REPORT TITLE:
Submerged Lands; Piers


DESCRIPTION:
Provides guidance with regard to fair and equitable regulation of
submerged lands as they relate to piers and other such
improvements.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        
HOUSE OF REPRESENTATIVES                H.B. NO.1735       
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                             
________________________________________________________________
________________________________________________________________


                   A  BILL  FOR  AN  ACT

RELATING TO SUBMERGED LANDS.
 


BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1      SECTION 1.  "Submerged lands" consist of the land mass which
 
 2 exists underwater in the ocean immediately adjacent to the main
 
 3 Hawaiian islands.  Submerged lands include live or dead coral
 
 4 reefs, sandy bottom shallows and mudflats.  Submerged lands are
 
 5 part of the public lands as defined by section 171-2, Hawaii
 
 6 Revised Statutes and are part of the ceded lands that belong to
 
 7 the state.  Submerged lands have been classified as conservation
 
 8 district lands. (See section 205-2, Hawaii Revised Statutes).
 
 9 The lands on which most piers are situated lie within the coastal
 
10 zone management area (See section 205A-1, Hawaii Revised
 
11 Statutes).
 
12      SECTION 2.  The legislature finds that there is a compelling
 
13 need to provide guidance to the Department of Land and Natural
 
14 Resources (DLNR) with regard to fair and equitable regulation of
 
15 submerged lands as they relate to piers and other such
 
16 improvements.  The legislature finds that various types of
 
17 structures have been built on submerged lands throughout the
 
18 state, around every island, and in every district having a
 
19 coastline.  Structures come in many forms and include piers,
 

 
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 1 docks, seawalls and groins, fishing platforms, boat moorings and
 
 2 other types of structures.  Some structures are in active use and 
 
 3 others may be abandoned.  While some structures are used in
 
 4 connection with commercial entities the majority are used by
 
 5 adjoining landowners for noncommercial purposes.  It is noted
 
 6 that piers, seawalls, fishing platforms and boat moorings are
 
 7 traditional uses of submerged lands and constitute an established
 
 8 part of the lifestyle of the people of this state.  This bill is
 
 9 intended to address the use of the state's submerged lands for
 
10 noncommercial residential pier use.
 
11      The legislature has determined that the state has an
 
12 interest in regulating submerged lands in order to protect and
 
13 preserve the environment and ecosystem which exists there.
 
14      The legislature has been apprised that there are more than
 
15 two hundred piers on state submerged land in the Kaneohe and
 
16 Kahaluu area of which only approximately twenty are paying rent
 
17 to the state.
 
18      The Department of Land and Natural Resources has recently
 
19 adopted a plan that will apply only to pier owners in the Kaneohe
 
20 and Kahaluu area.  This plan is the latest in a series of
 
21 regulations adopted by the DLNR, its predecessor department, and
 
22 other state departments and agencies since October 1, 1964, to
 
23 regulate piers.  (The adoption of a plan limited to a defined
 

 
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 1 geographical area raises the possibility that a different set of
 
 2 rules or none at all may be adopted in other areas of the state.
 
 3 The department's actions, moreover, may result in the
 
 4 establishment of precedents that may later complicate the
 
 5 implementation of statewide policies affecting submerged lands.)
 
 6      The legislature finds that unless it enacts this measure,
 
 7 irreparable harm will be done to the piers in the Kaneohe and
 
 8 Kahaluu area that will result in further undermining the
 
 9 confidence of the people in the government.
 
10      The legislature finds that many piers in the affected area
 
11 were built prior to October 1, 1964, the effective date of the
 
12 first regulatory measures concerning piers.  Other piers built
 
13 after this date were built in compliance with other regulations
 
14 that were in effect at the time of construction.  Piers
 
15 constructed before October 1, 1964, and those built subsequent to
 
16 that date in compliance with regulations adopted after that date
 
17 are nonconforming uses pursuant to section 183C-5, Hawaii Revised
 
18 Statutes, and the legislature has previously stated that no rules
 
19 may be adopted which shall prohibit the continued use of such
 
20 structures.  Some piers, however, were built without complying
 
21 with any permitting requirements whether at the time of
 
22 construction or any time thereafter.  These piers are therefore
 
23 illegal.  The legislature finds, however, that official records
 

 
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 1 that would help to identify nonconforming piers and illegal piers
 
 2 are scattered among various state and federal departments and
 
 3 agencies or have been destroyed.  The legislature therefore finds
 
 4 that it would be in the public interest to classify all existing
 
 5 piers as nonconforming in order to simplify and expedite the
 
 6 intent of this bill.
 
