The motto of the Sand Island Business Association (SIBA) should be something like “If at first you don’t succeed, try, try again.”

In the early 1990s, the group used its political connections to win both a very favorable lease for about 70 acres of state land on Sand Island for an industrial park, and then to obtain a very unusual grant of administrative control over the subleases to individual businesses. For most of the years since, SIBA has been pushing for the transfer of these public lands to SIBA in fee.

Over the past year, SIBA has been advocating on behalf of a special interest bill at the Honolulu City Council that would reduce real property tax payments by businesses with SIBA subleases, while simultaneously challenging its tax bills in state tax court.

This time around they’re at the legislature pushing SB176, which would authorize the Board of Land and Natural Resources to sell parcels of the state-owned land within the Sand Island Industrial Park to lessees. The bill does not provide any public purpose for allowing the sell-off of these publicly-owned industrial lands beyond the general decline in state revenue caused by the current pandemic.

The bill has been scheduled for a public hearing in the senate next Thursday, March 4, before the Senate Ways and Means Committee chaired by Sen. Donovan Del Cruz. The hearing is scheduled for 1:30 p.m. Due to Covid, the capitol is closed to the public, and all hearings are being conducted by Zoom, and written testimony, as well as remote testimony via Zoom, are being accepted.

SIBA has tried this gambit several times over the years. Back in 2009, for example, a similar bill requiring the state to offer the Sand Island parcels to the lessees passed the Senate and one house committee before bogging down in House Finance.

Testimony presented on behalf of then-Attorney General Mark Bennett said the measure would be unconstitutional.

This bill requires the Department of Land and Natural Resources to offer for sale or exchange parcels of Sand Island. Article XI, Section 5 of the Hawaii Constitution states that “The legislative power over the lands owned by or under the control of the State…and its political subdivisions shall be exercised only by general laws….” Given this directive, this bills requirement to sell the parcels at Sland Island would be unconstitutional.

The latest bill appears to also be an unconstitutional special interest bill singling out one organization. I understand why they took this risk. It’s just that there’s no way SIBA could sell the idea that all public land should be offered for sale to lessees.

DLNR’s 2009 testimony said the original lease agreements do not contain any provisions entitling lessees any right to purchase the fee simple interest in the land. Further, the approximately 70 acres of the Sand Island Industrial Park now generate significant revenue that supports DNLR other programs.

“Such sale would not be in the best interest of the beneficiaries of the public land trust, the State, or the Department,” then Land Board Chair, Laura Thielen, testified.

The current measure, SB176, originally had a double referral in the Senate to both the Committee on Water and Land, and Ways and Means. However, on February 4, it was re-referred to WAM, cutting the Water and Land committee, which would generally have jurisdiction over bills regarding land issues, out of the process.

See:

“Monday…Bill sliding through legislature to sell 73 acres of state-owned land on Sand Island,” iLind.net, March 20, 2009.

“Second look: Sand Island Business Association–Money & Politics,” iLind.net, March 18, 2013.

“Hawaii Monitor: Business Group Presses For Sand Island Land Swap/25 years of money, politics, and special interest,” Civil Beat, March 13, 2013.

“Tuesday, Part 2: Sand Island Business Association seeks special interest deal,” iLind.net, March 31, 2009.

“SIBA: Singing the same tune for nearly 30 years,” iLind.net, February 8, 2021.