Regulating Paradise
Price of Paradise · Hawaii Public Radio · aired 1994-05-01
Guests: David Callies (Professor of Law, University of Hawaii); Harold Masumoto (State Director of Planning)
Duration: 0:34:41
Note: music outro 478 s

[0:00:02] Randall Roth: Good morning. I'm Randy Roth, host of the Price of Paradise Radio show. My guests this week are state director of planning and former vice president for administration at the University of Hawaii, Harold Masumoto, and UH law professor David Callies. I'm looking at a book called Preserving Paradise. It's hot off the press and is sure to stimulate a lot of conversation about land use planning and regulation in Hawaii. David, I see your name right here on the cover. How about giving us a brief summary of your book's main theme?

[0:00:32] David Callies: Randy, the main theme of the book is that regulation is a difficult, especially legally, way to go about deciding how we want to use our land anymore. It concentrates on the difficulties in regulating land for open space preservation, regulating land for the the preservation of historic and other significant structures and buildings. It goes into the issue of delay and our very complex and sophisticated land use control system, how long it takes to get permission to build something in Hawaii.

[0:01:05] David Callies: And it goes into the the shoulds and should-nots about exacting or taking from a developer uh land or money or low-income housing or other so-called exactions as a a price for a permission to build something on property.

[0:01:24] Randall Roth: What's the subtitle of the book?

[0:01:26] David Callies: The subtitle of the book is Why Regulation Won't Work.

[0:01:31] Randall Roth: Is it safe to say then that you're of the opinion that regulation, as we know it today in Hawaii, somehow, for some reason, isn't going to work in the future?

[0:01:42] David Callies: That's safe to say because the Supreme Court says we can't under the Constitution.

[0:01:46] Randall Roth: So it's not because of something here in Hawaii that has happened recently, but it's some Supreme Court case in the United States?

[0:01:53] David Callies: That's correct.

[0:01:54] Randall Roth: Okay. Harold, are you in basic agreement with David on this?

[0:01:58] Harold Masumoto: Sorry to say, I agree with Dave on a lot of things, but I think on this issue I just don't agree with him.

[0:02:04] Randall Roth: Is it because your reading of that Supreme Court case is different or is there some other reason that you disagree?

[0:02:11] Harold Masumoto: It's probably because of my reading is as isn't as um precise or concise as his reading is, and you know, he's after all, he's a law professor and he probably should should know and doesn't know more than I do. On the other hand, I think society as as we have it here in Hawaii will find ways to get around the issue. Let me give an example. We have an interesting situation right now that I can give you uh that's uh the Mount what I call the Mount Olomana issue or as others people say the issue of the um windward Diamond Head, Diamond Head in the windward area.

[0:02:46] Harold Masumoto: We've got an issue here where the state legislature designated Mount Olomana as a monument, state monument. The the Department of Land and Natural Resources, the Board of Land and Natural Resources downzoned it from conservation general subzone, which is you can build golf course on it to uh uh to a uh protective subzone, which essentially means you can't build golf course on it. The owners of the land claimed that that action cost them $5 million. I don't see how we're going to backtrack on that because the committee just not going to allow the state to say you can build golf course on Olomana.

[0:03:27] Harold Masumoto: So we have to find a solution to that. I think the solution will lie in regulation.

[0:03:32] Randall Roth: Well, let me ask Professor Callies. David, what do you think?

[0:03:36] David Callies: Well, I think that a a landmark like um visual, if you will, like Mount Olomana or or Diamond Head uh or anything with a lot of community uh spirit invested in it, is is going to be the hardest case for government granting or not granting permission to build something on it. And so I'm not sure I'm I'm that far away from Harold's position right now. What what troubles me, Randy, is that having raised the conservation district, um the state is proposing to reclassify thousands of acres of agricultural land in the conservation district, much of it in the most restrictive subzone.

[0:04:19] David Callies: And these are not Mount Olomanas, uh and uh we used to be able to justify a lot of that by the need to protect watershed and a whole host of other things. Um, Supreme Court is not really all that uh crazy about regulation that has a mainly environmental bent. And when it's not possible to for a land owner to make use of of thousands and thousands of acres of land, um that was in one classification and now is another, I think poses the issue probably more more starkly, and indeed, uh I think maybe more fairly than picking up a a a highly visual significant thing like Mount Olomana.

