POSTED: 28 AUGUST 2008 - 9:00am HST

Condemn Molokai Ranch Lands

image above The Molokai Ranch Lodge main building (30,000sf)

by Karen Holt on 24 August 20008 of Molokai Community Service Council

In the near future, you'll probably be hearing more about the possibility of condemning Molokai Ranch's lands. This note is to give you a brief explanation of the concept and how it could work for Molokai.

Before the explanation, it’s important to know that the County of Maui has the authority to condemn the Ranch's lands all by itself. The County does not need the State’s authorization or support. And the process is surprisingly simple. It only requires the Maui County Council to pass a Resolution authorizing condemnation. A well-drafted Resolution and 5 out of 9 votes are all it would take to condemn the Ranch's lands! If you support this idea, your County leaders need to hear from you ASAP! Their e-mail addresses are at the end of this message.|

And now for the explanation.

" Eminent domain" is the government's power to take private land for the benefit of the public. The process that the government uses to take the land is called "condemnation." Protection of the public's "health and safety" is the government's legal justification for condemning private land.

In the really bad old days, kings, czars and emperors could simply seize a person's land without paying for it. But today, our laws say that government cannot take private land without paying "just compensation" to its owner. So eminent domain is not a license to steal land! The easiest way to understand the concept is to think of eminent domain as a way for government to protect the public by forcing a private owner to sell their land at a fair price.

People in Hawai'i weren't thinking much about eminent domain until Governor Lingle proposed using this power to condemn the Turtle Bay resort on O'ahu's North Shore. After the initial shock wore off, the state Legislature decided to authorize condemnation of the Turtle Bay lands. The bill that authorized condemning Turtle Bay is attached to this message. There are two interesting things about this bill:

1) The Legislature's only "public health and safety" reason for condemning Turtle Bay is: “To protect and preserve Hawaii's historic and cultural heritage." Period.

2) The bill authorizes a 2-step purchase process. First, it authorizes the Governor to negotiate with the Turtle Bay owners to see if a sale can be finalized without the need for condemnation. During these negotiations, the Governor is allowed to work with potential private buyers who might be able to purchase some or all of Turtle Bay themselves, without any help from the government. Second, if negotiations don't work within a "reasonable time," then the bill authorizes the Governor to exercise the power of eminent domain and begin condemnation proceedings.

So how does this apply to Molokai Ranch? We all know that the Ranch's local management has insisted for a long time that the Ranch is not for sale. When they shut down operations in April, the Ranch said that it planned to "mothball" their properties until better times came along. Although the Ranch's top owner, Hong Kong’s Guoco Group Limited, might have private, more practical opinions about selling, their public position (via CEO Peter Nicholas) is that they don't plan to sell.

To justify condemnation, the government must find that there are compelling health and safety reasons in support of such a drastic action. In the case of Turtle Bay, the Legislature decided that it was enough to say that condemnation would protect Hawaii's cultural and historic heritage. That’s a pretty skimpy (though valid) justification. But boy does it ever pale in comparison to the reasons that Maui County has for condemning Molokai Ranch’s lands!

The most obvious justification for condemning the Ranch is its threat to shut down utility services to 1,200 customers. This is a huge threat to public health and safety. The Department of Health’s hearing officer said so formally in his August 14 order requiring the Ranch to continue providing water and sewer services. But the Ranch has not given anyone formal assurance that it plans to abide by the hearing officer’s order, and the order is only good for 90 days.

No developer in Hawai‘i’s history has ever made such a serious threat. Curiously, the State's response to this threat was to have the PUC unilaterally raise customer rates (without even being asked by the Ranch), and to have the Department of Health try to force Maui County to take over the Ranch’s utilities. Thanks to the PUC's decision, Molokai residents are now saddled with rate increases of up to 178%. And although the County successfully defended itself against the State’s efforts to rescue the Ranch, it will be required to provide emergency water service to the Ranch’s customers if the Ranch walks away after the DOH’s 90-day order expires.

Molokai Ranch is owned by a foreign company, Guoco Group, whose most recent business ventures are in international gambling.


The Ranch is its only U.S. property. If the Ranch’s local management decides not to continue providing utility service after 90 days, there will be no way to fine or punish the top owners. The only leverage that our government has against this foreign company is its sole U.S. asset -- the Ranch’s 62,000 acres.

The Council could pass a resolution authorizing condemnation tomorrow (literally). If it chose to follow the Turtle Bay example, it could authorize Mayor Tavares to begin negotiations with the Ranch and potential private investors to arrange a sale at fair market value. If negotiations failed, the Council could then give the Mayor authority to exercise the power of eminent domain, in order to acquire the Ranch’s lands. Risk to taxpayers is minimal because:

1) The County would not need to put up any cash to start condemnation proceedings.

2) The process could be called off at any point if the County found that the Ranch’s threat to public health and safety was resolved.

To take this bold step, the County’s leaders need to know that they have the support of the Molokai community. Molokai’s Council member, Danny Mateo, said publicly last week that he is willing to pursue this option if the community supports it. Councilman Mateo, Mayor Tavares, and the rest of the Council need to hear from everyone! Here is a list of their e-mail addresses:

Mayor Charmaine Tavares

Council Vice-Chair Danny A. Mateo

Council Chair G. Riki Hokama

Councilmember Michelle Anderson

Councilmember Gladys Coelho Baisa

Councilmember Jo Anne Johnson

Councilmember Bill Kauakea Medeiros

Councilmember Michael J. Molina

Councilmember Joseph Pontanilla

Councilmember Michael P. Victorino

If you've made it this far, mahalo nui for your patience in reading this message. Molokai has fought hard to preserve its cultural and historical heritage for decades. Now is our chance to make our voices heard, and to move past the old battles to the huge task of restoring our island’s environment and economy. We can do it! But we need the County’s help to bring stewardship of the last Hawaiian island home from Hong Kong. And the County needs to know that we will stand behind them in this courageous endeavor.

I mua and Ho'i i ka Pono!

p.s. Here's the internet link to the County Code’s laws regarding condemnation: When you get to the site, search for Ordinance Number 3.44.015 in the Index.

And if you want to read more about eminent domain, here are two more websites: (pretty simple language) (seriously legal jargon)

see also:
Island Breath: Preserve Waikomo 8/19/08
Island Breath: Save Poipu 8/3/05
Island Breath: Pall Over Poipu 8/1/05
Island Breath: Haena Burial Site 6/9/08