BOARD OF WATER SUPPLY
COUNTY OF MAUI    
SPECIAL MEETING

 
Held at HGEA Conference Room, David K. Trask, Jr. 
Office Building, 2145 Kaohu Street, Wailuku, Maui, 
Hawaii, commencing at 10:00 a.m. on March 20, 2001.

REPORTED BY:   LYNANN NICELY, RPR/RMR/CSR #354
IWADO COURT REPORTERS, INC.

A P P E A R A N C E S

BOARD MEMBERS:
Elmer Cravalho, Chairman
Bob Takitani
Peter Rice
Jonathan Starr
Orlando Tagorda
Adolph Helm   
Mike Nobriga

STAFF PRESENT:
David Craddick, Director 
Mike Quinn
Howard Fukushima, Corporation Counsel
Fran Nago, Board Secretary 

IWADO COURT REPORTERS, INC.

CHAIRMAN CRAVALHO:  The special meeting of the 
Board of Water Supply will come to order.  Ms. Nago, 
will you determine whether we have a quorum present 
with us?

MS. NAGO:  We have Chairman Elmer Cravalho.  
We have board members Peter Rice, Michael Nobriga, 
Jonathan Starr, Adolph Helm, Orlando Tagorda, and 
Robert Takitani, so we do have a quorum.

CHAIRMAN CRAVALHO:  A quorum is present.  
Before getting into the regular proceedings of the 
meeting, the Chair would like to refer the matter over 
to corp counsel, Mr. Fukushima, who has some 
information for the members of the board as well as 
for members of the public who are here with us.

MR. FUKUSHIMA:  Thank you, Mr. Chairman, if I 
may.  Thirty minutes ago, our office was served with a 
complaint for declaratory and injunctive relief 
relating to the agreement that's the subject of the 
meeting today.  This particular complaint raises 
issues regarding alleged Sunshine Law violations, 
further allegations relating to some of the contents 
of the agreement. 
 At this time we would advise and recommend the 
board defer any action on approving of this agreement.  
We would also request that the Chair place this matter 
on the next board's agenda so the board has an 
opportunity to discuss this action with corporation 
counsel. 

CHAIRMAN CRAVALHO:  You heard the statement of 
the corp counsel to wit that there has been a suit 
filed in court and that this board take absolutely no 
action on the proposed agreement before this body and 
that the matter be placed on the agenda at the next 
regular meeting of the Board of Water Supply for 
discussion by the members of the board.

MR. FUKUSHIMA:  Excuse me, if I may, 
Mr. Chairman.  We would also request that that item be 
placed for possible Executive Session.

CHAIRMAN CRAVALHO:  With the addendum that per 
the recommendation of corp counsel that when the 
matter is placed on the agenda, that the possibility 
is placed on the agenda that there may be a 
requirement for an Executive Session.  At the time the 
board can decide what it wishes to do, whether to go 
into Executive Session or not.  This is the 
recommendation of corp counsel. 
 Mr. Starr?

MR. STARR:  Mr. Chair, the next scheduled 
meeting is Thursday.  I assume that we would not be 
talking about the Thursday meeting, but the next one 
that has an agenda time frame.

CHAIRMAN CRAVALHO:  Your assumption is 
correct.  The agenda for the Thursday meeting has 
already been set and set out and so we will not be 
amending the agenda for the Thursday meeting.  It's 
for the next regular board meeting.  Or special board 
meeting, whatever the case may be. 

MR. PARKER:  Could I suggest that we go ahead 
and take public testimony today, since everyone is here?

CHAIRMAN CRAVALHO:  That is the very next 
thing the Chair was going to announce; that is, all 
the members of the people who are here who wish to 
give any kind of testimony will be allowed to do so. 
 A number of people have already signed up for 
the orderly presentation and Ms. Nago has that list.  
This is not to preclude anyone else who wishes to 
discuss the matter from being heard.  Yes, sir. 

A VOICE:  I have a question.  If you go into 
Executive Session at your board meeting to address the 
issue, who represents the public at that session?

CHAIRMAN CRAVALHO:  That is a legal question 
and refer it to corp counsel for a proper response to you.

MR. FUKUSHIMA:  Thank you, Mr. Chairman.  The 
board would be meeting with corporation counsel to 
discuss the board's responsibilities, liabilities, et 
cetera, pursuant to Chapter 92, which allows for 
Executive Sessions with the board's attorney to 
consult with board members and the board's attorney on 
these sorts of matters.  It is provided by statute 
that these meetings are closed meetings, closed to the public. 

CHAIRMAN CRAVALHO:  All right.  Mr. Maxwell? 

MR. MAXWELL:  Would it be understandable that 
the subject matter would not be the agreement that 
would be discussed in this Executive Session?  In 
other words, what I'm saying is will the contents of 
the agreement be discussed at the Executive Session or 
just the implications of the suit that's been filed?

MR. FUKUSHIMA:  The contents of the agreement 
are relevant to the lawsuit, so there is a possibility 
that the contents could be discussed in context -- in 
the context of the lawsuit.

MR. MAXWELL:  Mr. Chairman, one follow-up 
question.  Wouldn't that then be more important for 
the public to be represented in an open session 
instead of Executive Session?

CHAIRMAN CRAVALHO:  You're directing the 
question to the Chair?

MR. MAXWELL:  I guess for the county attorney, 
which is protocol.

CHAIRMAN CRAVALHO:  The Chair can only respond 
on the basis what the Chair's actions have been in the 
past.  The Chair has been on record as being opposed 
to Executive Sessions.  The Chair has also indicated 
many times in the past that any matter of public 
interest can properly be brought before the board and 
that will continue to be the position of the Chair, 
although at this particular time I believe at that 
time there will be another Chair sitting here and I'll 
be a member.  But I'll basically maintain my position. 
 The matter -- aside of the legal implications, 
which are of another nature, but with respect to the 
contents, the merits or the demerits, in the Chair's 
opinion and the Chair's position is that it warrants 
complete and total revelation and openness to the 
public at all times.  And that is not a new position.  
It has been the position of the Chair from just about 
day one. 

MR. STARR:  Mr. Chair, I would like to 
compliment the Chair on his very well said comments 
and I would just like to echo it in the words of Part 
92, which is the Sunshine Law that I believe this case 
is about.  And the declaration of policy and intent of 
the Sunshine Law states that in a democracy, the 
people are vested with the ultimate decision-making 
power.  Governmental agencies exist to aid the people 
in the formation and conduct of public policy.  
Opening up the governmental processes to public 
scrutiny and participation is the only viable and 
reasonable method of protecting the public's 
interests.  Therefore, the legislature declares that 
it is the policy of this state and the formation and 
conduct of public policy, discussions, deliberations, 
decisions, and action of governmental agencies shall 
be conducted as openly as possible.  To implement this 
policy, the legislature declares that it is the intent 
of this part to protect the people's right to know.  
The provisions requiring open meetings shall be 
literally construed, and the provisions providing for 
exceptions to the open meeting requirements shall be 
strictly construed against closed meetings.  Thank you. 

CHAIRMAN CRAVALHO:  The Chair appreciates the 
position of Member Starr and it's consistent in terms 
of their objectives with the position that the Chair 
has taken.  We can differ on the contents, but the 
procedure and the ability and the right and the need 
for the public to be fully informed as to what is 
being done or what positions are being taken cannot be 
denied.  And this has been the position of the Chair 
for a long, long time, long before many of you may 
have even been born.  Yes, sir. 

A VOICE:  It's my understanding that if you 
have an Executive Session and the discussions within 
that Executive Session require some action on the part 
of the board, that the action would be subject to a 
public hearing.

CHAIRMAN CRAVALHO:  I'm not precisely sure 
whether there will be a public hearing per se.  It 
would have to be done in public because there are 
different requirements.

MR. FUKUSHIMA:  That's correct, Mr. Chairman.  
Any decision must be made in the public meeting. 

A VOICE:  I've got a question.  I'm Sandra 
Amoral.  For corp counsel, because it is a legal 
question.  The privilege of the board here to convene 
to Executive Session is one that is privileged, I 
believe, and please correct me if I am wrong, to 
discuss the legal ramifications as it affects the 
board because if it affects the board, it affects the 
people because if you get sued, we get sued, because 
that's just the way you sit. 
 When it comes to negotiations of this contract 
with the partners, is that a part of the negotiations 
that is otherwise open to the public rather than being 
discussed in Executive Session?  My question basically 
is are we dividing legal ramifications as opposed to 
negotiations?  Because I believe that the public -- at 
least those in Kihei that I have spoken to -- are 
concerned with the board putting together negotiations 
in a contract which binds the resources of the people, 
of which the state is trustees, and we really not 
having any say. 
 If in fact the purpose of the Executive 
Session is to discuss legal ramifications, then I 
believe the people have -- at least those that I speak 
to and myself -- have no objections to that because 
that is your right and your privilege by law.  
However, when it comes to negotiations, I believe that 
the people should from the very beginning onset of any 
negotiations you make with resources that belong to 
us, the people, should be left open to public scrutiny.

CHAIRMAN CRAVALHO:  The Chair is particularly 
pleased with your comments and your comments are 
received in the spirit in which it is intended.  The 
very questions you raise, to the understanding of the 
Chair, are contained in the lawsuit that is pending 
before the body and pending before all of us and 
pending before the County of Maui.  And the Chair does 
not wish to be repetitious, but the Chair has given 
every assurance, as far as this Chair is concerned, 
this is the method that will be followed.  And the 
question as to whether in fact there were any kind of 
negotiations that did take place contrary to the 
requirements of the law, both morally as well as 
legally, are part of the suit which will be discussed 
in the appropriate chambers. 
 And the Chair appreciates very much your 
presence and your indication of your concern on behalf 
of yourself as well as on your constituents whom you 
have had an opportunity to discuss the matters with.  
And if this is sufficient to all of us, shall we then 
proceed to receive testimony?  No objection, shall we 
proceed. 
 Ms. Nago.  First, people who wish to testify, 
please come up to the chair up front to be close to 
the microphone so that it can all be duly and 
appropriately recorded. 