[0:05:03] David Callies: Once again, I suspect that Harold and I may agree to disagree.

[0:05:06] Randall Roth: What do you think, Harold?

[0:05:07] Harold Masumoto: I disagree because we're taking action in that area. I think David is referring to what we call our KDC, Koloa Development Corporation, the uh uh proposal.

[0:05:17] Randall Roth: Can I ask are you expecting to be sued on it someday?

[0:05:20] Harold Masumoto: I think we'll be able to avoid it. Uh I I'm hopeful that um that our attorneys will be guiding us in such a manner that uh that the uh we can avoid a suit. I'm hopeful that the news uh land use commission member Casey Jarman, will be able to shed some light on what the the current status of the law is on this issue.

[0:05:41] Randall Roth: Another UH professor, right?

[0:05:43] Harold Masumoto: Another UH professor now in a decision-making role. All right. Oh, she can't only preach it on the side and now she has to put her money where her mouth is, I think. Feet to the fire, right? But this is a case in which I think Dave is talking about uh where we're we're saying that the developer who has supposedly rights to develop 500 lots on the big island, should uh concentrate these lots in the lower elevations and leave the upper elevations open in open space and uh in as a native uh native bird habitat.

[0:06:16] Harold Masumoto: You know, and uh I think that we'll see, we'll see whether uh it it it starts a lawsuit. I really doubt that it will.

[0:06:24] Randall Roth: And and if it does, eventually we'll find out from the court whether David's reading of Lucas or your reading of Lucas is more accurate.

[0:06:32] David Callies: I probably I I don't think this is going to be the case, though. I I I I don't think a large land owner like that with so many options would seek a uh judicial determination.

[0:06:45] Randall Roth: David, I I think in your book you suggested that perhaps in the past there have been uh land owners who didn't sue because they didn't want to be on bad terms with the state and that perhaps in the future, in part because of this Lucas case, or perhaps because there are some other land owners that just have that one project that they're concerned about, that maybe they would be more quick to sue in the future than they've been in the past. Is that an accurate description?

[0:07:12] David Callies: It is an accurate uh description. And what I'm suggesting, um, I I agree with Harold that that I it to go ahead and have a lawsuit over um these issues is a a last choice remedy. Uh lawsuits are time-consuming, especially if you're planning on going into the federal system, they can drag on for years.

[0:07:33] David Callies: Um neither the state or nor the private owner really wins under those circumstances. But I do think that it has been the case in the past that we have been primarily dealing with land owners in the state that are home grown, have lots of other property in the state, uh for for reasons of of culture and neighborliness prefer not to sue.

[0:07:53] David Callies: uh and for reasons of pure practicality, they have to go back to these agencies another time, agencies attempting to be as fair as they can, are not likely to be wildly sympathetic on a judgment call to uh an outfit that's just taken them to court and then sued them for millions and millions of dollars. We increasingly have a lot of land owners that aren't local and they have big ownership properties. I think this will cease to be a bar from filing suits in the future.

[0:08:17] Harold Masumoto: Randy, I I can't agree with Dave on this. I think he and I have had a conversation along these lines. I um and there are, as I agree with Dave, there are a lot of land owners who are a single parcel land owner uh who've got all their eggs in one basket in Hawaii, and if that basket is going sour, really think they have no alternative but but to file suit.

[0:08:37] Randall Roth: If if the state says you can't do what you wanted to do when you bought the land, then maybe they'll sue. Yeah. I I think this this high risk of that. You're listening to the Price of Paradise Radio show. I'm Randy Roth, and my guests this week are Hawaii state director of planning, Harold Masumoto, and UH law professor David Callies. Well, Harold, I've got a compound question for you here. First of all, would you agree that so-called plantation agriculture, sugar, pineapple, that plantation agriculture is rapidly fading in Hawaii, and if so, what should Hawaii do with the roughly 2 million acres now classified as agricultural land?

