Agribusiness Development Board Revisits Votes Taken at Disputed October Meeting

posted in: Agriculture, February 2014 | 0

With several important actions in limbo pending the outcome of a complaint Environment Hawai`i filed in November with the Office of Information Practices, the board of the state Agribusiness Development Corporation decided it was better to play it safe. So on January 14, it redid most of its October 30 agenda.

Environment Hawai`i i filed the complaint after the ADC issued an agenda for its October 30 meeting that did not give members of the public – including our reporter – enough information to find the meeting location. In addition, the agency also failed to post the agenda on the Hawai`i Agricultural Research Center conference room in Kunia, the meeting site on that day.

At the October 30 meeting, the ADC board approved a number of items relating to the growth and development of the Whitmore Village area as an agricultural hub, including two new land licenses for more than a hundred acres of former Galbraith Estate land, a memorandum of agreement with the Wahiawa Community Based Development Organization (WCBDO), and a recommendation to support state Sen. Donovan Dela Cruz’s Whitmore Village Agricultural Development Plan. (For more, see the article in our December 2013 issue.)

The OIP had not made a determination on the complaint by press time. But, on  January 14, in an apparent abundance of caution, the ADC board revisited the votes it took on October 30.

In the meantime, ADC director James Nakatani reported, the ADC acquired 24 acres in Whitmore Village from Castle & Cooke, as well as the Tamura Warehouse in Wahiawa to provide produce packing and processing facilities. Total cost of the properties was about $8 million.

The ADC has already begun getting requests to use some of the buildings, he said, adding, “Senator Dela Cruz is making more and more partners for us.”

What’s more, the WCBDO has met twice with ADC staff and has begun the process of obtaining a grant from the City and County of Honolulu to conduct training for agricultural workers in the area and to buy farming equipment, Nakatani said.

“I do think it is a very strong economic development tool for the area,” ADC board chair Letitia Uyehara said of the WCBDO, noting that there are “a lot of mid- to low-income folks living in the area” who will benefit from the training that’s going to be offered.

Also at its January meeting, the ADC board approved a new license of more than 100 acres of former Galbraith land to Ohana Best, LLC, which currently farms some 50 acres in Hale`iwa.

“I gotta tell you that the farm [in Hale`iwa] is immaculate, one of the best farms I’ve seen in the state of Hawai`i. They’ve already harvested about 35,000 pounds of vegetables. It’s something to see,” Nakatani said.

The parcel Ohana will be licensing from the ADC is currently unimproved, covered with trees and grass, and does not yet have an adequate source of water.

Although a water pipe already crosses the property, “it’s in kind of a limbo,” Nakatani said, adding that ADC board member (and newly appointed state Department of Agriculture director) Scott Enright is trying to resolve the water issue by getting an easement for the pipe across lands owned by the Office of Hawaiian Affairs.

The January meeting was held at the state Department of Agriculture’s Plant Quarantine Division conference room and was attended by state Rep. Marcus Oshiro and two staff members. Oshiro, chair of the House Finance Committee, was a key figure in the state’s acquisition of the Galbraith Estate lands, setting aside millions of dollars in general obligation bonds years ago for the purchase.


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Board Defers Setting Policy

On Rent Increases at Galbraith

In 2012, the state, through the Trust for Public Land, acquired more than 1,700 acres from the Galbraith Estate. The state contributed $13 million toward the $25 million purchase price. Just over 1,200 acres went to the ADC; the remainder went to the Office of Hawaiian Affairs, which had contributed $3 million.

While farmers are already starting to work on the ADC-controlled lands, the agency is still grappling with how much rent it should charge, given uncertainties over the area’s productivity.

The few farms with licenses –  Kelena Farms, Ohana Best, LLC, and Ho Farms – are large, successful farms that are expected to help develop the water resources needed to serve the entire 1,200 acres. Their initial rents have already been set, but the amount by which rents will increase over the 35-year term of the licenses has not been determined.

At its January meeting, the ADC board debated over whether or not rental reopening terms should be hammered out now or left for another time. A request to amend the Kelena Farms’ first license (it has two) from a 10-year term to a 35-year term prompted the discussion. The amendment would make the land license “consistent with all the other [licenses],” Nakatani told the board.

Board member William Tam argued that the ADC should agree on how rental reopenings will be dealt with before entering into any license agreement.

“It will be awkward to say, ‘We’ll deal with this when we get there,’” he said. “We’re entering into a land [license] without the terms being fully worked out.”

When pressed by board members to approve, or at least discuss, a policy for handling rent increases, Nakatani hesitated.

“I just want to see how Galbraith does as an agricultural area. I know it’s good land. I’m not sure we can do it all year around,” he said.

“The [license] rent looks low, but water is going to be expensive,” he continued. “We’ve got to make sure that farmers can make a living [but] I don’t want to make it so cheap it’s unfair to the rest of the system.”

“Let’s run some numbers, talk to the farmers, see [what’s] doable,” Nakatani said.

While the board voted to approve extending the license term for Kelena Farms, the matter of how future rents for Galbraith lands will be determined remained unresolved.

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