MS. NAGO:  The first person to speak is Sally Raisbeck. 

MS. RAISBECK:  Thank you, Mr. Chair.  I have 
submitted written testimony to the board.  I believe 
you did receive copies this morning -- or rather I 
submitted documents.  And I would like to just speak 
briefly about what was submitted.  I would then like 
to say some words about the public trust doctrine.  
Then I would like to look at a few questions about 
Mr. Takitani's cover memo and Mr. Figueiroa's letter 
to Mr. Takitani, and then just a few comments about 
the agreement itself. 
 First of all, the testimony that I believe you 
have before you includes the first three pages of the 
Waiahole Ditch decision given last August by the 
Hawaii Supreme Court.  Those pages include the table 
of contents and also the list of parties. 
 Secondly, I submitted a 20-page summary and 
commentary on the public trust aspect of that 
decision.  This was written by Jim Paul, the attorney 
for Hawaii's Thousand Friends who was one of the 
prevailing attorneys in that suit -- or rather that 
appeal, pardon me.  He is the one who framed the 
position about the Hawaii or the state water resources 
trust that was fully accepted by the Supreme Court. 
 Third, I submitted Board Member Starr's 
viewpoint which was published in the Maui News 
Saturday, as well as a letter to the editor by me. 
 The public trust -- the reason I submitted the 
first three pages of the Waiahole decision is because 
that table of contents shows what importance the 
Supreme Court puts on the public trust doctrine.  It 
gives -- from page 37 up to page 70, it gives you the 
history and development of that, starting with the 
mahele, the relationship to the State Water Code, it 
specifically defines the state's Water Resources 
Trust, the scope of the trust, the substance of the 
trust, the purposes of the trust, the powers and 
duties of the state under the trust, and the standard 
of review under the trust. 
 In figuring out how I could convince all of 
you of the importance of this decision, I wrote down a 
list of the parties to that appeal.  The parties who 
argued with very high priced legal talent before the 
Hawaii Supreme Court before their decision included 
the State Water Commission, the Bishop Estate, Castle 
& Cooke, the Campbell Estate, the Robinson Estate, the 
Honolulu Planning Department, the Honolulu Board of 
Water Supply, the Department of Agriculture, the 
Department of Land and Natural Resources, the Hawaii 
Farm Bureau, the Land Use Research Foundation, a golf 
course -- another commercial use -- and the Navy.  And 
on the winning side, the parties were Hawaii's 
Thousand Friends, the Waiahole-Waikane Community 
Association, the Hakapuu Ohana, and Kane Hui Hawaii. 
 So obviously this question of water law was 
very thoroughly argued from a number of different 
viewpoints and this decision includes, as I say, 
starting from the mahele, the law of Hawaii about 
water, including all the important decisions, 
including the constitution, and including the water 
code.  So it's very important.  If you yourselves 
would care to read those pages from 37 to 70 of the 
decision, you can obtain it from the corp counsel's 
office and it's possible for lay people to read that 
and understand what it says. 
 Secondly, I would recommend you to read the 20 
pages by Jim Paul about the public trust doctrine.  
It's somewhat easier to read than the decision itself 
since it eliminates the legal references to previous 
cases, et cetera.  So that I would recommend your reading.
 Under the Hawaii -- this is -- I am not a 
lawyer and I have not practiced law without a license 
when I say that the public trust doctrine says in no 
uncertain terms that going back to the mahele, the 
water of Hawaii is a public trust for the benefit of 
the people of Hawaii and the state is the trustee.  
Now, the county is not the trustee.  And for the 
county to say they have the authority to give away 
part of this trust is just as -- pardon the word -- 
foolish as for you to say you have the authority to 
give away some of the assets of the Bishop Estate or 
my sister's little private revokable trust.  You can't 
give away assets of a trust when you're not the 
trustee.  And even the state can't give those away.  
They can only regulate its use, it can assign use for 
a certain time for certain purposes to certain people.  
That's all the state can do with the water.  And you 
don't have any authority in that respect. 
 So I won't belabor the point further.  The 
reason I bring it up at all is that this agreement, in 
Section 2 and Section 4, those two agreements where 
you assume you have the authority to assign water to a 
private commercial use, those are illegal, those are 
unconstitutional, and therefore I'm sure they will be 
at some point proved to be unenforceable. 
 So if Makena Resort chooses to loan you up to 
their share of $1.5 million on the basis of an 
unenforceable agreement, you know, that is their 
privilege.  But it's not something I think they're 
very wise to do. 
 So that's about as much as I can say about the 
public trust doctrine.  I hope you will take a look at it. 
 I will just repeat again:  All water in 
Hawaii, groundwater, whatever kind of water, all water 
in Hawaii is part of the State Water Resources Trust.  
The state is the trustee, not the county.  The state 
can allow use of water for trust purposes.  And you 
know how much trustees are bound by the provisions of 
the trust in making use of the assets of the trust.  
So that the state can't do anything it wants with 
water, it has to be bound by the purposes of the trust 
and you can read about them all in the decision. 
 Secondly, I wanted to mention Mr. Takitani's 
cover memo and Mr. Figueiroa's letter.  I'm sorry to 
say that memo contains several incorrect statements.  
Page one implies that the settlement -- that the 
agreement settles how much water has been consumed by 
the JV partners, how much is still outstanding, and 
how much source credit they have utilized.  The 
agreement contains nothing about these subjects. 
 Page 2 of the cover memo says the JV and Board 
of Water Supply will resolve the issue of how much 
water has been used and how much is outstanding within 
30 days from the adoption of this agreement.  And 
Mr. Figueiroa of the Makena Resort has provided a 
letter in which he says the parties will exercise good 
faith and diligent efforts to establish those figures.  
However, there is nothing in the agreement that states 
this and Section 14 of the agreement explicitly 
rejects all other proposals, agreements, 
representations, covenants, oral or written, meaning 
that Mr. Figueiroa's letter is legally meaningless. 
 The memo also says incorrectly the agreement 
also addresses where much of the water will come from 
to fulfill the JV's unmet requirements.  There is no 
statement in the agreement as to where the water will 
come from.  There is an agreement that the county and 
the JV will each pay up to $1.5 million in matching 
funds as a loan from the JV for an additional water 
source not within the Iao Aquifer.  But the water 
meant for the Joint Venture is not tied to this 
additional source in any way. 
 Both the cover letter and the agreement 
characterize this loan of up to $1.5 million in 
matching funds as a contribution.  It is, in fact, an 
interest-free loan. 
 On the agreement, Section 1 says that it will 
run until all of the members have used up their 
allocation.  Some of the members may already have used 
their allocation.  Maybe all of the members have 
already used their allocation.  It really behooves the 
board and the parties, the JV, to settle that question 
of how much they have already used before an 
entangling agreement that may well involve you in 
additional very costly litigation is signed.  I think 
that would be very unwise. 
 Section 2 and Section 4 I already mentioned.  
Under the State Water Resources Trust, the Board of 
Water Supply has no authority to provide water to the 
developers.  If you think you do, if you sincerely and 
honestly think you do, I really suggest you should 
check it out with the State Water Commission for the 
benefit of both sides before you sign this agreement.  
Because if those two sections are invalidated or 
declared unenforceable because they're illegal and the 
board has no authority to do what it promises there, 
then it's a very interesting question what would 
happen if this agreement has been signed because there 
is a severability clause in the agreement, that's 
Section 11.  And it says that if any section is 
declared unenforceable, the rest still applies.  Well, 
I don't know how the JV would feel about still being 
obligated for this interest-free loan if they're not 
going to get any water whatsoever. 
 So Section 14, if the Board of Water Supply -- 
again, if the Board of Water Supply finds out it can't 
supply any water to the partners, but this agreement 
explicitly supersedes the source agreement, then it 
seems to me that possibly the Joint Venture is not 
going to have any recourse whatsoever.  So I just 
wonder at their intelligence in signing such a thing. 
 Well, that's really all I have prepared.  And 
I would just strongly urge you to really check out 
with good, experienced, knowledgeable counsel whether 
you have the right to sign -- to promise -- make the 
promises the board is making in this agreement.  Thank 
you, Mr. Chairman.

CHAIRMAN CRAVALHO:  Thank you very much.  Just 
for the edification of you and everyone else, in years 
gone by, the Chair has been I think unique in the 
sense of being standing alone in a number of public 
matters, matters that did go to the State Supreme 
Court at that time in which we appealed to the Federal 
Supreme Court and prevailed.  So the edicts that do 
come up and out of the State Supreme Court by and 
large, if necessary, are not the final -- would not be 
the final arbitration of any question.  And I make 
mention of this only to indicate the persistence in 
the past of the Chair in pursuing what the Chair 
understood to have been the best public interest. 
 The Chair would also like to add, for you and 
for others who are present here with us today, that 
the position of the Chair is somewhat confining in the 
sense that the Chair has a responsibility of keeping 
things going.  So the Chair looks forward with great 
anticipation to being removed from the Chair so the 
Chair can participate in a whole variety of these 
things as we go along. 
 History, if I may, ma'am, will record the very 
essence of what you have made reference to with 
respect to the public trust and with respect to public 
water being the property of the public.  And this has 
been recorded in the history of Hawaii for a long, 
long time.  The practice or the utilization of this 
asset, however, does fall within the purview of the 
overall public. 
 Just parenthetically, the Federal Supreme 
Court, in the case of a number of cases in the state 
-- great state of Colorado, where public questions 
were placed on the ballot and gained an overwhelming 
indication of public support in that [inaudible], the 
State Supreme Court ruled those [inaudible] illegal  
if they violated -- if they violated the provisions of 
the laws of the land. 
 So if we keep these factors in mind that all 
of us collectively, as well as individually, we want 
to see that the laws of the lands are carried out by 
all parties and with your help.  The Chair has 
appreciated your help in the past.
 Are we prepared to proceed, Ms. Nago?

