already grown there, 

they are not included in the estimate due to inadequate data. Sugarcane operation is phasing out, 

thus its output value estimated in Table 3 is declining in each year and approaching zero by the 

end of 2005. The company will retain 400 acres for sugar seed crop. 

In 2004, six farm entities occupied 7,122 acres of the former sugar plantation, with 6,689 acres 

under the lease for crop production and 433 acres for aquaculture. The assessment is made for 

cropland area held by four companies only. They include Gay & Robinson (sugar), Pioneer (seed 

crop), Syngenta (seed crop), and Wally Johnson (seed crop, fruits, vegetables & melons). 

Ceatech (shrimp farm) and Wines of Kauai are excluded from the estimation due to inadequate 

data. 8 Given the total leasehold, average yields and prices as explained earlier, the combined 

potential output by the four farms in 2004 is estimated at $34.9 million (Table 3). 9 Crops grown 

by the four farms used in the estimation include sugar, seed crops, and vegetables & melons. The 

actual production value in 2004 is estimated to be in the range of 47-57% of the potential value. 

Although actual production as a percent of land potential capacity declined between 2002 and 

2004, because of some existing tenants acquired more land faster than they could farm, the actual 

value of production increased moderately over this period. Farm operations by the four 

companies employed 375 workers in total in 2004, including 100 full-time, 275 part-time and 

8 

Nature of operation, cost and market constraints for shrimp farms are different from crop farms. The Wines of 

Kauai project is in its infancy and grape wine production is uncommon for Kauai, and data for grape wine 

production and price in Hawaii are not available. 

9 

Both yields and prices used for estimation are the averages over time (1999-2003) of the annual averages across 

farms. 

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seasonal workers. The number of employment declined due to the phasing out of sugar 

plantation. Among the full-time jobs, 19 were managerial and professional positions, 38 skilled 

technical positions, and 43 hourly-paid laborers. Part-time workers worked between 30 and 35 

hours per week throughout the year. Seasonal workers worked between two and a half and six 

months, depending on which farm they employed at. 

By 2010, aggregate potential farm output value could grow to between $38.4 million (2010a) and 

$50.8 million (2010b), and farm jobs, between 405 (2010a) and 513 (2010b), depending on land 

use and types of crop grown. Crop types used in the estimation are based on existing crops being 

grown there and have proven commercially successful and the existing tenants’ future 

investment plans. In both 2010a and 2010b cases, 3,150 acres are assumed used for seed crops. 

While only 350 acres are assumed used productively for vegetables and melons in the 2010a 

scenario, in the 2010b scenario, 4,175 acres are assumed used for vegetables and melons. Land 

leased by Ceatech is excluded from the estimation. The remaining land (of the 12,592 acres) is 

assumed left idled, although it may be productive for certain crops and agricultural activities. 

The smaller two of the four companies experienced actual output growth of approximately 30% 

and 67% each between 2002 and 2004. Each of the two companies plans to double or tripple 

production in Kekaha in the next five years. If these tenants could achieve their growth target as 

planned, the aggregate actual output would be in the neighborhood of 60-70% of the potential 

output value in column 2010a. 

Table 3 Economic Potential of the Former Kekaha Sugar Land: 

Direct and Total Contributions to Hawaii’s Economy 

Direct Contribution 

(Farm output and jobs) 

Total Contribution 

2002 2004 2010a 2010b 2010a 2010b 

1. Potential Output Value ($ million) 19.5 34.9 38.4 50.8 71 95 

2. Actual Output Value (% of Potential) 75-80% 47-57% 60-70% a 

na na na 

3. Total Number of Jobs (actual & potential): b 387 375 405 513 834 1,056 

4. Full-Time 112 100 60 73 na na 

5. Part-Time and Seasonal 275 275 345 440 na na 

6. Managerial/Professional (all Full-Time) na 19 na na na na 

7. Skilled Technical (all Full-Time) na 38 na na na na 

8. Laborer (Full- and Part-Time and 

Seasonal) na 318 na na na na 

9. Total Acreage of Cropland Held by Tenants c 5,000 6,172 3,500 7,325 3,500 7,325 

10. Types of Crop Grown 

Sugarcane 

Seed crops 

Vegetables 

& Melons 

Sugarcane 

Seed crops 

Vegetables 

& Melons 

Seed crops 

Fruits 

Vegetables 

& Melons 

Seed crops 

Fruits 

Vegetables 

& Melons 

Seed crops 

Fruits 

Vegetables 

& Melons 

Seed crops 

Fruits 

Vegetables 

& Melons 

Notes: a This is an expected actual output value in aggregate based on existing tenants’ growth plan. b Number of jobs for 2002 and 2004 

are estimates of actual farm employment. For 2010, they are estimates of potential job creation. c Total acreages for 2002 and 2004 are 

based on leasehold of the four farms used in the estimation; for 2010a, the total acreage is based on business plans of the existing tenants; 

and for 2010b, it is the total acreage of the readily arable and most productive cropland of the 12,592 acres, with a hypothetical land 

allocation. Farm yields and prices of crops used for estimation are Kauai’s averages, except for seed crops, which are statewide averages. 

The estimated potential farm output values are based on a set of assumptions regarding land, 

productivity, farm practice and technology, and price as described earlier. However, whether the 

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potential farm output values will be realized will depend on various constraints including market 

limitations, pests that may arise as production expands, and the required skilled labors. 

Vegetables and melons as a group is used in the estimation because it’s already being grown in 

Kekaha, proven profitable in Kauai, widely consumed by Hawaii residents, and is exportable. 

Expanding the production of existing products, as long as there is more room in the market for 

them, is a safer route than trying something unfamiliar to neither producers nor consumers. Data 

in section 3 offer a preliminary indication that there may be more room in the market for certain 

vegetables, melons and fruits to grow. However, a detailed market study for each crop is required 

before any conclusion can be made regarding market constraints. In addition, it should not be 

interpreted that this study recommends vegetables and melons for Kekaha, nor does it provides 

any indication that vegetables and melons will take half of the Kekaha agricultural landscape in 

the next 5-10 years. Ornamental plants, including flowers and potted plants, and other crops may 

thrive in Kekaha. For a number of reasons, such as changes in the market conditions, technology 

and input costs, crops that are profitable today may become unprofitable in the future. For the 

same reasons, crops that are not in the market today may be popular in the future. 

Total Potential Economic Contribution 

Beyond its direct contribution to the state’s economy in the form of farm income and farm jobs, 

farm activities also create demand for various types of farm inputs including tools, machinery, 

equipment, fertilizers, pesticides, materials, and services. Farm products are also used by 

manufacturers and eatery and tour-related businesses. In addition, the farm itself is used for 

tourism. Incomes earned by farm workers and all others whose job either supplying farm inputs 

or using farm outputs will be spent and further induced growth in income and employment 

elsewhere. These phenomena are called the multiplier or linkage effects. In order to assess the 

total potential contribution of the Kekaha former sugar land, these linkages effects must be 

accounted for. 

For this purpose, output and job multipliers for vegetables and other agricultural products, 

estimated by DBEDT, are employed. 10 Take the weighted average of the two multipliers 

according to their estimated shares in the Kekaha agricultural land yields output and job 

multipliers for Kekaha’s farm production. Applying these multipliers, which have been adjusted 

for Kekaha, the total potential contributions of the Kekaha former sugar land to state’s economy 

are derived and summarized in the far right columns in Table 3. 11 With the linkages effects, farm 

production originated in the Kekaha former sugar land could contribute to the GSP between $71 

million and $95 million and to state’s employment between 834 and 1,056 farm and non-farm 

jobs. 

5 Constraints and Challenges 

Kekaha former sugar land is an ideal place for agricultural production. The relative 

dryness of the region together with isolation is a natural pest control condition. Yet the irrigation 

system that is in place, which was designed specifically for the sugarcane plantation that uses 

10 Only type 2 multipliers, as defined by DBEDT, are considered. 

11 The (Type 2) output and job multipliers for 2010a are respectively 1.84 and 2.06, and for 2010b, 1.89 and 2.06. 

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water approximately three times the amount the average tropical farm products need, allows farm 

operators to have a better control of the amount of water in the field. This condition allows 

farmer to have better control of the farm environment. However, farmers in Kauai in general face 

relatively high input costs, a limited local market, and an extra cost for transporting goods to the 

markets outside the island. 

Advantages and Disadvantages for Farm Operations in Kekaha: There are advantages as 

well as disadvantages for farm operations in Kekaha, and in Kauai in general. The existing land 

rental rates, which are determined by size and type of crop to be grown, administered by ADC 

are low relative to other agricultural lease land both in Kauai and elsewhere in Hawaii. The 

extensive irrigation system and natural climate in the region allow farmers to have better control 

of the farm environment. Relatively low-cost irrigation water and hydroelectricity available 

within the property are both exceptional advantages farm tenants have. 

Major advantages and disadvantages associated with farm operations in the subject Kekaha land 

can be summarized as follows: 

Advantages: Disadvantages: 

• Good climate and soil condition 

allowing longer production 

period within a year 

• Abundant water supply through 

the irrigation network 

• Availability of relatively lowcost 

hydroelectricity 

• Relatively low rent 

• Isolation –natural pest control 

• Limited supply of farm workers 

• Extra transportation cost to major markets, 

but should diminish with the supper ferry 

in operation beginning in 2007 

• Relatively high input cost 

• Relatively small local market 

Diversification Constraint: Crop diversification, if properly practiced, could be useful for 

controlling pests and diseases, maintaining soil quality, and for mitigating the negative impact of 

market disturbances. However, careless crop diversification in a given region could also 

complicate pest and disease problems, hampering productivity. An introduction of a new crop or 

growing an existing crop of certain type at a certain time of the year could complicate pest 

control for the existing crops nearby. Such potential problem can be prevented through a 

cooperative effort among farmers in the same region by refraining from growing certain crops 

completely or at a certain time of the year, among others. For instance, seed crop farmers in 

Kekaha today control pests by limiting the amount of soybeans grown, and reserving the months 

of August and September as a corn-free period. Even if chemical pest control method is applied, 

cooperation among farmers in the same region is required for effectiveness in many cases. 

Without cooperation, there is room for pests to develop resistance to chemical by hopping across 

farms. 

Because, in a diversified agricultural context, effective pest control requires cooperation among 

farmers, an increase in the number of either farmers that compete for the same market or farmers 

that produce different variety of crops would likely increase difficulties and costs associated with 

maintaining cooperation. 

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Cost Constraint: Based on the 2002 Census of Agriculture, Kauai had lower farm operation 

expenses per acre of cropland, as well as per acre of harvested cropland, than any other island 

counties (Table 4). These statistics seem to contradict the general perception about Kauai’s 

production costs, as prices of goods, including gasoline, are generally higher than elsewhere in 

the state. 

Kauai’s relatively low total operation expenses per acre of cropland, on average, was a result of 

the county’s lower per acre expenses on seeds, livestock, feed, utilities, contract labor, 

depreciation, and “other expenses” (details in Appendix 3). This may be attributed to low 

utilization of purchased inputs, to the type of farm operations, possibly to cultural practices, and 

not to efficiency. Despite the county’s lower per acre operation expenditures, Kauai was the only 

county with a negative net cash income of farm operation ($30 per acre of cropland) in 2002. In 

contrast, Honolulu, which had the highest expenses per acre of cropland, also had the highest net 

cash income of operation per acre of cropland (Table 4). 

Table 4 State of Hawaii's Agricultural Status 2002: 

Cross-County Competitiveness Comparison 

State Hawaii Honolulu Kauai Maui 

Farm operation expenses per acre of harvested cropland ($) 4,120 2,907 9,430 3,921 4,000 

Farm operation expenses per acre of cropland ($) 2,136 1,778 4,458 1,513 1,871 

Operation Expenses-Product Value Ratio* 0.85 0.86 0.72 1.10 0.91 

Net cash income of operation per acre of cropland 465 379 1,799 (30) 203 

Government payment as %share of total operation expenses 0.002 0.002 0.000 0.004 0.002 

Irrigated land as % of cropland 

Number of farms with 180 acres and above as %share of the 

32.8 10.0 47.1 64.2 44.2 

total number of farms within own jurisdiction 5.82 5.66 4.28 8.50 6.08 

*Total farm operation expenses divided by total value of products sold. Data Source: Calculated from data reported in the 

2002 Census of Agriculture, Hawaii State and County Data, NASS. 

An explanation to Kauai’s negative net cash income is the county’s high total expenses per dollar 

worth of output sold, at $1.10 (Table 4). This is attributed to a combination of relatively low 

yields and high expenses on fertilizers, lime and soil conditioners; gasoline fuel and oil; supplies, 

repairs, and maintenance; machinery and equipment rental; property taxes (see Appendix 3). As 

a percent share in county’s own total operation expenses, Kauai’s expenses on these items were 

higher than those of any other county. With more than 64% of total cropland irrigated, Kauai is 

also most extensively irrigated than any other county in Hawaii (Table 4). Maintaining the 

irrigation system is costly. 

Market Constraint: Kauai’s small population is a natural barrier to commercial farming on the 

island. In 2003, with about 60,747 residents, Kauai’s population made up only 4.8% of Hawaii’s 

total population (DBEDT). In 2003, the island hosted 11.07% of state’s 58.78 million total 

visitor days. Visitors’ share in state’s total consumption of fresh produces in 2003 is 11.35%. 12 

With such a limited local market, farmers in Kauai must rely on export markets (defined as any 

market beyond the island county). 

12 Southichack, August 2005. 

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Diversifying agriculture means searching for new products that are profitable, and it usually 

requires a new idea, which may require new farmers. Certain products that are known to be 

fertile in Hawaii soil and climate already have established markets and others do not. If there 

were an abundant supply of products that are already established in the market, new farmers 

would have to come up with new products, which must pass through experimentation on both 

production and marketing in order to achieve a relatively stable supply and consistent quality. 

Under such a situation, new farmers would cautiously start farm operations with relatively small 

initial investment and land area. Given the relatively high input and transportation costs between 

the farm and the market destinations beyond the island of Kauai, the variety of agricultural 

products that can be profitably grown in Kekaha is limited. Large investment requires large and 

ready markets for the products to be produced. Thus, given the island’s unique situations (as well 

as Hawaii as a whole), if the minimum land lease size is designed for large investment projects to 

keep down cost associated with management and monitoring, much agricultural land may be sat 

unutilized over a long period of time. This poses a challenge for the land management agency, 

ADC. 

ADC’s Challenge: The number of farmers occupying the land could have a significant 

implication on the cost and effectiveness of management. Property management and 

monitoring cost tends to be lower, the smaller the number of tenants. However, both 

advantages and disadvantages exist whether the number of tenants is large or small. 

While it is less costly for the ADC to deal with a few large mono-cropping tenants, a 

business downturn resulting in bankruptcy and departure of a large tenant could be costly 

in terms of lost rent revenue and cost associated with finding a new tenant. On the other 

hand, with a relative large number of small tenants, management and monitoring costs 

would be higher than with a few large tenants. However, the departure of a small tenant 

would have a relatively small impact on the land manager’s rent revenue. Considering 

food safety and environmental impact of farm operations (i.e., from the application of 

pesticides), the larger the number of farmers tends to raise costs associated with 

monitoring and control. Although these costs will be mostly absorbed by the farmers 

themselves and the HDOA, part of the cost could be transferred to ADC if some 

historically good (paying) tenants decided to leave due to problems associated with pest 

control and contamination. 

The Sunshine Markets (Farmers Markets), as they are called in Kauai, although will probably 

never become the ultimate outlets where diversified agricultural products are sold at a level that 

sustain Hawaii’s agriculture economy, they are useful for both new farms with new products and 

established products. Sunshine markets are useful outlets in the initial stage of marketing 

experimentation for certain new products. They are also good marketing tools for all of Hawaii 

agricultural products, as they are known to be tourist attraction, especially for Kauai. Based on 

the surveys of four markets, conducted in mid-April 2005, Sunshine markets are frequented by 

locals, island visitors and vacationers who have kitchen facilities. 13 Prices were highly varied. 

Certain fruits (mangoes, pineapples, longans) were sold at much higher prices than in the 

supermarket. Each market was small, but the buying traffic (turnover) was rapid in each market 

visited. Based on 15-minute counts of the number of buyers leaving the market with goods 

13 Surveys were conducted on Saturday, April 16, 2005. Three private-run and one county-run Sunshine Markets 

were visited (Kekaha—County-run, Wailua, Hanalei, and Kilauea). 

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bought, roughly, the total value of goods sold per minute in each market could be anywhere 

between $50 and $200. Some vendors were seen to have moved from one market to another in 

the same day, as each market lasted two to three hours. Total sales value in 2004 from the 

county-run Sunshine Markets alone was reported at $405,000. Although the reported figure is 

small, which the County’s official in charge of the market operation admittedly to be much 

underreported, it grew 157% between 1990 and 2004. 14 

The University of Hawaii’s College of Tropical Agriculture and Human Resources (UH- 

CTAHR) has proposed an incubator facility in Kekaha in cooperation with ADC, which could 

occupy between 100 and 500 acres. The incubator facility is to allow the university to provide 

technical and infrastructure assistances to start-up farmers. The program has the potential to 

promote growth in diversified agriculture and complementary industries (e.g. processing, 

tourism) and may put a vast area of fallow lands in Hawaii State back into productive use and 

increase greenery in Hawaii’s landscape. However, the program is not costless. A number of 

factors must be taken into consideration in deciding where the incubator program is to be 

located. The state of Hawaii owns vast areas of fallowed land, left by the demise of sugar 

plantations at different locations. If there were enough paying-tenants to occupy all the farmable 

acreage in the Kekaha agricultural land in question, it may be in the best interest of the state to 

consider the possibility of locating the program elsewhere. By its definition and purpose, if it 

requires public funding, the establishment of an incubator program would be justified only if 

there is a vast excess agricultural land left unutilized. The program should not crowd out the 

private sector. In determining its location, the opportunity cost of land in which it would occupy 

must be considered in addition to other parts of the cost. 

Potential Water Shortages and Floods: Water shortages occurred for sugar plantation in some 

years during the dry season. However, existing farmers that are growing seed crops and other 

diversified products there have never experienced water shortage and, according to the 

interviews, in fact there has been more water available than needed. Flooding, nonetheless, could 

become a problem especially during the storm season if the drainage system is not properly 

maintained. Currently, excess water must be pumped out 24 hours with two pumping stations 

using hydroelectric power generated within the subject land to keep down the groundwater table 

to prevent possible root rots. During storm season, with five inches of rain in one day would 

result in flooding. These pumping stations help shorten the time required for the water table to 

return to its normal level. Although there is a good drainage system in place, a heavy storm 

similar to the Iniki that hit the island in the early 1990s could result in serious damages. 

The Unexpected: A shrimp farm has experienced the so-called white spot syndrome virus, 

which forced the farm operator to destroy its two million shrimps and close down its operation in 

2004. However, the farm has been officially declared clean and a new investor is set to renew 

operations in 2006. 

14 An interview was made on April 15, 2005 with an Economic Development Specialist of the Kauai County’s 

Office of Economic Development, C. W. “Bill” Spitz, who also supplied official data. 

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6 Conclusion 



Given the existing infrastructure left by the former Kekaha Sugar Company (KSC) and a 

favorable climate, the Kekaha agricultural land has considerable potential in generating income 

and employment for the people of Hawaii. The actual contribution of Kekaha agricultural land to 

the county’s and state’s economy would ultimately depend upon land use and types of crop 

grown. 

Since the KSC officially closed down its plantation operations in 2001, seed crops, with corn 

comprising of more than 90% of the total, melons, mangoes, and vegetables have been grown 

successfully there. Shrimp farming has been attempted, but the operation continues to face 

challenges such as the need for capital infusion and white spot syndrome virus. The Wines of 

Kauai project is at its infancy. The remaining sugarcane operations under Gay and Robinson are 

phasing out and will finally complete by the end of 2005. The company will retain 400 acres for 

sugar seed crop. The future of Kekaha’s former sugar land tends toward seed crops and other 

diversified products. 

The combined output potential of all farms, excluding shrimp farm and Wines of Kauai, 

increased as a result of land acquisition by some existing tenants, from $19.5 in 2002 to $34.9 

million in 2004 (Table 3), valued at average farm gate prices. The actual output value in 

aggregate has also increased moderately, from a range of $14.7-$15.6 million in 2002 to a range 

of $16.4-$19.9 million in 2004. Due to rapid capacity expansion, based on leases, the combined 

actual output value as percent of its potential declined from a range of 75-80% in 2002 to 47- 

57% in 2004. Farm employment, however, declined slightly over this brief period due to the 

phasing out of the remaining sugar plantation, from 387 to 375 full- and part-time positions. In 

2004, there were 100 full-time and 275 part-time and seasonal workers. Among the full-time 

jobs, 19 were managerial and professional positions, 38 skilled technical positions, and 43 

hourly-paid laborers. Part-time workers worked between 30 and 35 hours per week throughout 

the year. Seasonal workers worked between two and a half and six months, depending on which 

farm they employed at. 

Based on the land area existing tenants intend to hold, by 2010, the potential farm output could 

in aggregate grow to approximately $38.4 million, providing 405 farm jobs in total, with 60 fulltime 

and 345 part-time and seasonal jobs. However, based on the estimated actual output in 2004 

combining with existing farms’ expansion plans, actual output could be in the range of 60-70% 

of its potential in the 2010a scenario. With the multiplier effects, farm activities originated in 

Kekaha’s former sugar land could contribute approximately $71 million in total to Hawaii’s GSP 

and provide about 834 full-time and part-time jobs. If 7,325 acres that are considered most 

productive and readily arable cropland of the 12,592 acres were fully utilized, the farm gate 

value of output in aggregate could rise to approximately $50.8 million, providing about 73 fulltime 

and 440 part-time and seasonal jobs. With the multiplier effects, the Kekaha former sugar 

land could contribute about $95 million in total to the GSP and provide about 1,056 full-time and 

part-time jobs. 

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Products used in the estimation are neither by any mean what this study recommends, nor does 

this study provides any indication that vegetables and melons will take half of the Kekaha 

agricultural landscape in the next 5-10 years. They are used for the estimation because they are 

already being grown there and have proven commercially successful in Hawaii. For many 

reasons, such as changes in the market conditions, technology and input costs, crops that are 

profitable today may become unprofitable in the future. For the same reason, crops that are not in 

the market today may be popular in the future. 

Major advantages for farm operations in Kekaha include relatively long annual production 

period, relatively low rent, abundant and inexpensive water supply and hydroelectricity power 

generated from the irrigation system. Disadvantages include a limited local market, relatively 

high input costs, and scarce skilled farm workers. The extra costs for shipping in the many 

necessary inputs and shipping out the products are major constraints for farming in Kauai. 

The major challenge for ADC, as a managing agent, is to find ways to maximize the potential of 

the land as agricultural production asset to generate income and employment for Hawaii’s 

residents. Currently, all tenants have revocable permits, which is renewable annually. The longterm 

lease ADC is considering to issue is an important step to encourage investment. Given 

Hawaii’s unique situations, which includes both constraints and advantages, together with farm 

practices and complexities involved in product quality control and pest management that farmers 

must deal with, managing the number and type of tenants in the Kekaha agricultural land may 

prove to be the most challenging point for ADC. A minimum land size requirement that is too 

large for leasing, designed to keep the number of tenants small, could result in much of the land 

being left idle while small farmers who need farm land the size less than the existing minimum 

requirement of 300 acres would be left out. On the other hand, too many small, independent 

farms producing diversified products in a given region could create logistical problems 

associated with pest control, which could affect crop yields in the whole area, as well as food 

safety. 

____________________ 

Interviews: 

Mr. Alfredo Lee, Executive Director, Agribusiness Development Corporation, State of Hawaii. 

Mr. C. W. “Bill” Spitz, Economic Development Specialist, Office of Economic Development, 

Kauai County. 

Mr. Charles Okamoto, Director of Finance & Property Management, Gay & Robinson. 

Mr. Kenny Chicoine of Syngenta Seeds, Inc. 

Mr. Maurice Munechika, Wines of Kauai. 

Mr. Steven Kai, Plant Manager, Parent Seed-Kekaha, Pioneer Supply Management, Poineer. 

Mr. Wally Johnson of Far West Ag. 

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References 

ADC (December 2004). Complete Summary Appraisal Report Regarding Market Rent for 

Agricultural Land, Kekaha, Kauai, Hawaii. Agribusiness Development Corporation, State of 

Hawaii. 

ADC (2002). Kekaha Business Plan Draft #2. Agribusiness Development Corporation, State of 

Hawaii. 

DBEDT (March 2002). The Hawaii-Input-Output Study: 1997 Bench-Mark Report. Research and 

Economic Analysis Division, Department of Business, Economic Development and Tourism, 

State of Hawaii. 

DLNR (April 2000). Kekaha Sugar Infrastructure Study. Department of Land and Natural 

Resource, State of Hawaii. 

HAS (various issues). Statistics of Hawaii Agriculture. Hawaii Agricultural Statistics, 

Department of Agriculture, State of Hawaii. 

NASS (2002). 2002 Census of Agriculture – County Data. National Agricultural Statistics 

Service, USDA. 

Southichack (August 2005), Fresh Produces Inshipment Estimation Model for State of Hawaii: A 

Modification of Model Concept and Estimation Procedures, Draft, HDOA. 

U.S. Census Bureau. 1997 Economic Census: Summary Statistics for Kauai County, HI. 

http://www.census.gov/epcd/ec97/hi/HI007.HTM. 

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Appendix 1 Kauai's Agricultural Production and Yield in Comparison with State’s Average Yield for Selected 

Commodities 

Commodities 

Farm 

Production 

Value in 

Latest Year 

($1,000) 

% Share in 

State's Total 

Farm Production 

Value in Latest 

Year 

Kauai State of Hawaii 

Average Farm 

Price Over a 

Specified Period 

($/lb) 

Average Yield Average Yield Average Average Average 

Over a Specified Over a Specified Farm Price Yield Over a Yield Over a 

Period (lbs/acre) Period ($/acre) Over a Specified Specified 

Specified Period Period 

Period ($/lb) (lbs/acre) ($/acre) 

1.Floriculture & Nursery (2003) 3,203 3.3 na na na na na na 1. 

2. Cut flowers [1] 268 1.9 na na na na na na 2. 

3. Orchids [2] 459 1.9 na na na na na na 3. 

4. Potted flowering plants 148 2.6 na na na na na na 4. 

5. Other nursery products [3] 2,198 7.0 na na na na na na 5. 

6.Fruits (2003, including pineapple) 1,739 1.3 na na na na na na 6. 

7. Avocados (99-03) na na na na na 0.6 2,680 1,570 7. 

8. Guava (proc., 99-03) na na na na na 0.1 19,433 2,635 8. 

9. Longan (00-03) na na na na na 3.4 1,473 5,009 9. 

10. Lychee (99, 02-03) na na na na na 2.8 1,095 3,027 10. 

11. Papayas (98-02) 482 4.0 0.4 23,840 8,969 0.3 25,720 8,354 11. 

12. Pineapples (00-04) na na na na na 0.3 34,016 10,453 12. 

13. Rambutan (99-03) na na na na na 2.9 1,882 5,499 13. 

14. Starfruit (99-03) na na na na na 1.1 5,358 5,830 14. 

15.Seed Crops (99-03) na na na na na 8.1 1,593 12,880 15. 

16.Vegetables and Melons (99-03) 1,558 3.0 1.0 6,508 6,482 0.5 14,864 7,302 16. 