 7      The legislature finds that pier owners have overwhelmingly
 
 8 expressed their desire to pay a reasonable amount to the state
 
 9 for their continued use of submerged lands.  The legislative
 
10 auditor has previously found that the cost to account for monthly
 
11 rent for piers have exceeded the revenues realized to the state.
 
12      The legislature finds that the state has already sold more
 
13 than 50 easements for the use of submerged lands, many of which
 
14 are for piers in the same area.  The legislature finds that the
 
15 issuance of easements for a period of not less than 55 years (see
 
16 section 171-36(a)(2), Hawaii Revised Statutes) would result in a
 
17 substantial return to the state while significantly reducing the
 
18 accounting costs to the state (see sections 171-13 and 190D-21,
 
19 Hawaii Revised Statutes).
 
20      Lessees of state land are required pursuant to Chapter 171,
 
21 Hawaii Revised Statutes, to indemnify the state against
 
22 liability.  Section 171-36(a)(9), Hawaii Revised Statutes, as now
 
23 constructed, requires lessees to open their piers to the public
 

 
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 1 at large.  This provision creates a problem for pier lessees
 
 2 because it makes obtaining liability insurance prohibitively
 
 3 expensive and difficult to obtain and moreover interferes with
 
 4 pier owners' ability to maintain their structures and implied
 
 5 right to quiet enjoyment.  The legislature therefore finds that
 
 6 the deletion of this requirement as to noncommercial residential
 
 7 piers is in the best interests of the state.
 
 8      Section 171-36(a)(5), Hawaii Revised Statutes currently
 
 9 provides that leases of public lands may not be transferred
 
10 except by devise, bequest, or intestate succession.  This
 
11 provision would impose a cloud of uncertainty for adjoining
 
12 landowners that possess easements for piers having to sell their
 
13 property.  The legislature finds that it would be in the best
 
14 interests of the lessees and the state to allow the transfer of
 
15 noncommercial easements for residential piers when the adjoining
 
16 land is sold.
 
17      SECTION 3.  The DLNR is directed to develop a plan
 
18 establishing a fair and equitable method for valuing the sale of
 
19 long-term easements to use submerged lands for noncommercial
 
20 residential piers based on the market value of the submerged
 
21 lands used (see section 171-17, Hawaii Revised Statutes).
 
22      SECTION 4.  The legislature finds it desirable to encourage
 
23 good citizenship and the payment of rent to the state for the use
 

 
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 1 of its lands.  Therefore, the legislature directs the DLNR to
 
 2 also include in its plan appropriate remedies for those pier
 
 3 owners who are currently paying rent to the state.  Remedies may
 
 4 include offset of future rent or reduction on the sale price of
 
 5 easements sold to these individuals.
 
 6      SECTION 5.  Until such time as the plan is submitted and
 
 7 approved by the board of land and natural resources, all pier
 
 8 rentals and permits shall be tolled.
 
 9      SECTION 6.  Chapter 171, Hawaii Revised Statutes, is amended
 
10 by adding a new section to be appropriately designated and to
 
11 read as follows:
 
12      "171-    Kaneohe and Kahaluu Bays environmental protection
 
13 fund.  (a)  There is created in the department a special fund to
 
14 be designated as the "Kaneohe and Kahaluu Bays environmental
 
15 protection fund."  Subject to the Hawaiian Homes Commission Act
 
16 of 1920, as amended, and section 5(f) of the Admissions Act of
 
17 1959, all proceeds of sale of grants of easements on submerged
 
18 public lands in and around Kaneohe and Kahaluu Bay areas,
 
19 including interest on deferred payments shall be used only as
 
20 authorized by the legislature and with the concurrence of the
 
21 Kaneohe Bay regional council for the following purposes in and
 
22 around the Kaneohe and Kahaluu Bay area:
 