[0:09:15] Harold Masumoto: It's I've been spending the last three months at the state legislature on this particular issue. Uh I think we we anticipate that the uh that the large scale corporate agriculture as we know it, uh will be more and more difficult in the future. Uh that we may actually go back to a type something that happened in the 1800s, share cropping type agriculture, where the estates and large plantations would continue to hold on to the land and uh maybe even uh suggest what crops should be grown.

[0:09:47] Randall Roth: So it would stay in agricultural classification and use just small farmers rather than the big ones.

[0:09:54] Harold Masumoto: That's our objective. I think we'd like to see agriculture continue. I think for various reasons, open space, uh for tourism, whatever it may be. It's it's been a mainstay in Hawaii and I think we should continue that as long as we can.

[0:10:05] Randall Roth: What do you think, David?

[0:10:07] David Callies: Well, Randy, Harold, that's that's what troubles me, and it's a theme of of the book once again. If if large scale agriculture is uh numbered in terms of its days of utility in the state, then how are we going to deal with 2,000 uh sorry, 2 million acres of land roughly, classified as agriculture. If all that land stays in a classification which permits largely agricultural uses and and other things like golf courses, of which there are a finite number, uh both planned and and potential in the state. If that's true, then what do we do with the land owner that says, I want to do something different?

[0:10:49] David Callies: And what happens if a state agency says, no, we want to keep that land in agriculture, either as a holding zone, uh or because we like the open space characteristics or because tourists expect to see fields of pine and and fields of cane. Under this case which we are dealing with, this amounts to a a taking of all beneficial use of the land, economically beneficial use by regulation. And that's what the court says is a taking for which the state has to pay compensation. Becomes a real tricky issue.

[0:11:22] Harold Masumoto: I disagree with that, because as I understand the agricultural industry in Hawaii, there's always one use that can be made of all these lands, that that's grazing uh pasture land. And pasture land has the lowest tax rates, so everyone recognizes that you will not get the kind of returns that you could expect for intensive agriculture. But I think to say that you take away all economical use because it's in pasture, I don't think will cuts cuts the ice as far as uh as Supreme Court ruling goes.

[0:11:56] Randall Roth: But if if people who use the land for grazing or for diversified agriculture of some sort, if it came to the point where they simply couldn't make money using it in that way, would your position be different?

[0:12:09] Harold Masumoto: No, I don't think they have a right to ex- to build a home on it because you can't make money on agro in in the crop that you choose. I think what I'm suggesting is that there's always a crop that I think you can use the land for, and that's grazing either sheep or goats or or cattle or uh of that of that nature.

[0:12:29] Randall Roth: Well, we've had economists who've said that that because of of labor costs and because of of other costs in Hawaii, that uh arguably, um there aren't very many farming uses that can generate a profit even if the land is well, that's where I disagree with you because that one one story I heard the other day was that to raise cattle on the 25,000 acres of Hamakua sugar plantation land, you probably need all about 25 cowboys.

[0:12:57] Harold Masumoto: And you you can't tell me that that's going to be very high labor costs.

[0:13:01] Randall Roth: David, does it does it come down to whether or not agricultural use can generate some profit of any magnitude, or do land owners have a right to a relatively large profit?

[0:13:13] David Callies: Oh, Harold is is absolutely right in his comment that that the courts are only going to step in if there is no economically beneficial use. As long as there's some profit that can be made, then then the courts are a dodgy place to go to get your remedy. I agree with Harold that what is needed most is for government and land owner, which Harold is increasingly doing, I might add, through the office of State Planning, to get together and to get together a lot. Um, there is a a tendency in in Hawaii for certain groups to massively distrust cooperation between government and private sector.

[0:13:47] David Callies: Truth of the matter is it's the only way we're going to get anywhere. That combined with with massive purchase of of of development rights and open space um by by the government when it has the money, by private organizations, land trust, nature conservancy, is is the way we're going to get at preserving the open space that we want relatively development free. My problem with Harold's scenario with respect to agriculture is the huge amount of ag land that we have classified. I agree that there's there's probably there may be as much as 1, 2, 300,000 acres of ag land that can be converted to something else eventually, grazing goats, grazing grazing sheep, whatever.

[0:14:30] David Callies: 2 million acres, I think by a factor of four or five is is vastly more than than the state can find beneficial economic uses for.

