March 7th, 2006

Rep. Jon Riki Karamatsu Floor Speech on HB 1368 HD1

Rep. Jon Riki Karamatsu
Floor Speech
House Bill 1368 HD1
Relating to Land Use
February 17, 2006

Mr. Speaker. In Support. Mr. Speaker, let's go to the law. The reason why these developments have happened is because the law allowed it to happen. The law allowed one-acre lots to be develped. If you look at the statutes we defined what A and B lands are. C, D, E and U lands, what they are as well. Under A and B, you see a laundry list of restrictions. And under C, D, E and U, we gave authority to the counties. We also gave the authority to the counties to define accessory agricultural uses.

"The Land Use Commision created some rules which conflict with what the restrictions are for A and B. they tried to apply some of the A and B restrictions to C, D, E and U which is not stated in the law. And law supersedes ruling. So I think there might be a conflict in rulemaking versus what the law is stating.

"I think for this issue, there's language that allows this. If you look at 205-2, it's not linited to farm dwellings. You can also build buildings and not grow agriculture on that same lot. You can grow agriculture on other lots. So the law doesn't restrict C, D, E and U the way some attorneys are trying to make it restricted. So who's right or wrong depends on who interprets the law. And in this case the counties were given authority so they did what they did in permitting these developments. They didn't have to go to LUC. So maybe we need to clarify even better because the law doesn't state that the A and B restricitions should be applied to C, D, E and U. People are saying it should, but the law doesn't say that. So I'll just stand by the law. Thank you."

House Floor Written Comments on HB 2771 HD2

Representative Jon Riki Karamatsu
House Floor Written Comments Entere Into the House Journal
House Bill 2771, House Draft 2
Making an Appropriation for an Agricultural Park in Royal Kunia
Tuesday, March 7, 2006


I rise in support.

This bill appropriates monies to the Department of Agriculture's agricultural park in Royal Kunia. The agricultural park is one hundred fifty acres of prime agricultural land and would encourage agricultural development and serve as a buffer between urban lands in Kunia and the mauka agricultural lands. As the demand for urban land development increases, it is vital that prime agricultural land be protected through agricultural parks such as this.

House Floor Written Comments on HB 3068 HD3

Representative Jon Riki Karamatsu
House Floor Written Comments Entered Into the House Journal
House Bill 3068, House Draft 3
Kunia Special Agricultural District
Tuesday, March 7, 2006


I rise in support.

With the drastic increase in urban development in central and leeward Oahu, valuable agricultural lands must be protected. The Kunia agriculture lands bounded by Farrington Highway to the South, Kipapa Gulch and Kamehameha highway to the East, Wheeler Airforce base and Schofield Barracks to the North, and Makakilo Drive, the Makakilo residential urban district, and the Honouliuli forest reserve to the West is considered to be one of the best, if not the best agricultural lands in the State.

House Bill 3068 would establish the Kunia Special Agricultural District (District) and require the Agribusiness Development Corporation (ADC) to acquire public and private lands within the District for the development of agricultural projects and project facilities. The measure appropriates funds into the Hawaii Agricultural Development Revolving Fund to enable ADC to carry out this mission. Lastly, there is a low interest loan program in this bill to help entrepreneurs in the agricultural industry.

House Floor Written Comments on HB 3057 HD1

Representative Jon Riki Karamatsu
House Written Comments For House Journal
House Bill 3057, House Draft 1
Tuesday, March 7, 2006


I rise in support.

The Hawaii small business innovation research grant program was created to encourage small businesses to develop commercially viable technologies or innovations. Prior to 1989, there were only two Hawaii small business innovation research grant program-awarded companies, but since 1989, fifty-six Hawaii companies have won two hundred forty-five small business innovation research grant program awards. These grant program awards brought approximately $56,500,000 in federal small business innovation research grant program Phase I and Phase II funds to Hawaii. In addition to these grants, $57,500,000 in Phase III small business innovation research grant program commercialization contracts have been awarded to Hawaii companies. According to the United States Department of Agriculture, Hawaii companies have won the highest number of United States Department of Agriculture small business innovation research grant program awards per capita of any state.

