SB658

SECTION 1. In 1978, voters approved article XI, section 3, of the Constitution of the State of Hawaii, which sets out the framework for state policies to promote agriculture and the conservation of productive agricultural lands in the state. Article XI, section 3 reads as follows:

“The State shall conserve and protect agricultural lands, promote diversified agriculture, increase agricultural self sufficiency and assure the availability of agriculturally suitable lands. The legislature shall provide standards and criteria to accomplish the foregoing.

Lands identified by the State as important agricultural lands needed to fulfill the purposes above shall not be reclassified by the State or rezoned by its political subdivisions without meeting the standards and criteria established by the legislature and approved by a two-thirds vote of the body responsible for the reclassification or rezoning action.”

Act 183, Session Laws of Hawaii 2005 (Act 183) provides standards, criteria, and procedures to fulfill the intent and purpose of article XI, section 3, of the Constitution of the State of Hawaii and facilitates the implementation of its constitutional mandate.

Act 183 also recognized that while land is the basic resource for agriculture and the supply of lands suitable for agriculture is an irreplaceable resource, the long-term viability of agriculture also depends on factors that affect the profitability of agriculture, such as:

(1) Commodity prices;

(2) The availability of water for irrigation;

(3) Agricultural research and outreach;

(4) The application of production technologies;

(5) Marketing; and

(6) The availability and cost of transportation services.

One of the most important of these is the availability of water for irrigation. The legislature finds that to promote the long-term viability of agriculture, the State must establish mechanisms that promote the availability of irrigation water for agricultural activities.

The purpose of this Act is to further implement Act 183 by amending the state water code to require that:

(1) The state water plan, including the water resource protection, water use and development, and water projects plans; and

(2) The provisions of the water code regulating the use of stream waters,

recognize and support the importance of making sufficient irrigation water available for agricultural activity on lands identified and designated as important agricultural lands under part III or chapter 205.

SECTION 2. Section 174C-2, Hawaii Revised Statutes, is amended by amending subsection (c) to read as follows:

"(c) The state water code shall be liberally interpreted to obtain maximum beneficial use of the waters of the State for purposes such as domestic uses, aquaculture uses, irrigation and other agricultural uses, power development, and commercial and industrial uses. However, adequate provision shall be made for the protection of traditional and customary Hawaiian rights, the protection and procreation of fish and wildlife, the maintenance of proper ecological balance and scenic beauty, and the preservation and enhancement of waters of the State for municipal uses, public recreation, public water supply, agriculture[,] and irrigation for agricultural activity on lands identified and designated as important agricultural lands pursuant to part III of chapter 205, and navigation. Such objectives are declared to be in the public interest."

SECTION 3. Section 174C-31, Hawaii Revised Statutes, is amended as follows:

1. By amending subsections (a), (b), (c), (d), (e), (f), and (g) to read:

“(a) The Hawaii water plan shall consist of four parts:

(1) [a] A water resource protection plan which shall be prepared by the commission;

(2) [~~water~~] Water use and development plans for each county which shall be prepared by each separate county and adopted by ordinance, setting forth the allocation of water to land use in that county;

(3) [a] A state water projects plan which shall be prepared by the agency which has jurisdiction over such projects in conjunction with other state agencies; and

(4) [a] A water quality plan which shall be prepared by the department of health.

(b) All water use and development plans shall be prepared in a manner consistent with the following conditions:

(1) Each water use and development plan shall be consistent with the water resource protection and water quality plans;

(2) Each water use and development plan and the state water projects plan shall be consistent with the respective county land use plans and policies including general plan and zoning as determined by each respective county;

(3) Each water use and development plan and the state water projects plan shall be consistent with the water needs of agricultural activity on lands identified and designated as important agricultural lands pursuant to part III of chapter 205;

[~~(3)~~] (4) The water use and development plan for each county shall also be consistent with the state land use classification and policies;

[~~(4)~~] (5) The cost to develop the initial water use and development plan for each county shall be funded by the State in an amount not exceeding $150,000 per county;

[~~(5)~~] (6) The cost of maintaining the water use and development plan shall be borne by the counties; state water capital improvement funds appropriated to the counties shall be deemed to satisfy [~~Article~~] article VIII, section 5, of the State Constitution; and

[~~(6)~~] (7) Each county in order to be eligible for state appropriations for county water projects [~~mus~~t] shall have developed an acceptable water use and development plan within the time frame established by this chapter.

(1) Study and inventory the existing water resources of the State and the means and methods of conserving and augmenting such water resources;

(2) Review existing and contemplated needs and uses of water, including state and county land use plans and policies and agricultural activity on lands identified and designated as important agricultural lands pursuant to part III of chapter 205 and study their effect on the environment, procreation of fish and wildlife, and water quality;

(3) Study the quantity and quality of water needed for existing and contemplated uses, including irrigation, power development, geothermal power, agricultural activity on lands identified and designated as important agricultural lands pursuant to part III of chapter 205, and municipal uses;

(4) Identify rivers or streams, or a portion of a river or stream, which appropriately may be placed within a wild and scenic rivers system, to be preserved and protected as part of the public trust. For the purposes of this paragraph, the term "wild and scenic rivers" means rivers or streams, or a portion of a river or stream of high natural quality or that possess significant scenic value, including but not limited to[,] rivers or streams which are within the natural area reserves system. The commission shall report its findings to the legislature twenty days prior to the convening of each regular legislative session; and

(5) Study such other related matters as drainage, reclamation, flood hazards, floodplain zoning, dam safety, and selection of reservoir sites, as they relate to the protection, conservation, quantity, and quality of water.

