Litigation Station: East Maui Streams Back at the Hawaiʻi Supreme Court

State, Alexander & Baldwin seek to justify Board of Land and Natural Resources’ denial of Sierra Club’s right to due process, stream protection for Maui Hikina

By Wayne Tanaka, Chapter Director | Reading time: 6 minutes

“What is a beach without sand? What is a stream without water?” Sierra Club of Hawai‘i attorney David Kimo Frankel asked during his closing remarks before the Hawai‘i Supreme Court last month, as he reminded the justices of what was really at issue: the state Board of Land and Natural Resources’ (“BLNR’s”) decision to allow numerous Maui Hikina streams to be drained dry for yet another year, without a meaningful consideration of what the ecological harms may be, how waste could be minimized, and other analyses critical to its public trust and statutory duties.

The stakes, meanwhile, may be even higher. The outcome of the supreme court’s pending decision could allow the BLNR to turn a blind eye to its public trust and statutory responsibilities to safeguard our most precious resources, in favor of politically powerful private interests. Moreover, the arguments put forward by opposing counsel could allow agencies to deprive residents of their constitutional rights - including property rights and the right to a healthful environment - without giving them a meaningful opportunity to be heard.

The oral arguments in November centered on whether the Board of Land and Natural Resources (“BLNR”) should be required to provide the Sierra Club of Hawai‘i with its requested contested case hearing over the 2022 issuance of revocable permits to Alexander & Baldwin (a former plantation-turned-real estate investment trust) and Mahi Pono (a Canadian pension investment fund), to divert over 40 million gallons of water per day from East Maui’s streams throughout 2023. Notably, this amount was more than the diverters had demonstrated any actual need for, was in fact twice as much water as they had diverted in the previous year and a half, and three to four times – or more – the amount of water that they had reported using during that time.  

Longtime water rights advocates after the Hawaiʻi Supreme Court oral arguments on East Maui stream diversions. From L-R: Colleen Heyer, President of the Conservation Council for Hawaiʻi; Wayne Tanaka, Sierra Club of Hawaiʻi director; David Kimo Frankel, attorney for the Sierra Club; Jonee Peters, Conservation Council for Hawaiʻi director, and Isaac Moriwake, Managing Attorney for the Earthjustice Mid-Pacific Office.

The Environmental Court in June of last year ruled that the BLNR’s denial of the Sierra Club of Hawai‘i’s request for a contested case “offends the constitution,” depriving the Sierra Club of a meaningful opportunity to ensure a close examination of relevant issues and facts. Environmental Court Judge Jeffrey Crabtree highlighted numerous issues that merited such examination, including the amount of diverted water that was being wasted, the feasibility of waste reduction measures, the amount of water actually needed by the diverters for uses consistent with the public interest, and the applicability of various statutes and court rulings, among others.  As  Judge Crabtree had noted:

“These are multi-faceted and complex issues, involving facts, policy, law, and substantial impact on the public interest. That is precisely why a contested case hearing is necessary: get the facts, exhibits, witnesses, arguments, and perspectives out on the table, subject to cross-examination, hearing full argument (not three minutes) and create a full and robust record. Do that, and the chances increase for getting a solid, objective decision that protects our natural resources while also balancing legitimate needs to use those natural resources.”

The Intermediate Court of Appeals disagreed, and reversed Judge Crabtree’s decision. The Hawai‘i Supreme Court then granted the Sierra Club’s petition for review of the Intermediate Court of Appeals’ ruling, leading to the November oral arguments.

During these oral arguments, Sierra Club attorney Frankel focused on the BLNR’s failure to adequately consider new conclusions from its own Division of Aquatic Resources, regarding the ecological impacts of stream diversions. Frankel also noted that the BLNR had failed to apply the clear mandates of the Coastal Zone Management Act, which requires a full consideration of stream diversion impacts on the coastal and nearshore environment. 

Frankel also emphasized the value of contested case hearings in  providing a neutral decisionmaker to create a factual record through adversarial, court-like processes, such as cross examination of witnesses. 

He also argued that the the Sierra Club’s – and the public’s – constitutional right to a healthful environment, among other constitutional considerations, required a contested case hearing under the plain language of Hawaiʻi Revised Statutes Chapter 91.

Attorneys for the state and Alexander & Baldwin disagreed. They pooh-poohed the value of a contested case hearing, arguing that a BLNR meeting under the Sunshine Law– where members of the public are granted mere minutes to testify on highly complex materials they have only six days to review – is sufficient for the protection of the Sierra Club’s asserted constitutional rights and concerns. 

Downplaying the adversarial process used in contested case hearings, deputy attorney general Melissa Goldman also raised more than a few eyebrows when she asserted that “courts have often recognized that cross examination of scientific facts are an exercise in futility” – a proposition that made Chief Justice Mark Recktenwald do a double take. 

“I’m trying to understand what I did all those years in private practice,” he wondered out loud.  

Other arguments from the state and Alexander & Baldwin were also met with skepticism.

Justice Vladimir Devens highlighted numerous factual and policy issues connected to the revocable permits, that simply could not be meaningfully examined without the procedures of a contested case hearing. He also was no stranger to the difference between a public meeting and a contested case, pointedly asking:

 “It’s one thing to be able to express views, it’s another thing to be cross examined. As I understand these public [Sunshine meetings], people come up, they say whatever they want to say, conclusory statements, whatever opinions they may have, but they are never really challenged under cross examination. Isn’t that really the point that Sierra Club is making? That they want to have that opportunity – a meaningful opportunity – to present their case?”

 Justice Sabrina McKenna likewise questioned why a contested case hearing would not be appropriate to meaningfully examine the BLNR’s summary conclusion that millions of gallons of water lost to leakage every day was not “waste.” 

 And none of the justices seemed very interested in Deputy Goldman’s suggestion that the Board of Land and Natural Resources had no authority to assist in the implementation of minimum stream flow standards set by the Water Commission, including by requiring diversion modifications as a condition of the revocable permits – a proposition that would be very difficult to square with prior rulings (per Deputy Goldman, “[the Water Commission] has exclusive jurisdiction and final authority in all matters relating to implementation and administration of the state water code . . . that includes diversion modifications issues as well, so that topic is outside the scope of these proceedings”).

 Depending on whose views the Hawai‘i Supreme Court endorses, its pending decision could have a significant impact on the public trust in water, the government’s duties to uphold our constitutional right to a healthful environment, and whether and to what extent constitutional property interests can be summarily dismissed by state agencies. The skepticism expressed by the supreme court justices with arguments from the state and Alexander & Baldwin, and the strident and waterproof advocacy by Sierra Club attorney David Kimo Frankel, does give reason for a hopeful outcome.   

 In the meantime, you can listen to the oral arguments on the Judiciary website here.

BLNR Action Alert

This Friday, December 13, 2024, the Board of Land & Natural Resources will consider staff recommendations to DENY the Sierra Club of Hawai‘i‘s contested case request from December of last year, for the revocable permits for Maui Hikina that were issued for 2024 (yes, it took them a year to decide to deny a contested case request for a one year permit). 

Moreover, the BLNR will consider the reissuance of revocable permits for 2025 - stay tuned for more details on how you can weigh in and hopefully persuade the BLNR to finally fulfill its public trust duties in its decisionmaking.