17. Beans (Green, 98-02, HAKA) 147 16.7 0.9 3,400 3,044 0.9 5,080 4,623 17. 

18. Cabbages (Chinese, 98-02, HOKAMA) 528 32.4 na na na 0.2 21,596 3,824 18. 

19. Cabbages (Head, 98-02, HAHOKA) 1,844 67.5 na na na 0.2 25,467 4,169 19. 

20. Corn (sweet, 98-02, HAKA) 513 39.6 0.5 4,740 2,381 0.6 4,060 2,339 20. 

21. Cucumbers (98-02, HAKA) 289 11.6 0.4 17,240 7,337 0.4 13,440 5,887 21. 

22. Ginger Root (00-04) na na na na na 0.6 44,500 25,899 22. 

23. Lettuce (head and semi-head, 98-03) na na na na na 0.5 9,350 4,862 23. 

24. Melons (watermelons, 98-02, HAMAKA) [5] 100 3.4 0.2 8,740 2,176 0.2 20,640 4,830 24. 

25. Potato (sweet, 98-02, HAHOKA) 657 66.4 0.5 8,740 4,657 0.5 8,800 4,787 25. 

26. Taro (processed, poi, 00-04) [6] 2,079 74.0 0.5 16,534 8,753 0.5 13,944 7,491 26. 

27. Tomatoes (98-02) na na na na na 0.5 33,480 17,544 27. 

Notes: [1] Cut flowers refer to all cut flowers except for orchid, which is included in "Orchids." [2] Excludes orchids used for lei flowers. [3] Includes bedding plants, plant rental, sod, trees, and any other 

nursery products. [4] Shredded lettuce for salad. [5] In 1998 Kauai combined with only Hawaii. [6] Taro prepared for making poi. The capital letters in the parentheses in each row indicate county combined 

data. For example, HAHOKA - Hawaii, Honolulu, and Kauai combined. HA - Hawaii County, HO - Honolulu County (Oahu), KA - Kauai County, and MA - Maui County. 

Data Sources: Production and farm prices are from Statistics of Hawaii Agriculture 2002 and various issues of annual summary reports for specific products, HAS. Honolulu market supply and Kauai's 

shares in Honolulu market are calculated from inshipment data of fresh produces, Market News Section, Agricultural Development Division, HDOA. 

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Appendix 2 Commodity Briefs 



Floriculture and nursery products: Kauai’s floriculture and nursery production sale value (grower sale value) has 

been growing consistently in recent years, from $1.3 million in 2000 to $3.2 million in 2003 (Hawaii Flowers & 

Nursery Products Annual Summary, June 4, 2004, HAS). Kauai’s floriculture and nursery production value in 2003 

accounted for approximately 3% of state’s $97.7 million industry. Hawaii County is the largest producer (52%), 

followed by Honolulu (33%) and Maui (12%) counties. 

Fruits and nuts: Kauai’s fruit sale value declined consistently since 2001, from $3.8 million in 2000 to $1.7 million 

in 2003, and the county’s share in state’s total production also declined from 2.6% in 1999 to 1.3% in 2003. 

Included in the sale value are guava, tropical specialty fruits, bananas, papayas, avocados and citrus fruits. Tropical 

fruits are referring to longan, lychee, mango, rambutan, starfruit, among others. Kauai’s papaya production 

increased more than double between 1998 and 1999, growing from 2.06 to 4.76 million pounds. However, the 

county’s production declined by 57 percent between 2000 and 2001, from 3.94 to 1.69 million pounds, and dropped 

again in 2002 by more than 34 percent. 

Seed crops: Production of seed crops grew steadily since 1999. Total land use in production statewide expanded 

from 2,450 acres in 1999 to 4,080 acres in 2003. Total outshipment of seed increased from 3.5 million pounds in 

1999 to 6.4 million pounds in 2003. Total sales value (based on gross operational budget) increased from $30.5 

million in 1999 to $50.5 million. The majority of seed crops produced commercially is seed corn, which made up 98 

percent of total production sale value in 2003. 

Vegetables and melons: Kauai’s total production value of vegetables and melons grew from $0.80 million in 1999 

to $1.56 million by 2003. Kauai share in state's total production value of vegetables and melons also grew, from 

1.86% in 1999 to approximately 3% by 2003. Although on a five-year average (1999-2003) Kauai’s per pound farm 

value of vegetables and melons is more than twice that of state’s average, $1 versus $0.49, the county’s per acre 

yield in dollar terms is only approximately 90 percent of state’s average. The explanation lies with low per acre 

physical output of vegetables and melons grown in Kauai. On a five year average (1999-2003) Kauai’s per acre 

yield is 6,508 lbs while statewide average per acre yield is 14,864 lbs. 

Sweet potatoes: State’s total production of sweet potatoes declined steadily since after 1999, when aggregate farm 

output value was $1.83 million. In 2002 state’s total output was estimated at less than a million. 

Taro: State’s total taro production fluctuated downward since 1953. Oahu and Maui together was once the major 

taro producers. However, urbanization and the changing relative demand in the market had bidden away land and 

water resources from taro production in Hawaii, Oahu and Maui, making Kauai a leading taro producer in the state. 

In 2004, Kauai accounted for 74% of state’s total production. Kauai is also a major supplying base for Honolulu 

market. In 2004, Honolulu received 93% of all taro prepared for poi and chips from Kauai alone. Kauai’s taro 

production declined 19.6% in 2003, from $2.18 million in 2002, but regained 15.3% in 2004, while price remained 

roughly constant on an average over this period. Kauai’s competitive edge is in its higher yield (pounds of output 

per acre). If production cost for Kauai’s taro producers is roughly the same as for producers in other counties, Kauai 

will remain competitive relative to other counties. Threats: Since mid-1990’s to the present pests are the major 

problems for taro farmers. Apple snails and Taro Pocket Rot—a fungal disease caused by a species of 

Phytophthora—for wet taro; root aphids for dry land taro growers; and theft (reported) for all farmers. 

Cultured shrimp: Aquaculture in Hawaii has continued to grow in the past five years. Most growth took place in 

Hawaii County, which accounts for 71% of state’s total production of approximately $27.7 million in 2003. 

Honolulu, with approximately 17% share in state’s total output value in 2003, is state’s second largest aquaculture 

producer. Given a growing world’s cultured shrimp market, with the U.S. taking the lead as importer which 

purchased 48% of the $3.2 billion culture shrimp traded internationally, and with the existing infrastructure for 

cultured shrimp in place, Kekaha has the potential for commercial shrimp farming. However, given domination by 

the relatively low-cost S.E. Asian, Central and South American countries in the world major markets (U.S., Japan, 

and EU), the profitability of commercial shrimp culture in Kekaha is unclear. 

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Appendix 3 County Comparison: 

Farm Characteristics, Expenses and Income in 2002 

State Total Hawaii Honolulu Kauai Maui 

Number of farms 5,398 3,216 794 565 823 

Land in farm (acres) 1,300,499 821,276 70,705 151,828 256,690 

Total cropland 211,120 90,778 29,103 30,510 60,729 

Harvested cropland 109,461 55,529 13,757 11,771 28,404 

Irrigated land 69,194 9,041 13,703 19,595 26,855 

Average farm size 241 255 89 269 312 

Irrigated land as % of cropland 32.8 10.0 47.1 64.2 44.2 

Market value of agricultural products sold ($1,000) 533,423 187,736 179,321 41,855 124,511 

Government payment ($1,000) 886 397 60 165 264 

Income from farm-related sources ($1,000) 19,237 7,625 5,433 2,834 3,345 

Total farm production expenses ($1,000) 450,946 161,441 129,730 46,151 113,624 

Net cash income of operation ($1,000) 98,145 34,408 52,347 (914) 12,303 

Farm sizes (acres) 

1-9 3,440 2,009 574 352 505 

10-49 1,309 818 152 127 212 

50-179 335 207 34 38 56 

180-499 146 90 15 21 20 

500-999 61 38 5 11 7 

1000 or more 107 54 14 16 23 

Expenses ($1,000) 

Total farm production expenses 450,946 161,441 129,730 46,151 113,624 

Fertilizer, lime, and soil conditioners 17,791 5,738 5,009 2,329 4,714 

Chemicals 16,134 4,310 4,572 1,715 5,538 

Seeds, plants, vines, and trees 11,188 4,613 3,686 520 2,368 

Livestock and poultry 6,025 3,293 2,032 155 545 

Feed 27,997 11,993 11,148 2,282 2,575 

Gasoline fuel and oil 14,458 4,964 3,668 1,964 3,862 

Utilities 19,474 5,725 5,398 1,057 7,294 

Supplies, repairs, and maintenance 50,411 17,354 9,377 7,207 16,472 

Hired farm labor 177,692 47,453 59,615 18,082 52,452 

Contract labor 7,159 5,156 940 96 967 

Custom work and custom hauling 9,232 6,795 989 1,177 272 

Cash rent for land, building and grazing land 

Rent and lease expenses for machinery, 

19,723 6,866 7,471 1,938 3,448 

equipment and farm share of vehicles 3,066 1,128 678 608 653 

Interest expenses 8,633 5,372 1,202 1,372 688 

Property taxes 6,463 3,071 1,300 1,086 1,006 

All other production expenses 55,499 27,609 12,646 4,563 10,682 

Depreciation expenses claimed 34,498 16,031 5,823 2,352 10,292 

Data Source: 2002 Census of Agriculture, USDA, National Agricultural Statistics Service. 

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Appendix 4 

Technical Notes on Estimation Method: 



The aggregate potential farm output value is estimated using the following equation: 

4 n 

Y = Σ Σ aij Hj yi pi , 

j i 

The variable aij represents farm j’s fraction of the land area (in acreage) allocated for producing 

commodity i, for 0 < aij ≤ 1, and a11 + a21 + … + an1 = 1. Hj is farm j’s total land area. Thus, aijHj 

is the total land area farm j allocated for producing commodity i. The variables yi and pi 

respectively represent commodity i’s five-year average output per acre of land use and five-year 

average farm gate price. Output per acre and prices are averaged over five years period to 

minimize the effects of annual yield and price fluctuations, which could cause either over or 

under estimation. For commodities that have Kauai-specific data (sugarcane and vegetables and 

melons), the averages of output per acre and prices are Kauai-specific. Otherwise, they are 

statewide averages. 

Each farmer is assumed to be able to achieve an average yield for each crop by using common 

farm practices, management and technology that are common to farmers in Kauai and elsewhere 

in State of Hawaii and sell output at an average price specific to Kauai or State of Hawaii. The 

area of land used in the estimation is for the 7,758 acres, which are considered to be among the 

most productive land within the 12,592 acres complex under ADC’s control. Land productivity 

is assumed to be identical for each acre. 

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All Lease/License Terms Compared to DOA Agricultural Park (AP) Lot Lease Template 

The table below supplements the table in the main text relating to DOA and ADC instruments for land disposition. Whereas the table in the 

text reflects only selected terms, all terms of all five instruments are included here. 

The instruments compared in the table below are: 

(1) DOA AP Lot Lease: General Lease No. S-4936 between DOA and Glad’s Landscaping and Tree Trimming, Inc., dated May 1, 2001, 

for approx. 9.4 acres on Oahu. 

(2) DOA NAP Lot Lease: General Lease No. S-3771 between DOA and Contemporary Landscaping, LLC, dated August 23, 2011, for 

approx. 10 acres on Oahu. 

(3) ADC Lease: General Lease No. LE-K1202 between ADC and BASF Plant Science, L.P., dated July 16, 2012, for approx. 10 acres on 

Kauai. 

(4) ADC License: License No. LI-K1102 between ADC and Green Energy Team, LLC, dated May 3, 2011, for approx. 5,870 acres on 

Kauai. 

(5) ADC License: License No. LI-K1101 between ADC and Pacific Light and Power, Inc., dated April 15, 2011, for approx. 1,985 acres 

on Kauai. 

Payment Terms and Conditions (p. 2) 

Complete Lease Provisions from DOA Agricultural Park (AP) Lot Lease Template 

“ . . . the Lessee yielding and paying to the Lessor at the office of the Department of Agriculture, Honolulu, Oahu, a net annual rental as 

provided herein, payable in advance without notice or demand, in semi-annual installments . . .” 

Base Annual Rental (p.2) 

“For the first ten (10) years, the base annual rental shall be the sum of _____ DOLLARS ($_____), computed at _____ AND XX/100 

DOLLARS ($_____) per acre per annum for arable land, and _____ AND NO/100 DOLLAR ($_____) per acre per annum for non-arable land, 

provided that if any non-arable land is converted to arable land, the base annual rental for such land will be computed at _____ AND XX/100 

DOLLARS ($_____) per acre per annum, commencing on the date of final execution of this lease, or the date of such conversion, whichever is 

later, and such base annual rental shall be prorated ratably for the period; except, the Board may permit the Lessee to offset the cost of land 

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clearance and leasehold improvements against not more than two years of base annual rental, the evidence of which shall be submitted to and 

approved by the Lessor within the first year of the lease term.” 

Additional Rental (p. 3) 

“Each year on or before the 31st day of March, the Lessee shall submit to the Lessor a report disclosing the gross proceeds from the sale of 

commodities produced on the demised premises during the year immediately preceding. Together with the report, the Lessee shall pay to the 

Lessor any additional rental due, which amount shall be determined in the manner described below: From the report, determine a value 

representing _____ per cent (_____%) of the gross proceeds, which includes revenues from consignment sales and subletting. Any excess of 

the value so derived over the base annual rental constitutes the additional rental.” 

Reopening of Annual Rental (p. 3) 

“The base annual rental and additional rental shall be reopened and redetermined at the expiration of the 10th, 20th, and 30th years of the term, 

provided however, in no event shall the base annual rental be revised downward.” 

Determination of Annual Rental upon Reopening (p. 4) 

“The base annual rental and additional rental for any ensuing period shall be the fair market rental at the time of reopening. At least six months 

prior to the time of reopening, the fair market rental of the land in the specific use or uses for which the disposition was made shall be 

determined by an appraiser whose services shall be contracted for by the Lessor, and the Lessee shall be notified promptly of the determination; 

provided that should the Lessee disagree with the fair market rental as determined by the Lessor's appraiser, the Lessee may appoint its own 

appraiser, within fourteen days after written notice of the fair market rental, to prepare an independent appraisal report. The two appraisers 

shall review each other's reports and make every effort to resolve whatever differences they may have. Should differences still exist fourteen 

days after the exchange, the two appraisers, within seven days thereafter, shall appoint a third appraiser who shall also prepare an independent 

appraisal report and shall furnish copies thereof to the first two appraisers within forty-five days of the appointment. Within twenty days after 

receiving the third appraisal report, all three appraisers shall meet to determine the fair market rental. The fair market rental as determined by a 

majority of the appraisers shall be final and binding upon both the Lessor and the Lessee, subject to chapter 658A, Hawaii Revised Statutes. 

The Lessee shall pay for its own appraiser and the cost of services of the third appraiser shall be borne equally by the Lessor and the Lessee. 

All appraisal reports shall become part of the public record of the Lessor. In the event that the appraisers are unable to determine the fair 

market rental before the reopening date, the Lessee shall continue to pay the rent at the rate effective for the previous rental period, but the 

Lessee shall make up any deficiency within thirty days after the new rental has been determined. The Lessee or its appraiser's failure to comply 

with the procedures set forth herein shall constitute a waiver of the Lessee's right to contest the new fair market rental, and the Lessee shall pay 

the rental as determined by the Lessor's appraiser without adjustment. Alternatively, the Board may treat the failure as a breach of the lease 

and terminate this lease.” 

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Facilities Capital Recovery Fee (p. 5) 

“The Lessee shall pay a facilities capital recovery (‘FCR’) fee commencing on the date the Lessor installs improvements in support of the 

Lessee's operations or the commencement of the term of this lease, whichever is later. The FCR fee is based on the Lessor's expenditures to 

install the improvements and is based on one-tenth of one per cent of the Lessor's expenditures and will be added to the base annual rental each 

year.” 

Interest on Delinquent Rental (p. 5) 

“Interest at the rate of one per cent (1%) per month shall be charged on delinquent rentals.” 

Minerals and Water Rights (p. 5) 

“(a) All minerals as hereafter defined, in, on, or under the demised premises and the right, on its own behalf or through persons authorized by 

it, to prospect for, mine, and remove the minerals and to occupy and use so much of the surface of the ground as may be required for all 

purposes reasonably extending to the mining and removal of the minerals by any means, including strip mining, shall be reserved to the Lessor. 

‘Minerals’, as used herein, means any and all oil, gas, coal, phosphate, sodium, sulfur, iron, titanium, gold, silver, bauxite, bauxitic clay, 

diaspore, boehmite, laterite, gibbsite, alumina, all ores of aluminum, and all other mineral substances and ore deposits, whether solid, gaseous, 

or liquid, including all geothermal resources in, on, or under the premises, fast or submerged; provided that ‘minerals’ shall not include sand, 

gravel, rock, or other material suitable for use and when used in general construction in furtherance of the Lessee's permitted activities on the 

demised premises and not for sale to others. (b) All surface and ground waters appurtenant to the demised land and the right on its own behalf 

or through persons authorized by it, to capture, divert, or impound the same and to occupy and use so much of the demised premises as may be 

required in the exercise of this right, shall be reserved to the Lessor; provided that as a condition precedent to the exercise by the Lessor of the 

rights reserved in this paragraph, just compensation shall be paid to the Lessee for any of the Lessee's improvements taken.” 

Prehistoric and Historic Remains (p. 6) 

“All prehistoric and historic remains found in, on, or under the premises shall be reserved to the Lessor.” 

Ownership of Fixed Improvements (p. 6) 

“The ownership of all improvements, including but not limited to fences and stockwater systems located on the demised land prior to or on the 

commencement date of this lease, excluding the improvements constructed during the term of this lease, unless provided otherwise, shall be 

reserved to the Lessor.” 

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C-482

Withdrawal (p. 6) 

“The Lessor shall have the right to withdraw the demised premises, or any portion thereof, at any time during the term of this lease with 

reasonable notice and without compensation, except as provided herein, for public uses or purposes, for constructing new roads or extensions, 

or changes in line or grade of existing roads, for rights-of-way and easements of all kinds, and the premises shall be subject to the right of the 

Lessor to remove soil, rock, or gravel as may be necessary for the construction of roads and rights-of-way within or without the demised 

premises; provided that upon the withdrawal or taking which causes any portion of the land originally demised to become unusable for the 

specific use or uses for which it was demised, the base annual rental shall be reduced in proportion to the value of the premises withdrawn or 

made unusable. If any permanent improvement constructed upon the land by the Lessee is destroyed or made unusable in the process of the 

withdrawal or taking, the proportionate value thereof shall be paid based upon the unexpired term of this lease; provided that no withdrawal or 

taking shall be had as to those portions of the land which are then under cultivation with crops until the crops are harvested, unless the Lessor 

pays to the Lessee the value of the crops; and provided further that upon withdrawal the Lessee shall be compensated for the present value of 

all permanent improvements in place at the time of withdrawal that were legally constructed upon the premises by the Lessee of the leased land 

being withdrawn. In the case of tree crops, the Lessor shall pay to the Lessee the residual value of the trees taken and, if there are unharvested 

crops, the value of the crops also.” 

Payment of Rent (p. 7) 

“The Lessee shall pay the required rent in legal tender of the United States of America to the Lessor at the times, in the manner and form, and 

at the place specified above, or at any other place designated by the Lessor.” 

Taxes, Assessments, etc. (p. 8) 

“The Lessee shall pay or cause to be paid when due the amount of all taxes, rates, assessments, and other outgoings of every description as to 

which the demised premises or any part thereof, or any improvements thereon, or the Lessor or the Lessee in respect thereof, are now or may be 

assessed or become liable by authority of law during the term of this lease; provided that with respect to any assessment made under any 

betterment or improvement law which may be payable in installments, the Lessee shall be required to pay only such installments, together with 

interest, as shall become due and payable during the term.” 

Utility Services (p. 8) 

“The Lessee shall pay when due all charges, duties, and rates of every description, including, but not limited to, water, sewer, gas, refuse 

collection, or any other charges, as to which the demised premises, any part thereof, any improvements thereon, or the Lessor or the Lessee in 

respect thereof may become liable during the term, whether assessed to or payable by the Lessor or the Lessee.” 

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C-483

Irrigation Costs (p. 8) 

“Without limiting the provisions of the preceding section, the Lessee shall be responsible for its share of operating and maintenance costs 

associated with the irrigation system, if any, which provides irrigation water to _____ Agricultural Park including the demised premises. The 

Lessee agrees not to oppose the establishment of an irrigation project under Chapter 167, Hawaii Revised Statutes, under which assessments, 

tolls, fees, and charges for water usage and irrigation system operation and maintenance shall be set, and the Lessee agrees to abide by and to 

pay when due all assessments, tolls, fees, and charges set by such project.” 

Character of Use (p. 9) 

“(a) The Lessee shall use the premises hereby demised solely for diversified agriculture purposes, subject to the covenants, conditions, and 

restrictions of any and all encumbrances on the premises existing as of the date of this lease. No other use shall be permitted except as provided 

in section 4-153-33, Hawaii Administrative Rules. (b) No livestock production operations shall be conducted on the premises without the prior 

approval of the Department of Health. (c) All livestock production operations shall be operated and maintained so as not to create any public 

health problems as determined by the Department of Health. (d) No cesspools shall be constructed on the premises. However, upon approval 

from the Department of Health, the Lessee may use alternative wastewater treatment and disposal systems which do not pose a threat to the 

groundwater. (e) No solid or liquid animal waste shall be disposed of at the premises. Disposal of all solid and liquid animal waste must be by 

a means acceptable to the Department of Health. (f) Unless otherwise provided, the covenants, conditions, and restrictions contained in this 

section shall run with the land until the time that the premises is reclassified to a land use district other than an agricultural district, provided 

that if less than all the premises is reclassified, then the covenants, conditions, and restrictions shall terminate only as to the portion of the 

premises which is reclassified to a land use district other than an agricultural district. Any transfer, assignment, sublease, mortgage, or other 

instrument of conveyance of the premises shall expressly contain the restrictions on uses and the conditions in this section.” 

Utilization and Development of the Land (p. 10) 

“The development of the premises shall be completed within three (3) years from the commencement date of this lease, with not less than fifty 

percent (50%) developed within the first two (2) years of the term. Utilization and development of the premises shall be in accordance with a 

plan of utilization and development which shall be prepared by the Lessee and approved by the Lessor before execution of this lease. Any 

modification or deviation from the plan without the prior written approval of the Lessor may constitute a breach of this lease and cause for the 

termination thereof.” 

Good Husbandry and Conservation Practices (p. 10) 

“The Lessee shall at all times practice good husbandry with regard to the use of the demised premises for the use permitted and shall carry out a 

program of conservation based upon a conservation plan developed by the Lessee in cooperation with the appropriate Soil and Water 

Conservation District. In the event the activities of the Lessee are determined to be contrary to the conservation plan, the Lessor shall notify 

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the Lessee of the discrepancy, and the Lessee shall be required, within sixty days of the notice, to cure the discrepancy and to submit proof 

thereof satisfactory to the Lessor.” 

Major Portion of Income (p. 11) 

“Within three years following the commencement date of this lease, the Lessee shall attain and maintain throughout the remainder of the lease 

term a level of agricultural operation that generates more than fifty per cent (50%) of the Lessee's total annual income; except, that this 

restriction shall not apply if failure to meet the requirement results from mental or physical disability or the loss of a spouse, or if the premises 

are fully utilized in the production, marketing, and sale of crops or products for which this lease was granted. Each year on or before April 

30th following the third year of the lease term, the Lessee shall submit a copy of its federal or state income tax return for the year immediately 

preceding. The submitted tax return shall be subject to audit and verification by the Lessor who may impose additional requirements to carry 

out the requirements of this section. 

Sanitation (p. 11) 

“The Lessee shall keep the demised premises and improvements in a strictly clean, sanitary, and orderly condition.” 

Waste and Unlawful, Improper, or Offensive Use of the Premises (p. 11) 

“The Lessee shall not commit, suffer, or permit to be committed any waste, nuisance, strip or unlawful, improper, or offensive use of the 

demised premises or any part thereof, nor cut down, remove, or destroy, or suffer to be cut down, removed, or destroyed, any trees now 

growing on the premises without the prior written approval of the Lessor.” 

Inspection of Premises (p. 12) 

“The Lessee shall permit the Lessor and its agents, at all reasonable times during the term, to enter the premises and examine the state of repair 

and condition thereof and the improvements, equipment, chattels, books, and records of the Lessee in connection with the administration of this 

lease.” 

Improvements (p. 12) 

“At any time during the term, the Lessee shall not construct, place, maintain, or install on the premises any building, structure, signs, or 

improvement, except with the prior written approval of the Lessor and upon such conditions as the Lessor may impose. All buildings, 

structures, signs, or improvements shall be in accordance with all applicable federal, state, and county laws, ordinances, and rules. The 

ownership thereof shall be in the Lessee until the expiration or sooner termination of this lease, at which time the ownership thereof shall, at the 

option of the Lessor, vest in the Lessor or shall be removed by the Lessee at the Lessee's sole cost and expense.” 

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C-485

Repairs to Improvements (p. 12) 

“The Lessee shall, at its expense, keep, repair, and maintain all buildings, structures, and improvements now existing or hereafter constructed 

or installed on the demised premises in good order, condition, and repair, reasonable wear and tear excepted. Said buildings, structures, and 

improvements shall include, without limitation, roadways, drainage facilities, ditches, drains, culverts, reservoirs, flumes, pipelines, water 

courses, fences, gates, bridges, sidewalks, curbs, sewers, parking areas, fillings, pumps, wells, boundary markers and monuments, and other 

works and structures.” 

Dwelling Restrictions (p. 13) 

“The Board may permit farm dwellings on the premises if the need is clearly demonstrated. The farm dwellings shall be used in direct 

connection with agricultural activities on the premises and shall not be used for rental or any other purposes. The dwellings shall be subject to 

such additional terms and conditions as the Board may require including, but not limited to, an adjustment of the lease rental. All construction 

on the premises shall be in accordance with plans approved by the Lessor and shall be in accordance with all applicable federal, state and 

county laws, ordinances, regulations, and rules, including, but not limited to, laws regarding environmental quality control.” 

Insurance (p. 13) 

“At all times during the term of this lease, the Lessee shall keep insured all buildings and improvements erected on the demised premises in the 

joint names of the Lessor, the Lessee, and any mortgagee, as their interests may appear, against loss or damage by fire, including perils 

specified in the extended coverage endorsement and in an amount equal to the maximum insurable value thereof, and shall pay the premiums 

thereon at the time and place the same are payable; the policy or policies of insurance shall be made payable in case of loss to the Lessor, the 

Lessee, and any mortgagee, as their interests may appear, and shall be deposited with the mortgagee; and any proceeds derived therefrom in the 

event of total or partial loss shall be immediately available, and as soon as reasonably possible, to be used by the Lessee for rebuilding, 

repairing, or otherwise reinstating the same buildings or improvements in a good and substantial manner according to the plans and 

specifications approved in writing by the Board; except, that with the approval of the Lessor, the Lessee may surrender this lease and pay the 

balance owing on any mortgage, and the Lessee shall receive that portion of the proceeds which the unexpired term of this lease at the time of 

the loss or damage bears to the whole of the term, the Lessor to retain the balance of the proceeds.” 

