HOUSE OF REPRESENTATIVES

H.B. NO.

488

THIRTY-SECOND LEGISLATURE, 2023

H.D. 1

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

RELATING TO AQUACULTURE.

 

 

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

 


SECTION 1. The purpose of this Act is to promote economic development in the State by establishing an aquacultural area lease program within the department of agriculture for the purpose of identifying state facilities, state lands, and state marine waters that are suitable for commercial aquaculture.

SECTION 2. Chapter 141, Hawaii Revised Statutes, is amended by adding a new section to part IV to be appropriately designated and to read as follows:

"141-    Aquacultural area lease program. (a) There is established within the department an aquacultural area lease program for the purpose of:

(1) Identifying aquacultural areas comprising state facilities, state lands, state marine waters, or a combination thereof that are suitable for commercial aquacultural use; and

(2) Authorizing the department to issue leases for commercial aquacultural use.

The department shall manage and administer the program and any aquacultural area leased pursuant to the program in consultation with the department of land and natural resources, the agribusiness development corporation, and any other agency with jurisdiction over the aquacultural area.

(b) The department, in identifying and selecting state facilities, state lands, state marine waters, or any combination thereof, as aquacultural areas to be leased pursuant to this section, shall:

(1) Hold at least one public meeting in the community in which the proposed aquacultural area is situated;

(2) Take into consideration comments from the department of land and natural resources, agribusiness development corporation, and any other agency with jurisdiction over the proposed aquacultural area; and

(3) Complete the identification and selection process by June 30, 2025.

(c) Notwithstanding any other law to the contrary, the department may lease the aquacultural areas identified and selected for the program; provided that:

(1) The lessee obtains all necessary federal, state, and county permits to establish and conduct the proposed aquacultural activities in the aquacultural area, including a conservation district use permit issued by the board of land and natural resources pursuant to section 183C-6 or 190D-11, as applicable, if the aquacultural area includes lands within the state land use conservation district or state marine waters;

(2) The department and the lessee enter into an aquacultural area lease pursuant to this section for the lessee's proposed aquacultural activities in the aquacultural area;

(3) The lessee uses the leased aquacultural area only for aquacultural activities that are approved by the department, authorized by the permits obtained pursuant to paragraph (1), and set forth in the lease entered into pursuant to paragraph (2);

(4) The lessee's aquacultural activities in the aquacultural area do not have an adverse impact on existing programs of the department or other state departments or agencies, including the project facility program and agricultural projects implemented by the agribusiness development corporation and the marine life conservation district program, shoreline fisheries management area program, and the natural area reserve program administered by the department of land and natural resources;

(5) The lessee's aquacultural activities in the aquacultural area do not abridge, alter, conflict with, or impair konohiki fishing rights recognized in sections 187A-23 and 190D-24, including the right to sublease private konohiki fishing grounds for marine activities;

(6) The leasing of the aquacultural area does not adversely impact the public's use and enjoyment of the reefs in the state marine waters;

(7) The lessee complies with all applicable federal, state, and county statutes, ordinances, and rules;

(8) The department makes a determination that the lease is for commercial use; and

(9) Any lease entered into by the department pursuant to this section shall be fully executed no later than June 30, 2033.

(d) Leases issued by the department shall:

(1) Specify the term of the lease and the nature of the exclusive use of the aquacultural area being granted;

(2) Specify the aquacultural activities permitted to be conducted in the aquacultural area pursuant to the lease; provided that the lease shall be issued only for aquacultural activities that are approved by the department and authorized by the permits obtained pursuant to subsection (c)(1);

(3) Specify an annual rent set by the department for the leased aquacultural area; provided that the basic rent charged in the lease may be supplemented by royalty payments;

(4) 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:

(A) Protect the public interest in the event of the removal of any structures or aquatic plants or animals cultivated; and

(B) Restore or remediate the facilities, lands, and waters to the satisfaction of the department in and upon the leased aquacultural areas if the lease is forfeited for nonperformance or the department requires the removal or eradication of aquatic plants or animals pursuant to paragraphs (7) and (8);