Hawaii must be a strong participant in accessing matching funds from the federal small business innovation research grant program, which has $2,000,000,000 in funds. Hawaii's cumulative state investment in the Hawaii small business innovation research grant program of $3,700,000 has a return ratio of 15:1 in federal Phase I and II grants and 30:1 if the Phase III commercial contracts are included.

The current annual general fund appropriation of approximately $260,000 for the grant program has remained relatively the same over the past sixteen years and actually decreased in some years from a high of $400,000. However, the increase in the number of participating Hawaii companies and grants awarded has caused a significant reduction in the amount of funding available from the Hawaii small business innovation research grant program for recipients of the federal program. Small business innovation research-funded, start-up projects and companies are an important part of the pipeline that feeds and increases the size and number of research and development companies seeking to commercialize technologies in Hawaii. This program, other similar programs, and the efforts of those involved result in a more stable technology-based economy in the state. Therefore, through this bill, the appropriation for the Hawaii small business innovation research grant program, and other related technology grant programs being created this legislative session within the High Technology Development Corporation will be increased to $500,000 to help foster further growth in the technology industry.

House Floor Written Comments on HB 3067 HD2

Representative Jon Riki Karamatsu
House Floor Written Comments
House Bill 3067, House Draft 2
Tuesday, March 7, 2006


I rise in support.

Farming in Hawaii is very competitive with tight margins. This bill will provide eligible farmers an opportunity to obtain funds at favorable rates, which in turn encourages expansion, improvements, and diversification of their operations.

House Floor Written Comments on HB 3077 HD2

Representative Jon Riki Karamatsu
House Floor Written Comments
House Bill 3077, House Draft 2
Tuesday, March 7, 2006


I rise in support.

This bill authorizes up to $15,000,000 in Special Purpose Revenue Bonds to assist Rosette Steel Hawaii LLC in a manufacturing enterprise. The company will build a new facility to manufacture affordable home trusses and panels. Rosette Steel Hawaii LLC's affordable housing technology produces a superior grade steel product, which enables homes to be erected quickly and affordably. When completed, the facility will be able to produce six affordable homes per day. Finally, Rosette Steel Hawaii LLC's products and technologies can also be exported to other countries.

House Floor Written Comments on HB 3060 HD1

Representative Jon Riki Karamatsu
House Floor Written Comments
House Bill 3060, House Draft 1
Tuesday, March 7, 2006


I rise in support.

Through this bill, the High Technology Development Corporation will be able to extend its existing small business innovation research grant program to include a small business technology transfer program to encourage small companies and researchers at nonprofit research institutions, including research universities and colleges, to work together to move laboratory-developed technologies to the marketplace and to foster technology-based economic development. This program will strengthen Hawaii's technology industry by encouraging the partnership between small companies and researchers.

House Floor Written Comments on HB 3080 HD1

Representative Jon Riki Karamatsu
House Floor Written Comments
House Bill 3080, House Draft 1
Tuesday, March 7, 2006


I rise in support.

This bill is a collaborative refinement by state and county film offices, industry and union representatives of a similar bill that stalled in conference during the 2005 legislative session. It offers significant, but reasonable incentives to stimulate the film and television industry, which experienced a $64 million drop in expenditures between 2004 and 2005.

The bill provides a tax credit amounting to 15 percent of qualified production costs incurred on Oahu, and 20 percent on Neighbor Islands, with a cap of $8 million per production. According to film industry officials, this would make Hawaii competitive with other jurisdictions.

The Department of Taxation submitted testimony in strong support of the measure, stating that the tax credit allows Hawaii to compete in the worldwide marketplace of filming locations and that it is budget neutral, meaning that the tax credit would not impact the state's current expenditures.

The success of "LOST" in winning the Emmy, Golden Globe, and Screen Actors Guild Awards has brought positive attention to the film industry in Hawaii. If we can seize the moment and compete with other localities around the world, we will generate revenue and create jobs for our community.

House Floor Written Comments on HB 2181 HD2

Representative Jon Riki Karamatsu
House Floor Written Comments
House Bill 2181, House Draft 2
Tuesday, March 7, 2006


I rise in support.