Right of First Refusal (p. 14) 

“An agricultural park lease or any interest therein, including stock of a corporation holding the lease or an interest in a partnership or 

association holding the lease, shall not be transferred or assigned unless the lease and improvements, or any interest therein, are first 

surrendered to the Board, as follows: (1) The Board shall have the option to re-purchase the lease for the price paid by the current lessee, 

including closing costs, or the fair market value, less appreciated value, at the time of re-purchase, as determined in paragraph (3), whichever is 

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the lower but not less than zero. For the purposes of this section, "price paid by the current lessee" means the consideration paid for the lease 

exclusive of improvements, and "appreciated value" means the replacement cost for developing the demised premises. (2) Any improvements 

affixed to the realty, including trade fixtures and growing crops, shall be re-purchased at their fair market value. (3) At the time of the repurchase, 

the fair market value of the lease less appreciated value and the fair market value of any improvements shall be determined by a 

qualified appraiser whose services shall be contracted for by the Lessor; provided that should the Lessee disagree with the values, the Lessee 

may appoint the Lessee's own appraiser who, together with the Lessor's appraiser, shall appoint a third appraiser, and the fair market value shall 

be determined by arbitration as provided in chapter 658, Hawaii Revised Statutes. In this event, the Lessee shall pay for the Lessee's appraiser, 

the Lessor shall pay for the Lessor's appraiser, and the cost of the third appraiser shall be borne equally by the Lessee and the Lessor. (4) The 

Board may re-purchase the lease and improvements with funds from the agricultural park special fund or may accept a surrender of lease 

subject to the offer by a qualified applicant to purchase the lease and improvements, including any encumbrances, for not less than the amount 

to be paid therefor by the Board; provided that the purchase by a qualified applicant shall be subject to sections 4-153-19 and 4-153-22, Hawaii 

Administrative Rules. (5) Notwithstanding the conditions herein, the consideration for the applicant's purchase of the lease as provided in 

paragraph (4) shall not be less than the total of all encumbrances that have been approved by the Lessor at the time of the re-purchase. 

(6) This section shall not apply to a holder of record having a security interest upon foreclosure pursuant to section 4-153-35, Hawaii 

Administrative Rules.” 

Assignments of Lease, Lease Interest, etc. (p. 16) 

“(a) Any transferee, assignee, or sublessee of an agricultural park lease shall satisfy applicant qualification requirements. No lease or any 

interest therein, including corporate stock or an interest in a partnership or association, shall be transferred or assigned without the consent of 

the Board, except by devise, bequest, or intestate succession and upon the further condition that there is a dwelling on the property in which the 

devisee or heir resides or that more than fifty per cent (50%) of the devisee's or heir's income is derived from the productive use of the property. 

In the absence of or upon cessation of these conditions, the devisee or heir shall surrender this lease and improvements, or any interest therein, 

to the Board pursuant to its right of first refusal. (b) With the approval of the Board, and subject to its right of first refusal, the assignment and 

transfer of a lease or any interest therein, including stock of a corporation holding the lease or an interest in a partnership or association holding 

the lease, may be made if: (1) The lease contains the principal residence of the Lessee; (2) The Lessee becomes mentally or physically 

disabled; (3) Extreme economic hardship is demonstrated to the satisfaction of the Board; or (4) The assignment is to the corporate successor of 

the Lessee; provided that with the prior written approval of the Board, the assignment and transfer of this lease or any portion may be made in 

accordance with current industry standards, as determined by the Board; provided further, that prior to the approval of any assignment of lease, 

the Board shall have the right to review and approve the consideration to be paid by the assignee and may condition its consent to the 

assignment of the lease on payment by the Lessee of a premium based on the amount by which the consideration for assignment, whether by 

cash, credit, or otherwise, exceeds the depreciated cost of improvements and trade fixtures being transferred to the assignee pursuant to the 

Assignment of Lease Evaluation Policy adopted by the board on March 6, 1992; as amended, a copy of which is attached hereto as Exhibit “C.” 

The premium on any subsequent assignments shall be based on the difference in the selling and purchase price plus the straight-line depreciated 

cost of any improvements constructed by the then assignor, pursuant to the above-mentioned Evaluation Policy. With respect to state 

agricultural leases, in the event of foreclosure or sale, the above described premium shall be assessed only after the encumbrances of record and 

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any other advances made by the holder of a security interest are paid; and provided further that the Lessor may adjust the base annual and 

percentage (additional) rental pursuant to section 4-153-18, Hawaii Administrative Rules.” 

Subletting (p. 18) 

“The Lessee shall not rent or sublet the whole or any portion of the demised premises without the prior written approval of the Board; provided 

that before approval, the Board shall have the right to review and approve the rent to be charged to the sublessee; provided further that where 

the Lessee is required to pay rent based on a percentage of its gross receipts, the rents paid to the Lessee by the sublessee shall be included as 

part of the Lessee's gross receipts; provided further that the Board shall have the right to review and, if necessary, revise the base annual rental 

and percentage (additional) rental of the demised premises based upon the rental rate charged to the sublessee; and provided further that the 

base annual rental and percentage (additional) rental may not be revised downward.” 

Mortgage (p. 18) 

“Except as provided, the Lessee shall not mortgage, hypothecate, or pledge the premises or any portion thereof, or this lease or any interest 

therein, without the prior written approval of the Chairperson, on behalf of the Lessor, and any mortgage, hypothecation, or pledge without 

approval shall be void. Upon application and with the written consent of the Lessor, the Lessee may mortgage this lease or any interest therein 

or create a security interest in the leasehold of the demised premises. If the mortgage or security interest is to a recognized lending institution 

authorized to do business in the State of Hawaii, consent shall extend to foreclosure and sale at the foreclosure to any purchaser, provided that 

the purchaser is qualified to lease and hold the premises or any interest therein.” 

Breach (p. 19) 

“Except as otherwise provided, in the event of a breach or default of any term, covenant, restriction, or condition of this lease, the Board shall 

deliver a written notice of the breach or default by personal service or by registered or certified mail to the Lessee and to each holder of record 

having any security interest in the premises covered by or subject to this lease, making demand upon the Lessee to cure or remedy the breach or 

default within sixty days from the date of receipt of the notice; provided that where the breach involves a failure to make timely rental 

payments, including payment of any additional rent, the written notice shall include a demand upon the Lessee to cure the breach within thirty 

days after the receipt of the notice. Upon failure of the Lessee to cure or remedy the breach or default within the time period provided, or 

within such additional period as the Board may allow for good cause, the Board may exercise the rights it may have, subject to the rights of a 

holder of a security interest. Without limiting the foregoing, the Board, after due notice of default, shall terminate this lease or tenancy and 

take possession of the leased premises together with all improvements placed thereon without demand or previous entry and without legal 

process and shall retain all rent paid in advance as damages for the violations. The retention of advance rent as liquidated damages shall be in 

addition to any other rights and remedies available to the Lessor.” 

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Rights of Holder of Record of Security Interest (p. 20) 

“(a) Whenever any notice of breach or default is given to any party under section 4-153-34, Hawaii Administrative Rules, or under the terms of 

this lease, a copy of the notice shall be delivered by the Lessor to all holders of record having a security interest in any premises or interest 

covered by this lease or other instrument whose security interest has been recorded with the Department of Agriculture and the Bureau of 

Conveyances. In the event the Board seeks to forfeit the privilege, interest, or estate created by this lease, each recorded holder of a security 

interest may cure or remedy the default or breach of rent payment within thirty days, or any other default or breach within sixty days, from the 

date of receipt of the notice set forth herein, or within such additional period as the Board may allow for good cause, and add the cost thereof to 

the mortgage debt and the lien of the mortgage. Upon failure of the holder to exercise its option, the Board may: (1) Pay to the holder from 

any moneys at its disposal the amount of the mortgage debt, together with interest and penalties, and secure an assignment of the debt and 

mortgage from the holder; or if ownership of the interest or estate shall have vested in the holder by way of foreclosure, or action in lieu 

thereof, the Board shall be entitled to the conveyance of the interest or estate upon payment to the holder of the amount of the mortgage debt, 

including interest and penalties, and all reasonable expenses incurred by the holder in connection with the foreclosure and preservation of its 

security interest, less appropriate credits, including income received from the privilege, interest, or estate subsequent to the foreclosure; or 

(2) If the property cannot be reasonably reassigned without loss to the Lessor, then terminate the outstanding privilege, interest, or estate 

without prejudice to any other right or remedy for arrears of rent or for any preceding or other breach or default and use its best efforts to 

redispose of the affected land to a qualified and responsible person free and clear of the mortgage and the debt thereby secured; provided that a 

reasonable delay by the Board in instituting or prosecuting any right or remedy it may have shall not operate as a waiver of the right or to 

deprive it of the remedy when the delay serves to assist the Board in resolving the problems created by the breach or default involved. (b) The 

proceeds of any redisposition effected shall be applied: first, to reimburse the Lessor for costs and expenses in connection with the 

redisposition; second, to discharge in full any unpaid lease rental or other indebtedness owing the Lessor in connection with the privilege, 

interest, or estate terminated, and any balance to the owner of the privilege, interest, or estate.” 

Acceptance of Rent Not a Waiver (p. 21) 

“The acceptance of rent by the Lessor shall not be deemed a waiver of any breach by the Lessee of any term, covenant, or condition of this 

lease, of the Lessor's right to re-entry for breach of covenant, nor of the Lessor's right to declare and enforce a forfeiture for any breach, and the 

failure of the Lessor to insist upon strict performance of any term, covenant, or condition, or to exercise any option conferred herein, shall not 

be construed as a waiver or relinquishment of any term, covenant, condition, or option.” 

Liability Insurance (p. 22) 

“The Lessee shall procure and maintain during the entire period of this lease a policy or policies of commercial general liability insurance as 

will protect it from and against any liability for all claims for personal injury, death, and property damage which may arise out of the exercise 

of rights granted herein. The policy or policies shall cover the entire premises, including all buildings, improvements, and grounds and all 

roadways or sidewalks on or adjacent to the demised premises in the control or use of the Lessee. The minimum limit of said policy or policies 

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C-489

shall not be less than the single limit of $1,000,000.00, approved by the Board and subject to periodic review and adjustment every two (2) 

year(s), insuring the Lessor and the Lessee against all claims for personal injury, death, and property damage. The Lessee shall furnish the 

Lessor with a certificate verifying the policy and shall furnish a certificate upon each renewal of the policy, each certificate to contain or be 

accompanied by an assurance of the insurer to notify the Lessor of any intention to cancel any policy prior to actual cancellation. The 

certificate of insurance shall name the Lessor as an additional insured and shall require a thirty day notice to the Lessor of any policy change or 

cancellation. The procuring of this policy shall not release or relieve the Lessee of its responsibility under this lease or limit the amount of its 

liability under this lease.” 

Performance bond (p. 23) 

“The Lessee shall procure and deposit with the Lessor and thereafter keep in full force and effect during the term of this lease, a performance 

bond in an amount equal to two times the annual base rental as a surety for the satisfactory compliance of lease terms, conditions, and 

covenants. The bond shall provide that in case of a breach or default of any of the terms, conditions, and covenants contained herein, the full 

amount of the bond shall be paid to the Lessor as liquidated and ascertained damages and not as a penalty. The Lessor may waive or suspend 

the performance bond requirement at its discretion; provided that the Lessee has substantially complied with the terms, conditions, and 

covenants of this lease; and provided further that the Lessor reserves the right to reinstate the bond requirement at any time throughout the term 

of this lease.” 

Justification of Sureties (p. 23) 

“The bonds that are required herein shall be supported by the obligation of a corporate surety organized for the purpose of being a surety and 

qualified to do business as a surety in the State of Hawaii, or by no less than two personal sureties, corporate or individual, for which 

justifications shall be filed as provided in section 78-20, Hawaii Revised Statutes; provided that the Lessee may furnish a written bond in the 

same amount and with the same conditions, executed by it alone as obligor, if, in lieu of any surety or sureties, the Lessee shall furnish and at 

all times thereafter keep and maintain any of the forms of financial guarantee of performance that is approved by the Lessor.” 

Indemnity (p. 24) 

“The Lessee shall indemnify, defend, and hold harmless the Lessor from and against any claim or demand for loss, liability, or damage, 

including claims for property damage, personal injury, or wrongful death, arising out of any occurrence on the demised premises or on 

sidewalks, parking areas, and roadways adjacent thereto, or occasioned by any act or nuisance made or suffered on the premises, or by any 

accident or fire thereon, or growing out of or caused by any failure on the part of the Lessee to maintain the premises in a safe condition, or by 

any act or omission of the Lessee, and from and against all actions, suits, damages, and claims by whomsoever brought or made by reason of 

the non-observance or non-performance of any of the terms, covenants, and conditions herein or the laws, ordinances, rules, and regulations of 

the federal, state, or county governments. The provisions of this paragraph shall survive the expiration or earlier termination of this lease. 

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C-490

Costs of Litigation (p. 24) 

“If the Lessor shall be made a party to any litigation commenced by or against the Lessee (other than condemnation proceedings), without any 

fault on the Lessor's part, the Lessee shall pay all costs and expenses incurred by or imposed on the Lessor including, but not limited to, 

attorney's fees; furthermore, the Lessee shall pay all costs and expenses which may be incurred by or paid by the Lessor in enforcing the 

covenants and agreements of this lease, in recovering possession of the demised premises, or in the collection of delinquent rental, taxes, and 

any and all other charges.” 

Liens (p. 25) 

“The Lessee will not commit or suffer any act or neglect whereby the premises, any improvement, or the estate of the Lessee in the same shall 

become subject to any attachment, lien, charge, or encumbrance, except as provided herein, and shall indemnify, defend, and hold harmless the 

Lessor from and against all attachments, liens, charges, and encumbrances and all expenses resulting therefrom.” 

Lessor's Lien (p. 25) 

“The Lessor shall have a lien on all the buildings and improvements placed on the premises by the Lessee, on all property kept or used on the 

demised premises, whether the same is exempt from execution or not, and on the rents of all improvements and buildings situated on the 

premises for all costs, attorney's fees, and rent reserved, for all taxes and assessments paid by the Lessor on behalf of the Lessee, and for the 

payment of all moneys as provided in this lease to be paid by the Lessee, and the lien shall continue until the amounts due are paid.” 

Condemnation (p. 25) 

“If any portion of the demised premises shall be condemned for public purposes by the Lessor, a county, or any other governmental agency, the 

base annual rental shall be reduced in proportion to the value of the portion of the premises condemned. The Lessee shall be entitled to receive 

from the condemning authority: (a) The value of growing crops which it is not permitted to harvest; and (b) The proportionate value of the 

Lessee's permanent improvements so taken in the proportion that it bears to the unexpired term of this lease; provided that in the alternative, the 

Lessee may remove and relocate its improvements to the remainder of the premises occupied by the Lessee. The Lessee shall not by reason of 

the condemnation be entitled to any claim against the Lessor for condemnation or indemnity for the leasehold interest, and all compensation 

payable or to be paid for or on account of the leasehold interest by reason of the condemnation shall be payable to and be the sole property of 

the Lessor. The foregoing rights of the Lessee shall not be exclusive of any other to which the Lessee may be entitled by law. Where the 

portion so taken renders the remainder unsuitable for the use or uses for which the premises were demised, the Lessee shall have the option to 

surrender this lease and be discharged and relieved from any further liability therefor; provided that the Lessee may remove the permanent 

improvements constructed, erected, and placed by the Lessee within such reasonable period as may be allowed by the Lessor.” 

12 

C-491

Right to Enter (p. 26) 

“The Lessor, the City and County of Honolulu, or their representatives shall have the right at all reasonable times to enter and cross any portion 

of the demised premises for the purpose of performing any public or official duties; provided that in the exercise of the rights, the Lessor, the 

City and County of Honolulu, or their representatives shall not interfere unreasonably with the Lessee or the Lessee's use and enjoyment of the 

premises.” 

Extension of Time (p. 26) 

“Notwithstanding any provision to the contrary, wherever applicable, the Lessor, for good cause shown, may allow additional time beyond the 

time or times specified herein to the Lessee, in which to comply, observe and perform any of the terms, conditions, and covenants contained in 

this lease.” 

Quiet Enjoyment (p. 27) 

“The Lessor covenants and agrees with the Lessee that upon payment of rent at the times and in the manner specified and the observance and 

performance of the covenants, terms, and conditions hereof on the part of the Lessee to be observed and performed, the Lessee shall have, hold, 

possess, and enjoy the demised premises for the term demised, without hindrance or interruption by the Lessor or any other person or persons 

lawfully claiming by, through, or under it.” 

Surrender (p. 27) 

“At the end of the term or other sooner termination of this lease, the Lessee shall peaceably deliver unto the Lessor possession of the demised 

premises, together with all improvements existing or constructed thereon unless provided otherwise in this lease. Furthermore, upon the 

expiration, termination, or revocation of this lease, should the Lessee fail to remove any and all of the Lessee's personal property from the 

premises, the Lessor may remove or dispose of any and all personal property from the premises and either deem the property abandoned and 

dispose of the property or place such property in storage at the cost and expense of the Lessee, and the Lessee shall pay all costs and expenses 

for removal, disposal, transporting, and storage of the personal property. The provisions of this paragraph shall survive the expiration or earlier 

termination of this lease.” 

Non-warranty (p. 28) 

“The Lessor does not warrant the conditions of the demised premises, as the same is being leased ‘as is.’” 

13 

C-492

Hazardous Materials (p. 28) 

“(a) The Lessee shall not use, generate, manufacture, treat, handle, refine, produce, process, store, discharge, release, dispose of, or allow to 

exist on, within, under, or about the premises any hazardous materials, except in full compliance with all applicable hazardous materials laws. 

If the Lessee at any time becomes aware of any past, present, or contemplated hazardous discharge or of any hazardous materials claims with 

respect to the premises which could subject the Lessor, the Lessee, any mortgagee, or the premises to any liability or restrictions on ownership, 

occupancy, transferability, or use of the premises under any hazardous materials laws, the Lessee shall immediately advise the Lessor thereof in 

writing and provide to the Lessor such detailed reports thereof as may be reasonably requested by the Lessor. The Lessor shall have the right, 

in its sole discretion, to join and participate in, any settlements, remedial actions, or legal proceedings or actions initiated with respect to any 

hazardous materials claims. (b) The Lessee shall be responsible for and shall indemnify, defend, and hold harmless the Lessor and its 

employees, agents, successors, and assigns from and against any loss, damage, cost, expense, or liability directly or indirectly arising out of or 

attributable to the past, present, or future use, generation, manufacture, treatment, handling, refining, production, processing, storage, release, 

threatened release, discharge, disposal, or presence of hazardous materials on, under, or about the premises, including, without limitation: (1) 

all foreseeable and unforeseeable consequential damages; (2) the costs of any required or necessary repair, clean-up, or detoxification of the 

premises and of the preparation and implementation of any closure, remedial, or other required plans; (3) the costs of the Lessor's investigation 

and handling of any hazardous materials claims, whether or not any lawsuit or other formal legal proceeding shall have been commenced with 

respect thereto; (4) the costs of the Lessor's enforcement of this covenant, whether or not a lawsuit is brought therefor; and (5) all reasonable 

costs and expenses incurred by the Lessor in connection with clauses (1), (2), (3), and (4) including, without limitation, reasonable attorney's 

fees. (c) The provisions of this paragraph shall survive the expiration or earlier termination of this lease.” 

Covenant Against Discrimination (p. 29) 

“The use and enjoyment of the premises shall not be in support of any policy which discriminates against anyone based upon race, creed, color, 

national origin, sex, or physical handicap.” 

Hunting (p. 29) 

“No hunting shall be allowed on the demised premises during the term of this lease.” 

Boundary Stakeout (p. 29) 

“The Lessor shall not be responsible or liable for surveying and boundary stakeout of the demised premises. The Lessee shall be solely 

responsible for any survey and boundary stakeout of the demised premises.” 

14 

C-493

Fences (p. 29) 

“The Lessee shall, wholly at its own cost and expense, fence the whole or portion of the outside perimeter of the demised premises if such 

fencing shall be required by the Lessor or should be so required by any law now in force or that may hereafter be enacted and shall and will 

maintain in good order and condition throughout the period of this lease the fences so constructed and those now existing on the demised 

premises.” 

Setback Requirements (p. 30) 

“Building setback lines shall be in accordance with applicable city and county ordinances and rules.” 

Drainage Easements (p. 30) 

“The demised premises shall be subject to drainage and flowage easements as applicable. The easement area shall not be altered or used for 

any purposes which may obstruct flow or reduce the effectiveness of the drainageway. The Lessee shall accept the storm runoff draining into 

and through the easement area and shall be responsible for the maintenance and protection of the drainage easements against deterioration or 

loss of functional effectiveness.” 

Roadway and Utility Easements (p. 30) 

“The demised premises shall be subject to roadway and utility easements as applicable, which easements shall be in favor of property owners 

served by the easements; provided that the Lessee may cross the easements at any point; provided further that the Lessee shall be responsible 

for maintenance of the easements.” 

Compliance with Laws (p. 30) 

“The Lessee shall comply with the requirements of all federal, state, and county authorities and observe all federal, state, and county laws, 

ordinances, and rules pertaining to the premises which are now in force or later may be in force.” 

Interpretation (p. 31) 

“The use of any gender shall include all genders. If there is more than one Lessee, all words used in the singular shall extend to all Lessees.” 

15 

C-494

Headings (p. 31) 

“The article and paragraph headings herein are inserted only for convenience and reference and shall in no way define, describe, or limit the 

scope or intent of any provision of this lease.” 

Partial Invalidity (p. 31) 

“If any term, provision, covenant, or condition of this lease should be held to be invalid, void, or unenforceable, the remainder of this lease 

shall continue in full force and effect and shall in no way be affected, impaired, or invalidated thereby.” 

Governing Law (p. 31) 

“This lease shall be construed, interpreted, and governed by the laws of the State of Hawaii.” 

Certification for Use of Pesticides (p. 32) 

“The Lessee shall be a certified pesticide applicator, subject to the State of Hawaii, Department of Agriculture's field consultation and 

inspection program. The Lessee will have the following options: (a) The Lessee shall not use any chemical listed by the United States 

Environmental Protection Agency as a restricted-use pesticide based on its potential to contaminate ground water; or (b) The Lessee shall be 

subject to semi-annual inspections for compliance with use restriction on listed groundwater contaminants, as specified by agreement between 

the Board of Water Supply and the State of Hawaii, Department of Agriculture.” 

Subdivision of Premises (p. 32) 

“The Lessee shall allow the Lessor to subdivide the premises, with reimbursement of Lessee's reasonable costs.” 

Definitions (p. 33) 

“As used is this lease, unless the context otherwise requires: 

‘Chairperson’ means the Chairperson of the Board of Agriculture. 

‘Corporate successor’ means a solely owned corporation which, through an assignment of lease, succeeds an agricultural park lessee who shall 

own all of the stock issued by and be the principal officer of the corporation. 

‘Diversified agriculture’ means the conduct of activities concerned with the production and marketing of nursery products and horticultural 

crops such as vegetables, melons, orchards, flowers, foliage, and others, including activities related thereto, but shall not include any livestock 

and poultry operations. 

16 

C-495

‘Drainage easements’ and ‘flowage easements’ mean natural or improved drainage courses that serve to convey streamflows from one point to 

another. 

‘Hazardous discharge’ means any event involving the use, deposit, disposal, spill, release, or discharge of any hazardous materials on, within, 

or under the premises. 

‘Hazardous materials’ means and includes any and all flammable explosives, radioactive materials, asbestos, petroleum and oil and their 

products, organic compounds known as polychlorinated biphenyls, chemicals known to cause cancer or reproductive toxicity, pollutants, 

contaminants, hazardous wastes, toxic substances or related materials, and any and all other substances or materials defined as or included in 

the definition of ‘hazardous substances,’ ‘hazardous wastes,’ ‘hazardous materials,’ and/or ‘toxic substances’ under or for the purposes of the 

hazardous materials laws. 

‘Hazardous materials claims’ means and includes: (i) any and all enforcement, clean-up, removal, mitigation, or other governmental or 

regulatory actions instituted or, to the best of the Lessee's knowledge, contemplated or threatened, with respect to the premises pursuant to any 

hazardous materials laws, and (ii) any and all claims made or, to the best of the Lessee's knowledge, contemplated or threatened by any third 

party against the Lessee or the premises seeking damages, contribution, cost recovery, compensation, injunctive relief, or other relief resulting 

from any hazardous discharge or from the existence of any hazardous materials on, within, or under the premises. 

‘Hazardous materials laws’ means and includes all federal, state, and local laws, ordinances, and regulations now or hereafter in effect relating 

to environmental conditions, industrial hygiene and/or hazardous materials on, within, under, or about the premises, including, without 

limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. §9601, et seq., the 

Resource Conservation and Recovery Act, 42 U.S.C. §6901, et seq., the Hazardous Materials Transportation Act 49 U.S.C. §1801, et seq., the 

Clean Water Act, 33 U.S.C. §1251, et seq., the Clean Air Act, 42 U.S.C. §7401, et seq., the Toxic Substances Control Act, 15 U.S.C. §§2601 

through 2629, the Safe Drinking Water Act, 42 U.S.C. §§300f through 300j, the Emergency Planning and Community RightTo-Know Act, 42 

U.S.C. §§11011 through 11050, the Environmental Response Law, Chapter 128D, Hawaii Revised Statutes, and any similar state or local laws, 

ordinances, and the regulations now or hereafter adopted, published, and/or promulgated pursuant thereto. 

‘Holder of record of a security interest’ means a person who is the owner or possessor of a security interest in the demised premises and who 

has filed a copy of the interest with the Department of Agriculture and with the Bureau of Conveyances. 

‘Lessee’ includes the Lessee, its heirs, personal representatives, executors, administrators, successors, and permitted assigns. 

‘Noxious weed’ means any plant species which is injurious, harmful, or deleterious or which may be likely to become so to the agricultural 

industries of the State of Hawaii, as determined and so designated from time to time by rule of the Department of Agriculture. 

‘Premises,’ ‘demised premises,” or ‘demised land’ includes the land hereby demised and all buildings and improvements now or hereinafter 

constructed and installed thereon. 

‘Waste’ includes (1) permitting the premises or any portion thereof to become unduly eroded or failure to take proper precautions or make 

reasonable effort to prevent or correct same; (2) permitting any material increase in noxious weeds or alien plant species in or on the demised 

premises or any portions thereof; (3) failure to employ all of the usable portions of the demised premises; and (4) abandonment of the demised 

premises.” 

17 

C-496

Provisions from Selected Leases and Licenses Compared to DOA AP Lease Template 

Key: 

I = identical to the template 

C = some differences in language but consistent with the substance of the template 

M = minor but meaningful differences from the template 

S = significant and substantial differences from the template 

X = template provision not in lease 

(text) = provides page number in lease and sets out select similarities to, or differences from, the template and/or other instruments 

Lease or 

License Length 

Payment Terms 

and Conditions 

Base Annual 

Rental 

Additional 

Rental 

DOA AP Lease 

No. S-4936 (Glad’s 

Landscaping and 

Tree Trimming, 

Inc.), 2001 

DOA NAP Lease 

No. S-3771 

(Contemporary 

Landscaping LLC), 

2011 

ADC Lease 

No. LE-K1201 (BASF 

Plant Science, LP), 


18 

ADC License 

No. LI-K1102 

(Green Energy 

Team, LLC), 2011 

45 Years 35 years 35 Years 22 years or until such 

time licensee ceases 

to operate the 

I (p. 2) I (p. 2) S (monthly installments, p. 

5) 

M (base annual rental 

is calculated for first 15 

years, not first 10 

years; does not 

distinguish between 

arable and non-arable 

lands; no offset of 

rental amount for land 

clearances or leasehold 

improvements, p. 2) 

S (failure to submit 

report on gross 

proceeds and to pay 

additional rental due 

within 30 days of date 

M (does not distinguish 

between arable and 

non-arable lands, p. 2) 

C (April 30, instead of 

March 31, is date for 

submission of report 

disclosing gross 

proceeds for 

S (base annual rental is 

calculated for first 5 years; 

does not distinguish 

between arable and nonarable 

lands; no offset of 

rental amount for land 

clearances or leasehold 

improvements, p. 5) 

permitted use 

S (monthly 

installments, p. 3) 

S (increasing scale of 

annual rental every one 

or two years over the 

life of the license, 

either specified by 

dollars/acre or as 

percentage of increase 

over preceding year, p. 