MS. NAGO:  Please correct my pronunciation.  
Sanchia Foiles. 

MS. FOILES:  Good morning.  I would like to 
testify.  My name is Sanchia Foiles.  I'm from Haiku.  
And I want to testify on behalf of all the streams on 
East Maui that have been closed off by the use of 
water for agriculture and for other diversions into 
the flat lands where it's hot and there is no water. 
 The streams are very important to children.  
And I'm sure if you have children, they played there, 
they played in the waterfalls, they played in the 
pools, and it's just almost pathetic what has been 
done to that beautiful country.  It may not seem 
important to you, commercial uses may seem more 
important to you, but part of the commercial use is 
for tourism.  And tourists don't like to go to a place 
that has no running water, no streams, no waterfalls.  
So think about that. 
 And I deeply resent having a corporation ask 
for water from our area, where I assume it will come 
from, and their contribution to the island of Maui is 
not that great.  Tourism could be developed on the 
other side, you know, on our side.  We could have 
catchment systems there for these big hotels instead 
of having everything on the hot side.  That's all I 
really have to say.  Thank you. 

CHAIRMAN CRAVALHO:  Thank you very much.  We 
appreciate your comments.  I'm sure the members of the 
board will keep those in mind.  Ms. Nago, the next 
person, please.

MS. NAGO:  Juan Wilson. 

CHAIRMAN CRAVALHO:  Mr. Wilson.

MR. WILSON:  Mr. Chairman.  Maui is four years 
into a major drought.  According to the U.S. 
Geological Survey, the Iao Aquifer is at a 19-year 
low.  Because of these low levels, salinity in the 
aquifer is alarmingly high.  Maui is brown and dry and 
looking more like Southern California during the brush 
fire season than a tropical island paradise. 
 Moreover, upcountry water restrictions are 
becoming the norm.  Looming in the background is a 
threat increasingly of global warming.  Many 
scientists expect global warming to make our current 
water problems much worse for a long time.  We should 
be cooling population growth on Maui, not encouraging 
it.  Therefore, it is irresponsible for the Board of 
Water Supply to enter a 25-year agreement relocating 
to private parties much of Maui's water. 
 Maui's precious water resources should be held 
in public trust and not for those private developers.  
This is certainly the direction the Hawaii Supreme 
Court took with its decision on the Waiahole Ditch 
dispute on Oahu. 
 Real estate speculation is a risky business.  
You have no moral or legal obligation to make it less 
so.  The agreement before you earmarks much of the 
water to be committed to new resorts and residential 
developments in naturally dry Makena and Wailea.  I 
live in Kihei.  My neighbors are outraged that this 
board has secretly negotiated such a lopsided deal.  
This water allocation will greatly accelerate the 
development which has already created a hellish 
traffic problem that we face today in South Maui.  It 
will be like pouring gasoline on a fire. 
 We are losing the very quality of life that 
makes us love this island.  The residents of South 
Maui said it loud and clear at the transportation 
hearing in Kihei last month.  The solution to our 
problems is to put a moratorium on any new condo and 
resort development in South Maui.  We must focus on 
the long-range planning needs that will make a 
sustainable island paradise for the island of Maui.  
These plans should not be compromised for the sake of 
a few millionaires who will likely boast they can tee 
off from their lanais on to lush green golf courses 
built on barren lava rock. 
 I strongly urge you not to ratify this gift of 
8.9 million gallons of water a day for 25 years for 
the development of more luxury resorts and gated 
communities in South Maui.  Thank you. 

CHAIRMAN CRAVALHO:  The Chair wishes to thank 
you for your presentation.  The Chair would also 
extend to the public and to the members who are here 
the appreciation for the orderly conduct that has been 
taking place thus far and with the anticipation that 
this will continue for the remainder of the testimony 
so that all minds can carefully consider all of the 
presentations have been made, keeping in mind the 
assurances that the Chair has given with respect to 
the ability and the requirement that the public shall 
participate in all activities in the future as well. 
 Ms. Nago, will you get to the next person, please.

MS. NAGO:  We have Mr. Shenoweth.

MR. SHENOWETH:  Mr. Chairman, I request that I 
speak from this chair and I'll try to speak loudly.  I 
just want to comment about what I feel is important 
about how we use our asset, our marvelous water that 
we're so lucky to have on this island.  And I think 
that we need to be sure before we have any more land 
use designations or any more zoning of urban kinds and 
to be sure that we don't supply -- have to supply 
water to any new of these kinds of designations, that 
we first take our -- have a board take efforts to be 
sure that we preserve the watershed, prevent the alien 
species from spoiling it, do some stream restoration, 
and make sure that our hillsides can remain green, 
which has value beyond the crop value to our economy 
and to our quality of life.  Thank you. 

CHAIRMAN CRAVALHO:  Thank you.  Ms. Nago. 

MS. NAGO:  Mr. Rob Lafferty.

MR. LAFFERTY:  Thank you.  Chairman, members 
of the board, the intent of my comments today were to 
ask you to defer a decision on this matter, which has 
been down, so there is no need to get into that.  
Ms. Raisbeck and Mr. Wilson and others have pretty 
well covered everything else that I had to say with 
one other exception, so we'll leave that alone, too. 
 I do want to say that, Mr. Chairman, I have a 
keen appreciation for your insistence on proper 
parliamentary procedures.

CHAIRMAN CRAVALHO:  Thank you.

MR. LAFFERTY:  Members of the board, I would 
ask you to keep in mind that the only way to be 
certain of what is in the best interests of the public 
is to receive that information from the public.  And 
as much time as it takes for you to not ask your 
neighbors, but to actively seek the public's opinion 
on this matter in full when all of the information is 
available, would be the best possible course for you. 
 This is a historic decision that you're facing 
and it has implications that go far beyond the 25 
years that the term of this new agreement has outlined. 
 In my opinion, this is a new agreement that 
you're entering to.  This is just my opinion.  The old 
agreement has expired.  Therefore, any agreement you 
enter into is a new one and will have serious implications. 
 The public is interested.  This is not 
necessarily the best venue for you to get everyone's 
opinion.  There are other ways.  They will take time.  
And the media can be of assistance to you in that, perhaps. 
 I urge you to take every step that you can to 
collect as much information, as much feedback from the 
public as you can, and then make a decision once all 
of the information that corporation counsel has to 
offer you, once all of the information about the usage 
of that resource is available, let us know, educate 
us, we'll give you our opinion, then make your 
decision.  And that's what I would say.  Thank you.

CHAIRMAN CRAVALHO:  Thank you very much.  
Ms. Nago, anyone else, please? 

MS. NAGO:  Dennis Fitzpatrick.

MR. FITZPATRICK:  I'm just going -- I did a 
written testimony.  I'm just going to read the written 
testimony.

CHAIRMAN CRAVALHO:  That will be fine.

