Report Title:

Submerged Lands; Lands Beneath Tidal Waters; Leasing; DOT

Description:

Allows the director of transportation, with the approval of the governor, to lease submerged lands and lands beneath tidal waters under the custody of the department of transportation for marine activities.

HOUSE OF REPRESENTATIVES

H.B. NO.

48

TWENTY-SECOND LEGISLATURE, 2003

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

relating to the leasing of submerged lands.

 

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

Part I

SECTION 1. Chapter 266, Hawaii Revised Statutes, is amended by adding a new part to be appropriately designated and to read as follows:

"PART    . LEASING OF SUBMERGED LANDS UNDER THE

CUSTODY OF THE DEPARTMENT OF TRANSPORTATION

266-A Leasing of submerged lands and lands beneath tidal waters under the custody of the department of transportation. (a) The director of transportation, with the approval of the governor, may lease submerged lands and lands beneath tidal waters under the custody of the department of transportation. Leases may be issued pursuant to this part:

(1) For marine activities allowed under chapters 171, 182, 183C, and 190D;

(2) For marine activities allowed by rule, adopted by the director, and designed for profit; and

(3) For marine activities allowed by rule, adopted by the director, and not designed for profit.

(b) The director of transportation shall not lease submerged lands and lands beneath tidal waters when existing programs of the department of land and natural resources, such as the marine life conservation district program, shoreline fisheries management area program, or the natural area reserve program, will suffer adverse impacts as a consequence of the proposed marine activities. No lease shall be awarded for submerged lands and lands beneath tidal waters designated as being necessary for national defense purposes, as determined by the director in consultation with the appropriate federal agencies.

(c) The director of transportation shall not lease submerged lands and lands beneath tidal waters unless the director finds that a lease for the proposed activity, after detailed consideration of the present uses, is clearly in the public interest upon consideration of the overall economic, social, and environmental impacts and consistent with other state policy goals and objectives.

(d) The director of transportation shall not lease submerged lands and lands beneath tidal waters unless the director finds that the applicant for a lease has complied with applicable federal, state, and county statutes, ordinances, and rules.

(e) The director of transportation may require any person who has obtained federal, state, or county approvals to conduct marine activities on submerged lands and lands beneath tidal waters under the custody of the department of transportation to enter into a lease for the conduct of those activities.

(f) The director of transportation shall not award a lease to conduct marine activities on submerged lands and lands beneath tidal waters, if in so doing it would fail to protect the public's use and enjoyment of the reefs in state marine waters.

266-B Leasing procedure. (a) A person who wants to obtain a lease to conduct marine activities on submerged lands and lands beneath tidal waters under the custody of the department of transportation shall request a lease from the director of transportation at the time the person applies for federal, state, or county approvals to conduct these activities.

(b) Upon receipt of a completed lease application and with the approval of the governor, the director of transportation shall:

(1) Negotiate with and grant a lease to the applicant; or

(2) Conduct a public auction and grant the lease to the highest qualified bidder.

Public auctions shall be conducted by the director of transportation in accordance with procedures described in chapter 171. If an auction is held and the applicant submitting a completed lease application is not the highest qualified bidder, the director shall require the highest qualified bidder to indemnify the applicant for all legitimate costs incurred in the preparation of any environmental assessment or environmental impact statement included in the lease application pursuant to chapter 343. In establishing and following internal procedures for lease applications, the department of transportation shall attempt to minimize costs to those applicants submitting completed applications.

(c) The director of transportation shall not revoke or modify the director's approval of a lease application in such a way as to invalidate, impair, limit, or affect, directly or indirectly, in whole or in part, the rights of a lessee as set forth in the lease granted to the lessee pursuant to this part.

266-C Lease provisions. (a) Leases issued by the director of transportation shall be drawn up in accordance with the following requirements, in addition to any other requirements determined by rules:

(1) Each lease shall specify the term of the lease and the nature of the exclusive use of the area being granted;

(2) Each lease shall specify the marine activities or other resources that may be cultivated, produced, harvested, removed, or used pursuant to the lease;

(3) Each lease shall specify an annual rent set by the director for the leased area. The basic rental charged in a lease for marine activities designed for profit may be supplemented by royalty payments. No royalty shall be charged in a lease for marine activities not designed for profit;

(4) Leases may specify that failure of the lessee to perform substantially the activities for which the lease was granted shall constitute grounds for revocation of the lease and forfeiture to the State of all structures and, in the case of mariculture activities, all plants or animals cultivated, in and upon the leased area;

(5) Each lease shall require that the lessee execute a bond conditioned upon the substantial performance of the activities described in the lease. The amount of the bond so executed shall be appropriate to the size, scale, and risk of the activity for which the lease is granted, and shall be sufficient to protect the public interest in the removal of all structures and, in the case of mariculture activities, all marine plants or animals cultivated, as well as to restore or remediate affected areas, including leased areas, to the satisfaction of the department of transportation, if the lease is forfeited for nonperformance or the director requires the removal or eradication of marine plants or animals pursuant to paragraph (11);

(6) Each lease shall specify that if a lessee abandons a leased area, the director may order the removal or sale at public auction of all improvements, assets, marine plants or animals, and equipment remaining in and upon affected areas, including leased areas, and shall transmit to the state general fund the entire amount received from any public auction and any proceeds received from the lessee's performance bond. Alternatively, the director may permit the use of the improvements, assets, marine plants or animals, and equipment for purposes that benefit the general public;

(7) Each lease for mariculture shall specify that the marine plants or animals described in the lease to be cultivated and contained within the leased area are the exclusive harvest of the lessee; provided that any marine plant or animal that escapes from the leased area and is not clearly identifiable as the property of the lessee, shall become common property and may be taken or caught by any person, subject to the fishing laws of the State, without violating the rights of the lessee;