3) 

X X X 

C-497 

ADC License 


(Pacific Light and 

Power, Inc.), 2011 

25 years or until such 

time licensee ceases 

to operate the 

permitted use 

S (monthly installments, 

p. 3) 

S (similar to scale used 

in Green Energy license, 

except that arable and 

non-arable acres rent at 

different rates, p. 2)

Additional 

Rental (cont.) 

Reopening of 

Annual Rental 

Determination 

of Annual 

Rental upon 

Reopening 

Facilities 

Capital 

Recovery Fee 

Interest on 

Delinquent 

Rental 

Minerals and 

Water Rights 

Prehistoric and 

Historic 

Remains 

DOA AP Lease 




Inc.), 2001 

due constitutes breach, 

p. 2) 

S (re-openings at 15th, 

25th, and 35th years; 

lacks clause that base 

annual rental cannot be 

revised downward, p. 

3) 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

ADC Lease 




calculation of 

additional rental, p. 2) 

I (p. 3) S (re-openings at 5th, 10th, 

15th, 20th, and 25th years, 

p. 5) 

I (p. 3) I (p. 3) M (failure to accept terms 

of section is not considered 

in the alternative as a 

breach allowing lessor to 

terminate, p. 5) 

I (p. 5) M (adds language 

removing Capital 

Improvement Projects 

not used by lessee from 

calculation of FCR fee, 

p. 4) 

I (p. 5) I (p. 5) M (in addition to 1% per 

month interest, lessee pays 

$50 per month service fee 

for each delinquent 

payment, p. 7) 

19 

ADC License 


(Green Energy 


X X 

X X 

X X X 

M (same as ADC lease, 

p. 4) 

I (p. 5) I (p. 6) X X X 

I (p. 6) I (p. 6) S (terms more detailed than 

template and include 

examples; no provision that 

lessor owns remains; 

requirement to follow HRS 

chapter 6E, p. 23) 

C-498 

S (same as ADC lease, 

p. 19) 

ADC License 




M (same as ADC lease 

and Green Energy 

license, p. 4) 

S (same as ADC lease 


license, p. 19)

Ownership of 

Fixed 

Improvements 

Withdrawal 

Payment of 

Rent 

Taxes, 

Assessments, 

etc. 

Utility Services 

Irrigation Costs 

DOA AP Lease 




Inc.), 2001 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

I (p. 6) C (includes several 

additional examples of 

“improvements,” p. 6) 

ADC Lease 




M (covered under section 

titled “improvements” at p. 

15; improvements made by 

lessee either vest in lessor 

or are to be removed at 

lessee’s sole cost and 

expense.) 

I (p. 6) C (p. 7) M (section titled 

“withdrawal for public 

purposes”; mostly 

consistent, but includes 

appraisal process for 

determining compensation, 

p. 14) 

ADC License 


(Green Energy 


X X 

S (similar to ADC 

lease, but provides that 

licensee can terminate 

if it deems taking 

leaves premises 

unusable; refers to 76, 

p. 23, which states 

withdrawal can only be 

for emergency 

roadways and irrigation 

systems, p. 11) 

I (p. 8) I (p. 8) X X X 

I (p. 8) C (p. 8) C (section combines 

utilities and taxes 

provisions, p. 7) 

I (p. 8) C (p. 8) C (combined with “Taxes, 

Assessments, etc.,” above, 

C (p. 8) C (add sentence 

specifying that lessee 

“shall use due care” to 

protect the irrigation 

system, p. 8) 

p. 7) 

C (same as ADC lease, 

p. 4) 

C (combined with 

“Taxes, Assessments, 

etc.,” above, p. 4) 

X S (section titled 

“irrigation system 

maintenance”; licensee 

must maintain 

irrigation system on 

20 

C-499 

ADC License 




S (similar to Green 

Energy license, but 

lacks separate section to 

limit what can be 

withdrawn, p. 11) 

M (requirement to pay 

even if licensee doesn’t 

purchase utility services 

from the Cooperative, p. 

5) 

M (combined with 

“Taxes, Assessments, 

etc.,” above, p. 5)

Irrigation Costs 

(cont.) 

Character of 

Use 

Utilization and 

Development of 

the Land 

Good 

Husbandry and 

Conservation 

Practices 

Major Portion 

of Income 

DOA AP Lease 




Inc.), 2001 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

I (p. 9) M (cites to rules for 

NAP, not AP program; 

removes two clauses 

regarding livestock 

production operations, 

p. 9) 

ADC Lease 




S (most of the terms from 

template have been 

omitted, with the exception 

of prohibition of cesspools, 

p. 7) 

I (p. 10) C (p. 10) S (omits terms requiring 

50% development within 2 

years and 100% within 3 

years; property must be 

developed according to 

plans submitted and 

deviations therefrom must 

be approved, p. 8) 

21 

ADC License 


(Green Energy 


premises in good 

condition. (p. 23) 

S (more similar to 

template than ADC 

lease, but adds soil 

erosion provision and 

omits section on 

assignments, subleases, 

and covenants; also 

incorporates some 

provisions from 

template section on 

waste and nuisance, p. 

4) 


lease, but specifically 

references a ten year 

harvesting plan, p. 5) 

I (p. 11) C (p. 11) X S (licensee must submit 

conservation plan 

developed with soil and 

water conservation 

district; covers land 

clearing, irrigation, 

drainage, noxious weed 

control, and general 

environmental 

degradation, p. 5) 

I (p. 11) I (p. 11) X X X 

C-500 

ADC License 





Energy license, p. 5) 


Energy license; 

specifically references 

plan attached as exhibit, 

p. 6) 

S (same as Green 

Energy license, p. 6)

Sanitation 

Waste and 

Unlawful, 

Improper, or 

Offensive Use of 

the Premises 

Inspection of 

Premises 

Improvements 

Repairs to 

Improvements 

DOA AP Lease 




Inc.), 2001 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

ADC Lease 




22 

ADC License 


(Green Energy 


I (p. 12) I (p. 12) I (p. 9) C (adds language 

specifically referring to 

weed and grass control, 

I (p. 12) I (p. 12) S (waste, nuisance, 

unlawful use, etc., are 

covered under “Character 

of Use,” above; term omits 

protection of trees but adds 

provision on soil erosion, p. 

I (p. 12) I (p. 12) M (Lessor may enter upon 

prior notice and 

accompanied by 

representative of lessee, 

except in case of 

emergency, when lessor 

7) 

may enter alone, p. 14) 

I (p. 12) I (p. 12) S (term called “common 

infrastructure 

improvements costs” (see 

below); Lessee enters into 

MOA with Kekaha 

Agricultural Cooperative 

and pays share of 

construction and 

maintenance costs as 

specified, p. 6; section 

titled “improvements” is 

generally consistent with 

template, p. 9) 

C (lacks long sentence 

giving examples of 

C (lacks long sentence 

giving examples of 

S (SEE “Improvements,” 

immediately above; section 

C-501 

p. 6) 

X X 

M (licensor can enter at 

reasonable time to 

inspect state of repair, 

equipment, books, and 

records, p. 10) 

C (wordy restatement 

of template language 

which adds provisions 

about approved assigns 

and permittees, p. 6) 

M (consistent with 

template except for 

ADC License 




C (same as Green 

Energy license, p.7) 

M (same as Green 


S (term called “common 


improvements costs” 

(see below); Lessee 

enters into MOA with 

Kekaha Agricultural 

Cooperative and pays 

share of construction 

and maintenance costs 

as specified, p. 3; 

section titled 

“improvements” is 

generally consistent 

with template, p. 7) 

S (SEE 

“Improvements,”

Repairs to 

Improvements 

(cont.) 

Dwelling 

Restrictions 

Insurance 

Right of First 

Refusal 

Assignments of 

Lease, Lease 

Interest, etc. 

DOA AP Lease 




Inc.), 2001 

improvements covered 

under the clause, p. 13) 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

improvements covered 

under the clause, p. 13) 

ADC Lease 




titled “repairs to 

improvements,” p. 9, is 

consistent with template, 

plus limitation on payment 

for “common infrastructure 

improvements.” 

I (p. 13) C (p. 10) C (emphasizes only farm 

dwellings allowed with 

permission, p. 9) 

I (p. 13) I (p. 13) S (section titled “property 

insurance”; specifies “full 

replacement value”; 

submission of certificate of 

insurance made a condition 

of lease award, p. 12) 

I (p. 14) C (references are to 

NAP parks and to NAP 

chapters of HRS and 

S (the clause does not 

mention the March 6, 

1992, “Assignment of 

Lease Evaluation 

Policy” and associated 

calculations for 

determining premium 

to be paid, p. 16) 

rules, p. 14) 

M (includes additional 

reason for 

assignment—primary 

residence—as specified 

in relevant NAP 

administrative rules; 

references more recent 

“Assignment of Lease 

23 

ADC License 


(Green Energy 


brief reference to 

common infrastructure 

improvements costs 

share percentage; see 

that provision, below, 

p. 7) 

S (all dwellings strictly 

prohibited; licensee 

cannot use premises for 

residence, p. 7) 

S (generally similar to 

but much shorter than 

ADC lease; specifies 

“full insurable value,” 

“state-owned 

improvements,” and 

policy must waive 

subrogation claims 

against state or its 

officers, p. 10) 

X X X 

S (short clause prohibiting 

any assignment or 

mortgage without prior 

approval of lessor, “which 

consent will not be 

unreasonably withheld,” p. 

11) 

C-502 


lease, but states that 

“consent may be 

withheld in licensor’s 

sole discretion,” p. 8) 

ADC License 




immediately above; 

section titled “repairs to 

improvements,” p. 7, is 

consistent with 

template, plus limitation 

on payment for 

“common infrastructure 

improvements.” 




Energy license, p. 10) 

Extensive section titled 

“assignment,” with 

multiple, separately 

numbered subparts, 

treats assignment and 

related issues in depth. 

(p. 24)

Assignment 

(cont.) 

Subletting 

Mortgage 

Breach 

Rights of Holder 

of Record of 

Security Interest 

DOA AP Lease 




Inc.), 2001 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

Evaluation Policy” 

document, which is 

attached; cites to NAP 

program rules, p. 16) 

ADC Lease 




I (p. 18) C (p.18) S (section titled 

“subleasing”; only allowed 

with prior approval; “profit 

on an sublease charges is 

neither allowed, nor shall 

be sought by lessee”; omits 

clause related to gross 

receipts of lessee in 

determining rental amount, 

p. 8) 

I (p. 18) I (p. 18) X (not included as a 

separate clause; however, 

assignments clause simply 

states that any mortgage 

must be approve by lessor, 

p. 11) 

C (p. 19) I (p. 18) M (generally same as 

template, but includes 

bankruptcy and failure to 

pay common infrastructure 

improvements costs as 

causes for breach and 

termination; does not 

mention advance rent 

retainable as liquidated 

I (p. 20) S (significant 

provisions added; other 

changes, p. 19) 

24 

ADC License 


(Green Energy 



lease; section titled 

“sublicensing”; 

licensee can sublicense 

with consent of 

licensor, but cannot 

profit from same, p. 5) 

X (not included as a 

separate clause; 

however, assignments 

clause simply states 

that any mortgage must 

be approve by lessor, p. 

damages, p. 10) 

X X X 

C-503 

8) 

M (titled “breach or 

default”; similar to 

ADC lease, p. 7) 

ADC License 






“consent may be 

withheld at licensor’s 

sole discretion,” p. 6) 

Subpart to assignments 

section specifies that 

mortgage must be 

approved by licensor. 

(p. 24) 



Acceptance of 

Rent Not a 

Waiver 

Liability 

Insurance 

Performance 

Bond 

Justification of 

Sureties 

Indemnity 

Costs of 

Litigation 

DOA AP Lease 




Inc.), 2001 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

ADC Lease 




25 

ADC License 


(Green Energy 


I (p. 22) I (p. 22) C (p. 10) C (closer to template 

language than ADC 

lease is, p. 8) 

I (p. 22) M (insurance “shall be 

in an amount to be 

determined by the 

lessor” and other 

differences, p. 23) 

M ($500K/occurrence, 

$1M total coverage 

specified; no insurance 

needed for activities of 

agricultural cooperative; 

lessor reserves right to 

review coverage and 

require more if inadequate 

to risks on the property, p. 

11) 

M (similar to ADC 

lease, p. 8) 

I (p. 23) C (p. 23) C (p. 25) S (Licensee must 

submit surety bond to 

support commitment to 

remove all trees and 

vegetation from land 

and restore it to arable 

pasture land condition; 

calculation for 

increasing amount of 

bond set out, p. 22) 

I (p. 24) I (p. 24) I (p. 25) X X 

I (p. 24) C (p. 24) C (p. 18) C (similar to ADC 

lease, but omits parking 

areas and sidewalks, p. 

I (p. 25) I (p. 25) S (adds mirroring provision 

that if lessee is made party 

C-504 

14) 


p. 13) 

ADC License 








S (untitled section; 

licensee must submit 

surety bond to support 

commitment to return 

property to previous 

condition prior to 

vacation, p. 23) 



S (same as ADC lease 

and Green Energy

Costs of 

Litigation 

(cont.) 

Liens 

Lessor’s Lien 

Condemnation 

Right to Enter 

Extension of 

Time 

DOA AP Lease 




Inc.), 2001 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

ADC Lease 




to litigation by or because 

of lessor, without fault of 

the lessee, the lessor must 

cover costs, p. 17) 

I (p. 25) C (p. 25) C (section titled 

“involuntary liens,” p. 9) 

I (p. 26) C (p. 26) C (specifies that lessee is 

entitled to compensation 

for relocation costs if only 

part of property is 

condemned, which is only 

implied in the template, p. 

15) 

I (p. 27) I (p. 27) S (does not give City and 

County of HNL right to 

enter; entry must be 

preceded by prior notice 

and be accompanied by 

lessee, unless in case of 

emergency, p. 13) 

I (p. 27) I (p. 27) S (treated in two separate 

sections; under “term” the 

lease extendable for one 

10-year term; option must 

be exercised at least 180 

days prior to expiration of 

current term, p. 4; section 

titled “extension of time” is 

identical to section in 

template, p. 16 ) 

26 

ADC License 


(Green Energy 


C (similar to provision 

in ADC lease; section 

titled “involuntary 

liens,” p. 7) 

I (p. 25) I (p. 26) X X X 

C-505 

X X 

S (more lessor-friendly 

than ADC lease; lessor 

can enter at any time on 

official duties, p. 10) 

S (extendable for ten 

years under conditions 

similar to ADC lease, 

p. 2; general “extension 

of time” section on p. 

12 is consistent with 

ADC lease.) 

ADC License 





S (allows liens for 

Hydro Power Project 

financing, p. 8) 



S (licensee can extend 

for an additional term of 

25 years by exercising 

option not less than 90 

days before expiration 

of license, p. 2; general 

“extension of time” 

section on p. 12 is same 

as Green Energy 

license.

Quiet 

Enjoyment 

Surrender 

Non-Warranty 

Hazardous 

Materials 

Covenant 

Against 

Discrimination 

DOA AP Lease 




Inc.), 2001 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

ADC Lease 




27 

ADC License 


(Green Energy 


I (p. 27) I (p. 27) C (p. 16) C (same as ADC lease, 

p. 12) 

I (p. 28) C (p. 28) I (p. 14) C (p. 10) X 

I (p. 28) C (p. 28) C (adds “lessee assumes all 

risks incident” to use of the 

property, p. 17) 

I (p. 28) I (p. 30) S (in addition to template 

provisions, section adds 

clauses making lessor 

responsible for 

contamination caused prior 

to execution of lease, 

allows lessor to demand 

testing and affidavits to 

ascertain whether 

hazardous materials are 

stored or have been 

released on the premises. 

I (p. 30) M (adds factors upon 

which lessee may not 

discriminate, including 

family status, ancestry, 

disability, age, and HIV 

infection, p. 28) 

(p. 20) 

C (longer than template, 

but less detailed than clause 

in NAP lease; does not 

mention family status, 

ancestry, disability, age, 

and HIV infection, p. 10) 

C-506 


but adds provisions 

specifically exempting 

licensee from any 

hazardous materials 

claims resulting from 

discharge prior to 

execution of license, p. 

13) 


lease, but allows 

hazmat on the site with 

express permission of 

licensor or if used in 

normal course of 

licensee’s operations, 

p. 15) 

C (similar to ADC 

lease, p. 7) 

ADC License 




C (nearly identical to 

Green Energy license, p. 

12) 





notes that licensee 

remains responsible 

under DLNR agreement 

for some issues during 

Kekaha Sugar’s 

occupation of the 

premises, p. 16) 



Hunting 

Boundary 

Stakeout 

Fences 

Setback 

Requirements 

Drainage 

Easements 

Roadway and 

Utility 

Easements 

Compliance 

with Laws 

DOA AP Lease 




Inc.), 2001 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

ADC Lease 




28 

ADC License 


(Green Energy 


I (p. 30) I (p. 29) I (p. 18) S (no hunting allowed, 

except for pest 

eradication as specified 

in 77, p. 23, which 

must be done in 

humane manner, p. 14) 

I (p. 30) I (p. 29) C (p. 18) C (same as ADC lease, 

p. 14) 

I (p. 30) M (requires 

“stockproof fence” to 

be installed within six 

months of the date of 

lease execution; clause 

titled “Boundary 

Fences,” p. 32) 

X I (p. 14); additional 

clause near end of 

licensee, however, 

stipulates at licensee 

has fulfilled obligation 

to install boundary 

fencing. (p. 23) 

I (p. 31) I (p. 29) C (p. 8) X X 

I (p. 31) C (p. 29) M (drainage ways may be 

altered with prior written 

consent of lessor, p. 19) 

I (p. 31) I (p. 29) M (allows members of the 

cooperative entry to 

maintain and operate 

common infrastructure 

improvements; lessee 


maintenance of easements, 

p. 19) 

M (same as ADC lease, 

p. 15) 

M (similar to ADC 

lease, but licensee not 


maintenance of 

easements, p. 15) 

ADC License 




C (nearly identical to 

template, p. 14) 

C (same as ADC lease 



I (p. 15) 

M (same as ADC lease 



M (nearly identical to 

Green Energy license, 

but Kalepa Koalition 

cooperative not 

mentioned by name, p. 

15) 

I (p. 31) I (p. 29) I (p. 19) I (p. 15) I (p. 15) 

Separate, untitled 

section specifies that 

C-507

Compliance 

with Laws 

(cont.) 

Interpretation 

Headings 

Partial 

Invalidity 

Governing Law 

Certification for 

Use of 

Pesticides 

Subdivision of 

Premises 

Definitions 

Terms not in 

Template 

Holdover 

DOA AP Lease 




Inc.), 2001 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

I (p. 32) C (includes “headings” 

clause along with this 

clause, p. 30) 

I (p. 32) C (but included with 

“Interpretation” clause, 

above, p. 30) 

ADC Lease 




29 

ADC License 


(Green Energy 


ADC License 




I (p. 22) I (p. 18) 

licensee must comply 

with laws relating to 

animal feeding 

operations. (p. 23) 

I (p. 18) 

I (but titled “paragraph 

headings,” p. 22) 

I (p. 32) I (p. 32) C (but incorporated into 

“applicable law” section, 

below, p. 17) 

I (p. 32) C (clause is titled 

“Hawaii Law,” p. 33) 

C (section titled “applicable 

law; severability”; adds 

severability clause, p. 17) 

I (titled “paragraph 


C (but incorporated 

into “applicable law” 

section, below, p. 13) 

C (same as ADC lease, 

p. 13) 

X X X X X 

X X X X X 

I (p. 33) M (adds definitions for 

“Institutional Lender,” 

“Making a loan,” and 

“Security Interest,” p. 

34) 

X “Upon expiration of the 

lease term, if the land is 

M (both adds to and omits 

from list of terms defined 

in template, p. 26) 

Same as NAP lease, but 

lacks citation to admin. 

C-508 

M (differences based 

on nature of the lease, 

p. 24) 

Same as “holding 

over” provisions in 

I (titled “paragraph 


C (but incorporated into 

“applicable law” 

section, below, p. 13) 

C (same as ADC lease 



M (differences based on 

nature of the lease, p. 

25) 

Same as ADC lease and 

Green Energy license.

DOA AP Lease 




Inc.), 2001 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

Holdover (cont.) not otherwise disposed 

of, the Lessor may 

allow the lessee to 

continue to hold the 

land for a period not 

exceeding one year 

upon such rent, terms 

and conditions as the 

Lessor may prescribe, 

and further as provided 

in section 4-148-31, 

Hawaii Administrative 

Hazardous 

Waste 

Evaluation 

Commercial 

Operations 

Rules.” (p. 5) 

X Requires Level One 

Hazardous Waste 

Evaluation per EPA 

standards. (p. 31) 

X Lessor must approve 

any commercial 

operations (p. 32) 

ADC Lease 




rules. (p. 7) 

Additional section, titled 

“holding over,” provides 

for month-to-month 

tenancy with consent of 

lessor. (p. 24) 

Somewhat similar to 

provision in NAP lease, 

though heading title is 

different. Lessor may at 

any time during lease 

require the lessee to 

conduct an ASTM Phase I 

Environmental Site 

Assessment and, if 

necessary, a Phase II 

investigation. (p. 21) 

Lessor must approve 

commercial or retail 

activities (p. 23) 

30 

C-509 

ADC License 


(Green Energy 


ADC lease; provides 

for month-to-month 

tenancy with consent of 

licensor. (p. 20) 

Similar to NAP lease. 

(p. 17) 

Similar to ADC lease; 

lessor must approve 

commercial and retail 

activities; adds feedlot, 

dairy milking parlors, 

and boarding of horses 

to examples of 

commercial activities. 

(p. 19) 

ADC License 




(p. 21) 

Same as Green Energy 

license. (p. 17) 


license. (p. 19)

Abandoned 

Vehicles 

UNTITLED 

UNTITLED 

Building 

Restriction 

Security 

Deposit 

Inspection by 

Prospective 

Bidders 

DOA AP Lease 




Inc.), 2001 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

ADC Lease 




ADC License 


(Green Energy 


ADC License 




X Prohibits abandoned Same as NAP lease. (p. 23) Same as other 

Same as other 

vehicle storage (p. 32) 

instruments. (p. 19) instruments. (p. 19) 

X Rental offsets for land 

clearance or leasehold 

improvements do not 

apply to lease 

extensions or 

conversions (p. 33) 

X X X 

X Adds to annual rental 

amount for up to seven 

years a premium for 

lease conversion. (p. 

33) 

X X X 

Special Condition 

added because lot is 

within a flood hazard 

zone in Waimanalo; 

lessee must obtain 

flood insurance and 

construct in accordance 

with all applicable laws 

X X X X 

X X Deposit equivalent to 2 Same ADC lease, but Same as Green Energy 

months’ rent due at references licensee and license. (p. 9) 

execution; refundable after 

all terms and conditions of 

lease have been fulfilled. 

(p. 11) 

license. (p.8) 

X X In preparation for 

Same as ADC lease. Same as ADC lease and 

expiration of lease, lessor (p. 12) 

Green Energy license. 

and prospective bidders 

may enter property with 

prior notice to lessee and, if 

requested, accompanied by 

the lessee. (p. 16) 

31 

(p. 12) 


Abandonment 

and 

Termination 

Lessee’s Risk 

Environmental 

Regulations 

DOA AP Lease 




Inc.), 2001 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

ADC Lease 




X X Abandonment or failure to 

use for 4 or more 

consecutive months, except 

in force majeure situations, 

constitutes breach. (p. 16) 

X X All risk for all situations, 

including theft, weather, 

wiring, vandalism, or “any 

other cause whatsoever” is 

borne by lessee. (p. 36) 

X X Lessee must comply with 

all applicable 

environmental impact 

regulations, including HRS 

chapter 343; lessee 

responsible for obtaining 

all clearances. (p. 19) 

Encumbrances X X Lease is subject to existing 

recorded and unrecorded 

encumbrances; lessor may 

further encumber property 

so long as such does not 

restrict or interfere with 

lessee’s enjoyment of the 

Exhibits— 

Incorporation 

in Lease 

Removal of 

Trash 

premises. (p. 22) 

X X All exhibits are deemed 

incorporated by reference. 

(p. 22) 

X X Lessee responsible for 

removal of all illegally 

dumped trash. (p. 23) 

32 

C-511 

ADC License 


(Green Energy 


Same as ADC lease. 

(p. 12) 


(p. 13) 

Same as ADC lease. (p. 

15) 


(p. 18) 


(p. 18) 


(p. 19) 

ADC License 






(p. 13) 



(p. 13) 



(p. 16) 


section requires licensee 

to file EA and EIS 

statements and obtain 

FONSI w/in three years 

of execution. (p. 22) 



(p. 18) 



(p. 19) 



(p. 19)

Audit 

Passage and 

Access 

Recordation 

Common 

Infrastructure 

Improvement 

Costs 

Soil Erosion 

DOA AP Lease 




Inc.), 2001 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

ADC Lease 




X X Lessor has right to inspect 

all documents relating to 

operation, including 

documents sought under 

Hawaii Open Records Law, 

but cannot disclose 

confidential documents or 

trade secrets. Elements of 

this provision appear to 

overlap with “right to 

inspect” clauses in this and 

the other leases. (p. 23) 

X X Cooperative’s agents have 

access to all common 

infrastructure. This appears 

to overlap with several 

other provisions. (p. 24) 

X X Lessee may record lease or 

short form thereof with 

Bureau of Conveyances. 

(p. 25) 

X X Covered above under 

“improvements” and 

“repairs to improvements”; 

actual clause at p. 6. 

33 

ADC License 


(Green Energy 


Much shorter than in 

ADC lease; licensor 

can audit all records 

concerning licensee’s 

operations on the 

premises. (p. 20) 


(p. 20) 


(p. 21) 

Licensee to pay 25% of 

cooperative’s costs for 


maintenance and 

improvement. (p. 3) 

X X X Licensee cannot engage 

in activities that result 

in soil erosion from 

water or wind; licensee 

must fill in small 

washes and ditches; 

prior to termination of 

C-512 

ADC License 






Subsequent, untitled 

section specifically 

gives ADC right to 

conduct financial audits 

to determine gross 

revenues. (p. 23) 





(p. 22) 

Similar to ADC lease; 

Covered above under 

“improvements” and 

“repairs to 

improvements”; actual 

clause at p. 3. 


license. (p. 18)

Soil Erosion 

(cont.) 

Exclusion of 

Animals from 

Forest Lands 

Land Clearing 

Crop Changes 

DOA AP Lease 




Inc.), 2001 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

ADC Lease 




34 

ADC License 


(Green Energy 


license, licensee must 

submit erosion control 

plan. (p. 18) 

X X X Any livestock owned 

by licensee must be 

kept out of adjacent 

forest reserves; licensee 

must take reasonable 

precautions to avoid 

forest fires. (p. 19) 

X X X Prior to land clearing in 

gulches or wastelands, 

an archaeological 

inventory survey must 

be performed by SHPD 

staff archaeologist; if 

significant historical 

sites are found, then 

qualified archaeologist 

must perform survey; 

survey contents are 

specified. (p. 19) 

Another clause, also 

titled “land clearing” 

mandates that licensee 

get approval for land 

clearing from Historic 

Preservation Division 

of DLNR. (p. 23) 

X X X Licensor must approve 

changes to crops to be 

grown as set out in 

approved business plan. 

(p. 21) 

C-513 

ADC License 







license, without second 

clause requiring DLNR 

approval. (p. 20) 


license, but titled 

“cropping changes.” (p. 

21)

Crop Changes 

(cont.) 