[0:14:40] Harold Masumoto: The counter to that of course is 2 million acres into some other use, which would be very intensive human type use. You know, it's just something I just don't want to be alive when that happens. I think that's the problem we I think the uh community faces uh which brings me to a question you may want to ask in the future uh what do we do about all of this? You know, I think Dave and I have been talking about changing the system. We really need to change the uh land use regulatory system we have in the state of Hawaii at this time.

[0:15:09] Randall Roth: Tell me what if you could personally do it today, what's the first way you would go about changing it?

[0:15:16] Harold Masumoto: Well, uh to be honest with you, we I try to have be personally involved in trying to do something. We failed during this last session of legislature because I think a lot of people just aren't ready for it. Uh but with all this agricul- with the economy changing. We're going from a much large corporate sugar and pineapple-based economy to some other type of economy. Uh if you can is uh it's tourist-based right now. Defense is going down. Uh agriculture will be a different kind of agriculture. We need to do something.

[0:15:46] Harold Masumoto: The state land use system was established in 1960, early 1960 60 and 61, it was based upon the ILWU and the big five sugar planters dominating the scene, dominating politics in Hawaii. Uh that has all changed, and I think what we have now we're just not prepared for it. Uh what would I do? I try and get as much decision making down to the counties as possible. And the reason is that if you looked at what the people complain the most about the land use system, it's it's the growth. They they they don't like growth. But you can't do anything about that.

[0:16:22] Harold Masumoto: The other problem is infrastructure, and most of the roads, sewers, etc. are provided by the city and county of Honolulu, the county of Hawaii, county of Kauai, county of Maui. If they're going to pay for it, they should have more of a say in the decision making.

[0:16:36] Randall Roth: And so you actually sponsored a bill that recommended the abolition of the State Land Use Commission?

[0:16:43] Harold Masumoto: Yes, that's one way of describing it. Uh we suggested to abolish the Land Use Commission, convert the Land Use Commission to a sort of a planning commission setting guidelines as to what Hawaii should be like, setting the rules and regulations.

[0:16:55] Randall Roth: And leave leave the details to the counties?

[0:16:57] Harold Masumoto: Right. That's the way I would have liked it to happen.

[0:17:00] Randall Roth: You're listening to the Price of Paradise Radio show. I'm Randy Roth, and my guests this week are Hawaii state director of planning, Harold Masumoto, and UH law professor David Callies. Well, David, what do you think of what uh Harold has been pushing for and and not successfully, but presumably we'll continue to push for in the legislature?

[0:17:18] David Callies: Oh, I'm very supportive of what he's uh what Harold is pushing in the legislature. Um the bill was was a well-crafted bill, uh and um although it certainly raised some hackles with such things as the abolition of the Land Use Commission which I think is accurate. People are not quite ready for that yet as much as they say that they get frustrated with it. Um and and bringing the the major land use decision-making process down to the county level, with simply a matter of of state oversight for general planning and maybe preserving areas of critical state concern or setting guidelines for developments of a huge regional impact, it's great idea.

[0:17:55] David Callies: Um, it it takes, unfortunately, two or three years for a good idea to percolate through the legislature. That's not critical of the legislature, that's just the way it is.

[0:18:05] Randall Roth: I see. So there there isn't In terms of it not going through the legislature, there wasn't any particular reason other than it takes time to get this kind of change?

[0:18:14] David Callies: I think you'd have to ask Harold about particular reasons. He's the one who was up there lobbying for it.

[0:18:23] Randall Roth: Have the bruises healed yet? Did you get beat up in the legislature? I really didn't because we we we sensed very early that the uh the legislature just wasn't ready for change.

