Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committees on Agriculture and Water, Land, Energy and Environment, to which was referred S.B. No. 2494 entitled:

beg leave to report as follows:

The purpose of this measure is to permit current lessees of state agricultural land to petition the Department of Land and Natural Resources (DLNR) to solicit, at the lessee's expense, bidders for the land. Upon auction, if the lessee is not the highest bidder, the department shall compensate the lessee for the residual value of any improvements. In addition, if there are no interested bidders the department shall negotiate a new lease with the lessee.

Testimony in support of this measure was received from the Hawaii Farm Bureau Federation, Hawaii Cattlemen's Council, Inc., and Hawaii Leeward Planning Conference. Testimony opposing this measure was received from the Department of Land and Natural Resources.

Your Committees find that maintaining the value and productive use of the State's agricultural lands is of paramount concern. This measure allows the State and lessees to assess the value of the agricultural land and attached improvements prior to expiration of the lease. In addition, lessees are provided an opportunity to recoup their investments in the land through compensation or by entering into a new lease. Your Committees find that this measure strikes the proper balance between ensuring the State receives value for use of state agricultural land and supporting Hawaii's agricultural industry.

Your Committees have amended this measure to require the DLNR, upon petition of the lessee, to issue a "public notice" rather than an "advertisement" for purposes of consistency with section 171-16, Hawaii Revised Statutes, deleting a redundant definition, and making technical, nonsubstantive changes for style.

As affirmed by the records of votes of the members of your Committees on Agriculture and Water, Land, Energy and Environment that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 2494, as amended herein, and recommend that it pass Second Reading in the form attached hereto as S.B. No. 2494, S.D. 1, and be referred to the Committee on Ways and Means.