Agreements 

with Other 

Tenants 

Ten Year 

Harvesting Plan 

Adequate 

Funding and 

Financing 

DOA AP Lease 




Inc.), 2001 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

ADC Lease 




35 

ADC License 


(Green Energy 


X X X Licensee must use best 

efforts to settle disputes 

with other tenants due 

to recent parcel 

realignment; written 

records of agreements 

must be kept. (p. 21) 

X X X Licensee must submit 

10-year plan for 

harvesting invasive 

Albizia trees from its 

and other tenants’ 

parcels; species of trees 

selected for replanting 

must be approved by 

DLNR. (p. 21) 

X X X Licensee has 1 year to 

submit financing plan 

for proposed project. 

(p. 22) 

C-514 

ADC License 





section provides that 

ADC must approve 

changes in biomass crop 

species planted. (p. 23) 


section provides that 

ADC may approve 

cultivation of native 

trees or vegetation for 

erosion control or 

aesthetic purposes. (p. 

23) 

X 

X 

Untitled section; similar 

to Green Energy license. 

(p. 22)

Use of Land 

Soil and Water 

Conservation 

Plan 

Power Purchase 

Agreement 

East Kauai 

Water Users 

Cooperative 

Kalepa 

Koalition 

Vegetative 

Buffer Zone 

DOA AP Lease 




Inc.), 2001 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

ADC Lease 




36 

ADC License 


(Green Energy 


X X X Initial clearing must 

begin on 50% of parcel 

and licensee must 

justify that 100% of 

parcel will be needed 

for the project within 3 

years. (p. 22) 

X X X Within 2 years of 

execution, licensee 

must submit soil and 

water conservation 

plan. (p. 22) 

X X X Within 3 years of 

execution licensee must 

submit PUC approval 

of power purchase 

agreement with Kauai 

Island Utility 

Cooperative. (p. 22) 

X X X If project requires 

irrigation, licensee 

must work with 

EKWUC and pay for 

use of water. (p. 22) 

X X X Licensee must join 

Kalepa Koalition or 

enter into written 

agreement with the 

organization. (p. 22) 

X X X Licensee must maintain 

existing vegetative 

buffer along plateau 

and valley rims. (p. 23) 

C-515 

ADC License 




Untitled section; 

Licensee must show 

activity in at least 50% 

of arable acreage within 

3 years and show that 

entire acreage will be 

needed for Hydro Power 

Project. (p. 23) 

Untitled section; similar 

to Green Energy license. 

(p. 22) 

Untitled section; 

Licensee must submit 

copy of power SALES 

agreement with KIUC 

as approved by PUC. 

X 

X 

X

Wells 

Polihale Flood 

Diversion 

Agricultural 

Preservation 

DOA AP Lease 




Inc.), 2001 

DOA NAP Lease 

No. S-3771 

(Contemporary 


2011 

ADC Lease 




37 

ADC License 


(Green Energy 


ADC License 




X X X X Licensee must seal all 

abandoned wells on the 

property prior to 

expiration of license. 

X X X X Licensee acknowledges 

that flood water 

diversion causes road 

(p. 20) 

washouts. (p. 21) 

X X X X Licensee must be in full 

compliance with the 

easement. 

Easement 

Land Swapping X X X X Licensee can swap land 

with other licensees or 

revocable permit 

holders. (p. 21) 

UNTITLED X X X X Licensee at own 

expense must obtain all 

permits and clearances 

for construction of 

Hydro Power Project; 

permits listed. (p. 22) 

UNTITLED X X X X Licensee must adhere to 

water allocation 

agreements with state 

agencies and not have 

negative impact on 

other agricultural 

tenants. (p. 22) 

C-516

Subchapter 1 General Provisions 

HAWAII ADMINISTRATIVE RULES 

TITLE 4 

DEPARTMENT OF AGRICULTURE 

SUBTITLE 1 

ADMINISTRATION 

CHAPTER 1 

BOARD OF AGRICULTURE 

RULES OF PRACTICE AND PROCEDURE 

§4-1-1 Purpose; construction 

§4-1-2 Definitions 

§4-1-3 Grammatical usage; meaning of terms 

§4-1-4 Office 

§4-1-5 Hours 

§4-1-6 Meetings; conduct of meetings 

§4-1-7 Quorum; votes necessary for a decision 

§4-1-8 Records; annual report 

§4-1-9 Authentication of board actions 

§4-1-10 Public records; requests for public records; fees 

Subchapter 2 Proceedings Before the Board 

§4-1-11 General rule 

§4-1-12 Appearances before the board 

§4-1-13 Filing of papers 

§4-1-14 Retention of papers 

§4-1-15 Computation of time 

§4-1-16 Continuances or extensions of time 

§4-1-17 Striking or amendment of papers 

§4-1-18 Board decision 

§4-1-19 Counsel for the board 

§4-1-20 Substitution of parties 

§4-1-21 Consolidation 

1-1 

C-517

§4-1-22 Default 

Subchapter 3 Rulemaking Proceedings 

§4-1-23 Initiation of rulemaking 

§4-1-24 Denial of petition 

§4-1-25 Acceptance of petition 

§4-1-26 Notice of rulemaking 

§4-1-27 Conduct of rulemaking hearings 

§4-1-28 Recommendation; submissions; board decisions 

§4-1-29 Board action 

§4-1-30 Emergency rulemaking 

Subchapter 4 Application for Issuance or Renewal of License, Permit, or Certificate 

§4-1-31 Forms and instructions 

§4-1-32 Denial of application 

§4-1-33 Request for hearing 

§4-1-34 Proceedings upon request for hearing 

Subchapter 5 Contested Case Proceedings 

§4-1-35 Initiation of contested case 

§4-1-36 Request for contested case hearing 

§4-1-37 Filing of complaint 

§4-1-38 Order to show cause 

§4-1-39 Notice of hearing 

§4-1-40 Prehearing conferences; briefs 

§4-1-41 Conduct of contested case hearings 

§4-1-42 Recommended decision; exceptions 

§4-1-43 Board action 

§4-1-44 Informal disposition; offers of settlement; satisfaction of complaint 

§4-1-45 Service of papers 

§4-1-46 Depositions 

§4-1-47 Subpoenas 

§4-1-48 Ex parte communications 

§4-1-49 Record of hearing 

Subchapter 6 Declaratory Rulings 

1-2 

C-518

§4-1-50 Petition for declaratory ruling 

Subchapter 7 Severability 

§4-1-51 Severability 

Subchapter 8 Repeal 

§4-1-52 Repeal 

Historical Note: This chapter is based substantially upon State of Hawaii Board of 

Agriculture Rules of Practice and Procedure. [Eff 6/14/62; am 8/31/74; R Sep 20 1986] 

SUBCHAPTER 1 

GENERAL PROVISIONS 

§4-1-1 Purpose; construction. This chapter governs practice and procedure before the 

state board of agriculture and shall be construed to secure the just and efficient determination of 

every proceeding. [Eff Sep 20 1986] (Auth: HRS §§91-2, 141-2, 142-2, 144-11, 145-15, 147- 

4, 148-2, 149A-19, 149A-33, 150-22, 150A-9, 152-2, 153-4, 155-4, 157-13, 159-7, 161-7, 163- 

4) (Imp: HRS §91-2) 

§4-1-2 Definitions. As used in this chapter unless the context otherwise requires: 

"Board" means the state board of agriculture. 

"Chairperson" means the chairperson of the state board of agriculture. 

"Complainant" means a person, an agency, or an officer upon whose complaint a 

proceeding is instituted. 

"Department" means the state department of agriculture. 

"Deputy" means the deputy to the chairperson of the state board of agriculture. 

"Hearing officer" means a person duly appointed by the board to hold a hearing to take 

evidence or oral argument, and to make a recommended decision in any case or controversy 

within the jurisdiction of the board. 

"Party" means the department, if named, permitted or entitled as of right to participate in a 

proceeding, each person named in a proceeding, or any interested or aggrieved person permitted 

or entitled as of right to participate in a proceeding before the board in the capacity of a 

petitioner, respondent, intervenor, or in a capacity other than that of a witness. 

"Person" means individuals, partnerships, corporations, associations, or public or private 

organizations of any character other than the board or department. 

"Petitioner" means a person on whose behalf petitions are made in proceedings involving 

declaratory rulings or the adopting, repealing, or amending of any rule of the board. 

1-3 

C-519

"Proceeding" means the board's consideration of the relevant facts and applicable law and 

action thereupon, with respect to a particular subject within the board's jurisdiction, initiated by a 

filing, a submittal, a request, or the board's notice or order. It shall include, but not be limited to, 

the following: 

(1) Contested cases involving the denial, suspension, or revocation of, or refusal to 

renew, any license, permit, or certificate issued by the board; 

(2) Proceedings involving petitions for declaratory rulings; 

(3) An investigation or review instituted or requested to be instituted by the board; and 

(4) Proceedings involving the adoption, amendment, or repeal of any rule of the board, 

whether initiated by board order or by petition of a person with a legal interest. 

"Respondent" means a party in a contested case against whom an order to show cause has 

been issued by the board on its own initiative or a notice of hearing has been issued on the basis of 

a complaint filed with the board. [Eff SEP 22 1986] (Auth: HRS §91-2) (Imp: HRS §91-2) 

§4-1-3 Grammatical usage; meaning of terms. (a) Unless otherwise required by the 

context, the singular includes the plural and vice-versa. 

(b) Unless specifically stated, the terms used in rules adopted by the board pursuant to 

powers granted by statute shall have the meaning defined by that statute. 

(c) A rule which defines a term without express reference to the statute or to this chapter, 

or to a portion thereof, defines the term for all purposes as used both in the statute and in this 

chapter, unless otherwise specifically required by the context. [Eff Sep 20 1986] (Auth: 

HRS §91-2) (Imp: HRS §91-2) 

§4-1-4 Office. (a) The principal office of the board is located at 1428 South King Street, 

Honolulu, Hawaii. 

(b) All communications to the board shall be addressed to the state board of agriculture, 

P. O. Box 22159, Honolulu, Hawaii 96823. [Eff Sep 20 1986] (Auth: HRS §91-2) (Imp: 

§91-2) 

§4-1-5 Hours. The offices of the board shall be open from 7:45 a.m. to 4:30 p.m., 

Monday through Friday, unless otherwise provided by statute or executive order. [Eff 

Sep 20 1986] (Auth: HRS §§80-1, 91-2) (Imp: HRS §§80-1, 91-2) 

§4-1-6 Meetings; conduct of meetings. (a) The board may meet and exercise its powers 

in any part of the State. 

(b) Board meetings shall be held in accordance with sections 92-3, 92-4, 92-5, 92-7, 92- 

8, and 92-9, HRS, as applicable. [Eff Sep 20 1986] (Auth: HRS §§91-2, 92-4, 92-5, 92-7, 92-8, 

92-9) (Imp: HRS §§91-2, 92-3, 92-4, 92-5, 92-7, 92-8, 92-9) 

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§4-1-7 Quorum; votes necessary for a decision. The constitution of a quorum and the 

number of votes necessary to validate any act of the board shall be in accordance with section 

92-15, HRS. [Eff Sep 20 1986] (Auth: HRS §91-2) (Imp: HRS §§91-2, 92-15) 

§4-1-8 Records; annual report. (a) The chairperson shall have charge of the board's 

official records and shall be responsible for the maintenance and custody of the files and records 

of the board, including: 

(1) The transcripts of testimony and exhibits; 

(2) All papers and requests filed in proceedings; 

(3) The minutes of all board meetings and hearings; and 

(4) All findings, determinations, reports, opinions, orders, rules, and approved forms. 

(b) The chairperson shall prepare for submission by the board an annual report of the 

department's activities and accomplishments to the governor and the legislature. [Eff 


§4-1-9 Authentication of board actions. All orders and other actions of the board shall be 

signed by the chairperson or, in his absence, by another member of the board designated by the 

chairperson. [Eff Sep 20 1986] (Auth: HRS §91-2) (Imp: HRS §91-2) 

§4-1-10 Public records; requests for public records; fees. (a) All public records of the 

board shall be available for inspection by any person during office hours except as otherwise 

provided by section 92-51, HRS. 

(b) All requests for inspection or copies of public records shall be submitted to the board 

in writing. The request shall: 

(1) State the name, address, and phone number of the requestor; 

(2) Give the reason for the request; 

(3) Properly designate documents requested; and 

(4) Give the date of the request. 

(c) The fee to be charged for copies of public records shall be in accordance with section 

92-21, HRS. 

(d) As used in this section, "public records" do not include "personal records" as defined 

in section 92E-1(3), HRS. [Eff Sep 20 1986] (Auth: HRS §91-2) (Imp: HRS §§91-2, 92-21, 

92-51, 92E-1(3)) 

SUBCHAPTER 2 

PROCEEDINGS BEFORE THE BOARD 

§4-1-11 General rule. All persons and parties shall comply with these rules of practice 

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and procedure when appearing before the board. Procedures to be followed, unless specifically 

prescribed in this chapter or in chapter 91, HRS, shall be those which best serve the purposes of 

the proceeding. For good cause shown, the provisions of these rules may be modified or waived. 

[Eff Sep 20 1986] (Auth: HRS §§91-2, 92-16) (Imp: HRS §§91-2, 92-16) 

§4-1-12 Appearances before the board. (a) A person may be represented by or with 

counsel in any proceedings under this chapter. 

(b) When a person acting in a representative capacity appears in person or signs any 

document or paper submitted to the board, the personal appearance or signature of that individual 

shall constitute a representation to the board that the individual is authorized and qualified to 

represent that person. The individual, at any time, may be required to furnish proof of authority 

and qualification to act. 

(c) No person who has been associated with the board as a member, officer, employee, or 

counsel shall be permitted to appear before the board in behalf of, or to represent in any manner, 

any person in connection with any proceeding or matter which was pending before, or passed by, 

the board during the time of the person's association unless the person shall first have obtained the 

written consent of the board upon a verified showing that the person did not give personal 

consideration to the matter or proceeding as to which consent is sought or gain particular 

knowledge of the facts thereof during the person's association with the board. [Eff Sep 20 1986] 

(Auth: HRS §91-2) (Imp: HRS §91-2) 

§4-1-13 Filing of papers. (a) All papers or documents required to be filed with the board 

shall be filed with the chairperson. 

(b) Such papers may be mailed or hand-carried to any office of the department in the 

State within the time limit, if any, for filing. 

(c) The date on which the papers or documents are actually received by any office of the 

department shall be deemed to be the date of filing. 

(d) All papers or documents shall be written legibly or typed and signed in black ink by 

the party or the party's duly authorized agent or attorney. The signer's name shall be printed 

legibly below the signature. 

(e) The signature on any paper or document constitutes a certification that the person has 

read the document, that to the best of that person's knowledge, information, and belief, every 

statement in the paper or document is true, not misleading, and not interposed for delay. 

(f) The initial document filed by any person in any proceeding shall include on the first 

page the name and address of the person who may be served with any documents filed in the 

proceeding. [Eff Sep 20 1986] (Auth: HRS §91-2) (Imp: HRS §91-2) 

§4-1-14 Retention of papers. All papers filed with the board shall be retained by the 

board in its files. However, the chairperson may permit the withdrawal of the original documents 

upon submission of properly authenticated copies to replace the original papers. [Eff Sep 20 

1986] (Auth: HRS §91-2) (Imp: HRS §91-2) 

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§4-1-15 Computation of time. Computation of time shall be as provided under section 

1-29, HRS. [Eff Sep 20 1986] (Auth: HRS §91-2) (Imp: HRS §§1-29, 91-2) 

§4-1-16 Continuances or extensions of time. Whenever a person or agency has a right or 

is required to take action within the period prescribed or allowed by this chapter, by notice given 

under this chapter, or by an order, the board may: 

(1) With or without notice, extend the period before expiration of the prescribed period; 

or 

(2) Upon motion, permit the act to be done after the expiration of the specified period 

where the failure to act is clearly shown to be the result of excusable neglect. 

[Eff Sep 20 1986] (Auth: HRS §91-2) (Imp: HRS §91-2) 

§4-1-17 Striking or amendment of papers. If any paper filed with the board is not in 

substantial conformity with the applicable rules, the board, on its own motion or the motion of 

any party, may strike the document or require that it be amended. If amended, the document shall 

be effective as of the date of the original filing. [Eff Sep 20 1986] (Auth: HRS §91-2) (Imp: 

HRS §91-2) 

§4-1-18 Board decision. (a) Certified copies of all final orders, opinions, or rulings 

entered by the board in any proceeding shall be served upon the parties or persons participating in 

the proceedings by first class mail or personal delivery by the board. 

(b) All final orders, opinions, or rulings may be released for general publication. 

(c) Copies of materials released for general publication shall be available for public 

inspection in the office of the board or may be obtained upon request and upon payment of a 

reasonable charge in accordance with section 92-21, HRS. [Eff Sep 20 1986] (Auth: HRS §91- 

2) (Imp: HRS §§91-2, 92-21) 

§4-1-19 Counsel for the board. The attorney general, as counsel for the board, shall be a 

participant in all proceedings governed by this chapter. The attorney general or a representative 

of the attorney general shall be designated as "counsel for the board", and shall be served with 

copies of all papers, pleadings, maps, and documents as are all other parties to the same 

proceeding. [Eff Sep 20 1986] (Auth: HRS §§ 28-4, 91-2) (Imp: HRS §§ 28-4, 91-2) 

§4-1-20 Substitution of parties. Upon motion and for good cause shown, the board may 

order substitution of parties, except that in case of death of a party, substitution may be ordered 

without the filing of a motion. [Eff Sep 20 1986] (Auth: HRS §91-2) (Imp: HRS §91-2) 

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§4-1-21 Consolidation. The board may consolidate for hearing or other purposes or 

contemporaneously consider two or more proceedings which involve substantially the same 

parties or issues which are the same or closely related, if it finds that such consolidation or 

contemporaneous hearing will be conducive to the proper dispatch of its business and to the ends 

of justice and will not unduly delay the proceedings. [Eff Sep 20 1986] (Auth: HRS §91-2) 

(Imp: HRS §91-2) 

§4-1-22 Default. When a party, against whom an order to show cause has been issued, 

fails to plead or defend that action and this fact is made to appear by affidavit or otherwise, the 

board may enter the party's default. No order for default shall be entered against an infant or an 

incompetent person unless represented in a hearing by a guardian or other representative. For 

good cause shown, the board may set aside a default order. [Eff Sep 20 1986] (Auth: HRS 

§91-2) (Imp: HRS §91-2) 

SUBCHAPTER 3 

RULEMAKING PROCEEDINGS 

§4-1-23 Initiation of rulemaking. (a) The adoption, amendment, or repeal of any rule of 

the board may be made by the board on its own motion, or by petition of any interested person or 

agency. Petitions for rulemaking filed with the board shall be matters of public record. 

(b) Petitions shall conform to and be filed in accordance with section 4-1-12 and shall 

contain: 

(1) The name, address, and telephone number of each petitioner; 

(2) The signature of each petitioner; 

(3) A draft or the substance of the proposed rule or amendment or a designation of the 

provisions of the rule to be repealed; 

(4) A statement of the petitioner's interest in the subject matter; and 

(5) A statement of the reasons in support of the proposed rule, amendment, or repeal. 

(c) Within thirty days after the filing of a petition for rulemaking, the board shall either 

deny the petition or initiate rulemaking proceedings. [Eff Sep 20 1986] (Auth: HRS §§91-2, 

91-6) (Imp: HRS §§91-2, 91-6) 

§4-1-24 Denial of petition. Any petition that fails to comply in any material respect with 

the requirements of this chapter or fails to disclose sufficient reason to justify conducting 

rulemaking proceedings shall not be considered by the board. The board shall promptly notify the 

petitioner in writing of such denial, stating the reasons therefor. Denial of a petition shall not 

prevent the board from acting, on its own motion, upon any matter disclosed in the petition. The 

petitioner may seek judicial review of denial. [Eff Sep 20 1986] (Auth: HRS §91-2) (Imp: 

HRS §§91-2, 91-6, 91-14) 

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§4-1-25 Acceptance of petition. If the board determines that the petition is in order and 

that it discloses sufficient reasons in support of the proposed rulemaking to justify the conduct of 

rulemaking proceedings, the procedures to be followed shall be as set forth in this chapter and 

applicable statutes. [Eff Sep 20 1986] (Auth: HRS §91-2) (Imp: HRS §§91-2, 91-6) 

§4-1-26 Notice of rulemaking. Whenever pursuant to a petition or upon its own motion 

the board proposes to adopt, amend, or repeal a rule, a notice of proposed rulemaking shall be 

published in accordance with sections 91-3, 91-6, and 92-41, HRS. [Eff Sep 20 1986] (Auth: 

HRS §91-2) (Imp: HRS §§91-2, 91-3, 91-6, 92-41) 

§4-1-27 Conduct of rulemaking hearings. (a) Each hearing shall be held before the board 

or presided over by a hearing officer. 

(b) The board or hearing officer shall be authorized to take all actions necessary for the 

orderly conduct of the hearing. 

(c) Each hearing shall be held at the time and place set in the notice of hearing, but may 

be continued by the board or hearing officer from day to day or adjourned to a later date or to a 

different place without notice other than an announcement at the hearing. 

(d) The hearing shall be conducted in such a way as to afford interested persons a 

reasonable opportunity to offer evidence on the matters specified in the notice of hearing and to 

obtain a clear and orderly record. However, in order to avoid unnecessary, cumulative evidence, 

the board or hearing officer may limit the number of witnesses or the time allowed for testimony. 

(e) At the commencement of the hearing, the notice of hearing shall be read and the 

procedure to be followed shall be outlined briefly. Evidence shall then be received with respect to 

the matters specified in the notice of hearing in such order as the board or hearing officer 

prescribes. 

(f) All interested persons and agencies shall be afforded an opportunity to submit orally or 

in writing data, views, or arguments that are relevant to the matters specified in the notice of 

hearing. The board or hearing officer may require the filing of an original and eight copies of all 

written comments, recommendations, or replies. 

(g) Before proceeding to testify, all interested persons shall: 

(1) State their name, address, and whom they represent; and 

(2) Give any information respecting their appearance as the board or hearing officer may 

request. 

(h) Witnesses shall be subject to questioning by members of the board or by any other 

representative of the board. Cross examination by other persons or agencies shall be permitted 

only at the discretion of the board or hearing officer. 

(i) The board or hearing officer shall confine the evidence to the questions before the 

hearing, but need not apply the technical rules of evidence. 

(j) Unless otherwise ordered by the board or hearing officer, testimony given at the public 

hearing shall not be reported verbatim. 

(k) All supporting written statements, maps, charts, tabulations, or similar data offered in 

evidence at the hearing, and which are deemed by the board or hearing officer to be authentic and 

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elevant, shall be received in evidence and made a part of the record. [Eff Sep 20 1986] (Auth: 

HRS §91-2) (Imp: HRS §§91-2, 91-3) 

§4-1-28 Recommendation; submissions; board decision. (a) At the close of a public 

hearing presided over by a hearing officer, the hearing officer shall announce either: 

(1) What recommendation will be made to the board on the proposed adoption, 

amendment or repeal; or 

(2) The date by which such recommendation will be made. 

(b) If no recommendation is made at the close of the public hearing, the hearing officer, 

within five calendar days of the close of the public hearing, may request or allow filing of 

additional written submissions in support of or in opposition to the proposed rulemaking. 

(c) The hearing officer's recommendation shall be filed with the board not later than ten 

calendar days after the close of the public hearing or the expiration of any period for filing 

additional written submissions. 

(d) At the close of a public hearing before the board, the board shall announce its decision 

or the date by which such decision will be made. The board's decision on the adoption, 

amendment, or repeal of any rule shall be rendered in accordance with section 92-3(a)(2), HRS. 

[Eff Sep 20 1996] (Auth: HRS §91-2) (Imp: HRS §§91-2, 91-3) 

§4-1-29 Board action. (a) In rulemaking proceedings before the board, the board shall 

take final action either at the close of the public hearing or on the date previously announced for 

decision making. 

(b) In rulemaking proceedings presided over by a hearing officer, the board shall take final 

action within forty-five calendar days after the filing of the hearing officer's recommendation. [Eff 

Sep 20 1986] (Auth: HRS §§91-2, 91-3) (Imp: HRS §§S91-2, 91-3) 

§4-1-30 Emergency rulemaking. The board may adopt emergency rules in accordance 

with section 91-3(b) and 91-4(b)(2), HRS. [Eff Sep 20 1986] (Auth: HRS §§91-2, 91-3(b), 91- 

4(b)(2)) (Imp: HRS §§91-2, 91-3(b), 91-4(b)(2)) 

SUBCHAPTER 4 

APPLICATION FOR ISSUANCE OR RENEWAL OF 

LICENSE, PERMIT, OR CERTIFICATE 

§4-1-31 Forms and instructions. An application for the issuance or renewal of a license, 

permit, or certificate shall be filed with the board. Application shall be made by completing a 

form furnished by the department. [Eff Sep 20 1986] (Auth: HRS §91-2) (Imp: HRS §91-2) 

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§4-1-32 Denial of application. In the event an application for the issuance or renewal of a 

license, permit, or certificate is denied, the chairperson or the chairperson's designated 

representative shall promptly notify the applicant of the board's action by letter which shall include 

a concise statement of the reasons therefor and of the applicant's right to a hearing if the applicant 

so desires. [Eff Sep 20 1986] (Auth: HRS §§91-2, 91-9) (Imp: HRS §§91-2, 91-9) 

§4-1-33 Request for hearing. Any person whose application for the issuance or renewal 

of a license, permit, or certificate has been denied by the board, shall be entitled to a hearing after 

notice, provided that a request for a hearing is filed with the board within thirty days of the date of 

mailing of the letter informing the applicant of the denial of the application. [Eff Sep 20 1986] 


§4-1-34 Proceedings upon request for hearing. If a request for hearing is filed within the 

time prescribed, the board shall order a hearing upon reasonable notice, which shall be conducted 

in accordance with subchapter 5 and all applicable laws on contested cases. [Eff Sep 20 1986] 


SUBCHAPTER 5 

CONTESTED CASE PROCEEDINGS 

§4-1-35 Initiation of contested case. (a) A contested case is initiated with the filing of 

(1) A request for a contested case hearing; 

(2) A citation issued by the department; 

(3) A complaint; or 

(4) An order to show cause issued by the board. 

(b) Upon the filing of a document initiating a contested case, a docket number shall be 

assigned consisting of a two-digit year identifier, a two-letter division or branch identifier, and a 

numerical case identifier, with each identifier separated by a dash. Docket numbers shall be 

assigned chronologically on a calendar year basis. [Eff Sep 20 1986] (Auth: HRS §91-2) (Imp: 

HRS §§91-2, 91-9) 

§4-1-36 Request for contested case hearing. (a) A hearing on a contested matter may be 

requested by the board on its own motion, by any government agency upon filing of a written 

petition, or by any person aggrieved by a decision or ruling of the board or against whom a 

citation has been issued by department employees for a violation of state law or rule. 

(b) A person aggrieved by a decision or ruling of the board shall file a request for hearing 

within ten calendar days after mailing of written notice of board action. 

(c) A cited person desiring a hearing shall file a request for hearing within twenty days 

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after mailing of the citation, notice of violation, or similar document. 

(d) A request for hearing filed after the expiration of the time limits set forth in 

subsections (b) and (c) shall be deemed untimely, and the board need not grant such a request. 

[Eff Sep 20 1986] (Auth: HRS §91-2) (Imp: HRS §91-2) 

§4-1-37 Filing of complaint. (a) Any person or agency of the State or its political 

subdivisions, or any officer thereof, may file a complaint against a person holding a license, 

permit, or certificate issued by the board charging a violation of any law over which the board has 

jurisdiction or of any rule of the board. 

(b) The complaint shall be in writing, signed by the complainant, and shall contain: 

(1) A short and simple statement of the facts constituting the alleged violation; 

(2) The name and address of the complainant; and 

(3) The name and address of the respondent. 

