9 P.3d 409 (Hawai'i 2000), 21309, In re Water Use Permit Applications

Docket Nº:21309.
Citation:9 P.3d 409, 94 Hawai'i 97
Opinion Judge:[10] The opinion of the court was delivered by: Nakayama, J.
Party Name:In the Matter of the WATER USE PERMIT APPLICATIONS, Petitions for Interim Instream Flow Standard Amendments, and Petitions for Water Reservations for the Waiahole Ditch Combined Contested Case Hearing.
Attorney:[8] On the briefs: Gilbert D. Butson of Reinwald O'Connor & Playdon for Appellee/ Cross-Appellant Puu Makakilo Stephen K.C. Mau and Cheryl A. Nakamura of Rush Moore Craven Sutton Morry & Beh for Appellee/Cross- Appellant The Robinson Estate Margery S. Bronster, Attorney General of Hawaii, Heidi M...
Case Date:August 22, 2000
Court:Supreme Court of Hawai'i
 
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9 P.3d 409 (Hawai'i 2000)

94 Hawai'i 97

In the Matter of the WATER USE PERMIT APPLICATIONS, Petitions for Interim Instream Flow Standard Amendments, and Petitions for Water Reservations for the Waiahole Ditch Combined Contested Case Hearing.

No. 21309.

Supreme Court of Hawai'i

August 22, 2000.

        Reconsideration Denied Sept. 17, 2000.

        As Amended Nov. 29, 2000.

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        [94 Hawai'i 108] Gilbert D. Butson of Reinwald O'Connor & Playdon, on the briefs, for Appellee/Cross-Appellant Puu Makakilo.

        Stephen K.C. Mau and Cheryl A. Nakamura of Rush, Moore, Craven, Sutton, Morry & Beh, on the briefs, for Appellee/Cross-Appellant The Robinson Estate.

        Margery S. Bronster, Attorney General of Hawai'i, Heidi M. Rian, Haunani Burns and Marjorie Lau, Deputy Attorneys General, on the briefs, for Appellees/Cross-Appellants State of Hawai'i Department of Agriculture and Department of Land and Natural Resources.

        Benjamin A. Kudo, Wesley M. Fujimoto and Stacy E. Uehara of Dwyer, Imanaka, Schraff, Kudo, Meyer & Fujimoto, on the briefs, for Applicant/Petitioner-Appellant

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[94 Hawai'i 109] Kamehameha Schools Bernice Pauahi Bishop Estate.

        David Z. Arakawa, Corporation Counsel and Mark K. Morita, Randall K. Ishikawa, Duane W.H. Pang and Reid M. Yamashiro, Deputies Corporation Counsel, on the briefs, for Appellants City and County of Honolulu Planning Department and Board of Water Supply.

        Michael W. Gibson, Douglas S. Appleton and Keith M. Yonamine of Ashford & Wriston, on the briefs, for Applicant-Appellee/Cross-Appellant The Estate of James Campbell.

        Paul H. Achitoff and David L. Henkin of Earthjustice Legal Defense Fund for Petitioners/Appellants Waiahole-Waikane Community Association, Hakipu'u'Ohana and Ka Lahui Hawai'i and Alan T. Murakami and Carl C. Christensen of the Native Hawaiian Legal Corporation, on the briefs, for Petitioners/Appellants Waiahole-Waikane Community Association and Hakipu'u'Ohana .

        Gino L. Gabrio, Patrick W. Hanifin and Laurie A. Kuribayashi of Cades, Schutte, Fleming & Wright and Orlando R. Davidson and David L. Callies, on the briefs, for Appellee/Cross-Appellant Land Use Research Foundation.

        Gary M. Slovin, Margaret Jenkins Leong and Lisa Bail of Goodsill, Anderson, Quinn & Stifel, on the briefs, for Applicant-Appellee/Cross-Appellant Dole Food Company, Inc./Castle & Cooke, Inc.

        James T. Paul, Pamela W. Bunn and Jessica Trenholme of Paul, Johnson, Park & Niles for Intervenor/Appellant Hawaii's Thousand Friends.

        Frank D. Padgett, on the briefs, for Appellant Commission on Water Resource Management.

        James K. Mee of Pacific Legal Foundation and Cary T. Tanaka of Matsumoto, LaFountaine & Chow, on the briefs, for Appellee Hawaii Farm Bureau.

        Jon T. Yamamura and Kevin E. Moore of Carlsmith Ball, on the briefs, for Applicant/Appellee Nihonkai Lease Co., Ltd.

        Lois J. Schiffer, Assistant Attorney General, Robert Klarquist and Andrew C. Mergen, Attorneys, Appellate Section Environment & Natural Resources Division, Department of Justice and Cheryl Connett and Paul M. Sullivan, Attorneys, Pacific Division, Naval Facilities Engineering Command, on the briefs, for Appellee United States Department of the Navy.

        Alan M. Oshima of Oshima Chun Fong & Chung for Appellee/Cross-Appellant The Estate of James Campbell.

        Naomi U. Kuwaye of Dwyer Imanaka Schraff Kudo Meyer and Fujimoto for Applicant/ Petitioner-Appellant Kamehameha Schools Bishop Estate.