This is a very historical bill that will enable Hawaii to have a diversified economy by supporting Hawaii-based businesses in the fields of technology, life sciences, and renewable energy. Currently, Hawaii is in the beginning stages of establishing a strong knowledge-based industry. Unlike other areas of the United States and world, Hawaii-based businesses in these fields lack the amount of capital investments needed to move them from product development to commercial success.

This measure will play a huge role in solidifying a new economy in Hawaii based on technology, life sciences, and renewable energy by establishing $100,000,000 Hawaii innovations partnership special fund for the fiscal year 2006-2007 to invest in these entrepreneurial ventures through grants and capital investments. Thereafter, from 2007 to 2011, there will be an annual appropriation of one-half of one percent of the general revenues of the State into this fund.

House Floor Written Comments on HB 1368 HD2

Representatives Jon Riki Karamatsu
House Floor Written Comments
House Bill 1368, House Draft 2
Tuesday, March 7, 2006


I rise in support.

Agricultural lands of all types were lumped together, ranging from prime agricultural land to land not suitable for agriculture. By 1976, the State classified agricultural land by soil types: A, B, C, D, E, and U. According to the Land Study Bureau, Class A lands are generally the best-suited and most productive for intensive agricultural use. Class B lands include areas that are, in general, definitely suited for intensive agricultural use. They are inferior to Class A lands for one or more reasons that may include crop productivity, less favorable rainfall or other climatic characteristics, steeper slopes, stonier, thinner, and more erosive soils. Class C lands of this classification have, in general, only fair to marginal suitability for production of intensive crops. They are inferior to Class B lands for essentially the same reasons as Class B lands are inferior to Class A areas. In spite of these limitations, some Class C tracts have been used for production of intensive crops. Class D and E lands are generally unsuited for intensive agriculture for one or more reasons that include infertility, stoniness, excessive or deficient rainfall, unfavorable temperatures, excessive cloudiness, erosiveness, and excessive slope. Finally, Class U lands are near-raw lands that are highly variable and among these areas are lava areas. These lands are stony with limited soil material, and erratic and choppy that discourages cultivation.

The State identified agricultural land with A and B soils as prime agricultural land, thus identifying the land that Chapter 205 of the Hawaii Revised Statutes (HRS) intended to protect. For these lands, the State implemented restrictions contained in HRS §205-4.5(a), including that dwellings must qualify as "farm dwellings." In contrast, regarding C, D, E, and U agricultural lands or marginal agricultural lands, the State did not impose the same restrictions and allowed uses set forth in HRS §205-2(d). This section allows agricultural service and uses that support agricultural activities of the fee or leasehold owner of the property and accessory to agricultural activities, whether or not conducted on the same premises as the agricultural activities to which they are accessory, including but not limited to farm dwelling. Therefore, living dwellings are permissible and agricultural service and uses need only be accessory to agricultural activities. Further, the State gave the counties discretion to further define accessory agricultural uses on one-acre lots and to allow lot sizes of less than one acre if the counties find unreasonable economic hardship to the owner or lessee of the land that cannot otherwise be prevented or where land utilization is improved. As a result, counties have permitted the development of living dwellings on C, D, E, and U agricultural lands throughout the State.

The controversy in legal interpretation is occurring today because the Land Use Commission placed uses permitted on A and B agricultural lands to C, D, E, and U agricultural lands. These rules conflicted with the statutes on what uses are permissible on A and B agricultural lands in comparison to uses permissible on C, D, E, and U agricultural lands.

Currently, there is a case in the courts that could place thousands of single-family dwelling homes on C, D, E, and U agricultural lands in jeopardy and cost the counties millions of dollars should there be an unfavorable ruling. As a result, House Bill 1368 House Draft 1 intends to remove this legal cloud by permitting single-family dwellings on C, D, E, and U agricultural lands provided that not more than ten percent of the project area consists of soil classified as A or B. In the meantime, we must work on improvements to the statutes on agricultural lands to make it more clearly defined to avoid any future misinterpretation.