MR. FITZPATRICK:  I've been involved in water 
issues dealing with the upcountry situation for 16 
years and we've had droughts up there off and on for 
16 years, so it's not a new issue.  Okay? 
 As I participate in yet another meeting 
concerning Maui County water issues, I am concerned 
that the powers that be do not listen to the people 
but to special interests.  The water issue, like other 
infrastructure issues, is a reminder to all that our 
leaders have not done the people's bidding. 
 As a homeowner in the upcountry area since 
1984, I have seen restrictions imposed quite often, 
yet do not see anyone asked to conserve.  We have used 
bricks in our toilets, reused bath water for my 
children, and restricted shower times and frequency, 
plus flushing the toilets as well, remember.  Yet 
after 16 years, the problem is still there.  
Restrictions have been imposed two times since I came 
to a water meeting last summer and was told the new 
agreements would ensure some resolution to the water 
issue.  Well, I know that now the restrictions come 
earlier in the year instead of waiting until summer 
and when it gets only worse. 
 Recent headlines in the Maui News have brought 
issues to the front.  They had a chart which showed 
Kihei getting three inches of rain, upcountry area 35 
to 45, yet who gets the restrictions?  Upcountry, of 
course.  Could this be because we do not want to  
inconvenience our visitors?  Or the delivery system 
for upcountry is not in place to get the job done?  
Well, if so, why not?  After all, you've had 16 years 
to fix it.  I feel it's because residents are not seen 
as counting as much.  The way the problems of 
infrastructure are dealt with is by restrictions for 
water and cones for highway relief.  Where are the 
cones for Kihei?  Where is the restrictions for water 
on other parts of the island which get far less water 
than upcountry? 
 Yet another article dealt with the issue of 
water meters.  Recently upcountry had a meeting, came 
together, neighbors asking for meters and some on the 
list have been on that list for years and they were 
dealing with 80 water meters.  Who gets them, who 
needs them, right?  I was amazed that just recently 
Makena was petitioned by the Maui Prince group for 
1,100 residential housing which I am sure will be 
gated communities and a new hotel.  Yet this is an 
area that has been blessed to get about three inches 
of rain. 
 Then further articles came out to inform me 
that they were one of the original group who provided 
money to have the lines brought to Kihei.  Even though 
the 25-year agreement signed have expired, I have now 
been informed that you have negotiated yet another 
agreement without public input which will ensure their 
needs will be met while the citizens of Maui County 
are pitted against each other for this valuable resource. 
 I took a geology class from the University of 
Hawaii.  I was told that the aquifers of Maui County 
have more than enough water for our needs.  The 
problem is allocating it, getting it to the right 
areas, and insuring a reliable source. 
 The people who entered into the agreement 25 
years ago have made their enormous profits, expanded 
their lands, and now are at a loss as there is not 
enough water for them to continue this rapid growth.  
How do you solve it?  By planning on getting water 
from Haiku and sending it to Central and South Maui.  
Yet Haiku is often under drought restrictions.  Sounds 
like a reverse Robin Hood, taking from the people who 
are always asked to conserve and giving to the barons 
of development to increase profits. 
 Yet another article places traffic at the top 
of priorities.  Yet one can live without cars.  One 
needs water for survival.  Growth can be controlled by 
the issuing of water meters.  How the board can 
continue to allow the growth policies to aid 
developers but not take care of the people of Maui 
County is an injustice you all share responsibility 
for creating. 
 If water restriction 16 years ago and since 
were imposed on the whole island, there would be a 
public outcry to fix the problem.  If only upcountry 
area is singled out, water is not a problem for 
others.  Imagine tourists being asked to put bricks in 
their toilets, flush only a few times a day, and 
please reuse the bath water.  We would have fixed our 
upcountry problem years ago. 
 History has shown that water control is power.  
Wars are fought over water issues as they can cause 
harm to all.  Power should not be in the hands of a 
group of five who chipped in on water source.  Believe 
me, they did this for their benefit, not the residents 
of Maui County.  If not, then upcountry would have 
already had a delivery system in place with wells to 
create equal access and fairness. 
 Development strains our infrastructure.  Area 
is pitted against area for limited resources, yet one 
can question the  will of our local government to do 
the people's bidding.  I feel they have talked on deaf 
ears with regard to water issues.  
 Yet another recent comment in the newspaper 
quoted a geologist as saying that the rainfall on the 
island of Maui contributed to the whole island.  I 
feel upcountry area, which gets statistically more 
rainfall than many others, has therefore been 
subsidizing the other areas, not the way that other 
people see it.  Now we need to develop a policy of 
fairness to all. 
 I feel if a water shortage is called, there 
should be restrictions imposed on all the island.  
After all, on our small island water affects all in 
the same way.  Building should stop until the proper 
infrastructure is in place to guarantee the water for 
life.  I am sure outcry would be for jobs, but what 
good is a job if you have no water to drink?  I feel 
ever family suffers when water is used as a tool to 
restrict some areas and not others. 
 We need to hold accountable all leaders in 
government for our current problems.  The last three 
elections have all put the upcountry issue as a high 
priority.  We have changed the faces in elections, but 
not changed the problem of water.  The recent budget 
by Mayor Apana has no money marked for upcountry water 
that I know of, yet this was an issue he stressed.  
Many in the current council campaigned that the 
problems need fixing and they promised to work on it. 
 I was taught by my father that actions speak 
louder than words.  No action has meant water 
restrictions for upcountry two times since June of 
2000, yet nothing is changed.  Until accountability is 
addressed, the revolving doors of Mayor, Council, 
Water Department, and Planning will keep the spin 
going to protect their inactions and lay blame 
elsewhere.  Enough already.  Fix it or no building.  
It doesn't take a rocket scientist to see that. 
 Finally, the recent article by Mr. Starr makes 
there seem some problem of trust in the way the water 
issue has been handled by the board.  One can only 
wonder has there been a quid pro quo with the big five 
to insure they have power by controlling water and 
thus growth and maximum profits for themself at the 
expense of everyday working people of Maui?   Most 
people can't come to these hearings as they work, so 
access to their views are never really dealt with I 
don't think in a fair manner. 
 As I drive towards Makena beaches, I glance 
upcountry.  It's green about halfway down the 
mountain.  Kihei is brown unless one looks at the 
oasis created by irrigation.  I wonder when the next 
drought caused fire will occur in Kihei or on the road 
to Lahaina.  I question our leaders to fairness when I 
see the fruits of nature's rain on upcountry.  I'm 
confused as to how development continues when 
resources are at their breaking point.  Then I 
remember:  Jobs, greed, profits, maximum use of all 
land, and lack of accountability of our leaders.  
Reality sure hits you hard. 
 It will take wisdom, vision, compassion and 
love for Maui for you all to make the proper 
decisions.  Do not always put the few above the many.  
Hear the people.  Overdevelopment hurts all.  We need 
drilling, increased water capacity, and a guaranteed 
water resource for all.  You know the water is there, 
the allocation of distribution is what needs to be 
fine tuned.  I can only pray you make the right 
choices.  Thank you.

CHAIRMAN CRAVALHO:  Thank you very much.  
Proceed to the next individual, please.

MS. NAGO:  Carl Freedman.

MR. FREEDMAN:  Good morning, Chairman, members 
of the water board.  My name is Carl Freedman.  I live 
here on Maui.  I submitted some written testimony.  It 
has Haiku Design & Analysis as the letterhead. 
 I work under contract for the water 
department.  And as part of my responsibilities, I've 
been trying to refine some of the consumption data 
over the last years.  And because I've been working 
with that, I assisted the department with some of the 
quantification of the partners' historical 
consumption.  But I want to make it clear I'm here on 
my own.  I have a limited scope to my comments and I 
have not discussed any of this with the department.  
These are my own comments. 
 I have various concerns about the agreement, 
but I just want to address one limited set of concerns 
and that is the extent to which the proposed 
settlement agreement seems to go beyond what was 
intended by the Board of Water Supply in its 
negotiations.  And I've listed four areas where I 
think this document -- which was drafted by the Joint 
Venture Partners' attorneys, not by corp counsel.  And 
one thing -- I mean, with the deferral now, you've got 
more time.  I was concerned at the pace of things that 
there would not be a real thorough review of the 
language to make sure that it properly reflected the 
intent of the board and I'm pleased to know that there 
may be some more time to do that. 
 Three of the issues it's really clear that the 
language goes beyond what was intended.  The language 
in the document would obligate the water department to 
provide water service to the partners without any 
charge for transmission, no matter where it was put in 
-- middle of the cane field, new development -- and 
that did not seem to be the intent of the board.  So I 
made a suggested word change that's pretty simple, I 
think, that should be agreeable to everyone. 
 Another concern was that any interconnection 
between the upcountry system and the Central Maui 
system, according to the agreement, would extend the 
applicability of the agreement to upcountry and that 
clearly didn't seem to be the intent of the water 
board.  And maybe that's just a simple wording thing, 
but that -- the specific language, if literally 
interpreted, would do that. 
 And the fourth item there had to do with the 
schedule.  Part of the agreement has to do with an 
explicit process of schedules where the partners would 
present the department with a schedule of the water 
they would need and then the water department would be 
obliged to serve that.  As I understood the original 
intent, that was to give the Board of Water Supply and 
the Department some fair notice of what was coming 
down the pike.  But the wording, the literal wording, 
ould have the effect of obligating the department to 
serve water within as little as two months between the 
October and January dates in there because there is 
nothing that speaks to advance notice and the partners 
can change their schedules however they please 
according to the notice.
I guess the most fundamental issue and one 
that I'm not even sure what the intent of the board 
is, is the first one that I list, and that is the 
unconditional obligation to serve the partners.  Other 
parties who come before the department and the board 
for water service have to obey the existing rules of 
the board which include a finding of adequacy of 
supply, a finding that it will not degrade the water 
surface to other customers.  But the settlement 
agreement is worded kind of point blank 
unconditionally.  They will present you the schedule; 
you will serve them.  The implication is that they are 
not subject of the condition of the rules and I don't 
know where that falls, but that's something I think 
needs to be very clear and explicit before the 
settlement would go into effect. 
 The other effect of that is that if there are 
times in the next 25 years and within the proscribed 
allotments that there is insufficient supply in 
Central Maui, the agreement would give priority to the 
partners over the other public uses that may become -- 
and I don't know what your intent is with that, but 
that certainly goes beyond what the original agreement 
and the past practices are and it goes beyond what was 
agreed in the letter of agreement early I guess it was 
last year with A & B, that intent. 
 So I guess my concerns are that I'm making 
comments on are simply to preserve the intent in light 
of the language.  And I think it's very important to 
look carefully at the specifics for several reasons, 
one of which is the consideration that's in the 
document.  The partners are promising to loan 
$1.5 million.  By my calculation, the value of that to 
the department is worth something about $300,000 to 
$500,000 in interest that the department would not 
have to pay.  The low end if you're using the money in 
the bank with the county, and the high end if you're 
issuing bonds at a new bond issue or whatever.  That 
is a consideration by the partners.  But that comes at 
some cost, too, because if this settlement ever is 
litigated, it puts it out of the league of simply 
being an extension of an old agreement or the 
intention to eliminate ambiguities, but in light of 
this consideration it also makes it a whole new deal 
here.  And I would ask whether that three to five 
hundred thousand dollars is worth the liability you 
may face in subsequent litigation unless you really 
iron out all the uncertainties in the wording and pay 
very careful to the specific wording.  Thank you.

CHAIRMAN CRAVALHO:  Thank you.

MR. STARR:  Mr. Chair, I have a question.

CHAIRMAN CRAVALHO:  Yes, proceed. 

MR. STARR:  Mr. Freedman, I really appreciated 
a lot of your comments.  One thing that struck me was 
that you seem to have some knowledge that the 
agreement was written by the lawyer for one of the 
Joint Venture companies.  Were you involved in any 
meetings or negotiations with members of the board 
recently that had brought you to certain knowledge of 
these facts?

MR. FREEDMAN:  Well, as attached to my 
testimony is a letter written to Mr. Takitani.  And I 
originally had a list of concerns and I was trying to 
be sensitive to the fact that this was a negotiated 
agreement.  A negotiated agreement, you can't always 
tell on the face why things are the way they are.  And 
in order to be sensitive to that, I wanted to speak 
with someone who was involved and I discussed the 
matters with Mr. Takitani.  That's just my 
understanding.  You could get factual confirmation of that. 

