Major Kauai landowner Grove Farm Co. has been allowed to designate roughly one-third of all the land it owns as "important agricultural land" despite concerns raised by a state agency that not all the land is particularly well suited for agriculture.
The state Land Use Commission granted the company’s petition seeking the designation last month under a program created by the Legislature that provides financial benefits for operations and investments on such qualified land.
The LUC voted 7-0 to designate 11,026 acres near Lihue and Koloa.
Grove Farm intends to lease about 10,000 acres of the area to a partnership that includes itself, Kamehameha Schools and Maui Land & Pineapple Co. for growing biofuel crops such as eucalyptus and bana grass. The crops would be burned to generate electricity for Hawaiian Electric Co. on Oahu within the next five years.
The designation preserves such land for agricultural use in perpetuity, and in return provides owners with benefits including tax credits for investments in agriculture facilities, loan guarantees, placement of employee housing on prime farmland and expedited permitting for processing facilities under laws passed in 2005 and 2008.
There also is a controversial benefit that allows landowners to take 15 percent of the acreage designated and develop it for urban uses including housing. However, all applicants to date, including Grove Farm, have waived this benefit.
Grove Farm emphasized its intent to grow biofuel crops on the designated land and said the partnership, Hawaii BioEnergy LLC, has a pending option to lease 10,000 acres.
But the state Office of Planning recommended that only 4,717 acres be granted the designation because much of the property contains poor soil, gulches and ravines.
According to the petition for designation, about 6,000 acres of the land has "very poor" soil under a University of Hawaii rating system.
About 6,000 acres is in active agricultural production, including close to 5,000 acres leased to cattle ranchers. Another roughly 4,000 acres isn’t used for agriculture and includes ravines, gulches and reservoirs.
Grove Farm argued that the steep parts of the land support streams and drainage that are vitally important for agriculture along with reservoirs.
Kauai County’s Planning Department, which is doing its own work to identify important agricultural land islandwide, supported the classification of the entire property sought by Grove Farm.
The LUC vote followed a roughly two-hour visit to look at parts of the site Feb. 8. A written order was published Feb. 25.
The decision helps define what qualifies as important agricultural land under a program still in an early stage.
To date, six important agricultural land petitions have been granted. The first was in 2009 for 3,773 acres on Kauai owned by Alexander & Baldwin Inc. and used to grow coffee and seed corn.
A&B also designated 27,102 acres on Maui at its Hawaiian Commercial & Sugar Co. plantation that same year.
The largest designation was for 56,772 acres on Hawaii island for Parker Ranch in 2011.
In 2011 a Grove Farm affiliate, Maha‘ulepu Farm LLC, designated 1,533 acres on Kauai that supported taro, seed corn, fruit trees and forage crops.
And Castle & Cooke designated 679 acres on Oahu used for diversified farming in 2011. The company had sought to designate 902 acres, but the Land Use Commission rejected 223 acres predominantly occupied by a reservoir and gulch.
None of the companies that have obtained the designation has claimed any benefits under the law.
There is also a side benefit to landowners for voluntarily seeking the designation, and that is limiting how much, if any, land can be involuntarily committed for protection by counties.
Under the law, counties are required to evaluate and select appropriate lands, including privately owned property, for designation. But they can’t impose the protection on more than half of any private landowner’s holdings.
No county has developed a plan yet and begun selecting land, though work is under way.
