A decade after his controversial Public Land Development Corp. was dissolved in the face of a public outcry, Sen. Donovan Dela Cruz is using other agencies to buy and develop land.

Sen. Donovan Dela Cruz’s Public Land Development Corp. was a controversial idea that went nowhere. A decade later, it turns out, Dela Cruz didn’t really need the PLDC to accomplish at least one of his goals — buying up land to develop in the name of economic progress. 

Instead of the PLDC, which lawmakers dissolved in its infancy amid public criticism, Dela Cruz has been using quasi-independent executive agencies that have power to buy and develop land.

In the past decade, the Agribusiness Development Corp. and the Hawaii Technology Development Corp. have funneled considerable taxpayer resources to buy land, much of it in Dela Cruz’s district. Land acquisitions in and around his district have totaled more than $57 million in the past decade. That doesn’t count additional money needed for improvements, like infrastructure and buildings. 

Right, Senator Donovan Dela Cruz speaks to left, UH Vice President of Adminstrative Affairs Michael Unebasami with left, Senator Michelle Kidani at the Wahiawa Value Added Product Development Center under construction.
Sen. Donovan Dela Cruz, right, spoke to UH Vice President of Administrative Affairs Michael Unebasami and Sen. Michelle Kidani at a 2021 tour of the $16 million Wahiawa Value-Added Product Development Center, which is expected to open this summer. The Agribusiness Development Corp. acquired the building’s site, which housed a derelict warehouse, in 2013 for $4.3 million. It was one of numerous acquisitions the ADC has made in Dela Cruz’s district in the past decade. (Cory Lum/Civil Beat/2021)

It’s no fluke that the agencies are focusing work in Dela Cruz’s district. The influential senator has allies in key agency positions and, as chairman of the Senate Ways and Means Committee, has steered money to the agencies. This past session, he sought to change the makeup of the technology development agency through a secretive legislative process — a move that would have removed a critic of one of the senator’s pet projects.

“It’s kind of an open secret at the Legislature that this is the pattern that’s being pursued,” said Hawaii Rep. Amy Perruso, Dela Cruz’s House counterpart representing Central Oahu communities such as Wahiawa and Whitmore Village. 

Dela Cruz did not reply to a request for an interview for this story.

Recent developments include the Wahiawa Value-Added Product Development Center, a state facility expected to open this summer on the site of a derelict warehouse the Agribusiness Development Corp. paid $4.3 million to buy in 2013. Dela Cruz has championed the facility as an engine for boosting an agriculture economy that has waned since the decline of Central Oahu’s sugar cane and pineapple plantations.

With mountains of taxpayer money at stake, the ADC and HTDC have gained public scrutiny. This past session, Gov. Josh Green announced he would veto two of Dela Cruz’s measures involving the HTDC. One item would have steered $50 million to build roads, electric and water systems for a campus for public safety agencies that Dela Cruz wants the HTDC to build in his district. The other measure would have removed an HTDC board member who has raised questions about the campus.

Perruso, chair of the House Higher Education and Technology Committee, this past session killed a bill that proposed $100 million for Dela Cruz’s public safety campus, in part, she says because of concerns raised by fellow House members about Dela Cruz using the agencies as mini PLDCs.

“It was useful for me to hear from my colleagues that they had identified the pattern,” she said. “They pointed it out to me, and they said it had been an explicit pivot of his.”

Rep. Amy Perusso this past session killed a bill that would have steered $100 million to a project championed by Sen. Donovan Dela Cruz, Perusso’s counterpart representing Central Oahu. (David Croxford/Civil Beat/2023)

And it’s not just government officials who see the pattern. Choon James is a community activist and former Honolulu City Council candidate in Kahuku who opposed the PLDC. 

“The major PLDC became mini PLDCs through the years,” she said. 

To Colin Moore, a political scientist with the University of Hawaii Economic Research Organization, Dela Cruz’s moves aren’t surprising. Under U.S. political systems, each branch of government often vies for power over the others. Dela Cruz is doing just that, he said.

“He’s just playing the game aggressively, within the rules,” Moore said.

The Short Life Of The PLDC

The Public Land Development Corp. shared features of the Agribusiness Development Corp. and Hawaii Technology Development Corp. Like the ADC and HTDC, the PLDC was a quasi-independent state agency. That means it reported not to the governor, but to a board of experts – in its case people from sectors like banking, real estate and “the development and recreational industries.” 

The PLDC’s mission was to develop state land, including land managed by the Department of Land and Natural Resources. Like the technology and agribusiness development agencies, the PLDC also had the power to buy land. The PLDC was exempt from some state and local land-use regulations and able to enter ventures with private developers.

Dela Cruz’s bill establishing the PLDC stalled in the House Finance Committee during the 2011 session. But then-House Speaker Calvin Say, now a Honolulu City Council member, helped push it through by waiving the normal public notice requirements needed to hold a hearing. As a result, the bill squeezed through the Legislature and was signed into law by then-Gov. Neil Abercrombie in 2011. 