(d) The water resource protection plan shall include[,] but not be limited to:

(1) Nature and occurrence of water resources in the State;

(2) Hydrologic units and their characteristics, including the quantity and quality of available resource, requirements for beneficial instream uses and environmental protection, desirable uses worthy of preservation by permit, and undesirable uses for which permits may be denied;

(3) Existing and contemplated uses of water, as identified in the water use and development plans of the State and the counties, their impact on the resource, and their consistency with objectives and policies established in the water resource protection and water quality plans;

(4) Programs to conserve, augment, and protect the water resource; and

(5) Other elements necessary or desirable for inclusion in the plan.

Thereafter, the commission in coordination with the counties and the department of health shall formulate an integrated coordinated program for the protection, conservation, and management of the waters in each county based on the above studies. This program, with such amendments, supplements, and additions as may be necessary, shall be known as the water resource protection and water quality plans.

Thereafter, each county shall prepare a water use and development plan and the appropriate state agency shall prepare the state water projects plan.

(e) The department of agriculture shall prepare a state agricultural water use and development plan for agricultural uses in the State in accordance with chapter 167 and this chapter, and subsequently modify and update the plan as necessary. The state agricultural water use and development plan shall include but not be limited to a master irrigation inventory plan which shall:

(1) Inventory [~~the~~] public and private irrigation water systems;

[~~(2) Identify the extent of rehabilitation needed for each system;~~

~~(3) Subsidize the cost of repair and maintenance of the systems;~~

~~(4) Establish criteria to prioritize the rehabilitation of the systems;~~

~~(5) Develop a five-year program to repair the systems; and~~

~~(6) Set up a long-range plan to manage the systems.~~]

(2) Assess the condition of public and private irrigation water systems and the costs of rehabilitation;

(3) Identify the sources of water serving public and private irrigation water systems;

(4) Identify sources of water used by agricultural operations on lands identified and designated as important agricultural lands pursuant to part III of chapter 205;

(5) Identify the threats to agricultural use of water, including threats to the sources and the rehabilitation of water systems; and

(6) Identify current and future water needs for agricultural operations on lands identified and designated as important agricultural lands pursuant to part III of chapter 205.

The commission shall coordinate the incorporation of the state agricultural water use and development plan into the state water projects plan.

(f) Each county water use and development plan shall include but not be limited to:

(1) Status of water and related land development, including an inventory of existing water uses for domestic, municipal, and industrial users, agriculture, aquaculture, hydropower development, drainage, reuse, reclamation, recharge, and resulting problems and constraints;

(2) Availability of water needed to sustain viable agricultural activity on lands identified and designated as important agricultural lands pursuant to part III of chapter 205;

[~~(2)~~] (3) Future land uses and related water needs; and

[~~(3)~~] (4) Regional plans for water developments, including recommended and alternative plans, costs, adequacy of plans, and relationship to the water resource protection and water quality plans.

(g) The Hawaii water plan shall be directed toward the achievement of the following objectives:

(1) The attainment of maximum reasonable-beneficial use of water for such purposes as those referred to in subsection (a);

(2) The proper conservation and development of the waters of the State;

(3) The control of the waters of the State for such public purposes as navigation, drainage, sanitation, and flood control;

(4) The attainment of adequate water quality as expressed in the water resource protection and water quality plans; [~~and~~]

(5) The adequate provision of water needed to sustain viable agricultural activity on lands identified and designated as important agricultural lands pursuant to part III of chapter 205; and

[~~(5)~~] (6) The implementation of the water resources policies expressed in section 174C-2."

2. By amending subsections (k) to read:

"(k) The commission shall give careful consideration to the requirements of public recreation, the protection of the environment, [~~and~~] the procreation of fish and wildlife[.], and the water requirements to sustain viable agricultural activity on lands identified and designated as important agricultural lands pursuant to part III of chapter 205. The commission may prohibit or restrict other future instream or offstream uses on certain designated streams which may be inconsistent with these objectives."