MR. STARR:  Just him alone, just the one 
person, though.

MR. FREEDMAN:  Yes. 

CHAIRMAN CRAVALHO:  The Chair wishes to thank 
you for your presentation this morning.  I think it 
behooves all of us to be aware of a couple of facts.  
The Chair shares your sensitivity with respect to 
entering into a new era or a new scope or the new 
agreement.  And the Chair has indicated this in the 
past.  The Chair would have extreme difficulty in 
supporting any new agreement.  That's number one. 
 Number two.  The Chair also expressed the 
concern that if the parties didn't agree to a 
document, then a document could be submitted to this 
body by anybody who was a party and let it rise or 
fall on the merits.  And the Chair also indicated more 
than once that the Chair would have great difficulty, 
extreme difficulty, in supporting a new agreement that 
departed from the position and the policies of the 
board. 
 The Chair does this, making this public, to 
convince if possible any of the doubting Thomases in 
the community.  The position of the Chair does require 
a certain level of conduct.  It does not detract and 
check the records that go back 50 long years.  Check 
the records as to where the Chair stands on the rights 
of the public.  To be heard, to be involved, and 
finally to implement overall. 
 And just parenthetically, I think we all can 
take great pleasure and satisfaction that if the 
policies of the past had not been initiated and made 
part of the future of this community, the vast 
majority of you who are sharing with us the same 
concern and the same interest in this place would not 
be here.  You would not be here.

MR. HALL:  That's not true.

CHAIRMAN CRAVALHO:  Yes, it is true. 

MR. HALL:  That's not true.

CHAIRMAN CRAVALHO:  The vast majority I said 
would not be here.  And Mr. Hall.

MR. HALL:  If Kihei wasn't developed, we 
wouldn't be here?

CHAIRMAN CRAVALHO:  Mr. Hall, one moment, 
please.  The Chair in many cases has participated with 
you.  And the Chair in many cases operated in the form 
of a rescue basis.  Let's keep the record really 
straight.  And let's keep the sympathies and let's 
keep the objectives of this county in hand at all 
times.  There is room for all of us to participate.  
There is room for all of us to be heard.  And those 
are the facts of the situation.  Now, can we proceed? 
 Mr. Hall, the Chair has advised you in a very 
positive manner and the Chair would appreciate your 
cooperation.  Ms. Nago. 

MS. NAGO:  Hank Levaur.

MR. LEVAUR:  Good morning, Mr. Chairman, 
members of the board, friends and neighbors.  My name 
is Hank Levaur.  I live in Kihei.  I live in the 
subdivision of Maui Meadows.  I am president of the 
Maui Meadows Neighborhood Association and I come here 
representing the board which I canvassed the majority 
of.  And they have -- the only knowledge they have is 
what they have read in the paper.  And what their 
problem is, they're alarmed at the allegations of 
improprieties in the Sunshine Laws.  If proven true, 
the mayor should take swift and appropriate action. 
 As to the issue of water, if the figures 
submitted in the beginning of the agreement were or 
have been proven false, then the figures should be 
recalculated using established figures from historical 
survey and independent survey that should be conducted 
now.  Thank you, Mr. Chairman.

CHAIRMAN CRAVALHO:  Thank you.  Any other, Ms. Nago?

MS. NAGO:  Masako Westcott.

MS. WESTCOTT:  Aloha, good morning everyone.  
I appreciate the opportunity to speak this morning on 
this important issue and I'm greatly encouraged that 
I'm able to speak before this document has been 
signed, unlike the Memorandum of Understanding which 
was signed and public participation was not allowed. 
 Some of the issues I'm concerned about have 
been brought up, but I think they're worth repeating. 
 I do not share Mr. Takitani's pleasure in the 
completion of this agreement which was negotiated in 
secret.  He claims it is both necessary and good for 
Maui County.  In my view, this agreement is a water 
grab and the BWS negotiating committee is an 
enthusiastic participant. 
 Mr. Takitani's claim that the agreement 
eliminates the uncertainty that has existed over the 
entire Maui County planning process is absurd.  It 
eliminates planning uncertainty for the four JV 
partners and increases the uncertainty for everyone 
else on Maui, certainly for the hundreds of people 
waiting for water meters.  Once again, big developers 
go to the front of the line. 
 Mr. Takitani claims this agreement reveals 
where much of the water will come from to fulfill the 
JV's unmet requirements.  The JV's unmet desires may 
be unfulfilled.  However, the Central Maui Source 
Development Agreement of 1975, in Covenant 10, page 6, 
states that the term of the agreement shall be until 
December 31, 1999.  The County has no further 
obligations.  Importantly, this new agreement does not 
reveal where the water will come from to fulfill 
anyone's requirements. 
 Mr. Takitani claims this agreement reveals how 
some of the funding for new wells will be 
accomplished.  In Section 5, the cost of new water 
projects, it states that the ventures will loan, not 
give, the County $1.5 million toward the cost of the 
BWS's development of an additional unnamed water 
source, not within Iao aquifer. 
 Since we do not know where this mythical water 
source is, nor the cost of extracting and delivering 
the water to the joint venture anywhere in the 
expandable Central Maui service area, we don't know 
the cost of the project. 
 This agreement does not reveal where the BWS's 
money would come from for developing this water 
source, nor does it reveal where the BWS will get the 
$375,000 each year for five years it agrees to repay 
the joint ventures beginning one year after signing 
this agreement. 
 Mr. Takitani's highlights raise more questions 
than they answer.  How was the figure of 8.9 million 
gallons a day claimed to have been developed by the 
venturers arrived at? 
 Mr. Takitani says the Joint Venture and the 
BWS will resolve the issue of how much water has been 
used and how much is outstanding within 30 days from 
the adoption of this agreement.  Why not now?   Why 
not welcome public review of this crucial element of 
the agreement?
 In Section 2, Water Allocation, the BWS 
negotiating committee promises 8.9 million gallons a 
day to the venturers and releases them from any 
obligation to fund any well, water source, or water 
improvement necessary to obtain this specific water 
allocation. 
 The BWS negotiating committee is willing to 
enter into an agreement without naming the water 
source, without knowing the cost of the project, 
without knowing the amount of water it is obligating 
Maui County to provide to these big time developers.  
They pay nothing. 
 This agreement exposes the people of Maui to a 
serious and costly liability.  In Section 3, the right 
of each Joint Venture member to use water allocation.  
Each Joint Venture member shall have the right to use 
its allocation for property it previously owned, now 
owns, or subsequently acquires within the expandable 
Central Maui service area.  Rights and credits under 
this agreement may be transferred.  Here, the BWS 
negotiating committee is abdicating its role as 
representatives of the people and stewards of the 
public trust and is endowing the Joint Venture 
partners, all wealthy land owners and big time 
developers, with the power to make land use decisions, 
crowning them water barons. 
 The 1975 agreement included a provision on 
page 9 which declared the BWS has the right to reduce 
the allocation of water in the event of a drought, in 
the event of a declaration of an emergency due to a 
public calamity, in the event of a compelling public 
need requiring the equitable redistribution of water 
allotments in the Central Maui area and the plan of 
equitable redistribution is not discriminating or 
arbitrary and is in the public interest. 
 Unlike the previous agreement, this new 
agreement -- which should not be construed to be 
anything but a new agreement -- does not offer this 
remedy.  It fails in every way to serve the public interest. 
 Today is the first opportunity for the public 
to participate in this issue.  I call for a disclosure 
of all pertinent documents, the minutes of the 
February 27th meeting of the negotiating committee, a 
complete, open, and factual presentation of each Joint 
Venture members' existing water use and the standards 
for determining future water usage, an examination of 
the ramifications of the Waiahole decision on this 
proposal, and all hydrological and environmental 
reports on any area under consideration as a new water 
source. 
 Until the BWS negotiating committee and the JV 
Partners participate honestly in a public review, I 
reject this proposal. 
He Ui he ninaui ai'a i hea ka wai a kane.  
Thank you. 

CHAIRMAN CRAVALHO:  Thank you very much. 

MS. NAGO:  Mark Sheehan.

MR. SHEEHAN:  Good morning, members of the 
public and Mr. Chairman and board members.  It's a 
pleasure to be here this morning to talk about this 
critical issue. 
 I am appreciative of the other face of the 
Chair which is more conciliatory and more open to 
public input, as contrasted with his more autocratic 
style in previous meetings like last week and the time 
we had the Memorandum of Understanding.

CHAIRMAN CRAVALHO:  The Chair appreciates your comments.

MR. SHEEHAN:  I'm sure you would.

CHAIRMAN CRAVALHO:  And like you, we change to 
meet the requirements of the time.

MR. SHEEHAN:  I would also, since there are so 
many people here, I would like to ask how many people 
here came to speak in favor of this agreement and the 
adoption of it?  Would you please raise your hand or 
indicate that you're here for that reason?  Maybe we 
could assume --

CHAIRMAN CRAVALHO:  One moment.

MR. SHEEHAN:  I can't do that?

CHAIRMAN CRAVALHO:  One moment.  The Chair, 
like you, doesn't appreciate having words turned into 
our mouths.  The only observation the Chair was going 
to make was with respect that each person who presents 
testimony is supposed to present testimony that's 
relative to the matter before this body.  And the 
matter that is before this body, even though it may be 
indicated to be dictatorial in nature with respect to 
the Chair's ruling, the matter before this body is the 
agreement.  And we look forward with keen anticipation 
to your participation in focusing attention on this 
particular question. 
 The Chair has no objection for you to ask 
anybody of their particular reason for being present, 
but not at this time and not during your testimony 
period on the matter before this body.  And all other 
participants this morning have cooperated very, very nicely.

MR. SHEEHAN:  May I proceed?

CHAIRMAN CRAVALHO:  Thank you.

