WaterWorld, the Kevin Costner movie filmed on the Big Island, has seen its share of woes. By most accounts, the movie is over budget and behind schedule. Technicians have been fired or have walked off. The logistics involved in filming scenes on the huge artificial atoll just off the coast of Kawaihae Harbor have been formidable, with the water generally refusing to hold still while the cameras roll. According to supermarket tabloids, Costner’s marriage has become yet another casualty of the film.
By some accounts, the movie has been an environmental nightmare, on top of everything else. For example, Eddie Sherman, writing in Midweek, reported: “there has been damage to the environment (especially coral beds) as a result of huge explosions in the water, etc.” Other rumors have circulated about turtles being poisoned as a result of chemical spills, about oil spills, dumping of trash in the water, and the like.
Environment Hawai`i has found little basis for the rumors. Experts at the National Marine Fisheries Service have closely monitored the seabed where the artificial atoll has been moored. Mooring sites were chosen expressly to avoid any damage to coral. The pyrotechnics involved in some scenes appear to have been conducted in such a fashion as to avoid environmental harm. About the only rumor that could be verified is the one concerning trash in the water. After several warnings, however, the producers of WaterWorld hired people to keep the water in the harbor free of debris from the film operations.
Concessions
The movie’s environmental toll may not be great. But in other respects, the way in which the state Department of Business, Economic Development, and Tourism has dealt with WaterWorld producers sheds some light on the lengths to which DBEDT’s Film Industry Office will go to accommodate movie-makers. That the environment was not harmed this time may be more a matter of luck than design.
The movie WaterWorld is a big-budget picture, estimated to cost upwards of $125 million by the time it is released sometime next summer (barring further setbacks). According to a report by the Associated Press in October, Costner is being paid $12 million for his starring role as “a half-man, half-fish” hero. King Kona Productions, Inc., the subsidiary of Universal Studies set up to produce WaterWorld, was reported by AP to be picking up the tab for Costner’s ocean-view bungalow with butler and chef, at a cost of $4,500 a night. Food and lodging for cast and crew, the AP said, had cost more than $25 million by mid-October.
About the only parties who do not seem to be charging market rates (or more) to WaterWorld are those responsible for guarding the state’s interests. Consider this:
King Kona Productions occupies a warehouse at Kawaihae Harbor that is leased by the state to Kawaihae Terminal, Inc., a subsidiary of the Hong Kong-based Jardine Transport Services, Ltd. Jardine pays $64,500 a year ($5,375 per month) to the state to occupy some 9 acres of the harbor area. In turn, Jardine is charging King Kona Productions $26,412.33 a month for use of the land and the warehouse ($1,821 for the land and $24,591.33 for the warehouse and other improvements). The state Board of Land and Natural Resources approved this arrangement on December 17, 1993.
By contrast, in November 1993 and January 1994, the BLNR approved King Kona Productions’ use of unencumbered state land at Kawaihae Harbor for far less than the rate charged by Kawaihae Terminal. Monthly rent for 6 acres of open, unpaved fast land at the Kawaihae Small Boat Harbor (under DLNR jurisdiction) and for the exclusive use of some 25 acres of submerged land was set at $1,000 per month, plus unspecified “in-kind services and improvements.” Monthly rent for 10,000 square feet of warehouse space, 400 square feet of office space, 22,800 square feet along the pier apron, and 110,550 square feet of paved area in the commercial harbor area (under Department of Transportation jurisdiction) was set at $12,000 — subject, however, to adjustment. (An earlier draft of the staff submittal indicated that the market rate for this space would have come to $43,447 per month.) In January, the Land Board approved a third revocable permit to King Kona Productions — this time covering the use of 87,188 square feet of open land (under DOT jurisdiction) at $1,308 per month.
In other words, for the use of state land, warehouses, roads, and submerged lands at Kawaihae Harbor, WaterWorld producers were paying $14,308 a month — barely half of the sub-lease rent charged to WaterWorld by the state’s own tenant, Kawaihae Terminal.
And Deeper Discounts
By late January, WaterWorld was seeking still more favors from the state. In occupying part of the Kawaihae area, King Kona Productions had taken over a road used by Young Brothers twice a month. Because of insurance restrictions, King Kona could not allow Young Brothers continued use of the road and so proposed that the state allow it to pave an alternate route, over land under lease to Kawaihae Terminal, for Young Brothers’ use, with the cost of the paving (estimated to cost $46,000 to $50,000) to be deducted from rental payments to the state.
