Monday, July 28, 2014         


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Labyrinthine land-use laws suffocating isle economy

By Jay Fidell


Everyone knows our state, like others, is in a fiscal and economic crisis. We need to revitalize our sagging economy, and fast. The governor has made this an absolute priority, and he's right — we all have to work together to improve the economy, and that frankly includes all three branches of government.

The elephant in the room is land use, which was clear at a recent Hawaii land-use law seminar. Developers have to run a backbreaking gantlet before they can build anything. Environmental laws are increasingly used to stop projects, even if the real motivation isn't environmental but just NIMBY ("not in my backyard"). The result: Projects have become prohibitively expensive and an increasing number are stopped.

The Hawaii Constitution generally provides that each person has the right to a "clean and healthful environment," but recent court decisions have taken that language far beyond its original meaning.

Last April, the Kuilima decision blocked the expansion of the Turtle Bay Resort on Oahu's North Shore. Before this case, developers were only required to do a supplemental Environmental Impact Statement ("EIS") if their plans had changed. The Hawaii Supreme Court found that even if the plans hadn't changed, a supplemental EIS would be required if "circumstances" had changed. The court said that a migration of monk seals into the area was enough, but it seems clear that it was really the migration of people into the area that changed things. In either event, an EIS is always an expensive proposition.

In July the court decided the Ala Loop case, which dealt with a Big Island charter school on agricultural land. A nearby neighborhood association, Ala Loop, didn't want the school in its backyard. Although state law specifically delegates enforcement of land-use law to the counties, the Supreme Court, reversing the Intermediate Court of Appeals, took a new tack. It found that the "clean and healthful environment" phrase in the Constitution gave Ala Loop a private right to sue.

In Ala Loop the Supreme Court went further than in Kuilima. Not only did it establish a private right for any person to sue on an environment claim, it also establishes that a court can determine that any law is an environmental law and gives rise to an environment claim. These cases create new and powerful weapons for activists, and we're likely to see them used in more suits against developers.

Development is an increasingly risky business in Hawaii, and these decisions increase that risk. Developers and investors can't afford the uncertainty of being required to do a second EIS because external "circumstances" have changed, or a suit when an unidentified law is later found environmental. Understandably, developers go elsewhere, leaving our economy to languish.

As development goes, so goes our future. Development is not just about tourism — our people need homes, office buildings and supermarkets. Blocking development and scaring away investors for pseudo-environmental reasons is seriously shortsighted. Land use should not be a labyrinth, but a predictable path.

Hawaii has no shortage of bureaucratic barriers, and our courts seem bent on imposing more of them, extending the reach of environmental laws to the point where activism rules and "development" and "return on investment" are taboo. This trend is not protective, but destructive. Surely the economy has rights, too.

Our economy is land-based, so its success depends on the clarity of our land-use laws. Those laws must allow the state to be a productive economic unit, balancing concern for our natural resources with our need for an economy that will sustain us. We seem to have lost that balance. The courts have swung the pendulum too far, despite the obvious economic consequences. It's time for a re-balancing.

Jay Fidell, a longtime business lawyer, founded ThinkTech Hawaii, a digital media company that reports on Hawaii's tech and energy sectors of the economy. He can be reached at fidell@lava.net.


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