MR. SHEEHAN:  Let me explain why we are here.  
It is basically we have come to talk truth to power.  
The reason why people applaud is because someone is 
speaking the truth.  And the perception -- the 
perception is that this board was about to do a power 
grab for the benefit of the Joint Venture people.  And 
it is immoral and unethical and completely 
inappropriate.  And the reason why Maui Tomorrow, has 
a thousand members, and I personally have offered this 
lawsuit today is because we think your conduct is 
really out of touch.  Perhaps 25 years ago it was 
possible to sit down and make some decisions with 
regard to the big water users and the big developers 
and the public wouldn't notice it.  But now the public 
is paying very close attention, times have changed, 
water is critical, the resources are critical, and 
we're at a point where we need to have a very close 
study of the carrying capacity of this island, whether 
it's traffic or water or waste disposal.  And we don't 
have the fundamental information as to how much water 
is actually being used. 
 This document proposes to deliver water that 
we don't know where it exists to people who have no 
particular claim because their contract is expired.  
So there are a lot of serious questions that we have 
with regard to why we should be making this agreement, 
why it was even developed, and under what 
circumstances.  And it would seem that the 
circumstances under which this agreement was developed 
are less than what the law requires.  And this 
particular lawsuit, for your information, raises the 
issue of the Sunshine Law and whether or not the 
negotiating committee was properly appointed and so 
on.  So we look forward to a full disclosure in that regard. 
 I would like to raise some of the other issues 
that are the basis for this suit.  The Central Maui 
Source Joint Venture Agreement is against public 
policy primarily and violates the public trust for 
multiple reasons, including but not limited to the following. 
 The defendants have failed to treat these 
water sources as public trust resources.  The Central 
Maui Source Development Agreement expired by its own 
terms on December 31, 1999, such that there are no 
further controversy to resolve.  The Joint Venturers 
are not entitled to any further water resources under 
any reasonable interpretation of the relevant 
documents, the facts, or the law.  The defendants lack 
the power or the authority to allocate water resources 
as they have done through this settlement agreement, 
this power and authority having been given exclusively 
to the State Commission on Water Resources Management 
by the legislature pursuant to HRS Chapter 174(c). 
 The terms and conditions contained within the 
settlement agreement are so vague and unenforceable as 
to be against the public interest. 
 The settlement agreement violates the state 
water code and the board's own rules and regulations. 
 The settlement agreement gives the Joint 
Venturers absolute top priority on demand to 
undisclosed amounts of water, benefits the Joint 
Venturers never had before, thereby violating the 
public interest and the public trust. 
 The settlement agreement requires defendants 
to construct, at taxpayers' expense, the 
infrastructure to deliver potable water from 
defendant's well field to the Joint Venturers' project 
sites without cost to the Joint Venturers, benefits 
the Joint Venturers never had before, thereby 
violating the public interest and the public trust. 
 The settlement agreement allocates all 
remaining developed water resources and all water 
resources likely to be available in the near term to 
the Joint Venturers and thereby places the public 
interest last and violates the public trust. 
 People made a reference to Mr. Starr's 
commentary in Saturday's paper which I thought raised 
some of the really important issues.  There was in 
Friday's paper a very favorable editorial by the 
editor of the Maui News in which he suggested that 
this Joint Venture Agreement, legal ramifications 
notwithstanding, is a moral obligation.  I beg to 
differ with that point of view because I think there 
is a moral obligation to supply water to the people 
who live on this island, to the people who have been 
waiting 20 years for water, to the Hawaiians who have 
been waiting for water, to the agricultural community, 
and that those interests take precedence and priority 
to the needs and requirements of land developers. 
 So the reason why this suit has been filed is 
so that the interests of the public will be respected 
and we ask you to seriously review the grounds and the 
basis for this settlement agreement.  And I would 
personally like to know what the basis -- if the Chair 
or any members of the board would like to explain to 
us, what is the basis for the allocation of this water 
to the big developers instead of other potential users?

CHAIRMAN CRAVALHO:  The Chair would have no 
objection to responding to your question.  The Chair 
would also anticipate that there would be a public 
reaction one way or another to the Chair's comments.  
However, the Chair recognizes the fact that you and 
your counsel, you have initiated suit in the courts of 
Hawaii and it would be improper for the Chair to make 
any comment at this time. 
 At a subsequent date, when that particular 
question may have been resolved to the satisfaction of 
the parties concerned, and if at that time you would 
be gracious enough to offer an invitation to the Chair 
to participate in the discussion with respect to that 
question, I want to assure you I'll be there.

MR. SHEEHAN:  Look forward to that. 

CHAIRMAN CRAVALHO:  A request has been made 
for a break by a member of the board.  If there is no 
objection, a break for five minutes.  So ordered.

(Brief recess.)

CHAIRMAN CRAVALHO:  It's the understanding of 
the Chair we're about halfway through.  There are 
about 10 or 11 more.  We would like to be able to 
conclude by approximately 1:00 or there about so that 
it would not be necessary for parties to come back 
again -- to break for lunch and come back.  We go and 
finish up so we can pay proper attention to all of the 
presentations.  The meeting will be reconvened.  
Ms. Nago, please. 

MS. NAGO:  Cecelia Vessel.

MS. VESSEL:  Mr. Chairman.  I'm just here to 
say I oppose the signing of this agreement.  I know 
that maybe it's true, maybe that half of us wouldn't 
be here if things hadn't been done 25 years ago.  But 
we're here now.  And we all come from places where 
things like this used to happen and we didn't like it 
there and we're going to try to see that it doesn't 
happen here.  Because water is life.  And in most 
places, even where there is a lot of water, the 
developer puts in the infrastructure.  He puts in the 
roads, he puts in the water, he takes care of all of 
that.  This is the only place I've ever been where we 
pay so that the developer can take our land and 
overbuild.  I don't quite understand it.  And I don't 
understand this agreement.  So thank you so very much.

CHAIRMAN CRAVALHO:  Thank you very much.  
Ms. Nago, we have the next person with presentation to 
be made. 

MS. NAGO:  Jeffrey Parker.

MR. PARKER:  Good morning, Mr. Chairman.  I 
appreciate the manner and spirit in which today's 
meeting is being conducted.  However, I read through 
the original Central Maui Source Agreement as well as 
the new settlement agreement and I can't understand 
why anyone thinks that the Joint Venture is owed 
anything at all. 
 In point number 10 in the original agreement, 
it clearly states that under any circumstances, the 
term of the agreement shall end on December 31, 1999.  
So the agreement is over. 
 Also, the agreement stipulated that the 
Central Maui area sources to be developed in the study 
area are from Iao Valley to Waihee Valley.  But 
everyone knows that the current condition of the Iao 
Aquifer and the North Waihee wellfield are worse than 
in 1996 when the State Water Commission ordered the 
board to reduce pumping. 
 This means that apparently the new water will 
come from some new mysterious source outside the 
original study area.  This nullifies the original 
agreement which begins by describing the study area 
quite distinctly as from Iao Valley to Waihee Valley. 
 Common sense tells us that the water will come 
from East Maui.  And as you know, many legal and other 
issues remain before any East Maui water can be removed. 
 If the parties of the JV were threatening you 
with litigation, the BWS should have called their 
bluff and fought it out in court so that the interests 
of the general public were represented.  What we 
apparently have now is the interests of the developers 
have been placed above those of the general public.  I 
would like to know how does this agreement benefit 
myself and other members of the public? 
 So the source did not meet the optimistic 
yield that the private consultant had projected.  Why 
should the BWS be liable to now make up the 
difference?  And what will happen if the new source 
fails to deliver?  Will the BWS then feel obligated to 
build the developers a giant desalinization plant?  
Where does it end? 
 And we still don't know how much of the 8.9 
MGD talked about in this current agreement is new 
water.  Point number two in the settlement agreement 
says that the parties will resolve the issue of how 
much water has been used and how much is owed within 
30 days from the adoption of this agreement.  Why 
decide the most important aspect after the signing of 
the agreement?  This is crazy. 
 There are many people all over Maui who are 
waiting for their water meters, some for 20 years.  I 
think it's outrageous to give away this water to those 
developers who would trash Maui with more 
inappropriate urbanization.  What we have here is a 
massive betrayal of the public trust. 
 This original deal is a deal that Mr. Takitani 
in his cover letter described as a deal with a 
scarcity of details.  And then when you look at this 
new settlement agreement, details couldn't be more 
scarce.  And finally, Mr. Takitani's glowing cover 
letter says -- I have to go to that, "In the end, both 
sides realized that the risks inherent with litigation 
were much greater than the compromises given in direct 
negotiations."  So you are not concerned with the 
litigation that's now going to come from all of us?  
Thank you. 

CHAIRMAN CRAVALHO:  Thank you very much.  
Ms. Nago.

MS. NAGO:  Charles Maxwell.

MR. MAXWELL:  Mr. Chairman, members of the 
board, the word nawai ola means the water of life.  
This agreement is important for the native Hawaiians, 
for everyone that lives on this island now, but as a 
matter of fact let me just give you a sense of place 
where we are today.  These mountains, these valleys 
here, from Maui is called nawai eha.  The four famous 
waters of Maui:  Waikapu, Wailuku, Waiehu, and Waihee.  
Notice everything is named "wai."  Wai kane is the 
waters of kane.  Kane was the supreme being for the 
Hawaiian people.  Water in the Hawaiian language means 
waiwai.  Kanaka waiwai means a person who owns the 
water or lives by the water is the richest person 
around.  Money was not riches for the native 
Hawaiians; water was. 
 From 1850 to now, western man has degraded the 
use of water.  Presently today, the Iao Aquifer is 
depleted.  We are sitting on an island where the water 
lens comes -- is only one.  There is not separate 
pockets of water that you can drill and replenish the 
aquifer.  There is only one source. 
Mr. Chair?

