Ka Wai Ola - Office of Hawaiian Affairs, Volume 20, Number 05, 1 May 2003 — Hilton Waikolōa resort developer balks at paying for illegal use of submerged ceded lands [ARTICLE+ILLUSTRATION]

Hilton Waikolōa resort developer balks at paying for illegal use of submerged ceded lands

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By Sterling Kini Wong The Hilton Waikolōa Village resort owes the state $2 million in back rent and $190,000 in annual rent for the ceded land that a section of the resort sits on according to an independent appraisal done for the state in April. Negotiations are in process between OHA, the Native Hawaiian Legal Corp., the Department of Land and Natural Resources and the Lanpar/HTL, the owner of the resort, to settle the resort's utilization of the ceded lands for the past 15 years. Alan Murakami, litigation director of the Native Hawaiian Legal Corp. said the state's failure to collect on rent from the ceded Iands at Waikolōa not only affects OHA's bottom line but it also affects the rest of the state. "This loss of ineome stream does not only affect OHA, the general public is missing out on 80 percent of the revenue derived from this property," Murakami said. According to the state's Admission Act, ceded lands are held in trust by the state for five purposes, one of whieh is for the betterment of the conditions of Native Hawaiians. OHA receives 20 percent of revenue derived from the use of ceded lands. In 1986 developer Chris Hemmeter filled in submerged lands and

several anehialine ponds at Waiulua Bay while building the 62-acre resort. In response to the development Native Hawaiian fisherman Mervin Nāpe'ahi and the Native Hawaiian Legal Corp. filed a complaint in a U.S. District Court stating that "the state breached its fiduciary responsibilities by not protecting public lands. The state's appraisal was eompleted in accordance with the 1997 decision of federal judge David Ezra in the Nāpe'ahi case ordering

the state to seek fair compensation for the improper development of ceded lands. The Board of Land and Natural Resources approved, in concept, a land exchange for the filled land, a perpetual, non-exclusive, easement for the submerged lands and the payment of back rent for the filled lands from 1986. The 1.8 acres of ceded lands that a part of the Hilton Waikoloa Village resort rests on has been valued at $2.7 million according to the recent appraisal, whieh is based

on market value. Three years ago the Department of Land and Natural Resources appraised the land at $403,626. The property includes the Waters Edge Ballroom, whieh is one of the hotel's seven restaurants, portions of the dolphin lagoon and sections of the boat and tram systems. Lanpar refused a possible land swap in settlement with the state for the land appraised at $2.7 million and has indicated that it would prefer to litigate than to lease the land. In 2000 OHA and the Native Hawaiian Legal Corp. said they would sue DLNR if a land swap was agreed to as settlement. "Our position is that the ceded lands are always ceded lands," Murakami said. "We would oppose any land exchange." The DLNR threatened to evict the resort three years ago when settlement negotiations stalled. Muraka'mi said the state should go ahead and evict the resort. "The hotel is squatting on that land," Murakami said. "What would happen if that was a Hawaiian on that beach?" Murakami questioned how many other cases are there in whieh the state is not fulfilling its fiduciary responsibilities in collecting rent on ceded lands. "This is just one case, a 1.8 acre pieee of land in 1.8 million acres of ceded lands," Murakami said. "You do the math." •

Luxury resort on ceded lands — Guests at the Hllton Waikolōa iuxury resort enJoy man-made 'beach.' seven restaurants, portions of the dolphln lagoon and boat and tram systems utllizing shorellne ceded lands. Pho»o Aion Muiakami