Superferry fallout

The state cites the Alakai case in requiring an environmental review of a Molokai water project

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In the latest fallout from a Hawaii Supreme Court decision, a Molokai water project is being asked to have an environmental study before renewing a contract.

Molokai Ranch, also known as Molokai Properties, wants to continue to use a state-run irrigation system to transport its drinking water to the west end of the Friendly Isle.

But Deputy Attorney General Myra Kaichi, citing the Supreme Court's Aug. 31 decision on the Superferry, has issued an opinion saying an environmental study is needed to assess its effects.

Kaichi also said the ranch should get off the state-run irrigation system until it completes an environmental study.

The ranch is the main provider of drinking water to western Molokai.

First Deputy Attorney General Lisa Ginoza said she is worried about the Supreme Court's decision and its potential impact on future projects.

Superferry officials said their project is in jeopardy as a result of the court's decision requiring an environmental assessment.

Ginoza said the attorney general's office is looking at asking the Supreme Court to reconsider parts of its decision.

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WAILUKU » A resort owner has been told to stop using a state-run system to transport drinking water to western Molokai until it completes an environmental study.

Deputy Attorney General Myra Kaichi said Tuesday in an opinion that Molokai Ranch should get off the Molokai Irrigation System "as quickly as possible" -- citing the Aug. 31 decision by the Hawaii Supreme Court requiring the state to provide an environmental assessment of the impact of the Hawaii Superferry at Kahului Harbor on Maui.

The court ruled that state transportation officials were incorrect in exempting the Superferry from an environmental assessment, noting state law requires such a study whenever state property is used and there is a potential for significant environmental impact.

In a telephone interview yesterday, Kaichi said that after analyzing the Supreme Court decision, she decided an environmental study was required before a new contract could be issued to the ranch to use the state-run system.

Molokai Ranch has used the state-run irrigation system to transport water from central Molokai under an agreement issued by the state in the mid-1970s.

More than 1 million gallons a day has been allocated to go to the industrial park at Palauea, the resort -- beach lots, condos and a golf course -- at Kaluakoi and Maunaloa Town, including the ranch's 22-room Lodge.

Asked what is meant by "as quickly as possible," Kaichi said, "I think the parties should get together and talk this through."

First Deputy Attorney General Lisa Ginoza said she had not seen Kaichi's opinion, but the court's decision was of "great concern" because of the potential effect it will have on a number of projects.

Ginoza said that while she believes the court's decision does not apply retroactively, the ruling could influence whether projects go forward because of the resources needed to do environmental assessments.

"It creates quite a bit of uncertainty," she said. "We do see some real challenges."

Ginoza said the attorney general's office was reviewing the court's decision and looking at whether to ask justices for a reconsideration of parts of their decision.

Critics, including a group of Hawaiian homesteaders, have argued that the ranch, also known as Molokai Properties, should have conducted an environmental study before it was issued the agreement.

State administrators in the 1970s said the contract was issued before laws requiring an environmental study took effect.

The agreement was originally for 20 years and has been given a number of extensions, the latest ending in April 2006.

Under the 1970s license, the ranch is required to put a little more than 1 million gallons a day into the irrigation system's pipeline.

The ranch is allowed to take out about the same amount after the water is transported several miles west.

Molokai Ranch President Peter Nicholas declined comment, pending a review of the opinion.

Hawaiian homesteader Glenn Teves said he felt the opinion was long overdue.

Teves said the Molokai Irrigation System, including the 1.4 billion-gallon Kualapuu reservoir, was built mainly to benefit Hawaiian homesteaders and that two-thirds of the water was supposed to be set aside for them.

Teves said that under the current system of allocation, about 20 percent is set aside for Hawaiian homesteaders and 80 percent to other users.

Attorney Alan Murakami, representing some Hawaiian homesteaders, said an environmental study would improve accountability for the water use.

Murakami said a study would also help to assess the impact of Molokai Ranch's surface water diversions on ground water in central Molokai.

He said that in times of drought, Hawaiian homesteaders have been forced to cut back on their water use, while the resort has not.

State Deputy Agriculture Director Duane Okamoto said his department will be looking for guidance from the attorney general's office on how to comply with the opinion.

Okamoto said that at one time, Hawaiian homesteaders used about 80 percent of the water in the Molokai Irrigation System.

He said the usage decreased after homesteaders were prevented in the 1990s from engaging in third-party contracts renting their land to other farmers.

Okamoto said state agricultural officials have been meeting regularly with homesteaders to try to find a way to increase their participation as farmers.

"We'd certainly like to see more homesteaders farming," he said.