(c) Upon receipt of a complaint, the chairperson shall: 

(1) Transmit a copy of the complaint to the person against whom the complaint has been 

filed; 

(2) Direct the department staff to investigate the matter contained in the complaint if it 

has not already done so, and to make an appropriate report and recommendations. 

(d) Upon receipt of the staff investigative report, the chairperson shall present the 

complaint, together with the staff report and recommendations, to the board at its next meeting. 

(e) The board shall determine whether or not the complaint should be set for a contested 

case hearing. The board need not order a hearing where the matters complained of: 

(1) Involve a private controversy redressable in the courts and the public interest is not 

involved; or 

(2) Concern a situation where it is clear on the face of the complaint that there has been 

no violation of law or rule. 

[Eff Sep 20 1986] (Auth: HRS §§91-2, 92-17) (Imp: HRS §§91-2, 92-17) 

§4-1-38 Order to show cause. (a) Whenever the board has reason to believe that a law 

over which it has jurisdiction or one of its rules has been violated by a person holding a license, 

permit, or certificate issued by the board, the board shall issue and serve upon that person an 

order to show cause. 

(b) The order shall set forth the particular sections of the law or rule involved, and the 

nature of the alleged violation or subject matter of inquiry. [Eff Sep 20 1986] (Auth: HRS 

§§91-2, 91-9, 91-9.5, 92-17) (Imp: HRS §§91-2, 91-9, 91-9.5, 92-17) 

§4-1-39 Notice of hearing. Upon filing of a petition or request for hearing under section 

4-1-36, board determination that a contested case hearing is required under section 4-1-37(e), or 

service of an order to show cause under section 4-1-38, a written notice of hearing shall be served 

on the parties in accordance with section 91-9.5, HRS. [Eff Sep 20 1986] (Auth: HRS §91-2) 

(Imp: HRS §§91-2, 91-9) 

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§4-1-40 Prehearing conferences; briefs. (a) The board or hearing officer may hold prehearing 

conferences with the parties for the purpose of; 

(1) Formulating, simplifying, or narrowing the issues; 

(2) Arranging for the exchange of proposed exhibits or proposed written testimony, the 

setting of schedules, the exchange of names of witnesses, and the limitation of the 

number of witnesses; and 

(3) Such other matters as may expedite the orderly conduct and disposition of the 

proceedings. 

(b) The board or hearing officer may request briefs setting forth the issues, facts, and 

legal arguments upon which the parties intend to rely, and may fix the conditions and time for the 

filing of briefs and the number of pages. Exhibits may be reproduced in an appendix to a brief. A 

brief of more than twenty pages shall contain a subject index and a table of authorities. [Eff Sep 

20 1986] (Auth: HRS §91-2) (Imp: HRS §91-9) 

§4-1-41 Conduct of contested case hearings. (a) Each hearing shall be held before the 

board or presided over by a hearing officer. 

(b) The board or hearing officer shall be authorized to administer oaths or affirmations 

and to take all actions necessary for the orderly conduct of the hearing. 

(c) Each hearing shall be held at the time and place set in the notice of hearing, but may 

be continued by the board or hearing officer from day to day or adjourned to a later date or to a 

different place without notice other than an announcement at the hearing. 

(d) The hearing shall be conducted in such a way as to afford each party a reasonable 

opportunity to offer evidence on the matters specified in the notice of hearing and to obtain a 

clear and orderly record. However, in order to avoid unnecessary, cumulative evidence, the board 

or hearing officer may limit the number of witnesses or the time allowed for testimony. 

(e) At the commencement of the hearing, the notice of hearing shall be read and the 

procedure to be followed briefly outlined. Evidence shall then be received with respect to the 

matters specified in the notice of hearing in such order as the board or hearing officer prescribes. 

(f) The petitioner or complainant shall make the first opening statement and the last 

closing argument unless the board or hearing officer directs otherwise. Other parties shall be 

heard in such order as the board or the hearing officer directs. 

(g) Each party shall be afforded an opportunity to submit orally or in writing data, views, 

or arguments that are relevant to the matters specified in the notice of hearing. The board or 

hearing officer may require the filing of an original and eight copies of all written comments, 

recommendations, or replies. 

(h) All supporting written statements, maps, charts, tabulations, or similar data offered in 

evidence at the hearing, and which are deemed by the board or hearing officer to be authentic and 

relevant, shall be received in evidence and made a part of the record. 

(i) Each party shall have the right to call or have subpoenaed witnesses to testify at the 

hearing. 

(j) Each party shall have the right to conduct such examination or cross examination of 

the witnesses as may be necessary for a full and true disclosure of the relevant facts and shall have 

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the right to submit rebuttal evidence, subject to limitation of repetitive questions or cumulative 

evidence by the board or hearing officer. 

(k) Witnesses shall also be subject to questioning by members of the board, the hearing 

officer, or any other representative of the board. 

(l) Before proceeding to testify, all witnesses shall: 

(1) Swear or affirm to tell the truth; 

(2) State their name and address; and 

(3) Give any information respecting their appearance as the board or hearing officer may 

request. 

(m) Where a party is represented by more than one counsel, the counsel may allocate 

direct or cross examination of witnesses between them, but only one counsel shall be permitted to 

cross examine a witness, to state any objections, or to make opening and closing arguments. 

(n) Any procedure may be modified or waived by stipulation of the parties, and informal 

disposition may be made by stipulation, agreed settlement, consent order, or default. 

(o) The board or hearing officer shall confine the evidence to the questions before the 

hearing, but need not apply the technical rules of evidence. 

(p) At the close of the reception of evidence or within a reasonable time thereafter and 

prior to the filing of the hearing officer's recommended decision, the parties shall be permitted to 

file proposed findings of fact and conclusions of law together with reasons therefor. Proposals 

shall be in writing and shall contain references to the record and authorities relied upon. The 

original and eight copies shall be filed with the board and copies shall be furnished to all parties 

concerned. 

(q) Prior to the filing of a recommended decision, the hearing officer, for good cause 

shown, may reopen the case for the reception of further evidence. [Eff Sep 20 1986] (Auth: 

HRS §91-2) (Imp: HRS §§91-2, 91-9) 

§4-1-42 Recommended decision; exceptions. (a) The hearing officer's recommended 

decision shall be filed as soon as practicable and not later than thirty calendar days after the close 

of the reception of evidence. 

(b) The hearing officer's recommended decision shall become a part of the record and 

include separate findings of fact and conclusions of law as well as reasons therefor. The findings 

and conclusions shall be based upon the whole record and supported by reliable, probative, and 

substantial evidence, including facts of which the hearing officer may have taken official notice. 

(c) If any party to the proceeding has filed proposed findings, the hearing officer shall 

incorporate in the recommended decision a ruling upon each proposed finding. 

(d) A copy of the hearing officer's recommended decision shall be served upon each party 

or the party's counsel of record. 

(e) Within ten calendar days after receipt of a copy of the hearing officer's recommended 

decision, any party may file with the board exceptions to any part thereof and request review by 

the board. Each exception shall specify the portions of the record and the authorities relied on to 

sustain each point. A copy of the exceptions and request for review shall be served upon each 

party or the party's counsel of record. [Eff Sep 20 1986] (Auth: HRS §91-2) (Imp: HRS 

§§91-2, 91-12) 

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§4-1-43 Board action. (a) Before taking final action in a contested case, the board, on its 

own motion, may order further proceedings to be held. 

(b) In taking final action, the board shall consider the recommended decision of the 

hearing officer and all relevant evidence introduced in conjunction with the case. 

(c) If timely exceptions and requests for review have been filed by a party adversely 

affected by the recommended decision, the board shall allow the party an opportunity to present 

argument and shall consider the whole record or such portions as may be cited by the party. 

(d) The board shall take final action within forty-five calendar days: 

(1) After filing of the recommended decision of the hearing officer if no timely 

exceptions and requests for review have been filed; or 

(2) After the conclusion of further proceedings as provided in subsection (a) or review as 

provided in subsection (c). [Eff Sep 20 1986] (Auth: HRS §§91-2, 91-3) (Imp: 

HRS §§91-2, 91-3, 91-11) 

§4-1-44 Informal disposition; offers of settlement; satisfaction of complaint. (a) The 

complainant, respondent, counsel for the board, and any other party to the proceedings may meet 

at any time prior to or during hearings for the purpose of informal disposition of the proceedings. 

(b) Unaccepted proposals or offers of settlement shall not be admissible in evidence. 

(c) If a respondent satisfies a complaint either before or after the commencement of a 

hearing, a statement setting forth when and how the complaint has been satisfied shall be: 

(1) Signed and verified by each party; 

(2) Filed with the board; and 

(3) Served upon all parties of record. Satisfied complaints may be dismissed at the 

discretion of the board. [Eff Sep 20 1986] (Auth: HRS §§91-2, 91-9) (Imp: HRS 

§§91-2, 91-9) 

§4-1-45 Service of papers. (a) The board or hearing officer shall serve all orders, 

notices, and other papers issued by the board or hearing officer, together with any other papers 

which the board or hearing officer is required by law to serve. All other papers shall be served by 

the party filing them. 

(b) All papers, including notice of final board action, shall be served: 

(1) On all counsel of record at the time of filing; 

(2) Upon parties not represented by counsel; or 

(3) Upon agents designated by parties or by law. 

(c) Any counsel entering an appearance subsequent to the initiation of a proceeding shall 

notify all other counsel of record and all parties not represented by counsel of this fact. 

(d) Service of papers shall be made personally or by first-class certified mail. 

(e) A party shall be in default upon failure or refusal to adhere to papers served in 

accordance with this section. [Eff Sep 20 1986] (Auth: HRS §91-2) (Imp: HRS §91-2) 

1-15 

C-531

§4-1-46 Depositions. (a) Upon application of a party to any proceeding, the board or 

hearing officer, at any time after the filing of a complaint, may order the taking of testimony by 

oral deposition or by deposition upon written interrogatories. 

(b) Any party desiring to take the deposition of a witness shall make application in 

writing to the board or the hearing officer giving reasons why a deposition should be taken, 

together with the following: 

(1) The character of the deposition; 

(2) The time and place the deposition is to be taken; 

(3) The name and address of the person before whom the deposition will be taken; 

(4) The name and address of each witness; and 

(5) The subject matter upon which a witness is expected to testify. 

(c) Upon approval of an application for the taking of testimony by deposition, a 

deposition may be taken before any person having power to administer oaths other than the 

person designated in the notice, provided written notice is given to all parties concerned. 

(d) Each witness testifying shall be duly sworn. The adverse party shall have the right to 

cross-examine the witness. 

(e) The questions propounded to the witness and the answers thereto shall be reduced to 

writing and, in the presence of the person taking the deposition, read to and subscribed by the 

witness and certified in the usual form by the person taking the deposition. The person taking the 

deposition shall forward the original and two copies of the deposition to the board at its office in 

Honolulu, Hawaii. 

(f) A deposition ordered and taken in accordance with this section may be used in any 

proceedings if the board or the hearing officer finds that the evidence is otherwise admissible and 

that: 

(1) The witness is dead; or 

(2) The witness is outside the State, unless it appears that the absence of the witness is 

procured by the party offering the deposition; or 

(3) The witness is unable to attend or testify because of age, sickness, infirmity, or 

imprisonment; or 

(4) The party offering the deposition has endeavored and been unable to procure the 

attendance of the witness by subpoena; or 

(5) Exceptional circumstances exist to make it desirable to allow the deposition to be 

used. 

(g) If any part of a deposition is put in evidence by a party, any other party may require 

the production of the remainder or any other portion of the deposition. [Eff Sep 20 1986] (Auth: 

HRS §91-2) (Imp: HRS §91-2) 

§4-1-47 Subpoenas. (a) The issuance of subpoenas by the board shall be in accordance 

with section 92-16, HRS. 

(b) Application for subpoenas for the production of documentary evidence shall be made 

in writing to the board or to the hearing officer. The application shall be reasonable in scope and 

specify as exactly as possible the documents desired, showing their general relevancy. [Eff 


1-16 

C-532

§4-1-48 Ex parte communications. (a) No party or other person representing or on 

behalf of a party shall communicate privately on the merits of a case to any member of the board, 

the department staff, or the hearing officer designated to hear and decide a matter. 

(b) The following types of ex parte communications are permitted: 

(1) Requests for information as to the status of a proceeding; and 

(2) Those which all parties to the contested case have agreed upon or which the board or 

hearing officer has formally ruled may be made on an ex parte basis. 

(c) Statements may be made to any news media to inform the public of the status or 

progress of the contested case or the testimony presented or the evidence produced. [Eff 

Sep 20 1986] (Auth: HRS §91-2) (Imp: HRS §§91-2, 91-9) 

§4-1-49 Record of hearing. Contested case hearings shall be reported verbatim or 

recorded on electronic devices. [Eff Sep 20 1986] (Auth: HRS §91-2) (Imp: HRS §§91-2, 

91-9) 

1-17 

C-533

SUBCHAPTER 6 

DECLARATORY RULINGS 

§4-1-50 Petition for declaratory ruling. (a) On petition of an interested person, the board 

may issue a declaratory order regarding the applicability of any statutory provision or of any rule 

or order of the board. Petitions for the issuance of a declaratory order shall: 

(1) State clearly and concisely the controversy of uncertainty; 

(2) Cite the statutory authority involved; 

(3) Include a complete statement of the facts and the reasons or grounds prompting the 

petition, together with full disclosure of the petitioner's interest; and 

(4) Conform to the requirements of section 4-1-12. 

(b) The board, upon receipt of a petition, may require the petitioner to file additional data 

or a memorandum of legal authorities in support of the position taken by the petitioner. 

(c) The board, without notice or hearing, may dismiss a petition for declaratory ruling 

which fails in any material respect to comply with the requirements of this section. 

(d) Although no formal hearing will ordinarily be held on a petition for a declaratory 

ruling, the board may order a hearing. 

(e) Any petitioner or interested party who requests a hearing on a petition for declaratory 

ruling shall: 

(1) Set forth in writing the reasons why the information filed will not permit a fair and 

expeditious disposition of the petition; and 

(2) If the hearing is dependent upon factual assertions, submit affidavits establishing 

those facts. 

(f) In the event a hearing is ordered by the board, the proceedings shall be in accordance 

with subchapter 5. [Eff Sep 20 1986] (Auth: HRS §§91-2, 91-8) (Imp: HRS §§91-2, 91-8) 

SUBCHAPTER 7 

SEVERABILITY 

§4-1-51 Severability. This chapter shall be deemed to be severable, and in the event a 

section of this chapter is determined to be invalid, such invalidity shall affect that section only and 

not invalidate this chapter in its entirety. [Eff Sep 20 1986] (Auth: HRS §91-2) (Imp: HRS 

§91-2) 

1-18 

C-534

SUBCHAPTER 8 

REPEAL 

§4-1-52 Repeal. All rules and regulations adopted by the board in effect on July 1, 1980, 

and subsequently not converted to the Hawaii Administrative Rules format in accordance with 

section 91-4.2 and 91-5, HRS, are repealed. [Eff Sep 20 1986] (Auth: HRS §§91-2, 141-2, 

142-2, 144-11, 145-15, 147-4, 148-2, 149A-19, 149A-33, 150-22, 150A-9, 152-2, 153-4, 155-4, 

157-13, 159-7, 161-7, 163-4) (Imp: HRS §§91-4.2, 91-5) 

1-19 

C-535


The repeal of State of Hawaii Board of Agriculture Rules of Practice and Procedure and 

all rules and regulations adopted by the Board of Agriculture in effect on July 1, 1980 and 

subsequently not converted to the Hawaii Administrative Rules format in accordance with section 

91-4.2 and 91-5, Hawaii Revised Statutes, and the adoption of Chapter 4-1, Hawaii 

Administrative Rules, on the Summary Page dated August 28, 1986, were approved by the Board 

of Agriculture on August 28, 1986 following a public hearing held on August 11, 1986 after 

public notice was given in The Sunday Star-Bulletin & Advertiser, The Maui News, Hawaii 

Tribune-Herald, and The Garden Island on July 20, 22, 23, and 23, 1986, respectively. 

These rules shall take effect ten days after filing with the Office of the Lieutenant 

Governor. 


Gerald Y.Y. Chang 


__________________________ 

Jack K. Suwa, Chairperson 

Board of Agriculture 

__________________________ 

George R. Ariyoshi 

Governor, State of Hawaii 

Date: Sept. 9, 1986 

__________________________ 

Filed 

1-20 

C-536


Amendment and Compilation of Chapter 4-153 

Hawaii Administrative Rules 

July 23, 1998 

SUMMARY 

1. §§4-153-1 to 4-153-4 are amended. 

2. §4-153-8 is amended. 

3. §§4-153-11 to 4-153-13 are amended. 

4. §§4-153-16 to 4-153-18 are amended. 

5. §4-153-29 is amended. 

6. Chapter 153 is compiled. 

C-537

HAWAII ADMINISTRATIVE RULES 

TITLE 4 


SUBTITLE 8 

DIVISION OF AGRICULTURAL RESOURCE MANAGEMENT 

CHAPTER 153 

AGRICULTURAL PARK PROGRAM RULES 

Subchapter 1 Administration 

§4-153-1 Definitions 

§4-153-2 Administration of agricultural park program 

§4-153-3 Powers 

§4-153-4 Right to inspect 

§4-153-5 Application for leases 

§4-153-6 Fees and charges 

§4-153-7 Report on all dispositions 

Subchapter 2 Planning and Development 

§4-153-8 Planning 

§4-153-9 Development 

Subchapter 3 Joint Ventures 

§4-153-10 Development of joint ventures 

§4-153-11 Planning; joint ventures 

§4-153-12 Terms of joint venture 

Subchapter 4 Eligibility Requirements 

§4-153-13 General eligibility requirements for 

agricultural park lands 

§4-153-14 Permanent register for agricultural park 

lands 

153-1 

C-538

§4-153 

Subchapter 5 Qualifications of Applicants 

§4-153-15 All applicants 

Subchapter 6 Preference Rights 

§4-153-16 Preference right 

§4-153-17 Proof of preference status 

Subchapter 7 Appraisals and setting of lease 

rents 

§4-153-18 Appraisals and setting of lease rents 

Subchapter 8 Disposition of Leases 

§4-153-19 Negotiation 

§4-153-20 Drawing of lot 

§4-153-21 Public auction 

§4-153-22 Notices 

§4-153-23 Conduct of drawing 

Subchapter 9 Lease Provisions 

§4-153-24 Lease provisions; generally 

§4-153-25 Consent to mortgage 

§4-153-26 Irrigation projects 

§4-153-27 Taxes 

§4-153-28 Condemnation of leases 

§4-153-29 Re-purchase right, first offer to board; 

limitation on re-purchase price 

§4-153-30 Disposition of abandoned or seized 

property 

§4-153-31 Covenants against discrimination 

§4-153-32 Additional terms and conditions 

Subchapter 10 Lease Restrictions 

§4-153-33 Lease restrictions; generally 

153-2 

C-539

Subchapter 11 Breach or Default 

§4-153-34 Notice of breach or default 

§4-153-35 Rights of holder of security interest 

§4-153-36 Leases; forfeiture 

Subchapter 12 Severability 

§4-153-37 Severability 

153-3 

C-540 

§4-153-1 

Historical Note: Chapter 4-153, Hawaii 

Administrative Rules, is based substantially upon 

Chapter 4-2, Hawaii Administrative Rules, 

(Department of Agriculture) (Eff 1/28/88; 

R 3/6/92] 

SUBCHAPTER 1 

ADMINISTRATION 

§4-153-1 Definitions. As used in this chapter: 

"Abandoned property" means any and all property 

including personal property, items, materials, 

equipment, fixtures, motor vehicles, or vessels, that 

have been left unattended on land owned or controlled by 

the State without authority for a continuous period of 

more than twenty-four hours. 

"Administrator" means the head of the division of 

agricultural resource management, department of 

agriculture, or any officer or employee to whom 

authority has been duly designated. 

"Agricultural or aquacultural activity" has the 

same meaning as defined in section 166-2, Hawaii Revised 

Statutes. 

"Agricultural park" has the same meaning as defined 

in section 166-2, Hawaii Revised Statutes. 

"Agricultural processing" means the processing of 

agricultural produce or products, including dairying, 

grown, raised or produced in Hawaii. 

"Applicant" means any person, association, 

partnership, or corporation, other than a holder of 

record having a security interest, which acts to acquire 

or obtain an agricultural park lease or any interest 

therein, including a sublease, or an interest in an 

association or a partnership which holds the

§4-153-1 

lease or stock in a corporation which holds the lease. 

"Board" means the board of agriculture. 

"Bona fide farmer" means a person who: 

(1) Was an owner-operator of an established farm 

conducting a substantial farming operation and 

for a substantial period of the person's life 

resided on a farm or depended on farm income 

for livelihood; or 

(2) Has not less than two years' experience as a 

full-time farmer or four years' experience as 

a part-time farmer and who, in the 

administrator's judgment, is likely to 

successfully operate a farm by reason of 

ability, experience, and training as a 

vocational trainee. 

The term "bona fide farmer" includes agricultural 

cooperatives organized under chapter 421, Hawaii Revised 

Statutes, or other agricultural associations or 

partnerships, at least seventy-five per cent of the 

members of which would qualify individually as bona fide 

farmers. It also includes corporations incorporated 

primarily for agricultural production purposes where at 

least seventy-five per cent of the stock issued by the 

corporation is owned by persons who qualify individually 

as bona fide farmers. For the purposes of this chapter, 

"bona fide farmer" also includes "qualified 

aquaculturalist" as defined in section 219-2, Hawaii 

Revised Statutes. 

"Chairperson" means the chairperson of the board of 

agriculture. 

"Corporate successor" means a solely-owned 

corporation which, through assignment of lease, succeeds 

an agricultural park lessee who shall own all of the 

stock issued by and be the principal officer of the 

corporation. 

"Department" means the department of agriculture. 

"Displaced farmer" means a person who is or will be 

displaced from land that was condemned, taken, or 

repossessed by a governmental authority or private 

person. 

"Division" means the agricultural resource 

management division of the department of agriculture. 

"Economic unit" means the minimum size land area 

that is economically suitable for the operation of a 

farm. 

"Farm" also means "ranch" and "farmer" also means 

"rancher." 

153-4 

C-541

153-5 

C-542 

§4-153-1 

"Farm dwelling" means a single-family dwelling or 

employee dwelling located on a farm and used in 

connection with agricultural or aquacultural activities. 

"Holder of record having a security interest" means 

a person who is the owner or possessor of a security 

interest in any land covered in section 4-153-35 and who 

has filed a copy of the interest with the department and 

the bureau of conveyances of the State. 

"New farmer" means a person who is: 

(1) A college or community college graduate in 

agriculture or aquaculture who has less than 

two years' experience as a full-time farmer or 

less than four years' experience as a parttime 

farmer; or 

(2) A person who by reason of ability, experience, 

and training as a vocational trainee is likely 

to successfully operate a farm, as determined 

by the administrator. 

"Non-conforming use" means a use formerly permitted 

but presently incompatible with the permitted land use 

in a zoning district. 

"Person" means an individual, or partnership, 

corporation, association, or agricultural cooperative 

organized under chapter 421, Hawaii Revised Statutes, 

except as otherwise defined in this chapter. 

"Public purpose", as used in this chapter, unless 

the context clearly indicates otherwise, means all 

public uses, including but not limited to the 

straightening of boundaries of public lands, acquisition 

of access to landlocked public lands, the consolidation 

of holdings of public lands and the development of 

agricultural parks and residential, commercial, 

industrial, or resort projects on public lands. 

"Qualified aquaculturalist" means a person who: 

(1) Is actively engaged in aquaculture farming, 

aquacultural produce processing, or 

aquacultural product development activities; 

and 

(2) Is a bona fide farmer or new farmer as defined 

in this chapter. 

"State" means the State of Hawaii. [Eff 3/6/92; am 

and comp ] (Auth: HRS §166-9) (Imp: 

HRS §§166-2, 166-9)

§4-153-2 

§4-153-2 Administration of agricultural park 

program. Responsibility for the administration of the 

agricultural park program shall be placed within the 

agricultural resource management division, under the 

direction of the administrator. [Eff 3/6/92; am and 

comp ] (Auth: HRS §166-3) (Imp: HRS 

§166-3) 

§4-153-3 Powers. (a) The administrator shall 

have the power to: 

(1) Accept and process applications for 

agricultural park leases; 

(2) Disapprove agricultural park lease 

applications when the prospective applicant is 

unable to meet the requirements of the 

agricultural park program or the criteria for 

the particular lease disposition; 

(3) Recommend for board action the disposition of 

agricultural park lands to qualified 

applicants; 

(4) Collect rents, assessments, and other fees and 

charges; 

(5) Recommend for board action cancellation of 

leases where due notice of breach or default 

has been provided; 

(6) Issue non-renewable dispositions granting 

easements, permits and rights of entry for a 

period not in excess of fourteen days for use 

consistent with the purposes of this chapter; 

(7) Administer and manage the agricultural park 

special fund; and 

(8) Recommend for board action lease rentals as 

provided in section 4-153-18. 

(b) The board shall have the power to: 

(1) Approve of plans to develop agricultural 

parks; 

(2) Establish, operate, maintain, and improve 

agricultural park infrastructure; 

(3) Award and cancel leases, issue revocable 

permits, easements, and rights of entry 

covering agricultural park lands for use 

consistent with agricultural park purposes; 

(4) Approve the transfer, assignment, or sublease 

of an agricultural park lease or any interest 

therein, including the transfer 

153-6 

C-543

153-7 

C-544 

§4-153-4 

of stock of a corporation holding the lease, 

or the interest in an association or 

partnership holding the lease. To the extent 

the board reserves such a right in the lease, 

upon the transfer, assignment, or sublease of 

an agricultural park lease or any interest 

therein, the board may establish additional 

restrictions, terms, or conditions not 

inconsistent with this chapter to insure and 

promote the purposes of the demised lands; 

(5) Establish additional criteria for the 

selection of lessees not inconsistent with 

those prescribed in this chapter, relating to 

the intended use of particular land being 

disposed of, the financial feasibility of lot 

development, or the terms of the lease, the 

criteria to be included in the public notice 

of lease disposition; 

(6) Establish conditions of award which must be 

met to the satisfaction of the administrator 

prior to lease execution, the conditions to be 

included in the public notice of lease 

disposition; 

(7) Establish reasonable fees for services 

rendered by the division and for preparation 

of documents to be issued; 

(8) Waive rental payments due to natural 

catastrophes and other external factors beyond 

the lessee's control and determine the period 

for the waiver; 

(9) Delegate to the chairperson or the 

administrator, subject to the board's control 

and responsibility, such powers and duties as 

may be lawful or proper for the performance of 

functions vested in the board; and 

(10) Establish lease rentals as provided in section 

4-153-18. [Eff 3/6/92; am and comp 

] (Auth: HRS §166-9) (Imp: HRS §§166-3, 

166-5, 166-6, 166-7, 166-10, 171-11) 

§4-153-4 Right to inspect. The administrator or 

the administrator's authorized representative has the 

right to inspect, at reasonable hours, the leased

§4-153-4 

property in an agricultural park, and the improvements, 

crops, livestock, equipment, chattels, books, and 

records of the lessee in connection with the 

administration of the lease. [Eff 3/6/92; am and comp 

] (Auth: HRS §166-9) (Imp: HRS §166-6) 

§4-153-5 Application for leases. (a) Unless 

otherwise provided in a public notice of disposition of 

agricultural park lands, the applicant shall file an 

application with the department at the following 

location: 

Agricultural Resource Management Division 

State Department of Agriculture 

1428 South King Street 

Honolulu, Hawaii 96814 

Mailing address: P. O. Box 22159 

Honolulu, HI 96823-2159 

(b) The applicant shall file an application on 

forms furnished by the department, together with any 

supporting documentation required to verify 

qualification. Financial statements in a format 

acceptable to the department are required as part of the 

application. 