[0:18:32] Harold Masumoto: And it was probably our fault because we didn't brief them early enough. We spent too much time out in the community and not enough time with the legislature. That's a mistake I think we made and uh and uh we just didn't get the word out to them. Uh hopefully uh the report that we're putting out uh will explain what we're trying to do. And I think we've built the constituency out there. And I think the constituency will push it. Now when I say we build the constituency, we've also developed, I think we've

[0:19:00] Harold Masumoto: also alerted some people who may not want any changes. I always use I I always talk about the uh no growth people, anti-growth people, that like the Land Use Commission, and I always accuse them of having two buttons right now that they can press to stop a development, and they're looking for the third uh when they're looking for initiative and referendum. Mhmm. That's a third button. Right now the the theory I had, the argument I have is that anytime you want to develop a large uh parcel of land, you have to press two buttons, one at the City-County level and one at the State level. If you miss, if you press one button it doesn't light up, you can't do anything. Mhmm. So you've got a two button system. Okay.

[0:19:42] Speaker 2: Well, speaking of of the community, why should someone like me, why should an average citizen be concerned about this anyway, Harold?

[0:19:50] Harold Masumoto: It's going to affect your quality of life. I don't think there's any question in my mind. Uh it's uh if you have too much growth, it's going to create tremendous traffic problems, infrastructure problems. I think that's the kind of backlash that we're having right now. Mhmm.

[0:20:03] Speaker 2: Is it safe to say that when we talk about land regulation in Hawaii, the primary goal is to limit growth?

[0:20:12] Harold Masumoto: I think I I think it may be a primary goal in certain people's minds. I think in ours, I think it's the uh control growth more than limit growth.

[0:20:21] Speaker 2: Okay. David, any thoughts on that?

[0:20:23] David Callies: Well, let let me put another hat on for a minute here and that's that's the hat uh of a of a planner, which Harold also wears uh as as much or more so than than I do. The real goal of the regulation uh is to implement plans. And the question is whose plans and what plans? And in this state, that has been uh the implementation of of a multitude of plans from the state plan, which is in in uh uh more or less in the state legislature, legislation rather, and a number of county plans, development plans, general plans, and so on. So like laws, we're sort of knee-deep in plans. One of our visitors once stacked them all on a table and they were nearly as high as his head. Having said that, that's the idea of the regulation. It's to implement a plan. The plan is supposed to be where the community decides how they want growth to be and where it should go. I think that Harold's earlier statement is is accurate uh and that is growth is going to come. And and just the question of where we put it. Are we going to have more concentration in the urban area, in in which case not doing a rapid transit system was a bad idea because our roads and highways have got about as much as they can bear right now. But the infrastructure is already there in the urban area. The water, the sewer, uh some of the roads, uh the wastewater treatment. All of it is is already there. Or are we going to continue to create new growth areas like Mililani, like Kapolei where we will need new infrastructure, we'll need new connections and and things will be less expensive for a while and and easier to plan, but it will take a lot more community investment to do that. Mhmm.

[0:22:07] Speaker 2: Harold, is there a clear vision in terms of of how we want to control that growth?

[0:22:12] Harold Masumoto: I don't see the communities really come up with a clear vision. I think we've off it's been my responsibility along with other people to try and interpret what the community wants. Uh and I think it's it's one of the things that we we have difficulty with uh and I hope at least I've been consistent about it. I think we've tried to say that growth is inevitable. We have some say in where it goes, and uh that we ought to uh make sure that uh it benefits everyone in the community, not only a select few.

[0:22:42] Speaker 2: Mhmm. David, in in your book, you say that that land regulation in here in Hawaii, as it's being done today, isn't going to work. What would work? If we accept your reading of the Lucas case and there's a problem with the way it's being done now, if you were in charge of it, how would you approach it differently?

[0:23:02] David Callies: Well, I think first of all, I would begin to discourage reliance on regulation to preserve open space in historic buildings. I would start relying on on private money uh and selective use of public money to buy development rights, um and to buy easements um to to have to begin to enforce covenants that would limit development on open space. Let me stop and compensate the land owner for that limitation. Let me stop you for a moment. I want to come back. But Harold, from your position, is that realistic?