(5) Specify that if a lessee abandons a leased aquacultural area, the department may order the removal or sale at public auction of all improvements, assets, aquatic plants or animals, and equipment remaining in and upon the leased aquacultural area, and shall transmit to the aquaculture development special fund, established by section 141-54, the entire amount received from any public auction and any proceeds received from the lessee's performance bond. Alternatively, the department may permit the use of the improvements, assets, plants or animals, and equipment for purposes that benefit the general public;

(6) Specify that the aquatic plants or animals described in the lease, which are to be cultivated and contained within the leased aquacultural area, are the exclusive harvest of the lessee; provided that any plant or animal that escapes from the leased aquacultural 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;

(7) Specify that:

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

(B) The lessee is solely responsible for all costs of removal of the aquatic plants or animals whether within or outside of the leased aquacultural area; and

(C) If action is required by the department to eradicate escaped aquatic 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);

(8) Specify that, if the chairperson finds or has reasonable cause to believe that an activity conducted by the lessee in or upon the aquacultural area described in the lease is causing an immediate danger to human or marine life or the environment of the aquacultural and surrounding areas, the chairperson may direct a temporary or permanent suspension of aquacultural activities in the affected aquacultural area. Upon direction of the chairperson, the department shall immediately order the lessee or lessees affected by the notice to show cause why their activities should not be terminated, or why any structures, cultivated aquatic plants or animals, or equipment should not be removed from the aquacultural area. The department shall proceed to hold a public hearing and issue its order with respect to the hearing within a reasonable period. In its order following the hearing, the department may direct a temporary or permanent suspension of commercial or research activities in the affected aquacultural area, removal of equipment or cultivated aquatic plants or animals, or other measures as the department deems appropriate for protection of human or marine life and environment of the aquacultural area, including forfeiture to and destruction by the State of any aquatic plant or animal species;

(9) Specify that the lease may be assigned in whole or in part, or amended; provided that the department determines that the assignment or amendment is in the public interest and meets the provisions of this section and consents to the assignments. The department may consent to the mortgage of a lease pursuant to section 171-22;

(10) Specify that the lease may be revoked by the department for violation of any lease provision. The department 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 leased aquacultural area, 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 any additional period the department may allow for good cause, the department may revoke the lease; and

(11) Contain a statement describing the degree of exclusivity or access to the leased aquacultural area 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.

(e) Leases issued by the department may:

(1) Specify that failure of the lessee to substantially perform 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 all aquatic plants or animals cultivated in and upon the leased aquacultural area;

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

(3) 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 aquacultural area under lease and the names of the lessees on signs appropriately placed pursuant to specifications established by the department; and

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

(4) Include other terms and conditions as the department deems advisable to effectuate the purposes of the Hawaii State Constitution and this section.

(f) The chairperson or chairperson's authorized agents shall have the authority to enter and inspect any and all aquacultural areas leased by the department for the purpose of determining compliance with the terms and provisions of any lease issued under this section.

(g) A person who wishes to obtain a lease for an aquacultural area pursuant to this section shall request an aquacultural area lease from the department. Upon receipt of a completed application and authorization of a lease, the department 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 in accordance with chapter 171. If an auction is held and the applicant submitting a completed application is not the highest qualified bidder, the department 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 application pursuant to chapter 343 and the rules adopted thereunder. In establishing and following internal procedures for lease applications, the department shall attempt to minimize costs to those applicants submitting completed applications. The department shall not revoke or modify its approval of an application in a way that invalidates, impairs, limits, or affects, 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 section.

(h) The program may use the moneys in the aquaculture development special fund established by section 141-54 to carry out the purposes of this section, including hiring the necessary employees, specialists, and consultants. The revenues obtained from the leasing of aquacultural areas pursuant to this section shall be deposited into the aquaculture development special fund; provided that the portion of revenues subject to chapter 10 shall be deposited into the public land trust fund as provided by law.