23      (1)  To clean up environmental hazards and pollution that
 

 
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 1           may occur;
 
 2      (2)  To take preventative action against sources or causes
 
 3           of pollution;
 
 4      (3)  To protect the fisheries;
 
 5      (4)  To create programs which shall promote environmental
 
 6           awareness;
 
 7      (5)  To reimburse the general fund of the State for advances
 
 8           made that are required to be reimbursed from the
 
 9           proceeds derived from sales of grants of easements on
 
10           submerged public lands in and around Kaneohe and
 
11           Kahaluu Bay areas;
 
12      (6)  For the payment of all appraisal fees; provided that
 
13           all fees reimbursed to the board shall be deposited in
 
14           the fund;
 
15      (7)  For the payment of publication notices as required
 
16           under this chapter; provided that all or a portion of
 
17           the expenditures may be charged to the purchaser or
 
18           lessee of public lands or any interest therein under
 
19           rules adopted by the board; and
 
20      (8)  For the reimbursement or refund of overpayments made by
 
21           lessees and purchasers of public lands when required.
 
22      (b)  All unexpended and unencumbered moneys remaining on
 
23 balance with the fund at the close of each fiscal year shall be
 

 
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 1 carried over to the next year and under no circumstances shall
 
 2 lapse to the credit of the state general fund."
 
 3      SECTION 7.  Section 171-36, Hawaii Revised Statutes, is
 
 4 amended by amending subsection (a) to read as follows:
 
 5      171-36  Lease restrictions; generally.(a)  Except as
 
 6 otherwise provided, the following restrictions shall apply to all
 
 7 easements and leases:
 
 8      (1)  Options for renewal of terms are prohibited;
 
 9      (2)  No grant of easement or lease shall be for a longer
 
10           term than sixty-five years, except in the case of a
 
11           residential leasehold which may provide for an initial
 
12           term of fifty-five years with the privilege of
 
13           extension to meet the requirements of the Federal
 
14           Housing Administration, Federal National Mortgage
 
15           Association, Federal Land Bank of Berkeley, Federal
 
16           Intermediate Credit Bank of Berkeley, Berkeley Bank for
 
17           Cooperatives, or Veterans Administration requirements;
 
18           provided that the aggregate of the initial term and
 
19           extension shall in no event exceed seventy-five years;
 
20      (3)  No lease shall be made for any land under a lease which
 
21           has more than two years to run;
 
22      (4)  No lease shall be made to any person who is in arrears
 
23           in the payment of taxes, rents, or other obligations
 

 
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 1           owing the State or any county;
 
 2      (5)  No lease shall be transferable or assignable, except by
 
 3           devise, bequest, or intestate succession; provided that
 
 4           with the approval of the board of land and natural
 
 5           resources, the assignment and transfer of a lease or
 
 6           unit thereof may be made if:
 
 7           (A)  It contains the personal residence of the lessee;
 
 8           (B)  In the case of commercial, industrial, hotel,
 
 9                resort, apartment, and other business uses, the
 
10                lessee was required to put in substantial building
 
11                improvements;
 
12           (C)  The lessee becomes mentally or physically
 
13                disabled;
 
14           (D)  Extreme economic hardship is demonstrated to the
 
15                satisfaction of the board;
 
16           (E)  It is to the corporate successor of the lessee; or
 
17           (F)  In the case of agricultural uses, the assignee
 
18                meets the qualifications of a bona fide individual
 
19                farmer or a nonindividual farm concern pursuant to
 
20                section 171-14.5, in addition to or
 
21                notwithstanding the other conditions of this
 
22                paragraph;
 
23           provided further that prior to the approval of any
 

 
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 1           assignment of lease, the board shall have the right to
 
 2           review and approve the consideration to be paid by the
 
 3           assignee and may condition its consent to the
 
 4           assignment of the lease on payment by the lessee of a
 
 5           premium based on the amount by which the consideration
 
 6           for the assignment, whether by cash, credit, or
 
 7           otherwise, exceeds the depreciated cost of improvements
 
 8           and trade fixtures being transferred to the assignee;
 
