AUGUST 1, 2007 PUBLIC HEARING ON PROPOSED RULES FOR KEWALO BASIN

Sixteen people testified at the HCDA’s second public hearing on proposed administrative rules for Kewalo Basin.  The Department of Transportation-Harbors will relinquish jurisdiction of Kewalo Basin to the HCDA on September 1, 2007.  The proposed rules, regulations, charges and fees for Kewalo Basin will govern the use and operation of Kewalo Basin under HCDA.  These rules, which were drafted with extensive stakeholder input, are considered necessary and desirable to facilitate the public’s use and enjoyment of Kewalo Basin.  The proposed rules defined permissible activities regulate operations within the harbor and set forth procedures for obtaining leases and related fees.

The first public hearing on the proposed rules was held on March 7, 2007, at which time there was considerable testimony in opposition to the Rules.  Since that time, the Kewalo Ocean Activities (KOA)—an organization representing Kewalo Basin tenants—has been meeting with HCDA staff and an Authority subcommittee to revise the proposed rules.  An evening community meeting was held on May 29, 2007 to afford the public an opportunity to comment on the proposed rules.  During the process, the Authority subcommittee and HCDA staff considered tenant input and made appropriate changes to the draft Rules with the intent of balancing the competing interest and to best protect the public health and safety, as well as the value of Kewalo Basin.

At the August 1, 2007 hearing, the majority of testifiers spoke out against certain provisions of the proposed rules.  Issues raised included:  mixed usage of Kewalo Basin Harbor; transfer fee and limitation of liability; a two-tier rent structure; increases in parking fees and ticket booth rental rates; and that Kewalo Basin should remain under DOT management.

The proposed Rules are organized in four chapters as follows:

• Chapter 211 sets forth definitions and implementation (click here);
• Chapter 212 established general operations provisions (click here);
• Chapter 213 addresses rules for motor vehicles (click here); and
• Chapter 214 identifies fee structures and cost recoveries (click here).

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PUBLIC MEETING ON KEWALO BASIN HELD ON MAY 29

The Hawai‘i Community Development Authority (HCDA) held a public meeting on Tuesday, May 29, 6:00 p.m. at the Ward Warehouse (2^nd Floor) Kewalo Conference Room to take public comments on the proposed administrative rules for Kewalo Basin. HCDA has been meeting with the boating community in Kewalo, including the charter boats and long-line fishermen, to get their input on Kewalo Basin and the overall development of Kaka‘ako.  All interested stakeholders were invited and encouraged to attend the meeting.  About 90 people, most of whom are Kewalo Basin harbor stakeholders and concerned community members, attended and participated in the town hall meeting.

The discussion at the meeting addressed the transfer of management and operation of Kewalo Basin harbor facilities from the Department of Transportation (DOT) to HCDA. The two agencies are working together to move forward with the transfer.  HCDA already owns the harbor lands, and will soon receive ownership of the improvements, which have been managed by DOT.

•   Minutes of May 25, 2007 Kewalo Basin Tenants Meeting

•   Transcript of May 29, 2007 Community Meeting on Kewalo Basin Proposed Administrative Rules
  

“This action will culminate the transfer of both the lands and operational oversight of the activities occurring at the Basin as intended by the legislation to place the area under HCDA,” said Director of Transportation Barry Fukunaga.  “Both agencies recognize and agree that Kewalo Basin is part of Kaka‘ako and that HCDA has been charged with the responsibility for establishing and realizing the vision for the future of all of Kaka‘ako, including Kewalo Basin.  Moreover, it is proper from a legal perspective that the infrastructure be owned by the agency that owns the land.  DOT will assist HCDA in the transition by providing interim management during the changeover.”

In 1990, the State Legislature expressed its intent that Kewalo be part of the overall Kaka‘ako redevelopment. The Legislature reasoned that HCDA was equipped with the planning and regulatory tools to oversee the vision for the area.  The two agencies agreed that this vision remains valid and HCDA should integrate Kewalo Basin into the overall plan for the Kaka‘ako and the district’s waterfront.

 “Kewalo Basin lies in the heart of an area now entering a comprehensive community-based planning process,” said Daniel Dinell, executive director of HCDA, who noted that the recently convened Kaka‘ako Makai Advisory Working Group is now meeting to develop recommendations for the overall future of Kaka‘ako Makai. “The John A. Burns School of Medicine and Kaka‘ako Waterfront Park have set the tone for the area, and we anticipate other projects in the district, including Kewalo Basin, will demonstrate the same standard of quality.  We look forward to working with all stakeholders as we move forward.”

Due to natural aging and a longer transition between DOT and HCDA over the transfer of the harbor facilities, the present condition of the facilities are in critical need of repair, posing not only safety concerns for the harbor users, but also preventing the harbor from maximizing its full potential.