(i) Nothing in this section shall preclude the department from working with and receiving assistance from any other department or agency in carrying out the purposes of this section. If state facilities, state lands, and state marine waters under the control and management of other agencies are required by the department for purposes of enforcing this section, the agency having the control and management of those required facilities, lands, and waters, upon request by the department, may lease the lands and waters to the department upon the terms and conditions as may be agreed to by the parties. Notwithstanding the foregoing, no public lands shall be leased to the department if the lease would impair any covenant between the State or any county, or any department thereof, and the holders of bonds issued by the State or the county or department.

(j) Any person who conducts, in an aquacultural area, any aquacultural activity that is not permitted by a lease granted to that person by the department, or who conducts these activities in or upon aquacultural areas without having obtained the approval of the department, 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.

(k) Any person who wilfully or recklessly damages, disturbs, or interferes with any aquacultural activity that has been permitted in a lease granted by the department, or who wilfully or recklessly damages, disturbs, interferes with, takes, or possesses any improvements, assets, aquatic plants or animals, or equipment in an aquacultural area leased to a person, without the permission of that person, shall be subject to civil proceedings initiated by any person damaged thereby, notwithstanding the result in any criminal proceedings commenced under subsection (l).

(l) Any person who negligently or wilfully damages, disturbs, or interferes with any aquacultural activity that has been permitted in a lease granted by the department, or who negligently or wilfully damages, disturbs, interferes with, takes, or possesses any improvements, assets, aquatic plants or animals, or equipment in an aquacultural area leased to a person, without the permission of that person, shall be subject to chapter 708.

(m) Nothing in this section shall be held in any way to interfere or conflict with any vested rights under or arising out of any grant, lease, or license of or concerning any government lands or water rights, or rights-of-way; nor shall anything in this section be construed to change any rights in or concerning any water upon or flowing from or through any land set apart or surrendered as a forest reserve, or as depriving or limiting any state officer from exercising any existing power or authority or any power that may hereafter be created to deal with water or water rights, or rights-of-way.

(n) The department shall adopt rules pursuant to chapter 91 to implement this section.

(o) As used in this section, unless the context clearly requires otherwise:

"Agency" means any federal, state, local, or foreign government or any entity of any government.

"Aquacultural area" means state facilities, state lands, state marine waters, or any combination thereof identified by the department as being suitable for commercial aquaculture and may include public lands transferred from the department of land and natural resources to the department as non-agricultural park lands pursuant to chapter 166E; provided that "aquacultural areas" shall not include facilities, lands, or waters designated as being necessary for national defense purposes, as determined by the department of land and natural resources in consultation with the appropriate federal agencies.

"Aquacultural activity" or "aquaculture" means the propagation, cultivation, or farming of aquatic plants and animals in controlled or selected environments for commercial purposes, including research, stocking, aquaponics, or any growing of plants or animals with aquaculture effluents.

"Facility" means a building or buildings or similar structure owned or leased by, or otherwise under the jurisdiction of, an agency.

"Lease" means the agreement establishing the right to possess and use an aquacultural area pursuant to this section for a term of years.

"Lessee" means the holder of a valid aquacultural area lease granted by the department pursuant to this section.

"Program" means the aquacultural area lease program.

"Public lands" has the same meaning as in section 171-2; provided that "public lands" includes lands to which the department holds title by way of foreclosure, voluntary surrender, or otherwise, to recover moneys loaned or to recover debts otherwise owed the department under chapter 167.

"State lands" includes all public and other lands owned or in possession, use, and control of the then Territory of Hawaii or the State of Hawaii, or any of its agencies.

"State marine waters" has the same meaning as in section 190D-3.

"Water column" means the vertical extent of marine waters, including the surface, above submerged lands."

SECTION 3. Section 26-16, Hawaii Revised Statutes, is amended by amending subsection (c) to read as follows:

"(c) The department shall:

(1) Promote the conservation, development, and utilization of agricultural resources in the State;

(2) Assist the farmers of the State and any others engaged in agriculture by research projects, dissemination of information, crop and livestock reporting service, market news service, and any other means of improving the well-being of those engaged in agriculture and increasing the productivity of the lands;

(3) Administer the programs of the State relating to animal husbandry, entomology, farm credit, development and promotion of agricultural products and markets, and the establishment and enforcement of the rules on the grading and labeling of agricultural products; [and]

(4) Administer the aquaculture program under section 141‑52[.]; and

(5) Administer the aquacultural area lease program under section 141-   ."