 9           provided further that with respect to state
 
10           agricultural leases, in the event of foreclosure or
 
11           sale, the premium, if any, shall be assessed only after
 
12           the encumbrances of record and any other advances made
 
13           by the holder of a security interest are paid;
 
14      (6)  The lessee shall not sublet the whole or any part of
 
15           the demised premises except with the approval of the
 
16           board; provided that prior to the approval, the board
 
17           shall have the right to review and approve the rent to
 
18           be charged to the sublessee; provided further that in
 
19           the case where the lessee is required to pay rent based
 
20           on a percentage of its gross receipts, the receipts of
 
21           the sublessee shall be included as part of the lessee's
 
22           gross receipts; provided further that the board shall
 
23           have the right to review and, if necessary, revise the
 

 
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 1           rent of the demised premises based upon the rental rate
 
 2           charged to the sublessee including the percentage rent,
 
 3           if applicable, and provided that the rent may not be
 
 4           revised downward;
 
 5      (7)  The lease shall be for a specific use or uses and shall
 
 6           not include waste lands, unless it is impractical to
 
 7           provide otherwise; and
 
 8      (8)  Mineral and metallic rights and surface and ground
 
 9           water shall be reserved to the State[; and
 
10      (9)  No lease of public lands, including submerged lands,
 
11           nor any extension of any such lease, shall be issued by
 
12           the State to any person to construct, use, or maintain
 
13           a sunbathing or swimming pier or to use the lands for
 
14           such purposes, unless such lease, or any extension
 
15           thereof, contains provisions permitting the general
 
16           public to use the pier facilities on the public lands
 
17           and requiring that a sign or signs be placed on the
 
18           pier, clearly visible to the public, which indicates
 
19           the public's right to the use of the pier.  The board,
 
20           at the earliest practicable date, and where legally
 
21           possible, shall cause all existing leases to be amended
 
22           to conform to this paragraph.  The term "lease", for
 
23           the purposes of this paragraph, includes month-to-month
 
24           rental agreements and similar tenancies]."
 

 
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 1      SECTION 8.  Section 171-53, Hawaii Revised Statutes, is
 
 2 amended to read as follows:
 
 3      "171-53  Reclamation and disposition of submerged or
 
 4 reclaimed public land.(a)  Any submerged public land or land
 
 5 beneath tidal waters shall not hereafter be reclaimed by private
 
 6 abutting owners, except as hereinafter provided.
 
 7      (b)  As to presently reclaimed land, the board of land and
 
 8 natural resources, after finding that its disposition is not
 
 9 prejudicial to the best interest of the State, community or area
 
10 in which such reclaimed land is located and after giving public
 
11 notice in accordance with section 171-16(d) of its intention to
 
12 dispose, may dispose of it, without recourse to public auction,
 
13 to the abutting owner, by sale or lease; provided that if the
 
14 reclaimed land has been filled in or made with the prior approval
 
15 of government authorities, and not otherwise filled in or made
 
16 contrary to the public interest, it may be disposed of at fair
 
17 market value or fair market rental of the submerged public land,
 
18 but if the reclaimed land has been filled or made otherwise, it
 
19 shall be disposed of at the fair market value or fair market
 
20 rental of the reclaimed land.
 
21      (c)  The board, with the prior approval of the governor and
 
22 the prior authorization of the legislature by concurrent
 
23 resolution, may lease submerged lands and lands beneath tidal
 

 
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 1 waters under the terms, conditions, and restrictions provided in
 
 2 this chapter; provided that the approval of the governor and
 
 3 authorization of the legislature shall not be required for any
 
 4 grant of easement or lease of submerged lands or lands beneath
 
 5 tidal waters used for noncommercial residential piers, docks,
 
 6 moorings, cables, or pipelines; provided further that this
 
 7 exemption shall not apply to easements for cables used for
 
 8 interisland electrical transmission or slurry pipelines used for
 
 9 transportive materials, mined at sea, or waste products from the
 
10 processing of the same.
 
11      The lease shall provide that the lands shall be reclaimed at
 
12 the expense of the lessee.  Title to the reclaimed lands shall
 
13 remain in the State.
 