Once management responsibility is transferred, HCDA plans to fulfill the State vision through short-term measures and timely adoption of administrative rules that will enable proper management and operation of Kewalo Basin to the benefit of both the users and the public, as well as enabling the integration of the harbor into plans for the area currently being developed through the Kaka‘ako Makai Advisory Working Group.

By having complete control of Kewalo Basin, HCDA, through the Advisory Working Group, will give consideration to the harbor in the overall redevelopment of Kaka‘ako.

Proposed Adoption of Chapters 211-214, Title 15, Hawaii Administrative Rules, for Kewalo Basin

At a public hearing on March 7, 2007, over 20 people testified against the proposed adoption of new rules relating to Kewalo Basin and they said they were strongly opposed to the proposed increase in user fees.  The Department of Transportation-Harbors will relinquish jurisdiction of Kewalo Basin to HCDA on June 30, 2007.  HCDA has drafted proposed rules, regulations, charges and fees for Kewalo Basin to govern its use and operation under the jurisdiction, management and operation of HCDA.  These proposed rules, the subject of the public hearing, are necessary to facilitate the public’s use and enjoyment of Kewalo Basin.  The rules define permissible activities, regulate operations within the harbor and set forth procedures for obtaining leases and related fees.

 At the public hearing, Kewalo Basin harbor users—representing the fishing and tour, sports and pleasure boat industries—testified that although they acknowledge that repairs need to be made to Kewalo Basin harbor, the proposed user fees were unrealistic, too high and would drive them out of business.  Following the hearing, HCDA met with Kewalo Basin users to obtain their input and comments as the proposed rules were further revised. 

The major changes made to the proposed Kewalo Basin Rules, as a result of comments made at the Public Hearing and subsequent meetings with Kewalo Basin users include the following:

• Reduction of full dockage rates with step ups based on Consumer Price Index (CPI).

• Excluding common area maintenance fees.

• Reducing the minimum sales requirements for all tenants.

• Reducing the percentage rent amount to two (2) percent.

• Reduction of insurance coverage limits requirements to match current DOT limits.

• Reducing motor carrier permit fees to 1/3 current DOT rates.
  

• Allowing HCDA to enter into reciprocal agreements with DOT for motor carriers to avoid duplicating fees.

• Declaring Kewalo Basin as a no wake zone.

• Adding a provision allowing HCDA to enter into reciprocal agreements with DOT or the Department of Land and Natural Resources to allow tenants to use alternative state harbors in the event that Kewalo Basin is inaccessible.

• Allowing the Harbor Master to include parking passes as part of the lease.

• Fixing the rental rate for ticket booths at $250 (same as current rate) with step ups based on CPI.

• Specifying that regular mooring and miscellaneous permits can be assigned.

The proposed rules can be accessed below:

• Chapter 211 of Title 15, Hawaii Administrative Rules (version 5) (click here)
• Chapter 212 of Title 15, Hawaii Administrative Rules (version 5) (click here)
• Chapter 213 of Title 15, Hawaii Administrative Rules (version 5) (click here)
• Chapter 214 of Title 15, Hawaii Administrative Rules (version 6) (click here)
  

• Small Business Impact Statement on Proposed Kewalo Basin Rules (June 20, 2007) (click here)
• Recommendation to the Governor from the Small Business Regulatory Review Board (July 13, 2007) (click here)
• Recommendation to the Governor from the Small Business Regulatory Review Board (July 19, 2007)
  (click here)
• Small Business Impact Statement After Public Hearing of August 1, 2007
  Presented to the Small business Regulatory Review Board on August 15, 2007 (click here)
• Draft Kewalo Basin Revocable Permit
•  Small Business Regulatory Review Board Memorandum on Proposed HAR Chapters 15-211, 15-212, 15-213 and 15-214 "Relating to Rules for Kewalo Basin" dated August 23, 2007 (click here)

Background

In December 2005, HCDA formed an advisory Task Force to review and finalize the draft rules for Kewalo Basin.  The Task Force was composed of representatives of longliner and charter fishermen, tour boat operators, DOT and HCDA.  Based on input from the Task Force, the proposed rules were presented to the Small Business Regulatory Review Board (SBRRB) in January 2006 and the SBRRB recommended four changes, three of which were incorporated into the proposed rules. (Click here for SBRRB document.)   Since August 2006, HCDA has held monthly meetings with a transitional advisory group, composed of Kewalo Basin tenants, to communicate the steps in transfer, discuss issues that will be faced, and to seek their comments on the assumption of jurisdiction by HCDA.  All Kewalo Basin tenants were invited to participate in a special tenant briefing held on February 13 to review the proposed rules, answer questions and to solicit feedback.  Based on the comments received from tenants, proposed changes in insurance limits, percentage rents, minimal sales, liquor usage and administrative changes were incorporated into the proposed rules.

PLEASE SEND YOUR COMMENTS ON THE PROPOSED KEWALO BASIN RULES

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