Litigation Station: Another Win in the Maui Water Wars - Supreme Court Doubles Down on the Public Trust in Wai

by Wayne Tanaka, Chapter Director | Reading time: 11 minutes

As the climate crisis continues to metastasize across our islands and our planet, the need to prioritize the careful and just management of our water resources will be more critical to the future of Hawaiʻi than ever before.

Fortunately, a historic June decision by the Hawaiʻi Supreme Court has reaffirmed core principles of the public trust doctrine and our state water code, and reminded the Water Commission (and perhaps more importantly, the state attorney general) of the seriousness of its kuleana to uphold the public trust, and the law, in its decisionmaking over our precious wai.

“No be Lōlō, Restore Stream Flow”: A brief recent history of the Nā Wai ʻEhā water battle

Photo: Hui o Nā Wai ʻEhā

In a saga spanning over two decades, Hui o Nā Wai ʻEhā and Maui Tomorrow Foundation (the Hui) and the Office of Hawaiian Affairs (OHA) have fought to wrest control of Central Maui’s “Four Great Waters” from Wailuku Water Company, a former subsidiary of the “Big 5” oligarchy’s C. Brewer and Co., and Hawaiian Cane & Sugar, the sugar plantation subsidiary of “Big 5” oligarch Alexander and Baldwin (now replaced by a Canadian pension fund subsidiary, Mahi Pono). 

Building off the precedent set in the turn-of-the-century In re: Waiāhole decision, which led to the restoration of stream flow to Waiāhole, Waianu, Waikāne, and Kahana streams in Windward Oʻahu, the Hui and OHA have sought tirelessly to free the waters of Nā Wai ʻEhā from their legacy of oligarchal control, for the benefit of the environment, small farmers, cultural practitioners, and public beneficiaries of the public trust in water. Over the years, they have established water management area designation over the ground and surface waters of Central Maui; petitioned for increased minimum flow requirements for Wailuku, Waiheʻe, Waikapū, and Waiehu streams (the Nā Wai ʻEhā  or “Four Great Waters'' that once fed the largest contiguously cultivated region of loʻi kalo in all of Hawaiʻi); fended off an attempt by the Water Commission to ignore constitutionally protected Native Hawaiian traditional and customary practices in its decisionmaking on their streamflow petition; entered into a historic 2014 settlement agreement that led to mauka-to-makai stream flow in all four Nā Wai ʻEhā streams for the first time in more than century; and established Native Hawaiian traditional and customary kalo cultivation, domestic uses, and appurtenant rights as priorities for stream water use permit applications in the Nā Wai ʻEhā surface water management area. 

Public Trust Reaffirmed: Key takeaways 

Now, in an appeal of portions of the latest Water Commission decision regarding Nā Wai ʻEhā, the Hui and OHA have won key affirmations of the public trust in wai by the Hawaiʻi Supreme Court. Just some of the key takeaways in the 134 page court opinion include:

1. The Water Commission must independently and fully consider all opportunities to “restore stream flows to the extent practicable.”

One major takeaway from the most recent opinion was a clear ruling that the Commission has constitutional public trust duties to carefully and explicitly consider all available information - and seek out new information as necessary - to independently determine whether more stream flow can and should be restored via updated “interim instream flow standards” or IIFS (i.e. the minimum flow for given points in a stream).

Specifically, the supreme court noted that the Commission could not simply rubber-stamp the aforementioned 2014 settlement agreement between the Hui, OHA, Wailuku Water Company, and Hawaiian Cane & Sugar (HC&S), when HC&S shuttered its long-failing and water-thirsty sugar operations two years later. While the 2014 agreement did result in significant public trust benefits, the Water Commission could not turn a blind eye to the subsequent “historic opportunity to restore stream flows” arising from the end of HC&S’ sugar operations, and thereby provide even greater benefits to the public.

The lack of studies in 2024 to demonstrate the value of increased stream flows also was no excuse to maintain the 2014 “status quo,” particularly when the Commission itself had previously suggested the need for further studies to study the effects of stream restoration. As the court explained, “the Commission’s [status quo] action appears to be the result of a passive failure to take the initiative to protect the public trust.” 

Accordingly, the Water Commission must now consider and make explicit findings and conclusions as to whether even more stream flow should be restored to Nā Wai ʻEhā, since water is no longer needed for water-intensive sugar cane cultivation. In doing so, it must also address the impacts of all diversions on all “instream” uses along each stream, including previously overlooked kuleana and other appurtenant rights holders who are not required to apply for a water use permit.  

2. No shortchanging Ka Paʻakai.

The court also chastised the Water Commission for failing to conduct a full Ka Paʻakai analysis, as part of its constitutional duty to protect and enforce Native Hawaiian traditional and customary practices - which are afforded a high priority under the public trust - that may be impacted by its IIFS decisions. 

In particular, the Commission’s generalized statement that there would be some benefit to Native Hawaiian traditional and customary practices did not include specific findings required under a Ka Paʻakai analysis, including how continued diversions may impact specific practices beyond kalo cultivation, and how such practices could be feasibly protected.

Accordingly, the Commission must now make those findings and explicitly incorporate them in its update of minimum stream flow requirements for Nā Wai ʻEhā.

3. Facts and clarity matter.

The supreme court also reminded the Commission of the detailed clarity needed in its decisionmaking over permits to use public trust water resources in a water management area. 

In its decisionmaking, the Commission had awarded various amounts of water for numerous water use permits for Nā Wai ʻEhā, and established tables of “priority uses” to determine which types of water uses would have to be reduced first, when minimum stream flow requirements could not be met (e.g. in times of drought). However, it did not specify which permits fell under which priority use category in the tables, creating a lack of clarity over what should happen during times of low stream flow.

