Cover Story

Kakaako: What Gives?

The state’s offer of makai ceded lands to OHA underscores the lack of a unified plan for Honolulu’s “third city”

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Cover image for Dec 7, 2011

Joan Conrow

The Office of Hawaiian Affairs (OHA) has been fighting for decades to get some $200 million in back-due revenues in return for the state’s use of so-called “ceded” public lands that were siezed from the Hawaiian kindgom upon the overthrow of Queen Liliuokalani in 1893. And the state has been trying for decades to perk up the Kakaako area through redevelopment.

Now, Gov. Neil Abercrombie has merged the two long-sought objectives, announcing a proposal which would settle OHA’s claim by giving the agency 25 acres in Kakaako as well as his own grand plans to incorporate the neighborhood into Oahu as a “third city,” replete with a 650-foot skyscraper on Pohukaina Street that would tower some 250 feet over Honolulu’s tallest buildings.

But both proposals face significant obstacles, given the long-simmering dispute over rightful ownership of “ceded lands,” the state Legislature’s previous rejection of an OHA settlement proposal, ongoing fears that the deal could open the doors to a final resolution in favor of the state, past public opposition to Kakaako high rises and the threat of rising sea levels.

Groundless gift?

My first thought was, here we go again,” said Henry Noa, prime minister of the Reinstated Hawaiian Government. “We have the state trying to justify a land exchange that they don’t have proper title to. They don’t even have the right to transfer the land.”

Noa’s sentiments were echoed by University of Hawaii professor Jon Osorio in a Nov. 29 commentary published in The Hawaii Independent. “To begin with, all transactions involving so-called public lands by the state and any state agencies are violations of Hawaiian Kingdom law,” he wrote. “The crown and government lands of the Hawaiian Kingdom are the property of Hawaiian nationals and the heirs to the Crown. Possession of these lands by the United States is a theft and nothing more.”

Similar objections were raised when the state and OHA last announced a proposed settlement, back in 2008. That deal directed the state to give OHA $13 million in cash and 209 acres of commercial and industrial land on Oahu and the Big Island, worth an assessed value of $187 million. The plan also called for the state to pay OHA $15.1 million annually as its share of revenues from trust lands, a provision struck from a bill that the Legislature ultimately rejected.

State oversight

The most recent proposal, which has been endorsed by OHA and Abercrombie, but still requires legislative approval, would give OHA ownership of 10 parcels in Kakaako Makai, including Fisherman’s Wharf. However, the Hawaii Community Development Authority (HCDA), a state agency guiding redevelopment in Kakaako, would retain jurisdiction over how the lands are used.

OHA Chairperson Colette Machado said it doesn’t bother her that HCDA retains jurisdiction because she’s looking at the situation politically, and HCDA might be supportive of what the governor wants to do for Native Hawaiians.

According to Joshua A. Wisch, spokesman for the state Attorney Gereral’s office, state oversight comes with the territory. “All land owners located in these urban areas are subject to the master plan created by HCDA,” Wisch said.

While the state and OHA, a state agency, may have no problem with the deal, opponents see much that is troubling from issues of ownership to valuation of the land.

Flood zone?

OHA is supposed to be representing Native Hawaiian interests, and they’re claiming the land will negate the $212 million the state owes to OHA,” Noa said. “But I don’t think that land is worth even $50 million. The state hasn’t developed that property in over 15 to 20 years now, and I believe it’s because [it’s] a flood zone and the ocean plays a mean effect on that side of Kewalo Basin. The rest, out on Point Panic, is all landfill properties. You won’t be able to do anything with it.”

Henry Curtis, executive director of Life of the Land–a group that banded with the Surfrider Foundation, Save Our Kakaako Coalition and Friends of Kewalo Basin to resist previous plans for high rise projects in the area–had a similarly critical assessment of both the OHA land transfer and Abercrombie’s “third city” concept.

“Some people suggest that the governor has proposed a bold vision for the future,” Curtis wrote in an email to the Weekly. “In reality, a highly unpopular governor is misusing the term ‘urban oasis’ (parkland) to propose an allegedly ‘sustainable economy’ (dense urban growth) in an area that is within the Blue Line (flooding due to climate change).”

Chip Fletcher, a geologist in UH’s Geology and Geophysics Department, has done mapping that uses a blue line to show land vulnerable to the three-foot sea level rise expected by the end of the century. In response to an email query, he replied, “I don’t see a dramatic risk in the Kakaako area–but tsunami and high wave overwash and the possibilities of higher than expected sea level rise all suggest that any development there should take marine hazards into account in the building design, etc.”

Fletcher gives more detail on his department’s website detailing the anticipated effects of sea level rise, including sea water coming out of storm drains along Ala Moana Boulevard when tides are high.

High Expectations

Such factors raise questions about whether the land slated for transfer to OHA could realistically be developed to generate substantial revenue for the agency and whether preliminary valuations for the parcels are accurate. For example, one lot fronting Ala Moana Boulevard has been valued at $17 million, assuming a 400-foot height limit is allowed.

But citizens have strongly resisted previous proposals to build towers in Kakaako makai; indeed, an Alexander & Baldwin plan to build two high-rise condominiums, along with shops and public facilities, was so bitterly opposed that the state Legislature passed a law in 2006 prohibiting residential development there. Further, HCDA’s 2011 revised master plan for the area calls for preserving views of the Koolau Mountains from Kakaako Waterfront Park, which would appear to nix any plans for a 400-foot building. “They could build a 200-foot tower there, but to go 400 feet, they would have to change the height limits and there would be opposition to that,” said Ron Iwami of Friends of Kewalo’s.