Mufi Hannemann, then director of the Department of Business, Economic Development, and Tourism — whose divisions include the Film Industry Branch — forwarded the proposal on to then-Department of Transportation Director Rex Johnson. “WaterWorld will be expending $15 million on the Big Island to make the movie,” Hannemann wrote. “Additionally, DBEDT feels the successful production of this feature film will have tremendous long-range benefits in developing the island’s fledgling film industry, thereby providing badly needed economic diversification.”
Johnson nixed the idea. “Allowing the production company to pay for the paving in lieu of rental payments to DOT without going to public bid would not be legal,” he wrote in a memo dated January 28, 1994. Further, he said, “the proposed roadway is on property leased to Kawaihae Terminal, a private company. We cannot use state funds to improve a private facility.” The DOT had already “supported this activity by reducing rents to the production company and by rearranging our operations at Kawaihae Harbor,” Johnson said.
‘Celebrity Endorsements’
In February, King Kona agreed to pay a contractor $21,719.45 for the paving job — less than half of what it had proposed the state pay. John J. Smith, production manager for King Kona, wrote Mary Lou Foley, administrator of DBEDT’s Industry Promotions Division, memorializing an agreement that appears to have been reached in a phone call. “As agreed during our telephone conference call today, February 10, 1994, King Kona Productions, Inc., will attempt to develop tie-ins between the production of WaterWorld, a major motion picture to be released by Universal Pictures, and the Hawai`i Department of Business, Economic Development and Tourism.
“In consideration for the above, DBEDT will make every effort to reimburse King Kona Productions, Inc., the sum of $21,719.45, which King Kona is paying … for the paving of the Kawaihae By-Pass Road.”
At the end of March, the subject was taken up again, with Foley and John Smith discussion “studio/celebrity endorsement of Hawai`i” in return for DBEDT paying for the $22,000 road paving job. According to a memo to the files in DBEDT, Smith promised to discuss the matter with the studio’s publicity manager in mid-May.
By late November, no one who could be reached at DBEDT knew anything about the status of the proposed deal.
Excise Tax Rebate
“On behalf of King Kona Productions, I should like to thank you for taking the time to meet with Ginger Peterson and myself on April 21, 1994,” John J. Smith wrote to Hannemann on May 19. Ginger Peterson is the movie’s location manager; Smith is its production manager. “As discussed with you at that meeting,” Smith continued, “the WaterWorld Accounting Department will maintain accurate records documenting monies spent in the state of Hawai`i during the pre-production and production periods of our film…. We trust your office will be able to obtain a refund of the 4.167 percent tax incurred for goods purchased, services performed, hotel rooms, etc.”
In September, Georgette Deemer, head of the DBEDT’s Hawai`i Film Office, brought the request to the attention of Jeanne K. Schultz, Hannemann’s successor as DBEDT director. Deemer, who was present at the April meeting, told Schultz that when the request was made, “I informed them that we don’t have the funds, or even the mechanism, to provide any kind of refund, nor is there precedence on the matter. However, the issue remained open for further discussion. I don’t know whether Mufi continued the discussion with WaterWorld, or what, if anything, was decided.”
Inquiries made in late November with the DBEDT director’s office failed to yield any information on the status of this request.
‘Feeling Harassed’
DBEDT files on WaterWorld reveal a recurring pattern in the relations of King Kona with other agencies, both governmental and private. Take the time an OSHA inspector visited the site, in late May. As a routine matter, the Department of Labor and Industrial Relations sent one of its inspectors to Kawaihae Harbor, to determine compliance by King Kona Productions with federal and state worker-safety regulations. (The state enforces federal Occupational Safety and Health Administration rules, as well as state laws.) Although the DLIR had informed producers in advance of the inspection, Production Manager John Smith informed DBEDT’s Deemer that the inspection was “distressful” for any number of reasons, prompting Deemer to fly to Kona to discuss the matter with Smith in person.
On May 27, Deemer listed the concerns in a memo to Hannemann. “Universal/MCA is, of course, very sensitive to the health and safety of the production crew,” Deemer wrote. “They are certainly open to inspections and want to correct inadvertent violations. The inspection a few days ago, however, was distressful because:
“The inspector conducted himself in an unprofessional manner. He made references to his power…, he did not state his purpose for the inspection…
“The inspector found several violations, indicated that he could have cited them for violations totaling $100,000 to $200,000, but I believe they ended up with four citations at $2,000 each. As an example, they were cited $2,000 for having two persons riding on a forklift. This appears harsh. The inspector said he would be returning….