(The court would also find that this lack of clarity would also impermissibly delegate the Commission’s constitutional duty to balance and protect the rights of individual users to Wailuku Water Company, which the Commission had instructed to “equitably” reduce water between water use permittees when stream flows were too low. Constitutional duties such as balancing water rights and protecting traditional and customary practices such as loʻi kalo cultivation cannot be delegated to private parties).  

Moreover, the Commission had made inconsistent findings regarding acceptable system losses, how much habitat was estimated to be restored by its IIFS decisions, and how it calculated the amount of water allocated for HC&S’s successor, Mahi Pono.

As the court ruled, the lack of clarity in the Commission’s decisionmaking did not reflect the “openness, diligence, and foresight commensurate with the high priority [public water] rights command under the laws of our state,” and the Commission must now provide the much more detailed and clear decisions and justifications that the public trust requires for our most precious resource.

4. No absolute priorities in a water shortage - especially for a golf course.

The supreme court also rejected a few outlandish claims from MMK Maui LP, a golf course owner, that it should be entitled to receive more water per acre than agricultural uses, simply because its golf courses historically and currently use more than the 2,500 gallons per acre per day the Commission determined appropriate for diversified agriculture.

The court found it reasonable for the Commission to determine that “there is no reason to differentiate and give a higher water duty to a recreational use than to diversified agriculture,” in granting MMK the same amount of water per acre as a permittee for new diversified agriculture.  The Commission also permissibly rejected MMK’s reliance on its “average” water use in the past, which was akin to “requesting priority access to water during periods of water shortage over other permittees in advance.” Accordingly, the Commission was well within its authority to determine that granting extra water to a golf course above and beyond a diversified agriculture operation was not a “reasonable beneficial” use of water.

The fact that existing uses are generally prioritized over new uses also did not help MMK, as the supreme court reaffirmed that the public trust does not provide for “absolute priorities between broad categories of uses,” and a case-by-case analysis of water use permit applications by the Water Commission can and should be used to determine what best protects the public interest.

MMK’s suggestion that reducing the amount of water it currently uses could be a “taking” of its property rights was also rejected in a footnote – where the court reaffirmed, yet again, that “no private party has a vested right to continue an existing water use to the public detriment, because water is a public trust resource.”

5. Alternative sources must be seriously and diligently considered.

The court also reaffirmed the importance of fully and diligently considering alternative sources to stream water, including recycled wastewater; offhand references to cost, or the lack of existing infrastructure, cannot alone be the basis of dismissing such alternatives. 

For example, the Commission had previously dismissed the potential use of 5 million gallons of recycled wastewater per day by HC&S as an alternative to Nā Wai ʻEhā streamwater, based solely on the lack of distribution pipelines. The supreme court did not find the lack of infrastructure alone to be a sufficient excuse to ignore this alternative water source, especially since 5 million gallons of restored stream flow per day would be nearly sufficient to meet the needs of all kuleana owners in Nā Wai ʻEhā, and instructed the Commission to dig deeper. 

MMK had similarly testified that it had no alternative water sources due to the cost of pumping groundwater, and the lack of existing ditches or pipelines for recycled wastewater. Without further information, the court accordingly instructed the Commission to more adequately assess whether MMK could in fact use alternative sources to Nā Wai ʻEhā’s streams, in assessing the merits of MMK’s request.

6. A 12-month “Moving Average” standard is suspect.

As a final takeaway, the supreme court rejected MMK’s argument that the Commission should have granted it water based on a 12-month moving average (12-MAV), where a permittee’s compliance with their daily water use limit would be based on their average use over a 12-month period.

The court recognized that the Commission’s rejection of MMK’s 12-MAV request was appropriate: a 12-MAV approach would be “nearly impossible” to enforce (it would take up to a year of water use monitoring to determine a violation of the daily limit for any particular permittee), Central Maui is highly susceptible to droughts (which could lead to permittees taking far above their average daily allocation during dry periods, and reducing their use during wetter months to bring their daily “average” down), and there are many, many users of Nā Wai ʻEhā water (which could lead to chaos, given the prior considerations).   

Again, the supreme court found that the Commission was well within its authority - given its constitutional public trust duties - to decline to use a 12-MAV in allocating water to any Nā Wai ʻEhā water use permit applicants, including MMK.

Looking Ahead

The Hawai‘i Supreme Court’s Nā Wai ʻEhā decision, while rejecting certain decisions by the Water Commission, reaffirmed the Commission’s broad authority, and highest duties, to uphold the public trust, and the public interest, in our water resources. Decisions that may negatively impact our water resources or the public interest must be carefully and clearly detailed, without confusing or conflicting justifications, and with a full and independent consideration of all opportunities to restore stream flow. At the same time, decisions that carefully and appropriately safeguard the public interest - including determinations of what should and should not be considered “reasonable and beneficial uses” of our precious wai - are well within its purview, regardless of what legacy diverters and private, profit-driven interests may demand.  

Notably, the constitutional bases of the court’s ruling should give confidence to any and all government decisionmakers willing to uphold the public trust in wai, and truly protect the public interest in this most precious resource.

Others should hopefully reflect on the significance of their public trust kuleana, and revisit decisions that may fall short of the high standards now reaffirmed by the supreme court.  

This includes the Board of Land and Natural Resources, which most recently issued Alexander & Baldwin revocable permits to divert up to 31.5 million gallons per day of East Maui stream water, using a practically unenforceable 12 month moving average; failed to require A&B to use lined reservoirs as an alternative to unlined ones that leak millions of gallons of water per day; and ignored new biological, rainfall and other information that call for greater protections for East Mauiʻs streams. 

As a final note, many kudos to the Hui and OHA, along with their legal representatives Isaac Moriwake, Pamela Bunn, and Judy Tanaka for this latest historic win!