SECTION 4. Section 174C-71, Hawaii Revised Statutes, is amended to read as follows:

“§174C-71 Protection of instream uses. The commission shall establish and administer a statewide instream use protection program. In carrying out this part, the commission shall cooperate with the United States government or any of its agencies, other state agencies, and the county governments and any of their agencies. In the performance of its duties the commission shall:

(1) Establish instream flow standards on a stream-by-stream basis whenever necessary to protect the public interest in waters of the State;

(A) The commission, on its own motion, may determine that the public interest in the waters of the State requires the establishment of an instream flow standard for streams;

(B) In acting upon the establishment of instream flow standards, the commission shall set forth in writing its conclusion that the public interest does or does not require, as is appropriate, an instream flow standard to be set for the stream, the reasons therefor, and the findings supporting the reasons;

(C) Each instream flow standard shall describe the flows necessary to protect the public interest in the particular stream. The public interest shall include but not be limited to the protection of adequate fishery, wildlife, recreational, aesthetic, and scenic instream uses as well as offstream uses such as the support of agricultural activity and domestic and municipal uses. Flows shall be expressed in terms of variable flows of water necessary to protect [~~adequately fishery, wildlife, recreational, aesthetic, scenic, or other~~] beneficial instream uses in the stream in light of existing and potential water developments, including the economic impact of restriction of such use;

(D) Establishment or modification of an instream flow standard shall be initiated by the commission by providing notice of its intention to set an instream flow standard in a newspaper of general circulation published in the vicinity of the stream in question, to the mayor of the appropriate county, and to persons who have previously requested such notice in writing;

(E) After giving notice of its intention to set an instream flow standard, the commission or other agencies in participation with the commission shall investigate the stream. During the process of this investigation, the commission shall consult with and consider the recommendations of the department of health, the aquatic biologist of the department of land and natural resources, the natural area reserves system commission, the University of Hawaii cooperative fishery unit, the United States Fish and Wildlife Service, the department of agriculture, the mayor of the county in which the stream is located, and other agencies having interest in or information on the stream, and may consult with and consider the recommendations of persons having interest in or information on the stream. In formulating the proposed standard, the commission shall weigh the importance of the present or potential instream values with the importance of the present or potential uses of water from the stream for noninstream purposes, including the economic impact of restriction of such uses. [~~In order to~~] Priority shall be given to water used to support agricultural activity on lands identified and designated as important agricultural lands pursuant to part III of chapter 205. To avoid or minimize the impact on existing uses of preserving, enhancing, or restoring instream values, the commission shall consider physical solutions, including water exchanges, modifications of project operations, changes in points of diversion, changes in time and rate of diversion, uses of water from alternative sources, or any other solution; and

(F) Before adoption of an instream flow standard or modification of an established instream flow standard, the commission shall give notice and hold a hearing on its proposed standard or modification;

(2) Establish interim instream flow standards;

(A) Any person with the proper standing may petition the commission to adopt an interim instream flow standard for streams [~~in order~~] to protect the public interest pending the establishment of a permanent instream flow standard;

(B) Any interim instream flow standard adopted under this section shall terminate upon the establishment of a permanent instream flow standard for the stream on which the interim standards were adopted;

(C) A petition to adopt an interim instream flow standard under this section shall set forth data and information concerning the need to protect and conserve beneficial instream uses of water and any other relevant and reasonable information required by the commission;

(D) In considering a petition to adopt an interim instream flow standard, the commission shall weigh the importance of the present or potential instream values with the importance of the present or potential uses of water for noninstream purposes, including the economic impact of restricting such uses[;]. Priority shall be given to water used to support agricultural activity on lands identified and designated as important agricultural lands pursuant to part III of chapter 205;

(E) The commission shall grant or reject a petition to adopt an interim instream flow standard under this section within one hundred eighty days of the date the petition is filed. The one hundred eighty days may be extended a maximum of one hundred eighty days at the request of the petitioner and subject to the approval of the commission; and

(F) Interim instream flow standards may be adopted on a stream-by-stream basis or may consist of a general instream flow standard applicable to all streams within a specified area;

(3) Protect stream channels from alteration whenever practicable to provide for fishery, wildlife, recreational, aesthetic, scenic, and other beneficial instream uses;

(A) The commission shall require persons to obtain a permit from the commission prior to undertaking a stream channel alteration; provided that routine streambed and drainageway maintenance activities and maintenance of existing facilities are exempt from obtaining a permit;

(B) Projects which have commenced construction or projects reviewed and approved by the appropriate federal, state, or county agency prior to July 1, 1987, shall not be affected by this part;

(C) The commission shall establish guidelines for processing and considering applications for stream channel alterations consistent with section 174C-93; and

(D) The commission shall require filing fees by users to accompany each application for stream channel alteration;

and

(4) Establish an instream flow program to protect, enhance, and reestablish, where practicable, beneficial instream uses of water. The commission shall conduct investigations and collect instream flow data, including fishing, wildlife, aesthetic, recreational, water quality, and ecological information and basic streamflow characteristics necessary for determining instream flow requirements.

The commission shall implement its instream flow standards when disposing of water from state watersheds, including that removed by wells or tunnels where they may affect stream flow, and when regulating use of lands and waters within the state conservation district, including water development.”

SECTION 5. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 6. This Act shall take effect upon its approval.

INTRODUCED BY:	_____________________________

THE SENATE	S.B. NO.	658
TWENTY-FOURTH LEGISLATURE, 2007
STATE OF HAWAII