A controversial proposal to allow the Office of Hawaiian Affairs to develop 30 acres of Kakaako oceanfront land took a key step forward in the state Legislature on Tuesday.

Three Senate committees approved SB 1334, which would lift a residential prohibition on six of OHA’s 10 Kakaako Makai lots and allow for residential high-rises on two of the agency’s parcels on Ala Moana Boulevard.

The Legislature banned residential development in the area 15 years ago after the community rallied in opposition to a proposal by Alexander &Baldwin Inc. to build two condominium towers.

OHA acquired its lots from the state in 2012 in compensation for money owed to the agency from public-lands revenue accumulated over 3-1/2 decades. At the time, the land was estimated to be worth $200 million, and OHA was hoping to be able to generate substantial revenue to underwrite its programs.

But OHA continues to assert that it will be unable to generate enough revenue from the land to meet the rate of return expected of a $200 million investment without the ability to build residential projects.

Under terms of the bill, the height limit would be raised to 400 feet on the two parcels on Ala Moana Boulevard, and OHA would be allowed to convey them to third parties for development.

Tuesday’s joint meeting of the Senate committees on Judiciary, Ways and Means, and Water and Land was reserved for decision-making only, and there was no public testimony.

However, a hearing last month before the Senate committees on Hawaiian Affairs and Housing drew plenty of opposition. Testifiers said nothing has changed from when lawmakers banned high-rises in the makai region in 2006. They said it remains imperative to preserve public ocean access and the last coastal open space in the urban core of Honolulu. Otherwise, they said, the area is destined to become “another Waikiki.”

More than 3,000 people have signed an online petition opposing HB 1334 and its companion bill in the House of Representatives, HB 1267.

Sen. Donna Mercado Kim (D, Kalihi Valley-Moanalua-­Halawa) said she didn’t believe lawmakers should allow the high-rises on the makai lands.

“I think we have an opportunity to save and preserve those views and that vista for future generations,” she said.

But Sen. Michelle Kidani (D, Mililani-Waikele-Kunia) said she suspects much of the opposition comes from those who live on the mauka side of Ala Moana Boulevard.

“To me a lot of this is about the height and not wanting the condos that are there now to have their views disturbed, so I support this bill,” she said.

Last month OHA Board Chairwoman Carmen Hulu Lindsey said the agency envisions a mixed-use project that creates a Hawaiian sense of place, incorporating culture and commerce, and drawing the community to a revitalized urban core.

She described OHA’s vision of Kakaako Makai as a live, work and play community, a place for concerts and hula performances, and restaurants and retail spaces aimed at both locals and tourists. Parking and access to the ocean would be improved.

In January, the OHA trustees established a special Permitted Interaction Group to proceed with planning for Kakaako Makai. Chaired by Lindsey, the committee will examine policies and development strategies and make a recommendation to the full board of trustees within the year.

According to the latest edition of OHA’s newspaper, the agency plans to submit a master plan to the Hawaii Community Development Authority reflecting a best-case scenario regardless of whether the Legislature grants approval for residential development.

And the first property planned for transformation is the old Fisherman’s Wharf restaurant lot, Lindsey said.

OHA expects to team up with “seasoned developers” to help the agency create a variety of revenue streams to support programs for Native Hawaiians, according to the plan.

Lindsey, who took over as board chairwoman in December and made developing Kakaako Makai a priority, said transforming the land cannot be delayed any further.

“Our goal is to make near and long-term progress,” Lindsey said in OHA’s Ka Wai Ola newspaper. “We will make progress on parcels that are ready for immediate movement while we look to overcome challenges with other parcels. We are not going to let the challenges that slowed our progress in the past stop us from moving forward.”