14      (d)  Whenever in connection with reclaimed lands or the
 
15 reclamation of submerged lands or lands beneath tidal waters by
 
16 authority of law, the board deems it advantageous to the State in
 
17 order to settle the rights (littoral or otherwise), if any, of an
 
18 abutting owner, to create public beaches, or to consolidate the
 
19 holdings of public lands in the vicinity or provide public ways
 
20 or access to the public lands, it may, with the prior approval of
 
21 the governor, sell, lease, or transfer by way of an exchange,
 
22 without recourse to public auction but subject to the limitations
 
23 contained in section 171-50 and to the other provisions of this
 

 
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 1 chapter, lands having the status of public lands." 
 
 2      SECTION 9.  Section 190D-21, Hawaii Revised Statutes, is
 
 3 amended to read as follows:
 
 4      "[[]190D-21[]]  Leasing of state marine waters and
 
 5 submerged lands for private uses.(a)  The board may grant
 
 6 easements or lease state marine waters and submerged lands for
 
 7 marine activities upon compliance with section 171-53 and with
 
 8 the concurrence of the director of transportation.  Leases may be
 
 9 issued only for marine activities which are allowed pursuant to
 
10 an approved conservation district use application.  The board
 
11 shall make a determination that each lease is a commercial or
 
12 noncommercial lease.
 
13      (b)  The board shall not grant easements or lease state
 
14 marine waters or submerged lands when existing programs of the
 
15 department, such as the marine life conservation district
 
16 program, shoreline fisheries management area program, or the
 
17 natural area reserve program will suffer adverse impact as a
 
18 consequence of the proposed activities; provided further that no
 
19 lease shall be awarded within state marine waters designated
 
20 necessary for national defense purposes, as determined by the
 
21 department in consultation with the appropriate federal agencies.
 
22      (c)  The board shall not grant easements or lease state
 
23 marine waters or submerged lands unless the board finds that a
 

 
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 1 lease for the proposed activity is clearly in the public interest
 
 2 upon consideration of the overall economic, social, and
 
 3 environmental impacts and consistent with other state policy
 
 4 goals and objectives.
 
 5      (d)  The board shall not grant easements or lease state
 
 6 marine waters or submerged lands unless the board finds that the
 
 7 applicant for a lease has complied with applicable federal,
 
 8 state, and county statutes, ordinances, and rules.
 
 9      (e)  The board may require any person who has obtained
 
10 approval of a conservation district use application for marine
 
11 activities or the operation of an OTEC facility in state marine
 
12 waters or submerged lands to enter into a lease for the conduct
 
13 of those activities.
 
14      (f)  The board shall not approve an application, if in so
 
15 doing it would fail to protect the public's use and enjoyment of
 
16 the reefs in the state marine waters." 
 
17      SECTION 10.  Section 190D-22, Hawaii Revised Statutes, is
 
18 amended to read as follows:
 
19      "[[]190D-22[]]  Leasing procedure.(a)  Any person who
 
20 wants to obtain [a] an easement or  lease for marine activities
 
21 in state marine waters or submerged lands shall request a lease
 
22 from the board at the time of filing a conservation district use
 
23 application.
 

 
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 1      (b)  Upon approval of a conservation district use
 
 2 application, the board may either:
 
 3      (1)  Negotiate with and grant a lease to the applicant; [or]
 
 4      (2)  Offer to grant the applicant an easement at a priced
 
 5           based upon the appraised valuation of the submerged
 
 6           lands over which the easement is to be granted; or
 
 7 [(2)](3)  Conduct a public auction and grant the lease to the
 
 8           highest qualified bidder.
 
 9      Public auctions shall be conducted in accordance with
 
10 chapter 171.  If an auction is held and the applicant who has
 
11 gone through the conservation district use application is not the
 
12 highest qualified bidder, the board shall require the highest
 
13 qualified bidder to indemnify the applicant for all legitimate
 
14 costs incurred by the applicant to obtain approval of the
 
15 conservation district use application.
 