        [TABLE OF CONTENTS OMITTED]

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        [94 Hawai'i 110] MOON, C.J., LEVINSON, NAKAYAMA, RAMIL, JJ. and Circuit Judge IBARRA, in Place of KLEIN, J. Recused.

        OPINION.

        NAKAYAMA, J.

        The present appeal arises from an extended dispute over the water distributed by the Waiahole Ditch System, a major irrigation infrastructure on the island of O'ahu supplying the island's leeward side with water diverted from its windward side. In 1995, this dispute culminated in a contested case hearing of heretofore unprecedented size, duration, and complexity before appellee Commission on Water Resource Management (the Commission). At the hearing, the Commission considered petitions to amend the interim instream flow standards for windward streams affected by the ditch, water use permit applications for various leeward offstream purposes, and water reservation petitions for both instream and offstream uses. The Commission issued its final findings of fact (FOFs), conclusions of law (COLs), decision and order (D & O) (collectively, final decision or decision) on December 24, 1997.

        Parties on appeal include: the Commission; appellee/cross-appellant Estate of James Campbell (Campbell Estate); appellants City and County of Honolulu Planning Department and Board of Water Supply (collectively, the City); appellees/cross-appellants Department of Agriculture (DOA) and Department of Land and Natural Resources (DLNR), State of Hawai'i (collectively, DOA/DLNR); appellee/cross-appellant Dole Food Company, Inc./Castle & Cooke, Inc. (Castle); appellee Hawaii Farm Bureau (HFB); appellant Hawaii's Thousand Friends (HTF); appellant Kamehameha Schools Bernice Pauahi Bishop Estate (KSBE); appellee/cross appellant Land Use Research Foundation (LURF); appellee Nihonkai Lease Co., Inc. (Nihonkai); appellee/cross-appellant Pu'u Makakilo, Inc. (PMI); appellee/cross-appellant Robinson Estate (Robinson); appellants Waiahole-Waikane Community Association, Hakipu'u 'Ohana, and Ka Lahui Hawai'i (collectively, WWCA); and appellee United

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[94 Hawai'i 111] States Department of the Navy (USN). We have carefully reviewed their arguments in light of the entire breadth of this state's legal mandates and practical demands. For the reasons fully explained below, we affirm in part and vacate in part the Commission's decision and remand for further proceedings consistent with this opinion.

        I. BACKGROUND

        A. INTRODUCTION

        The Waiahole Ditch System collects fresh surface water and dike-impounded ground water 1 from the Ko'olau mountain range on the windward side of the island of O'ahu and delivers it to the island's central plain. Beginning in Kahana Valley, the collection portion of the system proceeds along the windward side of the Ko'olaus, then passes under the Ko'olau crest to the leeward side at the North Portal. The section of the system known as the Waiahole Main Bore or Tunnel extends from the North Portal to the Tunnel's leeward exit, South Portal Adit 8 (Adit 8). The delivery portion of the system begins at Adit 8 and winds through the plain of Central O'ahu. Measured at Adit 8, the system develops approximately 27 million gallons a day (mgd).

        The ditch system was built in significant part from 1913 to 1916 to irrigate a sugar plantation owned and operated by Oahu Sugar Company, Ltd. (OSCo). Until the plantation ceased operations in 1995, OSCo used much of the ditch's flow, in addition to a substantial supply of ground water pumped from the Pearl Harbor aquifer. At the time of this appeal, various leeward parties still retained, but were not using, well permits to pump approximately 53 mgd of leeward ground water.

        Diversions by the ditch system reduced the flows in several windward streams, specifically, Waiahole, Waianu, Waikane, and Kahana streams, affecting the natural environment and human communities dependent upon them. Diminished flows impaired native stream life and may have contributed to the decline in the greater Kane'ohe Bay ecosystem, including the offshore fisheries. The impacts of stream diversion, however, went largely unacknowledged until, in the early 1990s, the sugar industry on O'ahu came to a close.

        B. PROCEDURAL HISTORY

        On July 15, 1992, the Commission designated the five aquifer systems of Windward O'ahu as ground water management areas, effectively requiring existing users of Waiahole Ditch water to apply for water use permits within one year of that date. 2 In June 1993, the Waiahole Irrigation Company (WIC), the operator of the ditch system, filed a combined water use permit application for the existing users of ditch water. In August 1993, OSCo announced that it would end its sugar operations, signaling the imminent availability of the ditch water used by OSCo and raising the question of its future allocation.

        Conflict ensued. On November 4, 1993, DOA filed a petition to reserve 3 the ditch

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[94 Hawai'i 112] flow for agricultural uses. The Office of Hawaiian Affairs (OHA), WWCA, KSBE, and the Department of Hawaiian Homelands also filed petitions to reserve water. On December 7, 1993, WWCA petitioned to amend upward the interim instream flow standards for the Windward O'ahu streams affected by the ditch (WIIFS); 4 OHA filed a similar petition on February 28, 1995. KSBE and Castle also filed separate water use permit applications specifically requesting water drawn by the ditch system from lands they owned. The petitions to amend the WIIFS and the permit applications collectively exceeded the entire flow of the ditch.

        In May 1994, the Commission received complaints that, with the close of OSCo's sugar operations, WIC was discharging unused ditch water into Central O'ahu gulches....

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