[0:23:36] Harold Masumoto: It's it's realistic to a certain extent, although I do want to point out that uh one of the tools that we used to use, when you say when you purchase uh the easements and all those other things, was uh what we call the Land Exchange route. And again, let me refer back to Olomana. Uh the legislature said, pay pay some money, pay pay dollars or exchange lands to preserve Mount Olomana. Well, what what we would have done three years ago, five years ago, was to look for a nice piece of commercial land that's owned by the State and exchange with the owners of Olomana. Well, now with the Hawaiian sovereignty movement taking steam, building up steam, you have a element in the community that says all those lands, public lands are our lands. So you don't make the decision for us, we make that decision. And uh, I think um to do what David is suggesting, it's going to be much more difficult. Dave, we've got just a minute or so left. Why don't you carry on? I'll take a little just a little bit of it. The thing is, that's the most expensive a land exchange is the most expensive way to use public or private money in order to solve something. On an Olomana situation, maybe the only thing to do. You're trying to take one area and and get it in the state hand, so nothing can happen to it. State is landowner. Um, much better to go out and and with a little foresight, buy development rights in agricultural land, which is really pretty far from a developed area, when they'll be a lot cheaper. Uh and you can buy more development rights for for a whole lot less money than you could before. Um that would be my answer to to that process. The Native Hawaiian title question is is the elephant on the table um that everybody is is increasingly not ignoring but we have for years. Um the the ability to deal in land at all with clouds on title continuing to arise because of the assertion of certain rights is going to be troublesome and and beyond our our ability of forecast for years to come. Gentlemen, thank you very much. This has been very enlightening. My guests this week were state director of planning, Harold Masumoto, and land use legal expert, David Callies. David's newest book, Preserving Paradise, retails for 16.95 and can be found anywhere fine books are sold, and if you don't find it there, complain because it ought to be sold there. This week's show was produced by Suzie Roth with technical assistance from Mark Wagner. You've been listening to the Price of Paradise Radio Show. I'm Randy Roth. Aloha.

[0:23:49] Harold Masumoto: And again, let me refer back to all the mana. The legislature said, pay pay some money, pay pay dollars, or exchange lands to preserve Montalmana. Well, we what we would have done three years ago, five years ago, was to look for a nice piece of commercial land that's owned by the state and exchange with the owners of Omana. Well, now with the Hawaiian sovereignty movement taking steam, building up steam, you have a element in the community that says all those lands, public lands are our lands. So you don't make the decision for us. We make that decision. And uh I think um to do what Dave is suggesting, it's going to be much more difficult.

[0:24:31] Speaker 2: Dave, we got just a minute or so left. Why don't you carry on?

[0:24:33] Speaker 1: I'll take a little just a little bit of it. The thing is, that's the most expensive a land exchange is the most expensive way to use public or private money in order to solve something. On an Ola mana situation, maybe the only thing to do, you're trying to take one area and and get it in the state hands so nothing can happen to it. State is land owner.

[0:24:52] Speaker 1: Um, much better to go out and and with a little foresight by development rights and agricultural land, which is really pretty far from a developed area, when they'll be a lot cheaper and you can buy more development rights for for a whole lot less money than you could before. Um, that would be my answer to to that process. The native Hawaiian title question is is the elephant on the table, um that everybody is is increasingly not ignoring but we have for years.

[0:25:21] Speaker 1: Um, the the ability to deal in land at all with clouds on title continuing to arise because of the assertion of certain rights, it's going to be troublesome and and beyond our our ability to forecast for years to come.

[0:25:35] Speaker 2: Gentlemen, thank you very much. This has been very enlightening. My guests this week were state director of planning, Harold Matsumoto and Land Use legal expert, David Callies. David's newest book, Preserving Paradise retails for 16.95 and can be found anywhere fine books are sold, and if you don't find it there, complain because it ought to be sold there. This week's show was produced by Suzie Roth with technical assistance from Mark Wagner. You've been listening to the Price of Paradise Radio Show. I'm Randy Roth, Aloha.

[0:26:14] Speaker 3: This program is produced by the Consortium of 72 Price of Paradise authors in cooperation with Hawaii Public Radio. The Price of Paradise is a best-selling two volume book series that has become a must-read for every concerned citizen of Hawaii. Please tune in next week when Randall Roth and his guests will take on another question of importance to listeners in Hawaii. Cassette copies of this program are available from Hawaii Public Radio for $10 by calling 955-8821. For a listing of past shows and guests, send a stamped self-addressed envelope to Price of Paradise Radio Show, Hawaii Public Radio, 738 Kahaka Street, Honolulu, 96814.