(8) Each lease for mariculture shall specify that:

(A) The lessee is responsible for the removal of any cultivated marine plants or animals found outside the leased area but within state marine waters if removal is required to protect the environment or public health and safety, and removal is demanded by the director;

(B) The lessee is solely responsible for all costs of removal of these marine plants or animals; and

(C) If action must be taken by the State to eradicate escaped marine plants or animals, all costs of eradication shall be borne by the lessee; provided that the costs borne by the lessee shall be no greater than the amount of the bond required under paragraph (5);

(9) Leases may specify that the lessee shall construct and maintain gates, openings, or lanes at reasonable distances from one another throughout a leased area, which includes surface waters and in which any type of enclosure is an obstacle to free navigation, unless public transit in or through the enclosed area will cause undue interference with the operation being conducted by the lessee within the leased area;

(10) Leases may require, where necessary, that:

(A) All lessees mark off the areas under lease by appropriate ranges, monuments, stakes, buoys, fences, or any other devices placed so that they do not interfere unnecessarily with navigation and other traditional uses of the water surface;

(B) All lessees identify the area under lease and the names of the lessees on signs appropriately placed pursuant to specifications established by the director; and

(C) All limitations upon the use by the public of an area under lease shall be clearly posted by the lessee pursuant to specifications established by the department;

(11) Leases shall specify that if the director finds or has reasonable cause to believe that an activity conducted by the lessee in or upon the area described in the lease is causing an immediate danger to human or marine life or the environment of the state marine waters, the director may direct a temporary or permanent suspension of commercial or research activities in the affected area. The director shall immediately order the lessees affected by the notice to show cause why their activities should not be terminated, or why any structures, cultivated marine plants or animals, or equipment should not be removed from state marine waters. The director shall proceed to hold a public hearing and issue the director's order with respect to the hearing within a reasonable period. In the director's order following the hearing, the director may direct a temporary or permanent suspension of commercial or research activities in the affected area, removal of equipment or cultivated marine plants or animals, or such other measures as shall be deemed necessary for protection of human or marine life and environment of state marine waters, including forfeiture to and destruction by the State of any marine plant or animal species;

(12) Each lease shall specify that the lease may be assigned in whole or in part, or amended, only if the director determines that the assignment or amendment is in the public interest and meets the requirements of this part and consents to the assignments. The director may consent to the mortgage of a lease;

(13) Each lease shall specify that the lease may be revoked by the director for violation of any lease provision. The director shall deliver a written notice of the breach or default of any lease agreement by registered or certified mail to the party in default and to each holder of record having any security interest in the lands covered by or subject to the lease, making demand upon the party to cure or remedy the breach or default within sixty days from the date of receipt of the notice. Upon failure of the party to cure or remedy the breach or default within sixty days from the date of receipt of the notice, or within such additional period as the director may allow for good cause, the director may revoke the lease; and

(14) Each lease shall contain a statement describing the degree of exclusivity or access to the site by the public that will be based on an analysis of the user listing and descriptions provided in the application, and comments made by the public and in consideration of, but not limited to the following: compatibility of the operation with existing uses, perceived liability to the lessee and the public, and perceived risk to the lessee's investment.

(b) The director or director's authorized agents may enter and inspect any and all areas leased by the director pursuant to this part for the purpose of determining compliance with the terms and provisions of any such lease.

266-D Rules. The director of transportation may adopt such rules as are necessary and appropriate to carry out the purposes of this part. The adoption of these rules shall be in accordance with chapter 91.

266-E Revenues. The revenues obtained from the leasing of submerged lands and lands beneath tidal waters under the custody of the department of transportation pursuant to this part shall be deposited into the state general fund.

266-F Penalties. Any person who conducts any activities prohibited by a lease granted by the director of transportation, or who conducts these activities on submerged lands and lands beneath tidal waters without having obtained a lease from the director, shall be fined not more than $10,000 for each separate offense. Each day of violation shall constitute a separate offense. Any action taken to impose or collect the penalty provided for in this section shall be considered a civil action."

Part II

SECTION 2. Chapter 171, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"171-   Leasing of submerged lands under the custody of the department of transportation. This chapter shall not apply to the leasing of submerged lands and lands beneath tidal waters under the custody of the department of transportation. In the event of a conflict between chapter 266 and this chapter, chapter 266 shall control."

SECTION 3. Chapter 182, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"182-   Leasing of submerged lands under the custody of the department of transportation. This chapter shall not apply to the leasing of submerged lands and lands beneath tidal waters under the custody of the department of transportation. In the event of a conflict between chapter 266 and this chapter, chapter 266 shall control."

SECTION 4. Chapter 183C, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"183C-   Leasing of submerged lands under the custody of the department of transportation. This chapter shall not apply to the leasing of submerged lands and lands beneath tidal waters under the custody of the department of transportation. In the event of a conflict between chapter 266 and this chapter, chapter 266 shall control."

SECTION 5. Chapter 190D, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"190D-   Leasing of submerged lands under the custody of the department of transportation. This chapter shall not apply to the leasing of submerged lands and lands beneath tidal waters under the custody of the department of transportation. In the event of a conflict between chapter 266 and this chapter, chapter 266 shall control."

Part III

SECTION 6. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun, before its effective date.

SECTION 7. If any provision of this Act, or the application thereof to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of the Act, which can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

SECTION 8. In codifying the new sections added by section 1 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

SECTION 9. New statutory material is underscored.

SECTION 10. This Act shall take effect upon its approval.

INTRODUCED BY:

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