“John Smith estimates that he lost a total to $80,000 just to accommodate this inspection.”
Deemer suggested that Hannemann “discuss the matter with the Director of Labor and request that the investigator … be taken off the WaterWorld assignment.” She provided Hannemann with a copy of OSHA inspection guidelines drawn up by Universal, and noted that “the recent inspection did not fall into any of the usual categories for why the inspection took place.”
A few days later, Hannemann’s office received another memo from Deemer, this time in relation to a letter from the DLIR to King Kona Productions announcing a payroll audit. “Producer is feeling ‘harassed,'” Deemer wrote. “This is not normal — I’ve never heard of a prod. co. being investigated by OSHA or audited for payroll. Perhaps Mufi could give Dayton Nakanelua an urgent call.” (Nakanelua is head of the Department of Labor and Industrial Relations.)
‘Rude, Abrasive’
Again, on June 21, Deemer sent Hannemann a third memo suggesting he intercede with the Department of Labor on WaterWorld‘s behalf. This time, her memo covered a copy of a June 6 letter to Nakanelua from Big Island Mayor Stephen Yamashiro — who, apparently unlike Hannemann, had bent to WaterWorld‘s complaints.
Yamashiro relayed complaints that the DLIR inspector “acted in a rude, abrasive, and arrogant manner toward the production crew. At the same time, the producers of WaterWorld were informed there would be a payroll audit by your office. The producers of WaterWorld and the County of Hawai`i are concerned by these events…. Unfortunately for all of us, since these incidents, members of the production company have the impression that Hawai`i is an unfriendly state for the film industry…. Your prompt investigation of these matters would be appreciated.”
Nakanelua responded to Yamashiro on July 5. The “rude, abrasive, and arrogant” inspector had been confronted with the complaint, Nakanelua said, and was “shocked and very disappointed about this allegations. He has been acknowledged, including [by] other inspectors, as being one of the most courteous and cooperative inspectors. During the inspection and communication with certain employees at the site, there was no indication for him to believe that his behavior was improper or discourteous. In fact, the employees thanked the inspector for his recommendations and shook his hand after the closing conference.”
“Concurrently,” Nakanelua continued, “a complaint was received from an employee of King Kona Productions about possible violations of the wage and hour laws. To determine the validity of the complaint, a routine audit request was submitted to the Enforcement Division… My staff was also unaware beforehand of other complaints by former employees of King Kona Productions and Hawai`i Island residents opposed to the movie industry. These safety complaints by citizens of your own county require the department to address them appropriately, so should the counties.”
And on it went. WaterWorld producers were reported by DBEDT to have described union representatives as menacing and violent. An inspector from the Army Corps of Engineers was characterized as “brash” and had WaterWorld folk “very worried about [his] upcoming visit” to the set. Apparently, once WaterWorld producers began to think the county of Hawai`i film commissioner was overly diligent in performance of her duties, the county was pressured into firing her.
It’s a Wrap
Filming on the Big Island was supposed to have been concluded in October. However, a final shoot on the coast of Waipi`o Valley has been moved back to December. (According to the film permit application for use of the site, Waipi`o Valley will be where the end of the movie is shot — “a site called ‘Dryland’ where Kevin Costner, female principal talent ‘Helen’ and little girl talent ‘Enola’ discover land and the ‘hut’ civilization.” Between five and seven “indigenous grass/rock huts that resemble a Tibetan village” were to be placed on the beach, amid the ironwood trees, according to a description provided to the county Planning Department. Silk plants were to be added “to the background of the hut area to enhance the shot and make it look as exotic as possible.”) Unlike the state, which charges no location fee for use of its land and which, it appears, will have to pay $22,000 for a place in the film’s credits, Bishop Museum is getting paid $3,500 by WaterWorld for use of museum land in Waipi`o. In addition, King Kona Productions is to provide “on-screen credit/recognition of Bernice Pauahi Bishop Museum” and “not fewer than twenty-four (24) ‘official’ WaterWorld tee-shirts similar or equal to those provided by King Kona Productions for its cast and crew.”
Volume 5, Number 6 December 1994