In the worst case, it would allow the privatization of public lands through perpetual leases.
House Bill 1469 started out as a way to redevelop the hotels on Banyan Drive on the Big Island – urban lands classified for resort development that do need to be redeveloped.
But somewhere along the way, it morphed into a sweetheart deal for existing tenants on any state land, including the University of Hawaii and the Thirty Meter Telescope planned for Mauna Kea.
Under existing law, leases of state lands can’t exceed 65 years. Then they need to go back out for auction.
The policy is that any lease longer for 65 years is essentially a sale of land. So to be fair, you put it up for auction to allow new parties to bid.
The conference committee just signed off on a final version of the bill that amends the section of the law that governs all state leases – and eliminates the 65-year limit on any new or existing lease on any state lands. Basically, it’s turning tenants into potential owners of state land.
It also eliminates the Department of Land and Natural Resources’ rights to access certain information from lessees (making it optional) who sell, assign or sublease state land. Which means an existing tenant could get an extension of a lease, turn around and sell it or sublease it for a profit, and the state can’t necessarily take action.
Then some language that specifically applies to the TMT lease was added:
The bill would allows the Land Board to extend a lease in perpetuity to any person or entity, including any school, government entity or nonprofit organization upon approval of a development agreement proposed by the lessee to make substantial improvements or construct new improvements. No auction or separate public process would be needed.
So the Land Board could extend the UH and/or TMT lease at the same time it approves the construction or agreement to improve the area.
This bill raises all kinds of red flags. While the new authority to extend leases without limits likely wouldn’t be abused routinely, it opens the door to special sweetheart deals that would essentially privatize certain state lands, including ceded lands.
It is scheduled to be up for final floor votes in the House and Senate on Tuesday. It will be buried in the long list of bills awaiting final approval.