Kaua`i Tobacco Proposal Divides Agribusiness Development Board

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To grow tobacco on public lands or not? That was the question at last month’s Agribusiness Development Corporation board meeting, where a local high-end cigar maker proposed testing his tobacco crops on three acres of the agency’s land in Kekaha, Kaua`i.

Although the majority of the board members in attendance supported the idea, a motion to issue LBD Coffee, LLC, a revocable permit failed to get the required number of votes. Business ties with the company prevented ADC board chair Marissa Sandblom and member Paula Hegele from voting on the item. And board member William Tam thought the idea was simply ludicrous.

“Tobacco causes cancer. The state spends an enormous amount of money trying to prevent people from smoking,” Tam said.

The New Hampshire-based LBD Coffee, whose subsidiaries grow tobacco and organic coffee, wants to expand its tobacco production to broaden the taste profile of its cigars, company owner Les Drent told the board. Kekaha also has better light conditions and is relatively dry, he said, adding that the recent heavy rains at his farm in Kapa`a “totally shut down” operations there.

Should the proposed small, two-year pilot project in Kekaha prove successful, the company would seek a license for 40 acres, which would allow for crop rotation, Drent said.

Regarding Tam’s cancer concern, Drent said he felt premium cigars posed less of a health risk than other tobacco products. Drent also noted that LBD is already growing tobacco on state land under a long-term lease issued several years ago by the Board of Land and Natural Resources and transferred to the Department of Agriculture in 2011.

Tam, however, insisted that public resources should never be used for growing something that poses such a health risk.

“I will oppose this and take it up with the Department of Agriculture why this lease was issued. … I encourage you to look for another line of business. It’s not personal,” Tam said.

Hegele, whose Maui winery store sells cigars from LBD’s Kaua`i Cigar Company, said she does not consider the cigars a “tobacco cigarette product.”

“[Drent] has an extremely high-end product [with] great packaging,” she said. “It’s not a convenience product. … It is a gift, a high-end, locally significant product.” (The cigars on the Kaua`i Cigar Company’s website sell for more than $10 apiece.)

Drent noted that former U.S. Rep. (now Sen.) Mazie Hirono and Rep. Colleen Hanabusa supported recent legislation that would have exempted premium cigars from regulation by the Food and Drug Administration.

When Tam reiterated his opposition, Drent pointed out that his proposal was merely in response to an ADC solicitation.

“I didn’t come to you,” Drent said. “I don’t honestly need this.”

“Then go with a private landowner,” Tam responded.

Drent’s associate Roberto Rodrigo, a biochemist, argued that “everything is linked to cancer.” Any fermentable crop — corn, potatoes, etc. — creates alcohol and alcohol is linked to cancer, Rodrigo said.

“I’m not arguing those,” Tam said, adding that it was the board’s responsibility, not Rodrigo’s, to set policies.

ADC executive director James Nakatani said when he was the DOA director several years ago, whenever tobacco proposals came up, “we would just drop it.” Since then, however, the state Department of Land and Natural Resources issued a lease to LBD for four acres in Kapa`a where the company is now growing tobacco. However, when the Land Board approved the transfer of the lease to LBD and two other individuals in 2007, the DLNR’s cursory staff report to the board mentioned only that LBD grew coffee on the island.

“If they are growing tobacco on state lands now, how do we say no?” Nakatani asked the board. “I’m looking at this objectively. … The government still supports tobacco. I don’t know how you say no to this.”

He added that the pilot project would only be for two years.

Tam, however, argued that whatever the Land Board did is irrelevant and repeated that he was going to take the matter up with the DOA.

But he was alone in his objections. ADC board member David Reitow said the ADC’s job wasn’t to pass moral judgment on anybody, but to put farmers on the land. He made a motion to issue LBD a one-year revocable permit that could possibly be extended. Board member Patrick Kobayashi seconded the motion, but with just two other board members voting in favor, the motion failed and the matter was deferred.


ADC Board Supports Intent

To Buy Whitmore Village Lands

Last year, state Sen. Donovan Dela Cruz criticized the ADC board for not taking better advantage of its relative freedom from state bureaucracy and challenged it to help bring his Whitmore Village Agricultural Development Plan to life.

Board members said they liked the plan to turn Whitmore Village into O`ahu’s agricultural hub, but were noncommittal. They said such a feat — which included acquiring roughly 2,000 of acres of farmland along with a packing and processing facility — would take a lot of work and they weren’t sure whether they had enough staff to pull it off.

