Parker Ranch IAL Petition Gets Speedy Approval from Land Panel

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It was a day of extremes. One of the largest areas subject to a Land Use Commission petition – roughly 57,000 contiguous acres – was disposed of in one of the shortest LUC meetings in recent memory – less than 45 minutes long. 

On September 8, the commission met in Waikoloa to consider the petition of Parker Ranch to give IAL designation to a swath of land stretching across much of the northern slope of Mauna Kea, from Saddle Road, in the west, to near Honoka`a, in the east. Just two members of the public testified: one was the head of the North Hawai`i Community Hospital in Waimea (a beneficiary of the trust established by former ranch owner Richard Smart), the other was the herd veterinarian for the ranch. Both were in favor of the petition.

Russell Kokubun, head of the state Department of Agriculture, flew in to show his support for the ranch. When invited to comment, however, he said he would stand on his written testimony submitted in August. 

After what can only be described as perfunctory questioning of the ranch’s CEO, Neil “Dutch” Kuyper, by the ranch’s attorney and commissioners, the LUC voted, 7-0, to approve the petition.

Little Prime Land

Under the state classification system of Agricultural Lands of Importance to the State of Hawai`i (ALISH), just 2.4 percent of the 56,771.8 acres in the petition area meets the definition of “prime” — that is, having a soil quality, growing season, and water sufficient to produce sustained crop yields economically. The rest of the land is either rated as “other” (those not rated as prime or unique), or “unclassified.” According to the University of Hawai`i’s Land Study Bureau, 64 percent of the lands are rated “D” on a scale of A to E (with E being least productive).

In fact, most of the land is in pasture that supports the 12,500 head of cattle that make up the ranch’s herd. (The ranch also owns, at any given time, roughly the same number of cattle in feedlots or pasture on the mainland.) About 10 percent of the area in the petition – 5,594 acres – is leased to Cambium Pinnacle, Inc., for a eucalyptus production. 

Jesse Souki, director of the state Office of Planning, said his office supported the petition in its written comments, but he wanted to “highlight some portions” of it to the commissioners. “One of the [Abercrombie] administration’s priorities is agricultural renaissance,” he said. “The designation of important agricultural lands is an important component of this.”

One of the chief concerns in reviewing the appropriateness of IAL designation for a given area is the availability of water, he noted. If available water is insufficient to allow for profitable farming, then IAL designation should not occur, he said. In the case of the petition area proposed by Parker Ranch, “based on representations now, there is enough water available for ongoing activity.” Although nearly all the area receives less than 30 inches of rainfall annually, the ranch has an extensive water system that pumps 440,000 gallons a day of stream water from Kohala to tanks scattered throughout the pastures.

Most of the 7.5 million pounds of beef produced by Parker Ranch annually goes to mainland markets. Young calves are raised on the ranch for five or six months, then are shipped (mostly by air) to the mainland, where they are fattened on feedlots in Kansas, Texas, California, and Oregon. About 1,200 head a year are slaughtered locally and turned into ground beef for Hawai`i markets. Just 200 head are slaughtered and sold locally as grass-fed beef.

The Parker Ranch production accounts for 40 percent of the local beef production, which in turn accounts for just 10 percent of the beef sold in Hawai`i markets.

Kuyper was asked by LUC Chairman Normand Lezy whether the ranch intended to increase its percentage of local market share.

“The reality is that all ranching in Hawai`i is an energy-intensive business,” Kuyper replied. “As energy prices have risen, anything that consumes energy is a larger portion of costs. To mitigate that, most ranches are aggressively looking at increasing their local share of the market. We expect it to increase dramatically in the next three to five years.”

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Other LUC Dockets

On May 12, the LUC approved the petition for designation of 1,533 acres in southeastern Kaua`i as IAL. The land, once part of Grove Farm, was transferred in January to a new Delaware-registered entity, Maha`ulepu Farm, LLC. (For details on the petition, see the May 2011 edition of Environment Hawai`i.)

The petition of D.R. Horton/Schuler Homes seeking to shift about 1,530 acres of land in `Ewa, O`ahu from the Agricultural to the Urban district took an odd direction recently, as the LUC voted to grant intervenor status to state Senator Clayton Hee. Other intervenors are the Friends of Makakilo and the Sierra Club. Hearings on the petition are to begin later this month. Approval of the petition is required before the developer can start work on a mixed-use project involving more than 11,000 houses. Intervenors argue that the land should stay in agricultural use, as it is some of the most productive farmland in the state.

The evidentiary hearing on a project in Kula, Maui, has concluded. The developer, Kula Ridge Mauka, LLC, has already won county approval for the 48-acre project, where more than half of the houses to be built will be designated as affordable for low-income households. At the LUC hearing on the project in late August, members of the community testified in opposition, citing concerns over preservation of significant historic sites and sources of water. The parties in the case – the developer, Maui County, and the Office of Planning – were to have submitted their proposed findings of fact by late September. A decision is likely to be made next month.

Patricia Tummons

Volume 22, Number 4 — October 2011

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