CHAIRMAN CRAVALHO:  Yes, go ahead, sorry.

MR. MAXWELL:  There is only one source of 
water that you can tap into.  The ancient Hawaiians 
knew that when they use the water for the lo'i, the 
taro patches, their bananas, the wala, the sweet 
potato, it came down through the ahupua'a, the land 
division from the top of the mountain to the ocean.  
They would use the water and have awai.  Awai is 
tributaries that they took water even into the dry 
areas to water their crops. 
 However, that same water was returned to the 
ocean.  Modern man, western man today is ignorant 
because the water is diverted and the streams are dry, 
causing the fauna and flora in the stream and in the 
ocean to die.  Everybody worries about how come there 
is no limu, how come there's no fish anymore.  Because 
there is no fresh water going down into the ocean and 
the fish cannot come up, the juvenile fish cannot 
replenish their life cycle.  They channelize the 
rivers and the streams.  O'opu cannot lay eggs.  The 
ocean fish that come in from juvenile cannot come up 
the tributary because it's all concrete.  But that's 
modern man. 
 Twenty-five years ago when this settlement was 
made, was wrong.  Was wrong to start off with from day 
one.  It was wrong.  Why?  Because we opened up an 
area like Kihei.  Ancient Hawaiians knew, they never 
had settlements in Kihei.  They down the beach.  But 
they would go six months up in the mountain, six 
months down the ocean.  Modern man comes around and 
turns everything topsy-turvy. 
 Twenty-five years ago, Maui would not have 
been built, now, how it is now, and we're not worrying 
about infrastructure now had we had more insight when 
we signed this -- opened up A&B.  They didn't only 
take water.  They took the best beaches away from us, 
away from the public, where we cannot go no more.  
It's all for development.  They got security guards on 
there.  Water is the controlling force behind 
development.  If you furnish water in the next 25 
years, our census will be doubled in the next 20 and 
30 years.  It's a fact.  This morning's paper, Kihei 
community has doubled 28 percent.  I mean, we have to 
-- I mean, thank you everybody for coming.  
Twenty-five years ago, only several of us was yelling, 
nobody would listen.  Everybody would put it down. 
 Mr. Chair, please don't use your 50-year 
record because I was a police officer, remember, and I 
lived on the tyranny, with my family suffered a lot 
under that administration.  So please, I don't want to 
go there, I don't want to talk about it, Mr. Chair, 
but don't tell me about your record 50 years ago. 

CHAIRMAN CRAVALHO:  We're talking about water.

MR. MAXWELL:  We're talking about water.  Let 
me get back to water, Mr. Chair, but I have to throw 
that in, like you.

CHAIRMAN CRAVALHO:  Thank you.

MR. MAXWELL:  We have to collectively come 
together and help the board of directors of this water 
board and Mr. Craddick, who several years ago you were 
the chairman of our upcountry CSE.  He said there is 
plenty of water, no worry, plenty of water.  Where is 
this water?  You know, where is this water? 
 So not going into the legal ramifications 
which a lot of people have testified before me, but I 
wanted to give a Hawaiian concept.  If we're going to 
get back to the basics, let's go back to the Hawaiian 
system and put back water into the streams and the 
water for the people before the developers, before we 
max out Maui and we have no place to go. 
 Who are we creating jobs for by opening up 
this contract?  Our people are moving to the Mainland 
because they can't afford it, these gated communities 
anymore.  Who is the population that we're talking 
about that we want to have upward mobility for?  Who?  
Not our people.  There's new people coming here and 
they're making this a resort community.  Let's not 
make this happen.  Thank you.

CHAIRMAN CRAVALHO:  Ms. Nago.

MS. NAGO:  Robert Karpovich.

MR. KARPOVICH:  Good morning, and thank you 
for the opportunity to speak.  Although I agree with 
many of the comments made today, I do commend the 
board on trying to clarify the issue and come up with 
a determined plan for the future.  It seems going back 
to the 1975 agreement, over all the years I believe 
the newspaper, well, they were owed 19 million gallons 
is what the general public would conceive.  But when 
you read the agreement, there seems to be two parts.  
The first part, the four joint venturers contract 
among each other to attempt to develop up to 19 
million.  So what is the obligation of the board? 
 Well, the second part that the board signs 
says the board shall supply at any time the fractional 
proportion of the quantities of water developed up to 
19 million.  So there is the first part that expires 
in 1999.  It seems like the joint venturers have no 
more obligation or rights to develop after 1999.  But 
the real two little words is why we're here, "the 
board shall supply at any time."  Is this any time 
during and up to 1999?  Or any time in the future?  
The proportion that the joint venturers developed. 
 So the first agreement is unclear and may have 
gone to litigation to litigate that point.  So let's 
not perpetuate it with a second agreement that it has 
been so eloquently stated how totally unclear it is 
and it may infer future rights to the Joint Venture 
members that they never had. 
 The threat of litigation, Klaus Spreckels 
bought a quitclaim deed from a royal heir in the late 
1800's and with that and his buddies, he intimidated 
with threats of legislation the territorial government 
into giving them the apua's of Wailuku.  That's a nice 
gift, 20,000 acres for free.  Let's not let the 
threats of intimidation be repeated today that took 
place a hundred years ago, which is how they got the 
land in the first place.  Thank you very much. 

MR. STARR:  Ms. Nago. 

MS. NAGO:  Glen Shepherd.

A VOICE:  He left. 

MS. NAGO:  Ron Sturtz.

MR. STURTZ:  Good morning, Mr. Chairman, 
members of the board, members of the public.  My name 
is Ron Sturtz and I live in Kihei.  I had many pages 
of notes that I was going to testify to, but we've had 
such eloquent speakers on all sides -- all on one 
side, but all sides of the one side. 
 My background is in the field of law and one 
of the many things I did was to sit as legal counsel 
to a public agency board involving natural resources 
for many years and would give them guidance on some 
very difficult issues.  It's important to look at the 
context of what's going on here today as individuals.  
What does it take to -- what has happened that 
requires an esteemed agency like Maui Tomorrow to have 
to file suit on behalf of the public about something 
the board is trying to accomplish?  Why is it that 
people of all races, economic status, and backgrounds 
are leaving their jobs to come here on a weekday 
morning to testify from their hearts about their lives 
and about issues that are very important to them? 
 This agreement comes within a context.  I 
listened to your words about the emphasis on not 
supporting a new agreement.  I've read the old 
agreement.  I've looked at the new agreement.  It's 
very clear that the old agreement is completely 
expired.  So this should be a done deal.  There should 
be no further discussion.  It's over.  There's nothing 
left.  There's nothing to clarify.  It's done.  And so 
I look forward to your supporting that position and 
there being no further discussion about this agreement. 
 Now, I was present in I guess it was November 
of last year when Wailea 670 presented its proposal 
for development of 1404 units to the planning 
commission.  And the two big issues raised by the 
people were traffic and water.  And much to the 
developer's surprise, the development was not 
approved, it was deferred until they could deal with 
the traffic and water issues. 
 I was present when Makena Resort Corporation 
put forward its proposal for 1,100 units before the 
land use committee of the County Council.  Same 
issues, traffic and water.  The project was deferred 
until these issues -- the water issues are resolved. 
 The Waiahole Ditch decision, I've read that, 
too.  It basically says that the days of giving water 
to the developers at the expense of the people are 
over.  It is no longer permitted and there are no 
grandfathering rights.  Even if you've done it that 
way for a hundred years, there are no grandfathering 
rights.  All of the state's water -- above ground and 
below ground -- is held in trust for the public.  So 
we all agree.  And so we all have the responsibility 
to honor that trust for all the people, not just the 
developers. 
 And so I encourage you to listen to the 
outpouring of public opinion.  I encourage you to 
listen very carefully to the claims being made by Maui 
Tomorrow.  They're not an organization that's being 
financially supported by the developers or any special 
interests; they are representing the people.  And in a 
manner of a few short days they had to step forward to 
file a lawsuit to stop what they thought was a 
travesty going on, to help the board to see that there 
is something really important happening here that they 
have to take a look at. 
 That's what I want to highlight to you all 
today.  Recognize the historic moment we are at on a 
very major life supporting issue which is water.  And 
each of you as individual board members search your 
own hearts and look at your own histories and look at 
your own futures and seek what is in the interest of 
the island as a whole for its future.  We know what we 
have done wrong in the past.  What can we do right 
now?  Thank you.

MS. NAGO:  Jim Smith.