Environmentalists and community activists reviled the PLDC, criticizing not just the PLDC’s powers but also the process for establishing it, with relatively little notice and opportunity to be heard. When Abercrombie held an open-ended town hall on Kauai in 2012, the conversation was dominated with calls to get rid of the PLDC.

Rep. Scott Saiki did just that when he took over as House Majority Leader in 2013; one of his first moves was to support repeal of the PLDC.

“There were major problems with the PLDC law,” Saiki said Wednesday, when asked why the new House leadership took the unusual step of dissolving a state agency. “The prior House leadership rushed the bill through at the last minute without sufficient notice to House members and the public. The new law took people by surprise because of its scope. It gave a single state agency the power to acquire and develop land without safeguards.”

“When the House leadership changed in 2013, one of our top priorities was to repeal the PLDC law,” he added.

Environmental groups and other opponents of the PLDC rallied at the State Capitol in 2013, as lawmakers considered dissolving the controversial agency. (Chad Blair/Civil Beat/2013)

Like the PLDC, the ADC and HTDC are quasi independent. They don’t report to the governor, but to independent boards that hire a chief executive. 

“On the surface, creating an agency that can move faster and act quicker seems reasonable, until you realize that they’re not necessarily looking out for the public interest,” said Gary Hooser, a former state senator who was an outspoken critic of the PLDC. 

For instance, Hooser said, there’s no reason to have an Agribusiness Development Corp. set up as a quasi-independent entity. 

“Why not have the Department of Agriculture do what the Department of Agriculture is supposed to be doing?” Hooser said. 

As for Dela Cruz influencing agencies like the ADC and HTDC, Hooser said it’s not appropriate under separation-of-powers principles for lawmakers to meddle with executive agencies.

“It is bad for any entity that’s supposed to be working for the public good to be working under the direction of any senator,” he said.

Connections Between Agencies Are Key

Over the years, there have been webs of connections among and between the PLDC, Dela Cruz and the agribusiness and technology development agencies.

For example, one of the ADC’s staffers is Ken Nakamoto, a former employee of Dela Cruz. The PLDC’s short-lived executive director, Lloyd Haraguchi, was also a director of the ADC. And Robbie Melton, a former executive director of the HTDC who was a staunch, early supporter of Dela Cruz’s public safety campus, was also a one-time director of the ADC.

Agency board members who don’t go along with Dela Cruz’s plans can find themselves facing removal. For example, this past session Dela Cruz targeted HTDC board member Vassilis Syrmos.

As the University of Hawaii’s vice president for research and innovation, Syrmos is involved in a mission similar to the HTDC’s: to use technology to develop Hawaii’s economy. As the university’s representative on the HTDC board, he has questioned whether a state agency in charge of nurturing a technology eco-system should be spending its resources building a campus for firefighters and national guardsmen. 

In late May, Syrmos found his head on the proverbial chopping block. 

During the final days of the legislative session, Dela Cruz and his colleagues on a Senate conference committee – Sens. Michelle Kidani, Lynn DeCoite and Glenn Wakai – amended a measure providing $6 million to the HTDC to help startups and manufacturers. The amendment disqualified Syrmos from the HTDC board by stating that the HTDC’s university representative had to be a university regent.

There was no explanation why Syrmos needed to go or opportunity for testimony. There also was no chance of the HTDC getting its funding if Syrmos were allowed to stay on the board, said Rep. Daniel Holt, chairman of the House Economic Development Committee, who was co-chair of the House conference committee.

Holt told Civil Beat in June that he was informed in the conference committee that he needed to include language effectively firing Syrmos if he wanted the $6 million appropriation.  

The bill passed out of conference committee and the full Legislature. However, Green has formally announced his intent to veto the measure. The governor has until Tuesday to issue final vetoes.

Sen. Donovan Dela Cruz’s business partner and former staffer Dane Wicker, left, serves on the board of the Hawaii Technology Development Corp., where he has spoken in support of one of Dela Cruz’s pet projects, a campus for first responders and public safety agencies in Dela Cruz’s district. At June’s HTDC board meeting, Wicker was seated next to board member Vassilis Syrmos, who has questioned the project. Legislation introduced by Dela Cruz this past session would have disqualified Syrmos from serving on the board, but Green has officially said he will veto the bill. (Stewart Yerton/Civil Beat/2023)

Dela Cruz’s most notable ally on the HTDC and ADC boards is Dane Wicker, a former Dela Cruz legislative staffer. Wicker is also Dela Cruz’s business partner in Kilani Brew, a Wahiawa-based company that sells loose-leaf mamaki tea priced at $200 a pound.

Wicker is also deputy director of the Hawaii Department of Business, Economic Development and Tourism and serves on the HTDC and ADC boards in that capacity.