SECTION 4. Section 141-54, Hawaii Revised Statutes, is amended to read as follows:

"141-54 Aquaculture development special fund. (a) There is established in the state treasury the aquaculture development special fund into which shall be deposited:

(1) Appropriations from the legislature;

(2) Moneys collected as fees for special microbiological and histological procedures and expert aquaculture-related services;

(3) Moneys collected from the sale of any item related to aquaculture development that is purchased from the department;

(4) Moneys directed to the aquaculture development program from any other sources, including but not limited to grants, gifts, and awards; [and]

(5) Moneys collected as fees or lease rent under the aquacultural area lease program pursuant to section 141-   , notwithstanding section 190D-33; and

[(5)] (6) Moneys derived from interest, dividend, or other income from the above sources.

(b) Moneys in the aquaculture development special fund shall be used to:

(1) Implement the aquatic disease management programs and activities of the department, including provision of state funds to match federal grants; [and]

(2) Support research and development programs and activities relating to the expansion of the state aquaculture industry. Research and development programs and activities funded under this paragraph may be conducted by department personnel or through contracts with the University of Hawaii or other qualified persons[.]; and

(3) Implement the aquacultural area lease program pursuant to section 141-   , including:

(A) Hiring the necessary employees, specialists, and consultants to carry out the program; and

(B) Paying lease rents to agencies under the aquacultural area lease program pursuant to section 141-   (i)."

SECTION 5. Section 190D-2, Hawaii Revised Statutes, is amended to read as follows:

"190D-2 Findings and purpose. Article XI of the constitution of the State of Hawaii relating to the conservation, control, and development of resources, provides in section 6 that the State shall have the power to manage and control the marine, seabed, and other resources located within the boundaries of the State, including its archipelagic waters, and reserves to the State all such rights outside state boundaries not specifically limited by federal or international law.

The legislature finds that the State's marine waters offer the people of Hawaii sources of energy, minerals, food, and usable space. The legislature further finds that the proper management and development of these ocean resources require defined rights of usage and tenure.

The purpose of this chapter is to establish procedures for the leasing of state marine waters and to guarantee property rights and protection for any activities approved under these procedures. Unless otherwise provided, the provisions of this chapter shall not apply to leases administered by the department of agriculture for the aquacultural area lease program pursuant to section 141-   ."

SECTION 6. Section 190D-33, Hawaii Revised Statutes, is amended to read as follows:

"190D-33 Revenues. The revenues obtained from the leasing of state marine waters pursuant to this chapter shall be deposited into the special land and development fund to be used for planning, research, and development of the aquaculture industry; provided that the portion of revenues subject to chapter 10, shall be deposited into the public land trust fund as provided by law[.]; provided further that revenues obtained from the leasing of state marine waters as aquacultural areas pursuant to section 141-    shall be deposited into the aquaculture development special fund established under section 141-54."

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 that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

SECTION 8. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

SECTION 9. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 10. This Act shall take effect on July 1, 3000.

 


 


 

Report Title:

Aquaculture; Aquacultural Area Lease Program; Department of Agriculture; State Facilities; State Lands; State Marine Waters; Ocean and Submerged Lands

 

Description:

Establishes the aquacultural area lease program within the department of agriculture to identify state facilities, state lands, and state marine waters that are suitable for use and lease as commercial aquacultural areas. Allows agencies having control and management of identified aquacultural areas to lease the facilities, lands, and waters to the department of agriculture. Allows the program to use the moneys in the aquaculture development special fund and requires the revenues obtained from aquacultural area leases to be deposited into the aquaculture development special fund. Imposes penalties and civil and criminal liabilities. Exempts the aquacultural area lease program from the Hawaii ocean and submerged lands leasing act. Effective 7/1/3000. (HD1)

 

 

 

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