But that hasn’t stopped ADC executive director James Nakatani from working toward buying two of the components identified in the Whitmore Village plan: the processing facility and lands with access to irrigation water. (He’s also seeking legislative approval this session to hire another staff member.)

For the past few months, he has been negotiating with Castle & Cooke to purchase a 24-acre parcel for whose purchase the 2012 Legislature appropriated $3.6 million. He’s also been working with the Trust for Public Land on buying the adjacent 456 acres, owned by Dole Foods, which has access to Kaukonahua Stream. Last year, the Legislature appropriated $750,000 to investigate the possibility of using the stream to irrigate the lands recently acquired from Galbraith Estate.

Christmas trees and flowers are currently grown on the Dole land, which also has office buildings and a parking area for trucks that were once part of the processing facility on Castle & Cooke’s land.

Dole wants more than $10 million for the 456 acres, according to TPL executive director Lea Hong. She said she’s getting her own appraisal and is tentatively seeking $5 million from the military, $4 million from the City and County of Honolulu, and $1.146 million from the state Legacy Land program.

Last year, the Legacy Land commission recommended providing at least $600,000 for the project. The city’s Clean Water and Natural Lands Commission recommended contributing $1 million to 2 million.

Should TPL succeed in acquiring the land, the organization would transfer it to the ADC. At the ADC’s board meeting last month, board member William Tam asked when that might occur.

Hong said if all the funding came through, the sale would not close until some time in 2014.

“How far along are we in due diligence?” Tam asked.

Hong said she had not yet conducted an initial environmental survey.

“If we can agree on a price, then maybe I’ll spend money on an environmental survey,” she said.

Nakatani asked the board for its blessing to continue negotiations for both parcels. “I want to make sure everybody’s on board with this project. … Lea’s project also,” he said.

With the understanding that it was only supporting the intent to buy the lands, the board authorized its staff to negotiate the acquisitions, which would be subject to due diligence.


Church Seeks ADC’s Help

Farming Kunia Ag Land

To board member William Tam, the memorandum of understanding offered by New Hope Leeward Church seemed to commit the ADC to testifying in favor of land use changes that are needed for the church to build on the 203 acres in Kunia it plans to buy from Nihonkai Lease Co. Ltd.

The land used to belong to the Robinson Estate and was part of the O`ahu Sugar Company. When Nihonkai bought it in the 1980s for $5.875 million, it intended to develop a golf course, according to state documents. It never obtained the necessary zoning changes.

In the 1990s, Nihonkai leased the entire parcel to Alec and Mike Sou of Aloun Farms. More recently, Halms Enterprises, Inc., has subleased some of the land, growing ti leaves, taro, cucumbers, tomatoes, green beans, and other vegetables. The crops receive 0.48 million gallons a day of Waiahole Ditch water under a permit from the state Commission on Water Resource Management.

Now New Hope Leeward Church wants to relocate there and is seeking to buy the property, currently valued at $11 million. The church will need to rezone about a quarter of the lot so it can build its facilities. Under the MOU as originally proposed by New Hope, in consideration of the church’s commitment to keep 155 acres in farming, the ADC would agree to publicly support the church’s overall plans for the area, including the entitlements.

“Are we supposed to testify for a land use change? I’m a little concerned about what our obligations are,” Tam said.

(The MOU also included an odd provision regarding public disclosure. It stated, “ADC and NHL agree that, if either of them wishes to disclose this MOU to any third parties, including without limitation, any news organization, governmental entity or through any press releases, the party wishing to make such announcement shall first advise the other party of its intent, as well as of the content of the announcement it intends to make and shall give the other party not less than three business days to comment on the proposed announcement.”)

Church representative Abel Malczon said the commitment to publicly support the church’s plans primarily referred to press releases.

Under the MOU, the ADC would also take the lead in developing plans for how to best achieve a variety of objectives, including food sustainability for local residents, agricultural education for farmers, and appropriate crop diversification.

“We’re not farmers. We don’t claim to be farmers. But we do have a deep desire to see the lands used for farming … to provide food for the less fortunate. We can make a difference in the state if the land is used correctly,” Malczon said.

Tam said he liked the project, but was worried about committing to publicly support the church’s development plans, especially since the ADC and the church haven’t yet agreed on what to do with the 155-acre “agricultural harvest area.”

“I’d be happy to say ‘we agree to work together’ rather than ‘we publicly support,’” he said.

In the end, the board approved an amended version of the MOU that addressed Tam’s concern.

–Teresa Dawson

Volume 23, Number 8 February 2013

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