Wicker’s role as an advocate for Dela Cruz’s public safety campus project was clear at the HTDC’s June 23 board meeting. During the meeting, Wicker called on the board to create an advisory committee for the public safety campus. Syrmos and fellow board member Greg Kim questioned whether the technology agency should be building a campus for first responders. 

Wicker and board chairman Craig Nakanishi defended the project, saying it would involve sophisticated technology needed to predict and respond to emergencies.

Nakanishi also said HTDC had legal power to develop the campus. 

“Just because it’s legal doesn’t mean we have to do it,” Kim replied.

The discussion proved moot. Green cut the $50 million Dela Cruz tried to steer to the campus through the HTDC. While the HTDC board was still meeting, Green also announced his intent to veto the bill axing Syrmos.

In an interview Syrmos said he’ll stay on the HTDC board if UH President David Lassner wants him to remain the university’s representative.

Is Hawaii Community Development Authority Next?

Now, Dela Cruz appears to be extending his influence to the Hawaii Community Development Authority, another quasi-independent agency with the power to buy and develop land. The authority’s statutory purpose is to help redevelop areas that are “substantially undeveloped, blighted, or economically depressed, and are or are potentially in need of renewal, renovation, or improvement to alleviate such conditions as dilapidation, deterioration, age, and other such factors.”

By statute, lawmakers have designated a handful of such areas to be under HCDA’s purview. The best known is Kakaako, which has transformed in the past 20 years from a neighborhood encompassing mainly warehouses and light industrial facilities into a gentrified oceanside community of luxury condominiums and high-end shops and restaurants.

Although the verdant agriculture lands of Dela Cruz’s district fall far outside HCDA’s scope of responsibility, the agency has gone out of its way to support Dela Cruz’s first responders campus. The support goes beyond testifying in favor of the $100 million appropriation bill proposed this past session, which HCDA did.

During a press tour held on June 9 to show the media why Hawaii needed the public safety campus, HCDA’s executive director, Craig Nakamoto, joined Dela Cruz and fellow Sens. Michelle Kidani, Sharon Moriwaki, Maile Shimabukuro and Glenn Wakai.

One argument against the campus is that the Honolulu Police Department has said — in testimony as recently as March 14 — that it has no plan to use the campus. But that didn’t stop the delegation from handing out a document saying the Honolulu Police Department planned to occupy 18% of the 150-acre parcel, making the police force the campus’ second-largest tenant. 

During a June 9 media event, a delegation of public officials led by Dela Cruz passed out a presentation indicating the Honolulu Police Department plans to occupy 18% of a proposed campus for public safety agencies. Three months earlier, the police department had testified it has no such plans. (University of Hawaii Community Design Center/Hawaii State Senate)

Asked by a reporter on the tour about the discrepancy between HPD’s testimony and the handout, Nakamoto spoke up, insisting the police department had “expressed interest” in the campus.

“They have no place for evidence storage,” Dela Cruz added. 

HPD spokeswoman Michelle Yu said in a June 22 statement that the department “has sufficient evidence storage space at the main station” and “also leases warehouse space in the community.” She reiterated that the department has no plan to participate in the proposed campus.

Asked why he had insisted the HPD is interested in the campus when it clearly is not, Nakamoto said a few days later in an interview that, “I thought they were interested in still having a warehouse location there.”

Nakamoto said he didn’t know who told him that or when. He also said he had never met with HPD officials. He said he joined the media tour because HTDC had asked HCDA to be a partner on the campus. 

Nakamoto dodged questions about why he misled the media about HPD’s interest in the campus.

“If I misstated it, then it’s my fault,” he said. “The point is the project is probably not going to go through anyway.”

Are There Limits To Dela Cruz’s Ambition?

Whether Green’s high-profile rebuttals quell Dela Cruz’s efforts remains to be seen. 

Hooser, the former senator who is now board president of the Hawaii Alliance for Progressive Action, said Dela Cruz’s actions “have brought a lot of heat on the Senate.”

But Hooser said he wasn’t sure the bad publicity matters. Senate President Ron Kouchi, the titular leader of the Senate, has shown no interest in reining in Dela Cruz. And Hooser said it wasn’t clear whether Kouchi could stop Dela Cruz if Kouchi wanted to. 

“He might not have power, literally, to rein in Donovan,” Hooser said.

As chairman of the Senate Ways and Means Committee, Dela Cruz maintains control with his ability to steer budget appropriations for capital improvement projects and other funding to the districts of his fellow senators.

Still, for now the system seems to be setting limits on Dela Cruz’s ambitions, said Moore, the political scientist.

Green is pushing back, Moore said. So are HTDC board members like Kim and Syrmos. And the public is getting to see it all.

“The danger is if you don’t have a press that’s covering this or it’s flying under the radar,” Moore said.

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