(c) The department shall require a completed 

application for review and shall notify the applicant of 

a deficient application. If the applicant fails to 

provide the necessary documentation or correction within 

ten (10) days of notification of deficiency, the 

application shall be deemed incomplete and disapproved. 

(d) Each applicant shall authorize the department 

in writing to verify the applicant's qualifications and 

any other information submitted. [Eff 3/6/92; comp 

] (Auth: HRS §166-9) (Imp: HRS §166-7) 

§4-153-6 Fees and charges. (a) Fees for the 

processing of public documents and records shall be 

charged as follows: 

(1) Lease, Assignment of Lease, Sublease, Consent 

to Mortgage, Collateral Agreement, and all 

other documents: $30.00/document 

(2) Copy of public document: $.50/page 

153-8 

C-545

153-9 

C-546 

§4-153-8 

(b) The cost of appraisals, surveys, public 

notices, lease closing and other services relating to 

lot disposition, reopening or assignment which are 

incurred by the department shall be charged to the 

lessee upon completion of the relevant lease 

transaction. 

(c) When a notice of lease disposition covers more 

than one lot or parcel, each lessee shall bear a prorata 

share of the cost of the services referenced in 

subsection (b) and the share shall be determined by the 

administrator. [Eff 3/6/92; 


§166-6) 

§4-153-7 Report on all dispositions. The 

department shall submit, as part of its annual report 

required by section 141-1(7), Hawaii Revised Statutes, a 

report on all dispositions made in the preceding year, 

the persons to whom made, the size of each disposition, 

the use, the tax map key number, the base rental and any 

additional rental, and method of disposition. [Eff 

3/6/92; comp ] (Auth: HRS §166-9) 

(Imp: HRS §141-1(7)) 

SUBCHAPTER 2 

PLANNING AND DEVELOPMENT 

§4-153-8 Planning. (a) The division from time to 

time shall: 

(1) Reassess the agricultural park program and 

define new directions and priorities for the 

program; 

(2) Identify and analyze potential agricultural 

parks required to support the development of 

agricultural industries in the State; and 

(3) Select and recommend suitable sites for future 

agricultural park projects to meet the needs 

of agricultural commodity industries. 

(b) Prior to the development of an agricultural 

park project, and subject to section 166-4, Hawaii 

Revised Statutes, the division shall prepare or cause to 

be prepared plans and specifications as a package for 

board action, including but not limited to:

§4-153-8 

(1) Site selection analysis, including preliminary 

site inspection and boundary mapping, 

sufficient to establish the suitability of the 

land for its intended uses; 

(2) Development plan and preliminary engineering 

report, including alternative land use plans 

and infrastructure requirements, 

configurations, and costs required to service 

the project area, and schedule of governmental 

permits and approvals required to implement 

the project; 

(3) Agricultural feasibility analysis, including 

agronomic suitability and production 

capability of the project area, identification 

of potential markets, costs and economic 

returns to farm production at the site, and 

recommended lot sizes; 

(4) Environmental impact statement prepared in 

accordance with chapter 11-200, Hawaii 

Administrative Rules (Department of Health); 

(5) Land use district boundary amendment and 

county plan and zoning amendments as required 

for the project; 

(6) Survey and cadastral work, including 

topographic and feature map, profile and cross 

section survey, preliminary and final 

subdivision map, parcel descriptions, and 

installation of property pins for individual 

lots; 

(7) Design of project improvements (such as roads 

and irrigation facilities), including 

construction drawings and specifications, cost 

estimates, soils and drainage reports, 

quantity takeoffs, approval signatures from 

permitting agencies, and arrangements for 

utilities installations; and 

(8) Consultation and advice during construction 

phase, including resolution of problems due to 

unforeseen conditions, approval of 

substitutions by the contractor, and as-built 

drawings. 

(c) If the agricultural park improvements are to 

be developed exempt from county zoning and subdivision 

requirements pursuant to section 166-4, Hawaii Revised 

Statutes, the project plans and specifications shall 

include detailed information on the method and costs 

153-10 

C-547

153-11 

C-548 

§4-153-11 

of maintaining the exempt improvements. [Eff 3/6/92; am 

and comp ] (Auth: HRS §166-9) (Imp: 

HRS §§166-3, 166-4, 166-9) 

§4-153-9 Development. The division shall cause 

agricultural park infrastructure improvements approved 

by the board to be established, improved, operated, and 

maintained. [Eff 3/6/92; comp ] (Auth: 

HRS §166-9) (Imp: HRS §§166-3, 166-4, 166-9) 

SUBCHAPTER 3 

JOINT VENTURES 

§4-153-10 Development of joint ventures. (a) As 

provided by section 166-5, Hawaii Revised Statutes, the 

board may enter into a partnership agreement with a 

federal agency, a county, or a private party for 

development and subdivision of an agricultural park, 

which may include irrigation systems. 

(b) "Partner" means a person, firm, corporation, 

partnership, association, trust, or other legal entity, 

or a combination of any thereof, who or which has 

experience in the development and subdivision of land 

for agricultural or aquacultural uses and has the 

financial ability satisfactory to the board to develop, 

and subdivide land and enter into a joint venture as 

provided in this section. [Eff 3/6/92; comp 

] (Auth: HRS §§166-5, 166-9) (Imp: HRS §§141-1, 166- 

3, 166-4, 166-5) 

§4-153-11 Planning; joint ventures. (a) Prior to 

entering into a partnership agreement, the board shall: 

(1) Determine: 

(A) Whether the lands shall be developed by 

disposition or contract; 

(B) The location, area, and size of the lands 

to be developed; 

(C) The use or uses to which the lands shall 

be put; 

(D) The estimated period of time to construct 

and complete the development; 

(E) Minimum requirements for on-site and

§4-153-11 

off-site improvement, if any; and 

(F) Such other terms and conditions as shall 

be deemed necessary by the board; 

(2) Set the minimum or upset rental and additional 

rental, if any, on the basis of an appraisal 

report prepared by an appraiser for the board, 

determining the rental value of the lands for 

the use or uses for which they are to be 

developed using generally accepted appraisal 

methods; the appraised value may be adjusted 

as provided in section 4-153-18; 

(3) Give notice of the proposed partnership 

agreement by publication at least once in each 

of three successive weeks in a newspaper of 

general circulation in the State. The notice 

shall invite interested persons to submit 

applications to be selected as the partner for 

the project. The notice shall also state in 

general terms the size, location, the minimum 

rental and additional rent, if any, of the 

area to be developed, the minimum requirements 

for any required off-site and on-site 

improvement, the maximum estimated period of 

time to install and complete the construction 

of any required improvement, the use or uses 

to which such lands shall be put, the last 

date on which applications will be received by 

the department, which date shall not be less 

than thirty days or more than ninety days 

after the last date of publication of such 

notice, and the times and places at which more 

detailed information with respect to the 

partnership agreement may be secured by 

interested persons; 

(4) Require each interested person to include a 

financial statement, and performance and 

experience records in agricultural or related 

development; provided that the board may also, 

in its discretion, require the interested 

person to submit answers, under oath, to 

questions contained in a questionnaire 

prepared by the department; 

(5) Require each interested person to submit a 

sealed bid, which shall include a development 

plan in as much detail as 

153-12 

C-549

153-13 

C-550 

§4-153-11 

possible including but not limited to the 

following: the interested person's proposal 

as to how and when the person intends to 

develop the land in partnership with the 

board, including any permitted incremental 

development, the amount of money the person 

intends to commit to the total project, the 

method of recovery of the interested person's 

costs and profits, the amount the person 

agrees to pay to develop the land, and the 

income the board will receive from leases; 

(6) Establish reasonable criteria for the 

selection of a private party or parties as a 

partner; and 

(7) Determine within forty-five days of the last 

day for filing applications the person or 

persons who meet the criteria for selection 

set by the board, and notify all persons who 

submitted applications of the board's 

determination within seven days of such 

determination. Any person may examine the 

basis of the determination, which shall be in 

writing, to ascertain whether or not the 

conditions and criteria established by the 

board were followed; provided that if any 

person does not notify the board of any 

objections and the grounds therefore, in 

writing, within ten days of such notice, the 

person shall be barred from proceeding to seek 

legal remedy for an alleged failure of the 

board to follow the conditions and criteria. 

(b) If only one person meets the criteria for 

selection as the partner, the board then may enter into 

a partnership agreement with the partner; provided that 

the terms of the partnership agreement shall not be less 

than those proposed by the partner in the application. 

If two or more persons meet the criteria for selection, 

the board shall consider all of the relevant facts of 

the partnership agreement, the proposals submitted by 

each person, the experience and financial capability of 

each person, and shall within forty-five days from the 

date of selection of the persons that met the criteria, 

select the person who submitted the best proposal. The 

board then may negotiate the details of the partnership 

agreement;

§4-153-11 

provided that the terms of the agreement shall not be 

less than those proposed by the partner in the 

application. [Eff 3/6/92; 

am and comp ] (Auth: HRS §§166-5, 166- 

9) (Imp: HRS §§166-3, 166-4, 166-5) 

§4-153-12 Terms of joint venture. Any partnership 

agreement for a joint venture shall be approved by the 

board and shall be in conformity with section 166-5, 

Hawaii Revised Statutes. The terms of a partnership 

agreement for joint venture shall include the following, 

wherever appropriate: 

(1) The development and subdivision shall comply 

with appropriate state and county zoning and 

subdivision requirements; provided that, 

pursuant to section 166-4, Hawaii Revised 

Statutes, the development and subdivision may 

be exempt from the requirements. 

(2) The partners shall file with the department a 

good and sufficient bond conditioned upon the 

full and faithful performance of all the 

terms, covenants, and conditions of the 

partnership agreement. 

(3) The dates on which the partner must submit to 

the board for approval the preliminary plans 

and final plans and specifications for the 

total development. No construction shall 

commence until the board has approved the 

final plans and specifications, provided that 

with board approval, construction on an 

incremental basis may be permitted. 

(4) The date of completion of the total 

development, including the date of completion 

of any permitted incremental development. 

(5) The minimum requirements for off-site and onsite 

improvements that the partner must 

install, construct, and complete by the date 

of completion of the total development. The 

board may permit incremental development and 

establish the minimum requirements for offsite 

and on-site improvements that must be 

installed, constructed, and completed prior to 

the date of completion of the total 

development. 

(6) A partnership agreement may provide that the 

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C-552 

§4-153-13 

board shall issue a lease to the nominees of 

the partner, including the partner, pursuant 

to the terms previously negotiated and agreed 

upon between the partner and the board, 

including lease rent to the lessee and method 

of recoupment of expenses by the partner. 

(7) In the event of a lease the partner may be 

permitted, after he has completed construction 

of any required offsite improvement, to assign 

or sublease with board approval portions of 

the leased lands in which the construction of 

any offsite improvement has been completed to 

an assignee or sublessee who shall assume the 

obligations of the partner relative to the 

parcel being assigned or subleased, including 

the construction of any onsite improvement. 

The board may permit a partner to share in the 

lease rent for a fixed period in order to 

recover costs and profit. 

(8) The board may include in any partnership 

agreement or lease, provisions concerning 

notice of breach or default, rights of a 

holder of a security interest, and consent to 

mortgage as set forth in this chapter. 

(9) Other terms and conditions set by the board. 

[Eff 3/6/92; am and comp ] 

(Auth: HRS §§166-5, 166-9) (Imp: HRS §§166- 

3, 166-4, 166-5) 

SUBCHAPTER 4 

ELIGIBILITY REQUIREMENTS 

§4-153-13 General eligibility requirements for 

agricultural park lands. (a) Any person shall be 

eligible to apply for an agricultural park lease if the 

person: 

(1) Is a citizen of the United States who has 

resided in the State for at least three years 

or is a permanent status alien who has resided 

in the State for at least five years; and 

(2) Is a bona fide farmer or new farmer as defined 

in this chapter;

§4-153-13 

(b) In the case of agricultural cooperatives, 

associations, partnerships and corporations, the 

residence requirement must be met by seventy-five per 

cent of the members, partners or stockholders who are 

bona fide farmers, new farmers or qualified 

aquaculturalists. 

(c) No person shall be eligible to lease 

agricultural park lands who has had during the five 

years preceding the date of disposition a previous sale, 

lease, license, permit, or easement covering public 

lands canceled for failure to satisfy the terms and 

conditions thereof. 

(d) No person shall be eligible to lease 

agricultural park land who is in arrears in the payment 

of taxes or other obligations to the State or any of its 

counties. [Eff 3/6/92; am and comp ] 

(Auth: HRS §§166-7, 166-9) (Imp: HRS §§166-7, 166-9) 

§4-153-14 Permanent register for agricultural park 

lands. The administrator shall establish and maintain a 

register in which all persons desiring to acquire 

agricultural park lands may register. The administrator 

shall determine the information required from each 

registrant and may establish a criteria for 

registration. [Eff 3/6/92; comp ] 

(Auth: HRS §166-9) (Imp: HRS §§166-3, 166-9) 

SUBCHAPTER 5 

QUALIFICATIONS OF APPLICANTS 

§4-153-15 All applicants. (a) In addition to 

satisfying the general eligibility requirements of 

section 4-153-13, all agricultural park applicants shall 

qualify as bona fide farmers or new farmers, as defined, 

and shall demonstrate ability to perform the lease terms 

and shall provide the following information, at a 

minimum, to the department: 

(1) A resume with periods of farming experience 

identified by month and year; 

(2) A preliminary plan of utilization and 

development of agricultural park land, 

including a financial projection of the 

estimated cost of the development; 

153-16 

C-553

153-17 

C-554 

§4-153-16 

(3) State and county tax clearances including 

general excise tax; 

(4) An affidavit that the applicant is not 

delinquent in any obligation to the State or 

any of its political subdivisions and that the 

applicant has not had a sale, lease, license, 

permit or easement covering public land 

canceled for failure to satisfy any terms or 

conditions thereof; 

(5) A financial statement, in the format outlined 

in the application instructions, including a 

balance sheet current within six months; and 

(6) Copies of state income tax returns for the 

last five years. 

(b) Additionally, applicants which are 

partnerships, corporations, associations or agricultural 

cooperatives shall provide the following information: 

(1) In the case of a corporation, a copy of 

articles of incorporation reflecting date of 

filing, purpose of the corporation, and 

disclosure of all directors and officers. 

(2) In the case of an association, partnership, 

corporation, or agricultural cooperative, a 

resume of associates, partners, directors and 

officers, and members, with periods of farming 

experience identified by months and years. 

(c) Whenever the board establishes additional 

criteria for the selection of lessees, pursuant to 

section 4-153-3(b)(5), in support of qualification, each 

applicant shall provide documentation to the 

satisfaction of the department. [Eff 3/6/92; comp 


9) 

SUBCHAPTER 6 

PREFERENCE RIGHTS 

§4-153-16 Preference right. Any person otherwise 

qualified to take an agricultural park lot shall have 

preference in any disposition of agricultural park lots 

if the person: 

(1) Is a veteran who served in the military

§4-153-16 

forces of the United States and who was 

honorably discharged therefrom; 

(2) Is a displaced farmer who within a five-year 

period preceding the application is the former 

owner or lessee of farm premises that were 

condemned, taken, or repossessed by a 

governmental authority or private person; 

(3) Is an owner or lessee in possession of farm 

premises that will be condemned, taken, or 

repossessed by a governmental authority or 

private person, for any reason, and will be a 

displaced farmer within ten years following 

the application date for an agricultural park 

lot; 

(4) Operates a farm located in a zoning district 

where agricultural use is a nonconforming use; 

or 

(5) Is a new farmer as defined in section 4-153-1. 


(Auth: HRS §§166-8, 166-9) (Imp: HRS §166- 

8) 

§4-153-17 Proof of preference status. (a) Any 

applicant claiming preference status shall furnish proof 

of veteran status, displacement or potential 

displacement, nonconformance to zoning, or new farmer 

qualification as called for in the instructions to 

applicants and which shall be submitted together with 

the application. 

(b) Willful sale or surrender of a farm shall 

disqualify an applicant as a displaced farmer. [Eff 

3/6/92; am and comp ] (Auth: HRS §§166- 

8, 166-9) (Imp: HRS §166-8) 

SUBCHAPTER 7 

APPRAISALS AND SETTING OF LEASE RENTS 

§4-153-18 Appraisals and setting of lease rents. 

(a) Public auction. The appraisal of agricultural park 

lands for the determination of the upset lease rental at 

public auction may be made by an employee of the 

department qualified to appraise lands, or by one but 

not more than three disinterested appraisers contracted 

for by the administrator; 

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C-556 

§4-153-18 

provided that the upset lease rental shall be determined 

by disinterested appraisal when prudent management so 

dictates. Except as otherwise provided in this 

subchapter, no such lands shall be leased for a sum less 

than the rental value fixed by appraisal; provided that 

for any lease at public auction, the board may establish 

the upset lease rental at less than the appraisal value 

set by an employee of the department and the land may be 

leased at that price. The department shall be 

reimbursed by the lessee for the cost of any appraisal 

made by a disinterested appraiser or appraisers 

contracted for by the department. 

(b) Drawing or negotiation. The base rental and 

additional rental of agricultural park lands to be 

disposed of by drawing or by negotiation shall, except 

as otherwise provided in this subchapter, be no less 

than the rental value determined by a disinterested 

appraiser or appraisers contracted by the administrator, 

and such appraisal, and any further appraisal which is 

made at the request of the lessee and with the approval 

of the department, shall be reimbursed to the department 

by the lessee. 

(c) Reopening. In the case of reopenings of the 

rental for an agricultural park lease, the base rental 

and additional rental for any ensuing period shall be 

the rental value at the time of reopening determined in 

accordance with generally accepted appraisal methods. 

At least six months prior to the time of reopening, the 

rental value of the land in the specific use or uses for 

which the disposition was made shall be determined by an 

appraiser whose services shall be contracted for by the 

administrator, and the lessee shall be promptly notified 

of the determination; provided that should the lessee 

disagree with the appraised rental, the lessee may 

appoint the lessee's own appraiser who together with the 

department's appraiser shall appoint a third appraiser, 

and the appraised rental shall be determined by 

arbitration as provided in chapter 658, Hawaii Revised 

Statutes. In that case the lessee shall pay for the 

lessee's own appraiser, the department shall pay for its 

appraiser, and the cost of the third appraiser shall be 

borne equally by the lessee and the department. 

Automatic escalation of the appraised rental at 

reopening may be permitted. The increase shall be

§4-153-18 

based on the "Consumer Price Index for all Urban 

Consumers, U.S. City Average", published monthly by the 

Bureau of Labor Statistics of the U.S. Department of 

Labor, labeled as "CPI". The calculation of the 

escalated value shall be based on a base index and a 

reopening period index, both of which are arithmetic 

averages over a set period of time. The quotient of 

these two indexes will set the rate of increase, which 

is then multiplied by the existing rental, giving the 

rental for the ensuing period. 

In the event publication of the CPI is discontinued 

or not available, any comparable statistics, equivalent 

to the CPI, published by an agency of the United States 

or by a responsible financial periodical of recognized 

authority, shall be used to calculate the indexes as 

described in the preceding paragraph. 

The CPI computation shall be conclusive and 

binding, but shall not preclude any adjustment in the 

event of a published amendment to the CPI or an error in 

the computation; provided the lessee, within thirty days 

after receipt of notice, shall notify the lessor of the 

claimed error or dispute therein. 

(d) Assignment of lease. In the event of an 

assignment of lease, the base rental and additional 

rental for any ensuing period may be redetermined by the 

board pursuant to appraisal conducted by a disinterested 

appraiser or appraisers contracted by the administrator; 

provided that the base rental and additional rental 

shall be the rental value at the time of assignment 

determined by generally accepted appraisal methods. The 

cost of redetermining the base rental and additional 

rental shall be borne by the lessee. 

(e) When more than one appraiser is appointed each 

shall prepare and submit an independent appraisal. All 

appraisal reports shall be available for review by the 

public. 

(f) Notwithstanding anything to the contrary 

contained in this chapter 4-153, the administrator may 

recommend to the board for approval an adjustment of an 

appraised value. The administrator may recommend using 

any of the following adjustments. 

(1) An adjustment of the fee simple value 

determined through appraisal as necessary to 

maintain equitable fee simple values between, 

among, or throughout the 

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C-558 

§4-153-18 

department's agricultural park system for 

parks having the same designated use and which 

are put out to lease within twelve months of 

each other. 

(2) An adjustment of the rental value determined 

through appraisal by: 

(A) Applying a percentage of the rate of 

return used in the appraisal instead of 

the appraisal's rate of return. An 

adjusted rate of return may be applied in 

the following cases: 

(i) For those uses which require 

extensive or large capital 

expenditures to meet lease terms and 

conditions; 

(ii) For those uses involving a crop of 

low yield value; and 

(iii) For those uses involving a crop or 

product which does not generate 

revenues for a substantial period of 

time after award of the lease, 

provided that the adjusted rate of 

return shall apply only for the 

period of time in which revenues are 

not generated. 

(B) Factoring in an agricultural park lot's 

unproductive acreage, e.g., drainageways, 

wastelands, restricted easements, common 

usage, and uncontributory land areas, for 

those agricultural park lots for which 

the specified use is for crops to be 

grown "in the soil or ground." 

(C) Factoring in extraordinary start-up costs 

for those crops or uses which require 

heavy initial capital investments before 

any returns are realized, e.g., 

shadehouse crops, wetland crops, etc., or 

those crops or uses which have unusually 

little or no return during the initial 

years of the lease. 

(D) Delaying collection of the rental for 

those crops or specific uses where no 

income is realized during the first five 

to seven years. Generally, this 

adjustment would apply to orchard type

§4-153-18 

crops where a plant must reach a certain 

maturity before bearing fruit, e.g., 

macadamia nut trees and guava and other 

tropical fruit plants. The proposed 

rental structure may factor in the no 

revenue years with low rent and the 

revenue years with a "catch-up" rent, 

making a multi-tier rental structure 

during the initial rental period. 

(3) An adjustment of the rental determined through 

appraisal at the time of reopening or 

conversion, as the case may be, by: 

(A) Factoring in the income for a particular 

lessee using a percentage increase that 

reflects the increase in the agricultural 

use value of the leasehold since 

commencement of the lease. 

(B) Using an appropriate index (e.g., 

consumer price index, producers' price 

index, etc.) to calculate an escalation 

of the rental over a specified period of 

time. [Eff 3/6/92; am and comp 

] (Auth: HRS §§166-6, 166-9) (Imp: 

HRS §166-6) 

SUBCHAPTER 8 

DISPOSITION OF LEASES 

§4-153-19 Negotiation. (a) A lease of 

agricultural park land may be disposed of through 

negotiation upon a finding by the board that the public 

interest demands it. 

(b) After a determination is made to negotiate the 

disposition of a lease, the administrator shall: 

(1) Give public notice in accordance with the 

procedure set forth in section 4-153-22(b), of 

the department's intention to lease 

agricultural park land through negotiation, 

setting forth the minimum conditions 

thereunder, and the uses for which the land 

will be leased. Any person interested in 

securing the lease shall file an application 

with the administrator not later than 

153-22 

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C-560 

§4-153-20 

forty-five days after the first publication of 

the notice; 

(2) Determine the applicants who meet the criteria 

for selection set by the board and notify all 

applicants of the administrator's 

determination. Any applicant may examine the 

basis of the determination, which shall be in 

writing, to ascertain whether or not the 

conditions and criteria established by the 

board were followed; provided that if any 

applicant does not notify the administrator of 

the applicant's objections, and the grounds 

therefor, in writing, within twenty days of 

the receipt of the notice, the applicant shall 

be barred from proceeding to seek legal remedy 

for any alleged failure of the department to 

follow the conditions and criteria. 

(c) If only one applicant meets the criteria for 

selection of the lessee, the board may, after notice as 

provided in subsection (b)(2), dispose of the lease by 

negotiation. 

(d) If two or more applicants meet the criteria 

for the selection of the lessee, the board shall select 

the lessee who submits the highest offer contained in a 

sealed bid deposited with the administrator. 

(e) Disposition of agricultural park lands set 

aside for common use or for the processing of 

agricultural products may be negotiated without regard 

to the limitations set forth in this section and section 

4-153-22; provided that the disposition encourages 

competition within the agricultural processing industry 

and shall not exceed a maximum term of thirty-five 

years. 

(f) The lease shall be issued when conditions of 

the award of lease are fulfilled. (g) 

Notwithstanding the provisions of this section and 

section 4-153-22, the board may renegotiate leases as 

provided in section 4-153-3. [Eff 3/6/92; comp 

] (Auth: HRS §§166-6, 166-9) (Imp: HRS §166-6) 

§4-153-20 Drawing of lot. When the board 

determines that agricultural park lands are to be leased 

by drawing, the administrator shall give public

§4-153-20 

notice inviting applications for the drawing as provided 

in section 4-153-22, with such details concerning the 

drawing as it deems necessary and desirable. 

Applications to participate in the drawing shall be 

filed with the department within two weeks after the 

last publication date of the notice. Within not more 

than one hundred twenty days after the closing date for 

applications, the administrator shall screen the 

qualifications of the applicants, select those qualified 

to participate, notify all applicants of the selection, 

and conduct a drawing. The date of the drawing shall be 

published as set forth in section 4-153-22. All 

applicants shall be notified of the results of the 

drawing, and the award of leases shall be made by the 

board at its next regularly scheduled meeting. The 

lease shall be issued when conditions of the award of 

lease are fulfilled. [Eff 3/6/92; comp ] 

(Auth: HRS §§166-6, 166-9) (Imp: HRS §166-6) 

§4-153-21 Public auction. (a) Disposition of 

agricultural park lands may be made at public auction 

after public notice as provided in section 4-153-22. 

All public auctions shall be held at the department or 

at any other convenient place in the district in which 

the land is located, and shall be conducted by the 

administrator or by an authorized employee of the 

division under the direction of the administrator, who 

shall perform this service without extra compensation. 

(b) To be eligible to bid in an auction for an 

agricultural park lease, a bidder shall qualify as a 

bona fide farmer or new farmer as defined in this 

chapter. [Eff 3/6/92; comp ] (Auth: 

HRS §§166-6, 166-9) (Imp: HRS §166-6) 

§4-153-22 Notices. (a) Each notice of proposed 

lease disposition shall contain the following 

information: 

(1) General information regarding all the parcels 

or lots offered for lease, such as time and 

place of disposition, terms and conditions of 

disposition, qualification of applicants, 

procedure for filing application, conditions 

of award, if any, and time and place at which 

more detailed 

153-24 

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§4-153-22 

information regarding the lease disposition 

may be obtained; and 

(2) Specific information pertaining to the 

individual parcels or lots offered for lease 

such as the parcel or lot number, its 

description, location and area, minimum, base, 

or upset rental, basis for additional rent if 

any, method of payment, purpose for which 

leased, the term of lease, building 

requirement, and other such covenants and 

conditions; and 

(3) The lessee's responsibility for applicable 

lease disposition costs pursuant to section 4- 

153-6. 

(b) Negotiation. Notice of a proposed disposition 

by negotiation shall be published at least once in each 

of three successive weeks in a newspaper of general 

circulation in the State and in addition in a newspaper 

of general circulation in the appropriate county. The 

notice shall invite proposals and state in general terms 

the size, location, and minimum rental of lots to be 

leased, the terms of lease, and the last date on which 

application shall be received by the department, which 

date shall be not less than thirty days after the last 

date of publication of the notice. 

(c) Drawings. Whenever a disposition by drawing 

by lots is proposed, notice inviting applications to 

participate in the drawing shall be published once a 

week for three successive weeks in a newspaper of 

general circulation published in the State and, in 

addition, in a newspaper of general circulation in the 

appropriate county. The notice shall contain: 

(1) The qualifications required of applicants; 

(2) A general description of the land, including 

the location and tax map key; 

(3) The specific use for which the disposition is 

intended; 

(4) Base rental to be charged, and basis for 

additional rent, if any; and 

(5) The date by which all applications shall be 

filed, which date shall be not less than 

fourteen days after the last publication date. 