16      (c)  The board shall not revoke or modify its approval of a
 
17 conservation district use application in such a way as to
 
18 invalidate, impair, limit, or affect, directly or indirectly, in
 
19 whole or in part, the rights of a lessee as set forth in the
 
20 lease granted to the lessee pursuant to this chapter."
 
21      SECTION 11.  Section 190D-23, Hawaii Revised Statutes, is
 
22 amended to read as follows:
 
23      "[[]190D-23[]]  [Lease] Easement and lease provisions.(a)
 

 
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 1 [Leases] Easements or leases issued by the board shall be drawn
 
 2 up in accordance with the following requirements, in addition to
 
 3 any others determined by the board:                           (1)
 
 4      Each easement or lease shall specify the term of the
 
 5 easement or lease and the nature of the exclusive use of the area
 
 6 being granted.
 
 7      (2)  Each easement or lease shall specify the marine
 
 8           activities or other resources which may be cultivated,
 
 9           produced, harvested, removed, or used pursuant to the
 
10           easement or lease.
 
11      (3)  Each lease shall specify an annual rent set by the
 
12           board for the leased marine waters or submerged lands.
 
13           The basic rental charged in a commercial easement or
 
14           lease may be supplemented by royalty payments.  No
 
15           royalty shall be charged in a noncommercial easement or
 
16           lease.
 
17      (4)  [Leases] Easements or leases may specify that failure
 
18           of the lessee to perform substantially the activities
 
19           for which the easement or lease was granted shall
 
20           constitute grounds for revocation of the easement or
 
21           lease and forfeiture to the State of all structures
 
22           and, in the case of mariculture activities, all plants
 
23           or animals cultivated, in and upon the leased marine
 

 
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 1           waters and submerged lands.
 
 2      (5)  Each lease shall require that the lessee execute a bond
 
 3           conditioned upon the substantial performance of the
 
 4           activities described in the lease.  The amount of the
 
 5           bond so executed shall be appropriate to the size,
 
 6           scale, and risk of the activity for which the lease is
 
 7           granted, and shall be sufficient to protect the public
 
 8           interest in the removal of all structures and, in the
 
 9           case of mariculture activities, all marine plants or
 
10           animals cultivated, in and upon the leased marine
 
11           waters and submerged lands, if the lease is forfeited
 
12           for nonperformance or the board requires the removal or
 
13           eradication of marine plants or animals pursuant to
 
14           paragraph (11).
 
15      (6)  Each lease shall specify that if a lessee abandons [a]
 
16           an easement or leased area, the board may order removal
 
17           or sale at public auction of all improvements, assets,
 
18           marine plants or animals, and equipment remaining in
 
19           and upon the easement or leased area, and shall
 
20           transmit to the state general fund the entire amount
 
21           received from any public auction and any proceeds
 
22           received from the lessee's performance bond.
 
23           Alternatively, the board may permit the use of the
 

 
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 1           improvements, assets, marine plants or animals, and
 
 2           equipment for purposes which benefit the general
 
 3           public.
 
 4      (7)  Each lease for mariculture shall specify that the
 
 5           marine plants or animals described in the lease to be
 
 6           cultivated and contained within the leased area are the
 
 7           exclusive harvest of the lessee; provided that any
 
 8           marine plant or animal which escapes from the leased
 
 9           area and is not clearly identifiable as the property of
 
10           the lessee, shall become common property and may be
 
11           taken or caught by any person, subject to the fishing
 
12           laws of the State, without violating the rights of the
 
13           lessee.
 
14      (8)  Each lease for mariculture shall specify that the
 
15           lessee is responsible for the removal of any cultivated
 
16           marine plants or animals found outside the leased area
 
17           but within state marine waters or submerged lands if
 
18           removal is required to protect the environment or
 
19           public health and safety, and removal is demanded by
 
20           the board; that the lessee is solely responsible for
 
21           all costs of removal of such marine plants or animals;
 
22           and that if action must be taken by the department to
 
23           eradicate escaped marine plants or animals, all costs
 

 
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 1           of eradication shall be borne by the lessee; provided
 
 2           that the costs borne by the lessee shall be no greater
 
 3           than the amount of the bond required under paragraph
 
 4           (5).
 