Machado said she would not push to have the Legislature overturn the law prohibiting residential highrises in Kakaakao makai. But regarding the parcel where height limits would have to be raised to allow 400-foot buildings, “height might be nice so we can accommodate some commercial space,” she said.

Open space concerns

But much of Kakaako makai is slated for noncommercial public development, such as shoreline parks and promenades, community gardens, cultural museums, a performing arts center, fish and farmers’ markets, a 1,110-space parking lot and a community center, according to HCDA’s draft master plan.

Any development would be at least 10-15 years down the road, Machado told the Weekly. “We are not A&B or a business that is going to be looking at a time frame to generate a revenue base and ram this down everybody’s throat. We’re going to be there for time immemorial. We are going to tread lightly,” Machado noted, adding that she knows the community there wants to be assured of having adequate access to ocean and shoreline frontage. “I’m not sure how far apart we are, but I know we support access to the shoreline as well as gathering,” she said. Even less clear is whether the state will be able to come up with the money to implement the draft master plan itself or find ways of passing the costs on to others, such as landowners developing properties in Kakaako mauka. Language in the master plan itself speaks to this concern, citing the “current economic downturn.”

For whose benefit?

This seems to run counter to a statement Abercrombie reportedy made to the Associated Press when the proposed settlement was announced: “The $200 million will rise in value, we think, very, very rapidly as we move on the Kakaako development.”

In his commentary, Osorio urged, “It is time for OHA’s beneficiaries to weigh in about whether we think that our trustees should be getting deeper into the property management business. Hopefully our trustees will take the time to listen.”

OHA stakeholder meetings are going on this month in preparation for opening of the Legislature in January. “We’ve learned valuable lessons from the past. I hope we’re smarter now, more sensitive and more respectful,” Machado said.

But those who are focused on independence, like Noa, are experiencing sentiments more akin to distrust than gratitude. “To me, it’s obvious the state is trying to build OHA’s credibility as far as representing our people,” Noa said.

And that leads to Osorio’s underlying concern. “I am also worried that this is the opening the governor is seeking to a ‘final settlement’ of land and perhaps cash with a Hawaiian agency,” he wrote. “Whether through outright sale, exchange or by utilizing the Public Land Development Corporation set up last year through Act 55, the Legislature, like the governor, is anxious to remove as many legal restraints from its use of ‘ceded lands’ as it can.”

It remains to be seen how much OHA will settle for in order to stay in power. “With the seemingly tremendous opportunity that Governor Abercrombie has given to the Office of Hawaiian Affairs, I truly believe this will have a tremendous impact for future generations and also for the new Native Hawaiian government we’re working to hard on with the Native Hawaiian Roll Commission,” Machado told the Weekly.

What are “Ceded” Lands?

The lands that are often referred to as “public” or “ceded” were actually seized from the Kingdom of Hawaii during the 1893 overthrow of the monarchy, which the US Congress deemed unlawful when it approved the 1993 “Apology Resolution.”

In 1898, the Republic of Hawaii–led by those who masterminded the coup–“ceded” control of 1.8 million acres of Kingdom lands to the US government and sold the rest to private parties.

When Congress adopted the 1959 Admissions Act, which brought Hawaii into the union, it kept 400,000 acres of “ceded lands” for military bases, national parks and other federal uses and put the rest into the Public Land Trust, which was turned over to the newly formed state of Hawaii.

In the years since statehood, these trust lands have been developed for the Hilo and Honolulu international airports, Maui’s Kahului Harbor, Sand Island, hotels, hospitals, affordable housing, golf courses, parks at Kapiolani and Ala Moana, the University of Hawaii system and other uses. Additional lands were sold, exchanged, leased or transferred to the counties or other government entities.

The Admissions Act mandated that the state use revenues from the trust to improve conditions for Native Hawaiians, develop farms and home ownership opportunities and support public education and other public uses. However, revenue from the trust was used primarily for public education up until 1978, when the state Constitutional Convention proposed creating OHA specifically to receive and to manage trust revenues for the benefit of Hawaiians, according to the agency’s website.

Hawaii voters ratified that plan in 1978, and two years later the state Legislature passed Act 273, which directed 20 percent of all “funds” from trust lands to OHA, while failing to define just what the term “funds” encompassed.

Since OHA’s inception, it has been in litigation with the state over both the source and definition of these funds, most notably revenues from Hilo Hospital, state affordable housing and duty free shops at Honolulu Airport.

The state Supreme Court said that before OHA could sue on the issue of funds, it had to go back to the Legislature to clarify the claims, which prompted the negotiations leading to the most recent proposed settlement agreement, as well as the one that lawmakers rejected in 2008.

In the meantime, the state is prohibited from selling or transferring any “ceded lands” to private entities.

What’s Cookin’ in Kakaako

Kakaako has suddenly become the happening place.

Besides announcing a proposal to give the Office of Hawaiian Affairs 25 acres on the makai side of Ala Moana Boulevard, Gov. Abercrombie has unveiled plans to develop 1,004 housing units, half of them affordable, as well as a civic/commercial center and a 650-foot tower–the tallest in the state–on Pohukaina Street by the end of 2019.

Kamehameha Schools, meanwhile, has approval to build 2,750 multifamily housing units and commercial space on the 29 acres it owns, possibly starting in mid-2013, while Howard Hughes Corp. will be allowed to build 4,300 residential units and commercial space on 60 acres.

In addition, plans are in the works to build 68 affordable senior rentals in this space on Kona Street between Pensacola and Piikoi Streets, and Kewalo Basin LLC is slated to develop 345 condominium units on Waimanu Street.