Within not more than one hundred twenty days after the 

closing date for applications, the administrator shall 

select those qualified to participate in the drawing,

§4-153-22 

notify all applicants as to whether or not they 

qualified, and conduct the drawing. The notice of 

selection of applicants qualified to participate in the 

drawing, together with the notice of drawing, shall be 

mailed to each applicant, whether or not the applicant 

in fact qualified. The notice of the drawing shall 

state the time and place of the drawing. In addition to 

the notice to each applicant, the administrator shall 

publish the notice of drawing at least three times 

within a period of ten days in a newspaper of general 

circulation in the State and, in addition, in a 

newspaper of general circulation in the appropriate 

county, each publication to be not more often than once 

in two successive days. Upon completion of the drawing, 

the award of leases shall be announced at the next 

regularly scheduled meeting of the board and the lease 

issued when conditions of the award are fulfilled. 

(d) Auctions. Notice of any proposed disposition 

by public auction shall be published at least once in 

each of three successive weeks in a newspaper of general 

circulation in the State and, in addition, in a 

newspaper of general circulation in the appropriate 

county. The last publication shall be not less than ten 

days before the date of the auction. Notice of the 

auction shall contain the following: 

(1) Time and place of the auction; 

(2) General description of the land, including the 

location and tax map key; 

(3) Specific use for which the disposition is 

intended; 

(4) Upset rental to be charged and basis for 

additional rent, if any; and 

(5) The date by which applications for 

qualification shall be filed. 

The maps showing the metes and bounds description and 

the classification of the land shall be kept in the 

office of the department and shall be open for 

inspection at all reasonable hours. [Eff 3/6/92; comp 

] (Auth: HRS §§166-6, 166-9, 171-16) (Imp: HRS §166- 

6) 

§4-153-23 Conduct of drawing. (a) Qualified 

applicants shall be present in person or shall be 

represented by an agent with appropriate credentials 

authorizing representation. Applicants who are not 

153-26 

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§4-153-23 

present or arrive late at the drawing shall be 

disqualified. 

(b) All qualified applicants shall be placed in 

the following groups: 

(1) Group I, All persons given preference pursuant 

to section 4-153-16; or 

(2) Group II, Bona fide farmers as defined in this 

chapter. 

(c) The department may determine the order of lot 

selection as follows: 

(1) Within Group I, by prioritizing in any 

sequence the different preference categories 

identified in section 4-153-16(1) through 4- 

153-16(5). 

(2) Within the Group I preference categories and 

within Group II, by establishing subgroups of 

priority based on qualification for 

agricultural park lots intended for restricted 

use. The department may also reserve or limit 

the number of intended restricted use lots 

designated to a subgroup and may determine the 

order in which lots for different restricted 

uses shall be drawn. If there is an 

insufficient number of qualified applicants 

for the first intended restricted use, the 

remaining lots may be made available for 

selection for an alternate intended restricted 

use, and thereafter for selection for nonrestrictive 

permitted use until all lots are 

selected. 

(d) Within each group or subgroup, the applicant 

whose name is first drawn shall be the first to select a 

lot and the drawing of names shall continue until all 

lots are selected or all applicants have selected, 

whichever occurs first. When subgroups have been 

established for intended restricted use lots, names of 

applicants from Group I subgroups shall be drawn first, 

in the sequence established pursuant to subsection (c), 

followed by Group II subgroups, then remaining Group I 

applicants, followed by remaining Group II applicants. 

When no such subgroups have been established, names of 

applicants from Group I shall be drawn before those from 

Group II, in the sequence established pursuant to 

subsection (c). 

(e) After all lots have been selected, five 

additional names each may be drawn as alternates from 

Group I and Group II remaining applicants. In the

§4-153-23 

event awards are canceled for failure to satisfy 

conditions of award or other reason, the lots made 

available shall be offered for award to the alternates, 

first from Group I and then from Group II in the order 

in which their names were drawn. 

(f) The public notice of lease disposition shall 

identify intended restricted uses, if any, and the 

priority of the preference categories in Group I. 

"Restricted use" as used in this section means limited 

to use for a crop or agricultural product determined by 

the board to be the most appropriate use for the 

particular lot, based on consideration of the site 

selection analysis, development plan and preliminary 

engineering report and agricultural feasibility 

analysis. [Eff 3/6/92; comp ] (Auth: 

HRS §§166-6, 166-9) (Imp: HRS §166-6) 

SUBCHAPTER 9 

LEASE PROVISIONS 

§4-153-24 Lease provisions; generally. Every 

agricultural park lease issued by the board shall 

contain: 

(1) The specific use or uses to which the land is 

to be employed, provided that the use or uses 

shall be for agricultural or aquacultural 

activities only; 

(2) The improvements required, provided that a 

minimum reasonable time shall be allowed for 

the completion of the improvements, and 

provided further that the board may permit the 

lessee to offset the cost of any improvements 

to the leasehold against not more than two 

years of lease rental; 

(3) Restrictions against alienation as set forth 

in section 4-153-33; 

(4) The rent as established by the board or at 

public auction, which shall be payable not 

more than one year in advance, in monthly, 

quarterly, semiannual, or annual payments; 

(5) Where applicable, adequate protection of 

forests, watershed areas, game management 

areas, wildlife sanctuaries, and public 

hunting areas; reservation of rights-of-way 

and access to other public lands, public 

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C-566 

§4-153-26 

hunting areas, game management areas, or 

public beaches; and prevention of nuisance and 

waste; and 

(6) Such other terms and conditions as the board 

deems necessary to preserve and protect 

agricultural park lands and to effectuate the 

purposes of the State Constitution and of 

chapter 166, Hawaii Revised Statutes. [Eff 

3/6/92; comp ] (Auth: HRS 

§§166-6, 166-9) (Imp: HRS §§166-6, 166-9) 

§4-153-25 Consent to mortgage. (a) Whenever 

under this chapter or under any agricultural park lease 

issued by the board, consent of the State is required as 

a condition precedent to the mortgage of, or the 

creation of a security interest in public land, the 

chairperson may, upon due application, grant the 

consent, and if the mortgage or security interest is to 

a recognized lending institution authorized to do 

business in the State of Hawaii, the consent shall 

extend to foreclosure and sale at the foreclosure to any 

purchaser, provided that the purchaser is qualified 

under this chapter to lease and hold the land or any 

interest therein. 

(b) The holder of record having a security 

interest includes any insurer or guarantor of the 

obligation or condition of the mortgage, including any 

federal mortgage lending agency and its respective 

successors and assigns or any lending institution 

authorized to do business in the State of Hawaii; 

provided that the consent to mortgage to a 

nongovernmental holder shall not confer any greater 

rights or powers in the holder than those which would be 

required by any federal mortgage lending agency. [Eff 

3/6/92; comp ] (Auth: HRS §§166-6, 166- 

9) (Imp: HRS §§166-6, 166-9) 

§4-153-26 Irrigation projects. In any 

agricultural park lease a condition may be provided 

requiring the inclusion of the land being disposed in 

any irrigation project formed or to be formed by the 

state agency responsible therefor, and making the land 

subject to assessments made or to be made for the 

project, the assessments constituting a first lien

§4-153-26 

upon the land which, if not paid, shall result in the 

forfeiture of the land subject to notice of default as 

provided in section 4-153-34. [Eff 3/6/92; comp 


9, 167-19) 

§4-153-27 Taxes. Agricultural park leases shall 

be subject to real property taxes. Upon notice by the 

appropriate agency, the administrator shall notify the 

lessee and each holder of record having a security 

interest as provided in section 4-153-35 of any default 

in the payment of the taxes, and upon failure to remedy 

the default within sixty days after receipt of notice of 

default, the board may cancel and terminate the lease 

without prejudice to any other remedies the State may 

have against the lessee. [Eff 3/6/92; comp 


9) 

§4-153-28 Condemnation of leases. The 

agricultural park lease shall provide that whenever a 

portion of the public land under lease is condemned for 

public purposes by the State, a county, or any other 

governmental agency, the base rental shall be reduced in 

proportion to the value of the portion of the premises 

condemned. The lessee shall be entitled to receive from 

the condemning authority: 

(1) The value of growing crops, if any, which the 

lessee is not permitted to harvest; and 

(2) The proportionate value of the lessee's 

permanent improvements so taken in the 

proportion that it bears to the unexpired term 

of the lease; 

provided that the lessee may, in the alternative, remove 

and relocate the lessee's improvements to the remainder 

of the lands occupied by the lessee. The foregoing 

rights of the lessee shall not be exclusive of any other 

to which the lessee may be entitled by law. Where the 

portion so taken renders the remainder unsuitable for 

the uses for which the land was leased, the lessee shall 

have the option to surrender the lease and be discharged 

from any further liability therefor; provided that the 

lessee may remove the lessee's permanent improvements 

within such reasonable period allowed by the State. 

[Eff 3/6/92; 

153-30 

C-567

comp ] (Auth: HRS §§166-6, 166-9) 

(Imp: HRS §§166-6, 166-9, 171-38) 

153-31 

C-568 

§4-153-29 

§4-153-29 Re-purchase right, first offer to board; 

limitation on re-purchase price. An agricultural park 

lease or any interest therein, including stock of a 

corporation holding the lease or an interest in a 

partnership or association holding the lease, shall not 

be transferred or assigned unless the lease and 

improvements, or any interest therein, are first 

surrendered to the board, as follows: 

(1) The board shall have the option to re-purchase 

the lease for the price paid by the current 

lessee, including closing costs, or the fair 

market value, less appreciated value, at the 

time of re-purchase, as determined in 

paragraph (3), whichever is the lower but not 

less than zero. For the purposes of this 

subsection, "price paid by the current lessee" 

means the consideration paid for the lease 

exclusive of improvements and "appreciated 

value" means the replacement cost for 

developing the leased premises. If the board 

does not exercise its option, the provisions 

of section 4-153-33(a)(6) shall apply. 

(2) Any improvements affixed to the realty, 

including trade fixtures and growing crops, 

shall be re-purchased at their fair market 

value. 

(3) At the time of the re-purchase, the fair 

market value of the lease less appreciated 

value and the fair market value of any 

improvements shall be determined by a 

qualified appraiser whose services shall be 

contracted for by the department; provided 

that should the lessee disagree with the 

values, the lessee may appoint the lessee's 

own appraiser who together with the 

department's appraiser shall appoint a third 

appraiser, and the fair market value shall be 

determined by arbitration as provided in 

chapter 658, Hawaii Revised Statutes. In this 

event, the lessee shall pay for the lessee's 

own appraiser, the department shall pay for 

its appraiser, and the cost of the

§4-153-29 

third appraiser shall be borne equally by the 

lessee and the department. 

(4) The board may re-purchase the lease and 

improvements with funds from the agricultural 

park special fund or may accept a surrender of 

lease subject to the offer by a qualified 

applicant to purchase the lease and 

improvements, including any encumbrances, for 

not less than the amount to be paid therefor 

by the board; provided that the purchase by a 

qualified applicant shall be subject to 

sections 4-153-19 and 4-153-22. 

(5) Notwithstanding the conditions herein, the 

consideration for the applicant's purchase of 

the lease as provided in paragraph (4) above 

shall not be less than the total of all 

encumbrances that have been approved by the 

State at the time of the re-purchase. 

(6) This section shall not apply to a holder of 

record having a security interest upon 

foreclosure pursuant to section 4-153-35. 


(Auth: HRS §§166-6, 166-9) (Imp: HRS §§166- 

6, 166-9) 

§4-153-30 Disposition of abandoned or seized 

property. The department may sell, donate, or otherwise 

dispose of property abandoned or seized on land managed 

by the department upon compliance with the requirements 

of section 171-31.5, Hawaii Revised Statutes. [Eff 

3/6/92; comp ] (Auth: HRS §166-9) 

(Imp: HRS §171-31.5) 

§4-153-31 Covenants against discrimination. The 

board shall provide in every agricultural park lease 

that the use and enjoyment of the premises being granted 

shall not be in support of any policy which 

discriminates against anyone based upon race, creed, 

color, national origin, sex, or physical handicap. The 

board shall not dispose of any public land to any person 

who practices discrimination based upon race, creed, 

color, national origin, sex, or physical handicap. As 

used in this section "physical handicap" means a 

physical impairment which substantially limits 

153-32 

C-569

153-33 

C-570 

§4-153-32 

one or more of a person's major life activities. [Eff 

3/6/92; comp ] (Auth: HRS §§166-6, 166- 

9) (Imp: HRS §§166-6, 171-64) 

§4-153-32 Additional terms and conditions. (a) 

The agricultural park lessee, within a reasonable period 

of time and in accordance with the plan of development 

and utilization provided for in subsection (d), shall 

derive the major portion of the lessee's annual income 

from the production of livestock, poultry, crops or 

products for which the land is granted to the lessee; 

provided that this restriction shall not apply if 

failure to meet the restriction results from mental or 

physical disability or the loss of a spouse, or if the 

premises are fully utilized in the production of crops 

or products for which the disposition was granted. The 

lessee shall promptly provide information and documents 

requested by the administrator, including but not 

limited to copies of income tax returns, to verify that 

the income requirement is being met. 

(b) The lessee shall furnish the department, prior 

to the issuance of the executed lease, the following: 

(1) A certificate of comprehensive liability 

insurance to be maintained throughout the term 

of the lease with coverage in an amount to be 

determined by the department and approved by 

the board, subject to periodic review and 

adjustment at intervals specified in the 

lease. The certificate of insurance shall 

name the department as an additional insured 

and shall require a thirty-day notice to the 

department of any policy change or 

cancellation; and 

(2) A performance bond to be maintained throughout 

the term of the lease in an amount equal to 

two times the annual base rental; provided 

that the bond requirement may be waived by the 

administrator upon evidence that the lessee is 

substantially in compliance with lease terms 

and the lessee's lot is substantially 

developed according to plans approved by the 

department; provided further that the 

department may reinstate the waived bond at 

any time during the term

§4-153-32 

of the lease. 

(c) The board, at its discretion, may permit a 

farm dwelling or dwellings on an agricultural park lot 

if the need is clearly demonstrated. The farm dwelling 

or dwellings shall be used in connection with 

agricultural or aquacultural activities on the lot and 

shall not be used for rental purposes. The dwelling 

shall be subject to such additional terms and conditions 

as the board may require, including, but not limited to, 

adjustment of the base rental to reflect residential 

use. 

(d) The lessee shall utilize the agricultural park 

land only for the purposes specified in the lease, in 

accordance with a plan of development and utilization 

which, in the case of original lessees of agricultural 

park lots, shall be submitted for the administrator's 

approval prior to the issuance of the lease. The lessee 

shall not modify or deviate from the plan without the 

approval of the department and any unapproved 

modification or deviation from the plan may be cause for 

the termination of the lease. 

(e) All construction on the agricultural park lot 

shall be in accordance with plans approved by the 

administrator and shall be in accordance with all 

applicable federal, State and county laws, ordinances, 

and rules, including but not limited to laws regarding 

environmental quality control. 

(f) Mineral and metallic rights and surface and 

ground water shall be reserved to the State. 

(g) The State shall retain the rights to all 

prehistoric and historic remains found on agricultural 

park lands. [Eff 3/6/92; comp ] (Auth: 

HRS §§166-6, 166-9) (Imp: HRS §§166-6, 166-9) 

SUBCHAPTER 10 

LEASE RESTRICTIONS 

§4-153-33 Lease restrictions; generally. (a) 

Except as otherwise provided, the following restrictions 

shall apply to all agricultural park leases: 

(1) Options for renewal of terms shall be 

prohibited; 

(2) No lease shall be for a term of less than 

fifteen years nor more than fifty-five 

153-34 

C-571

153-35 

C-572 

§4-153-33 

years, including any extension granted for 

mortgage lending or guarantee purposes; 

(3) No lease shall be made for any land under a 

lease which has more than two years to run; 

(4) No lease shall be made to any person who is in 

arrears in the payment of taxes, rents, or 

other obligations owing the State or any of 

its political subdivisions; or to any person 

who, during the five years preceding the date 

of disposition, has had a previous sale, 

lease, license, permit, or easement covering 

public lands canceled for failure to satisfy 

the terms and conditions thereof; 

(5) Any transferee, assignee, or sublessee of an 

agricultural park lease shall first qualify as 

an applicant under this chapter. No lease or 

any interest therein, including corporate 

stock or interest in a partnership or 

association, shall be transferred or assigned 

without the consent of the board, except by 

devise, bequest, or intestate succession and 

upon the further condition that there is a 

dwelling on the property in which the devisee 

or heir resides or that more than fifty per 

cent of the devisee's or heir's income is 

derived from the productive use of the 

property. In the absence of or upon cessation 

of these conditions, the devisee or heir shall 

surrender the lease and improvements, or any 

interest therein, to the board pursuant to 

section 4-153-29; 

(6) With the approval of the board, and subject to 

the provisions of section 4-153-29, the 

assignment and transfer of a lease or any 

interest therein, including stock of a 

corporation holding the lease or an interest 

in a partnership or association holding the 

lease, may be made if: 

(A) The lease contains the principal 

residence of the lessee; 

(B) The lessee becomes mentally or physically 

disabled; 

(C) Extreme economic hardship is demonstrated 

to the satisfaction of the board; or 

(D) The assignment is to the corporate 

successor of the lessee; provided that

§4-153-33 

prior to the approval of any assignment 

of lease permitted by this section, the 

board shall have the right to review and 

approve the consideration to be paid by 

the assignee and may condition its 

consent to the assignment of the lease on 

payment by the lessee of a premium based 

on the amount by which the consideration 

for assignment, whether by cash, credit 

or otherwise, exceeds the depreciated 

cost of improvements and trade fixtures 

being transferred to the assignee; 

provided further that in the event of 

foreclosure or sale, the premium, if any, 

shall be assessed only after the 

encumbrances of record and any other 

advances made by the holder of a security 

interest are paid; provided further that 

the board may adjust the base and 

additional rental pursuant to the method 

outlined in section 4-153-18(d); 

(7) The lessee shall not sublet the whole or any 

part of the demised premises without the 

approval of the board; provided that prior to 

the approval, the board shall have the right 

to review and approve the rent to be charged 

to the sublessee; provided further that where 

the lessee is required to pay rent based on a 

percentage of its gross receipts, the rents 

paid to the lessee by the sublessee shall be 

included as part of the lessee's gross 

receipts; provided further that the board 

shall have the right to review and, if 

necessary, revise the rent and percentage 

rental, if applicable, of the demised premises 

based upon the rental rate charged to the 

sublessee; and provided further that the rent 

and percentage rental may not be revised 

downward; 

(8) The lease shall be for a specific use or uses, 

and shall not include wastelands unless it is 

impractical to provide otherwise. 

(b) The board may extend the term of the lease to 

qualify the lease for mortgage lending or guaranty 

153-36 

C-573

153-37 

C-574 

§4-153-33 

purposes with any federal mortgage lending agency and 

its respective successors and assigns or to any lending 

institution authorized to do business in the State; 

provided further that the approval of any extension 

shall be subject to the following: 

(1) The demised premises are developed and 

utilized according to a plan of utilization 

and development approved by the department; 

(2) The lessee is otherwise in compliance with 

lease terms; 

(3) The aggregate of the initial term and any 

extension granted shall not be for more than 

fifty-five years; 

(4) The board may increase the rent and adjust the 

rental period; and 

(5) Additional restrictions, terms and conditions 

to insure and promote the purposes of the 

demised lands, to the extent the board has 

reserved this right in the lease. 

(c) The board at any time during the term of any 

agricultural park lease and when justified by sound 

agricultural practices and economic or other 

circumstances, may permit an alternative agricultural or 

aquacultural use or uses for any portion or portions of 

the land demised under the lease. As a condition to 

permitting alternative uses, the board may require such 

other modifications, including rental adjustments or 

changes in the lease, as may be necessary to effect or 

accommodate the alternative use or uses. An alternative 

use or uses may be allowed by the board upon: 

(1) The application of the lessee; 

(2) Consent of each holder of record having a 

security interest in the leasehold; and 

(3) A finding by the board that the alternative 

use or uses are in the public interest. 

(d) The land leased under this chapter, or any 

portion thereof, shall be subject to withdrawal by the 

State at any time during the term of the lease with 

reasonable notice and without compensation, except as 

provided in this section, for public uses or purposes, 

for constructing new roads or extensions, or changes in 

line or grade of existing roads, for rights-of-way and 

easements of all kinds, and shall be subject to the 

right of the State to remove soil, rock, or gravel as 

may be necessary for the construction of roads and

§4-153-33 

rights-of-way within or without the demised premises; 

provided that upon the withdrawal, or upon the taking 

which causes any portion of the land originally demised 

to become unusable for the specific use or uses for 

which it was demised, the base rent shall be reduced in 

proportion to the value of the land withdrawn or made 

unusable. If any permanent improvement constructed upon 

the land by the lessee is destroyed or made unusable in 

the process of the withdrawal or taking, the 

proportionate value thereof shall be paid based upon the 

unexpired term of the lease; provided that no withdrawal 

or taking shall be had as to those portions of the land 

which are then under cultivation with crops until the 

crops are harvested, unless the State pays to the lessee 

the value of the crops; and provided further that upon 

withdrawal any lessee shall be compensated for the 

present value of all permanent improvements in place at 

the time of withdrawal that were legally constructed 

upon the land by the lessee of the leased land being 

withdrawn. In the case of tree crops, the State shall 

pay to the lessee the residual value of the trees taken 

and, if there are unharvested crops, the value of the 

crops also. [Eff 3/6/92; comp ] (Auth: 

HRS §§166-6, 166-9) (Imp: HRS §§166-6, 166-9) 

SUBCHAPTER 11 

BREACH OR DEFAULT 

§4-153-34 Notice of breach or default. Except as 

otherwise specifically provided in this chapter, in the 

event of a breach or default of any term, covenant, 

restriction, or condition of any agricultural park lease 

issued under this chapter, the board shall deliver a 

written notice of the breach or default by personal 

service or by registered or certified mail to the party 

in default and to each holder of record having any 

security interest in the land covered by or subject to 

the lease, making demand upon the party to cure or 

remedy the breach or default within sixty days from the 

date of receipt of the notice; provided that where the 

breach involves a failure to make timely rental 

payments, including the payment of additional rents due, 

pursuant to the lease 

153-38 

C-575

153-39 

C-576 

§4-153-35 

issued under this chapter, the written notice shall 

include a demand upon the party to cure the breach 

within less than sixty days, but not less than five 

business days, after receipt of the notice. Upon 

failure of the party to cure or remedy the breach or 

default within the time period provided in this section 

or within such additional period as the board may allow 

for good cause, the board may, subject to section 4-153- 

35, exercise the rights it may have at law or as set 

forth in the lease. [Eff 3/6/92; comp ] 

(Auth: HRS §§166-6, 166-9) (Imp: HRS §§166-6, 166-9, 

171-20) 

§4-153-35 Rights of holder of security interest. 

(a) Whenever any notice of breach or default is given 

to any party under section 4-153-34, or under the terms 

of any lease or other instrument issued under this 

chapter, a copy of the notice shall be delivered by the 

administrator to all holders of record having a security 

interest in any land or interest covered by an 

agricultural park lease or other instrument whose 

security interest has been recorded with the department 

and the bureau of conveyances of the State. Should the 

board seek to forfeit the privilege, interest, or estate 

created by the lease, each holder may, at its option, 

cure or remedy the breach or default, if the same can be 

cured or remedied, by the payment of money or, if such 

is not the case, by performing or undertaking in writing 

to perform all the terms, covenants, restrictions, or 

conditions of the lease capable of performance by the 

holder, as determined by the board, within the time 

period provided in section 4-153-34 or within such 

additional period as the board may allow for good cause, 

and add the cost thereof to the mortgage debt and the 

lien of the mortgage. Upon failure of the holder to 

exercise its option, the board may: 

(1) Pay to the holder from any moneys at its 

disposal the amount of the mortgage debt, 

together with interest and penalties, and 

secure an assignment of the debt and mortgage 

from the holder; or if ownership of the 

interest or estate shall then have vested in 

the holder by way of foreclosure or action in 

lieu thereof, the board shall be entitled to a 

conveyance of the interest

§4-153-35 

or estate upon payment to the holder of the 

amount of the mortgage debt, including 

interest and penalties, and all reasonable 

expenses incurred by the holder in connection 

with the foreclosure and preservation of its 

security interest, less appropriate credits, 

including income received from the privilege, 

interest, or estate subsequent to the 

foreclosure; or 

(2) If the property cannot be reasonably 

reassigned without loss to the State, then 

terminate the outstanding privilege, interest, 

or estate without prejudice to any other right 

or remedy for arrears of rent or for any 

preceding or other breach or default, and use 

its best efforts to redispose of the affected 

land to a qualified and responsible person 

free and clear of the mortgage and the debt 

thereby secured; provided that a reasonable 

delay by the board in instituting or 

prosecuting any right or remedy it may have 

under this section shall not operate as a 

waiver of the right or to deprive it of the 

remedy when the delay serves to assist the 

board in resolving the problems created by the 

breach or default involved. 

(b) The proceeds of any redisposition effected 

under this section shall be applied: first, to reimburse 

the department for costs and expenses in connection with 

the redisposition; second, to discharge in full any 

unpaid lease rental or other indebtedness owing the 

State in connection with the privilege, interest, or 

estate terminated; and the balance, if any, to the owner 

of the privilege, interest, or estate. Nothing in this 

section shall be construed in a manner as to infringe 

upon or prejudice in any way the rights of a holder of 

record having a security interest which shall have 

vested prior to the effective date of this section. 

[Eff 3/6/92; comp ] (Auth: HRS §§166- 

6, 166-9) (Imp: HRS §166-6) 

§4-153-36 Leases; forfeiture. Upon the violation 

of any condition or term of any agricultural park lease 

to be observed or performed by the lessee, 

153-40 

C-577

153-41 

C-578 

§4-153-37 

including but not limited to failure of a prospective 

lessee to execute the lease within thirty days after 

presentation thereof, the board, after due notice of 

default as provided in section 4-153-34, and subject to 

the rights of each holder of record having a security 

interest as provided in section 4-153-35, shall 

terminate the lease or tenancy and take possession of 

the leased land together with all improvements placed 

thereon, without demand or previous entry and without 

legal process, and shall retain all rent paid in advance 

as damages for the violations. The retention of advance 

rent as liquidated damages shall be in addition to any 

other rights and remedies available to the department 

under section 4-153-34. [Eff 3/6/92; comp 


9) 

SUBCHAPTER 12 

SEVERABILITY 

§4-153-37 Severability. This chapter shall be 

deemed to be severable, and in the event a section of 

this chapter is determined to be invalid, such 

invalidity shall affect that section only and not 

invalidate this chapter in its entirety. [Eff 3/6/92; 


§91-2)

Amendments to and compilation of chapter 153, title 

4, Hawaii Administrative Rules, on the Summary Page 

dated July 23, 1998 were adopted on July 23, 1998, 

following public hearings held on June 15, 1998, June 

16, 1998, June 17, 1998, and June 18, 1998, after public 

notices were given in the Honolulu Star-Bulletin, Hawaii 

Tribune-Herald, West Hawaii Today, The Garden Island, 

and The Molokai Dispatch on May 14, 1998. 

These amendments to and compilation of chapter 4- 

153, Hawaii Administrative Rules shall take effect ten 

days after filing with the Office of the Lieutenant 

Governor. 



JAMES J. NAKATANI 

Chairperson, 

Board of Agriculture 

APPROVED: 

BENJAMIN J. CAYETANO 

Governor 

State of Hawaii 

Dated: 

153-42 

C-579 

Filed

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