 5      (9)  Leases may specify that the lessee shall construct and
 
 6           maintain gates, openings, or lanes at reasonable
 
 7           distances from one another throughout a leased area
 
 8           which includes surface waters and in which any type of
 
 9           enclosure is an obstacle to free navigation, unless
 
10           public transit in or through the enclosed waters will
 
11           cause undue interference with the operation being
 
12           conducted by the lessee within the leased area.
 
13     (10)  Leases may require, where necessary, that all lessees
 
14           mark off the areas under lease by appropriate ranges,
 
15           monuments, stakes, buoys, or fences, placed so that
 
16           they do not interfere unnecessarily with navigation and
 
17           other traditional uses of the water surface; that all
 
18           lessees identify the area under lease and the names of
 
19           the lessees on signs appropriately placed pursuant to
 
20           rules of the board; and that all limitations upon the
 
21           use by the public of an ocean area under lease shall be
 
22           clearly posted by the lessee pursuant to rules
 
23           established by the board.
 

 
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 1     (11)  [Leases] Easements or leases shall specify that if the
 
 2           chairperson finds or has reasonable cause to believe
 
 3           that an activity conducted by the lessee in or upon the
 
 4           area described in the lease is causing an immediate
 
 5           danger to human or marine life or the environment of
 
 6           the state marine waters or submerged lands, the
 
 7           chairperson may direct a temporary or permanent
 
 8           suspension of commercial or research activities in the
 
 9           affected area.  The chairperson shall then notify the
 
10           board.  The board shall immediately order the lessee or
 
11           lessees affected by such notice to show cause why their
 
12           activities should not be terminated, or why any
 
13           structures, cultivated marine plants or animals, or
 
14           equipment should not be removed from state marine
 
15           waters or submerged lands.  The board shall proceed to
 
16           hold a public hearing and issue its order with respect
 
17           to such hearing within a reasonable period.  In its
 
18           order following such hearing the board may direct a
 
19           temporary or permanent suspension of commercial or
 
20           research activities in the affected area, removal of
 
21           equipment or cultivated marine plants or animals, or
 
22           such other measures as shall be deemed necessary for
 
23           protection of human or marine life and environment of
 

 
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 1           state marine waters and submerged lands, including
 
 2           forfeiture to and destruction by the State of any
 
 3           marine plant or animal species.
 
 4     (12)  Each lease shall specify that the lease may be assigned
 
 5           in whole or in part, or amended, only if the board
 
 6           determines that such assignment or amendment is in the
 
 7           public interest and meets the provisions of this
 
 8           chapter.  The board may consent to the mortgage of a
 
 9           lease pursuant to section 171-22.
 
10      (13) Each grant of easement shall specify that the easement
 
11           may be assigned in the event that the adjoining
 
12           dominant estate shall be transferred or sold.
 
13 [(13)](14)Each grant of easement or lease shall specify that the 
 
14           easement or lease may be revoked by the board for
 
15           violation of any easement or lease provision.  The
 
16           board shall deliver a written notice of the breach or
 
17           default of any easement or lease agreement by
 
18           registered or certified mail to the party in default
 
19           and to each holder of record having any security
 
20           interest in the state marine waters and submerged lands
 
21           covered by or subject to the easement or lease, making
 
22           demand upon the party to cure or remedy the breach or
 
23           default within sixty days from the date of receipt of
 

 
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                                     H.B. NO.1735       
                                                        
                                                        

 
 1           the notice.  Upon failure of the party to cure or
 
 2           remedy the breach or default within sixty days from the
 
 3           date of receipt of the notice, or within such
 
 4           additional period the board may allow for good cause,
 
 5           the board may revoke the lease.
 
 6      (b)  The chairperson or chairperson's authorized agents
 
 7 shall have the authority to enter and inspect any and all areas
 
 8 covered by an easement or leased by the board for the purpose of
 
 9 determining compliance with the terms and provisions of any such
 
10 lease."
 
11      SECTION 12.  Statutory material to be repealed is bracketed.
 
12 New statutory material is underscored.
 
13      SECTION 13.  This Act shall take effect upon its approval.
 
14 
 
15                           INTRODUCED BY:_________________________