UPDATED: 9/26/2016 8 p.m.

Honolulu Mayor Kirk Caldwell and city officials are under fire from a nonprofit organization for “the continuing misuses of admission fees paid by visitors to Hanauma Bay.”

“The simple reality is that the City has intentionally, and persistently, misused these funds in violation of court rulings,” attorneys Paul Alston and Michael Purpura said in a seven-page letter to Mayor Kirk Caldwell that they sent on behalf of Friends of Hanauma Bay.

“The situation is intolerable,” the lawyers said. “lt cannot continue.”

Hanauma Bay Nature Reserve vog sunrise1

Hanauma Bay Nature Preserve, on the east side of Oahu, receives roughly 1 million visitors annually.

Cory Lum/Civil Beat

Republican Charles Djou, Caldwell’s opponent in the Nov. 8 mayoral election, is familiar with the group’s concerns since it was around a decade ago when he was on the Honolulu City Council. Djou said he authored a resolution in 2007 that led to an independent audit of the fund.

“Hanauma Bay isn’t just one of the most beautiful beaches in Hawaii, this is one of the most beautiful nature preserves on Planet Earth,” he said Monday in an interview at the bay. 

Update: The mayor’s office responded to questions seeking comment with a statement Monday evening.

“The city has strived to provide the Friends of Hanauma Bay with accurate and responsive information,” Andrew Pereira, Caldwell’s spokesman, said in an email. “Many of the concerns in the letter relate to issues that occurred in past decades and must be further researched. The city continues to work toward preserving the Hanauma Bay Nature Preserve for future generations and appreciates the efforts of all concerned.”

Indeed, many of the issues existed prior to Caldwell, including during the terms of Mayors Peter Carlisle, Mufi Hannemann and Jeremy Harris.

Charles Djou at the Pearl Country Club in Pearl City, HI, on Saturday, August 13, 2016.(Civil Beat photo by Ronen Zilberman)

Charles Djou says the city is mismanaging Hanauma Bay.

Ronen Zilberman/Civil Beat

The Hanauma Bay Nature Preserve Fund — which receives money from non-resident admissions to the bay, parking fees and snorkel rentals — was created in 1996 to provide for the bay’s operation and maintenance, education and orientation programs for visitors and environmental studies of the preserve. Leftover funds could also be put toward two nearby facilities, the Koko Head Rifle Range and the Koko Head Botanical Garden.

In 2002, a judge found the money was being misused and ordered the city to keep any surplus in the fund to offset any future deficits at the bay, and to refund nearly $3.2 million that had been used for other purposes in prior years.

Over the past decade, the Friends of Hanauma Bay organization said the city has used the fund to buy vehicles for lifeguards to use at other parks, skimmed the interest from the fund and put it toward other uses, and paid employees to work at other parks with the fund’s money.

Visitors form a quick moving line at the entrance Hanauma Bay Nature Reserve to pay their $7.50 per person and watch a mandatory video.

Visitors form a line at the entrance of Hanauma Bay Nature Preserve to pay their $7.50 per person non-resident entry fee and watch a mandatory video about the bay and ocean safety.

Cory Lum/Civil Beat

The nonprofit has “tirelessly advocated” with various city officials to get Honolulu to comply with federal court orders, conduct an independent financial audit, repay misused funds and use the money to repair and maintain Hanauma Bay, according to its letter to the mayor.

The city has taken some steps but not enough, according to Friends of Hanauma Bay. For instance, the City Council last year passed an ordinance requiring the interest earned by the fund to stay in the fund.

City officials have reimbursed $1 million in interest charged to the fund and pledged to stop paying employees using that fund if they don’t work at the bay, but the nonprofit says that the pledge has not been honored.

The city’s operating budget for fiscal 2017, which started July 1, shows the fund balance at $7.5 million, less an interfund transfer of $1.9 million. The city budgeted $1.2 million for capital improvement projects at the bay.

The nonprofit wants the city to comply with legal requirements to conduct annual “carrying capacity studies,” which would assess the impact of the roughly 1 million visitors annually to the bay and inform management decisions.

But only one such study has been done to date — the initial baseline study in 2000, according to Friends of Hanauma Bay.

“This is a crown jewel which Kirk Caldwell is mismanaging and neglecting,” Djou said. “The law is black and white.”

Honolulu Mayor Kirk Caldwell says a consensus report by state, county and tourism officials offers a more reasonable tax split for the counties.

Honolulu Mayor Kirk Caldwell is under pressure to respond to the Friends of Hanauma Bay’s concerns by Oct. 10 or possibly face legal action.

Cory Lum/Civil Beat

Friends of Hanauma Bay has also authored a resolution, which Djou supports, that calls for the city to establish a public-private partnership.

Djou envisions a quasi-public entity, likely created by the City Council, that would manage the fund. He envisions it as a board whose members are appointed by the mayor and confirmed by the council.

The group’s attorneys told the mayor in their letter, which was dated Friday, that they need a response by Oct. 10.

“If we do not have an affirmative response by that deadline, we will pursue steps to enforce the earlier Court orders,” Alston and Purpura said. “We hope that will not be necessary.”

The Friends of Hanauma Bay formed in 1990 as the city was tightening access to the bay in order to better protect it.

The group’s members have regularly testified at Council meetings, supporting a smoking ban in 1995 and entrance fees for non-residents in 1997, according to a city audit.

In recent years, the nonprofit has worked to kill plans that could have increased the amount of visitors to the bay by allowing busloads of tourists to be dropped off.

The bay, a popular place for snorkeling, remains the most common place for visitors to drown in Hawaii.

Read the full letter below.

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