S.C.R. NO.









requesting an evaluation of the problems of leases on public lands due to expire.


WHEREAS, in 2000, the legislature approved Act 55, which authorizes the Board of Land and Natural Resources to issue new leases to existing lessees of the Banyan Drive resort area in Hilo, as an integral part of preserving and enhancing the tourism base of east Hawaii; and

WHEREAS, with the majority of the leases expiring in 2015, the Banyan Drive lessees were faced with the uncertainty of continued tenancy, and as the end of the lease term nears, lessees have fewer incentives to make major investments in improvements to their infrastructure and ensure the long-term maintenance of their facilities; and

WHEREAS, under Act 55, one group of lessees is exempted from the overall public policy of making public lands available to the highest qualified bidder at auctions, based on the fact that the State owns virtually the entire Banyan Drive resort area, which represents approximately eighty per cent of total overnight accommodations in east Hawaii; and

WHEREAS, Banyan Drive is an integrated resort area critical to the success of the tourism market in east Hawaii and to the continuance of approximately five hundred direct resort jobs, as well as many other jobs indirectly affected by this resort area; and

WHEREAS, the legislature finds that while an exception is justified for the Banyan Drive resorts, regarding the public policy of making public lands available to the highest bidder, the legislature limited Act 55 to this specific geographic region and the Act will be repealed on July 1, 2005; and

WHEREAS, concerns have been raised that there may be a need to extend the statute beyond its current lapse date of July 1, 2005, and there may be other state leases of commercial and agricultural properties that are already experiencing, or soon will experience, problems similar to those of the hotels along Banyan Drive; now, therefore,

BE IT RESOLVED by the Senate of the Twenty-First Legislature of the State of Hawaii, Regular Session of 2002, the House of Representatives concurring, that the Department of Land and Natural Resources is requested to evaluate the problems of leases that soon will expire, with consideration given to the fact that in the private sector such leases routinely would be renegotiated and extended, and make recommendations regarding changes in present state policy that would fairly and equitably meet the needs of lessees while protecting the State's interests; and

BE IT FURTHER RESOLVED that the department shall submit its recommendations no later than twenty days prior to the Regular Session of 2003; and

BE IT FURTHER RESOLVED that a certified copy of this Concurrent Resolution be transmitted to the Chairperson of the Board of Land and Natural Resources.






Report Title:

Public Lands Leasing; DLNR to evaluate and recommend changes.