MR. SMITH:  Mr. Chairman, members of the Board 
of Water Supply, my name is Jim Smith.  I am a citizen 
who lives in Haiku and I spend a little time paying 
attention to what's happened. 
 Now, I received from Fran about a week and a 
half ago both documents.  I think that was wonderful.  
Everybody here had the opportunity to examine these 
documents prior to this meeting.  I looked at this and 
came up with obvious conclusions that you don't have 
to be a genius to come up with.  And I'm sure you, 
each of you, knows from the beginning what is 
happening.  But you see, this is the process and we're 
being engulfed by cynicism and we're being engulfed by 
-- what was the word that Mr. Takitani used? 
Dissention and contention?  Well, this is the battle.  
We must resolve this battle and this is the process.  
And what we have here is a report to our 
representatives who were appointed by the mayor and 
confirmed by our council. 
 Now, you represent me and I get this and I 
say, well, this is a committee report with a proposed 
agreement, a settlement agreement.  I'm not sure 
what's being settled.  And when I look at the 
documents, I find, well, the joint venturer, they 
didn't even sign the Board of Water Supply's terms.  
They signed the old agreement on July 21st and then on 
the bottom of that were all these terms that the joint 
agreement didn't sign.  Did they read them?  I don't 
know.  I suspect.  But that's just part of it. 
 So I'm looking at this and I see this letter, 
March 9th, it's not signed by Robert Takitani.  It 
doesn't say he agrees to any of this. 
 This is the process.  We're coming forward.  
We're giving our kokua, if you want to use that word.  
But in any event, so I'm looking at this.  And I'm 
saying to myself, this isn't complete.  So I would 
like for there to be an amendment to this memorandum 
because I'm not sure what the authority of the board 
was by charter when they participated in this, whether 
they were autonomous.  I'm not sure of any -- I'm not 
sure whether the Joint Venture Partners didn't amend 
with a partner and extend this.  So I don't know these 
things and I would like to have it addressed in 
historical context so that at least there will be some 
substance -- I know that the board right now has 
certain powers, different from that time, I believe. 
 So when I examined this, it seems to me that 
public trust is at the heart of it and when we look at 
our political process the way we solve public trust 
problems with the Sunshine Law, but more importantly 
the Administrative Procedures Act.  And to me, this is 
implicated in several ways when you consider that the 
Maui County Council and the County of Maui adopted in 
1991 a chapter regulating water use and permits.  And 
it says allocation of water use.  And it says that in 
those areas where groundwater withdrawal reaches 70 
percent of the sustainable yield, the council shall 
set forth the allocation of water use. 
 Now, has this been superseded or amended?  I 
don't know.  But it would seem to me that on the basis 
of it, you are creating a rule.  Fundamental.  You are 
doing something that by definition of HRS 91 is a 
rule, requires certain public participation.  That's 
what we're doing.  But has to be recognized as a rule 
and not a contract. 
 So when I see in this the use of the word 
contract, I know that that conflicts with public law.  
A contract is on a different set of understanding.  So 
you must, as our public representatives, keep that 
word contract out out out of any agreement because 
that threatens the people.  So I would say that would 
be the first thing is you're reviewing this, it's 
going to happen in whatever your next meeting is, 
you're going to review it further if it goes that far.  
But to me, you've got to improve upon this memorandum. 
 Now, I don't know if there was a committee 
involved.  Because when you start -- and I don't know 
if this is a permanent document that justifies 
somebody getting up in arms about.  I don't know any 
of these things.  But I do know that the process is 
working.  And we're here and most of us are not so 
hurt by what's happening to resort to name calling or 
anything, but I have trust that you guys -- you 
persons or whatever will proceed and reflect the 
wisdom that you are given.  But you need to look at 
this, from my perspective, as rule making.  Simply 
because you're affecting private rights and you have 
to do it so everybody is treated equally.  And that is 
what you need to consider. 
 I think Mr. Takitani is sincere in his work 
and that the venture partners feel that they have in 
fact some problems, that in fact they agreed to 
certain things and those things may or may not have 
happened and there is contention or whatever, okay.  
Well, if you're going to take care of my contention, 
you take care of everybody's contention, but you just 
make everybody sees it so that we know that the 
process works.  And process works.  And I don't have 
to go to court when I have confidence that the process 
works.  But when I don't have confidence, I spend a 
lot of time.  And that's meaningless.  Thank you very much.

CHAIRMAN CRAVALHO:  Thank you very much, Mr. Smith. 

MS. NAGO:  Akahi Wahine.

MS. WAHINE:  Aloha for giving us this 
opportunity to express our deep from our hearts our 
pu'uwai to all of you that are here.  I come on behalf 
of the Kingdom of Hawaii, our nation and our trust.  
E'eve kanakamaole represents its nation which they are 
the nation of Hawaii. 
 And I'm saddened to hear of what these issues 
are today.  We have suffered the great injustice, 
grave injustice upon our people for the past 108 
years.  I believe now is the time that all of your men 
here that heard the past speakers and speaking on 
behalf of their interests as well as the others as the 
people of Hawaii Nei, I believe all of you should 
stop, think, and listen to the voices of the people.  
They are the nation.  You are the officials of the 
government.  You folks got to listen to their voices. 
 Enough of the grave injustice already has been 
to this present date today.  It's time for you folks 
to listen.  Water brings life.  It has been stolen for 
the past years from our people.  The lands has been 
gravely taken from our people.  We are ranked one in 
the islands as the homeless people, as the health 
problem people, imprisonment.  It's time that the 
voices of our people be heard.  It's time that the 
grave injustice stop here at this time.  Listen to the 
cries of even our nakapunas that stands even to ask 
for injustice to stop, to bring justice.  The wrongs 
have to be righted.  And it has to begin somewhere. 
 We labor our times up in Iao to give back to 
the community and give back education to our people, 
to teach the culture and traditions that also was 
taken, the language also has been taken from our 
people.  It's time for now you folks to open those 
doors.  Instead of giving the water to these great big 
companies, these four great big companies -- which 
really there is five.  It's time to give to the most 
needy.  Put us back in priority.  I think it's time 
for it to go back to the kanakamaole again. 
 We love our peoples that come to our islands.  
That's why Hawaii has been given aloha.  It comes from 
the pu'uwai.  Also we speak of our na'au as well.  But 
it comes from the true love that no nation in the 
islands of the world I should say has the gifts that 
we have, the na'au, the true people, the aboriginals, 
we are originals of our islands.  And we do need the 
due respect to our people.  Like those that come into 
our islands and spoke highly of the injustice already 
that has been done. 
 Give the water.  Give the aina.  Give the 
water back to our people.  We need to receive.  It 
takes the life of our people.  Monies was not the 
issue to our people as our nokapunas of our past.  The 
aina gave life.  The aina gave everything to our 
people.  Monies is the issue of this now.  Greed is 
the spirit that flows to the islands of the rich.  
It's time to hear the less fortunate, which we are 
fortunate because the love we have, those who come 
into our islands do not have.
 Now Aloha is bought by the resorts.  They sell 
'em in packages.  It doesn't come from the pu'uwai.  
It doesn't from the na'au of our people.  It's time.  
Because the blood is on the hands of you people of 
great injustice.  It's perpetuating the great 
injustice.  And this is what is happening.  Search the 
heart, search the pu'uwai.  Because you folks are 
partakers of it.  The great injustice is the poisonous 
tree of doctrine that has been come from the overthrow 
1893 to the provisional government, to the Republic of 
Hawaii, to the Territory of Hawaii, and to today to 
call the State of Hawaii.  The poisonous fruits of 
this poisonous doctrine is all those that are sitting 
here in the government today as, quote, officials. 
 It's got to stop.  I thank akua, no more 
bloodshed.  I thank God for our Queen Liliokalani.  
They didn't believe in bloodshed in our people.  I 
don't think we need it.  It can become as smooth and 
peaceful transition if it only goes back to our 
traditional ways.  It wouldn't be such grief upon the 
people of Hawaii Nei if you only can sit and olelo  
and speak the issues out. 
 Stop the injustice.  The monies cannot bring 
life.  No tomorrows are promised.  It's time for it to 
be corrected and we should start opening our pepeaus 
and listen to the voices of the people.  They are the 
nation.  You are just the government.  Without the 
people, you are nothing.  Hear the voices of our 
people today.  Stop being ignorant and looking at the 
monies to benefit the pocketbooks of the government.  
It's the people, not the government that makes the 
difference.  Listen to them.  Mahalo. 

MS. NAGO:  Christina Hemming. 

MS. HEMMING:  Hello.  I believe this 
waterboard has clearly been given the message that you 
all are stepping out of your bounds as a waterboard 
trust in creating any kind of agreement with joint 
venturers.  And I would like to point out a few facts. 
 Each water meter on the islands costs about 
$4,000.  Now, let's just do some numbers.  1,400 homes 
for Wailea 670, 1,100 homes for Makena, two resorts 
part of that, let's just say a thousand rooms, 1,200 
homes in Maalaea Harbor, and let's just throw in an 
extra 300 homes in Kihei that might have gotten passed 
with the last County Council.  That brings it up to 
5,000 water meters if you consider each room or each 
townhouse having its own water meter.  Five thousand 
times $4,000 is $20 million. 
 Now, if this joint venture is only giving -- 
or loaning -- the county one, one and a half million 
dollars and they're receiving $20 million worth of 
water, plus they don't have to pay for infrastructure, 
I mean, that's like better than buying Microsoft in 
1986.  So I mean, what a deal for them. 
 Then who's going to pay for drilling the 
wells?  Oh, is it going to be that lawsuit you guys 
settled a couple years ago for $3 million where they 
polluted DBCP in all the water and then we still have 
to drink it.  And so what, we got the carbon filters, 
thanks a lot.  When are they going to drill the new 
wells to do the polluted wells, shut down the polluted 
wells for good.  Every time we go on upcountry water 
restrictions, you're opening up that polluted well, 
Mr. Cravalho.  So let me tell you, I am really sick 
and tired of it.  I will put all my money, all my 
money into this island to help the people of this 
island because it is so outrageous the greed that is 
occurring.  It is so outrageous.  You're going to 
drill those 25 wells, give five wells to people 
upcountry.  People been waiting over 20 years for 
their water meters.  So you can do the other 20 wells 
with a big four-foot wide pipe going across Maliko 
Gulch from some engineering feat and pipe it all the 
way down.  What about all the people who live on the 
east side?  What about all the streams that are dying?  
What about all the taro farmers?  A lifestyle, a 
livelihood that is equally as important as a resort  
where money is shipped off the island.  It's not even 
really spent on the island. 
 An example of how high integrity Makena 
Resorts are, we all know that they petitioned the 
state land use committee so that they didn't have to 
even pay for their portion of the road system.  So 
they are going to -- we're talking about those kind of 
people coming to the negotiating table with you.  The 
agreement has expired.  It doesn't exist. 
 The perennial streams must be preserved, all 
perennial streams on the island.  Maui should be 
declared a water management area.  The aquifers East 
and West Maui need to be completely identified and not 
by a hydrologist whose wife is a senator, but by some 
other hydrologist. 
 And the Memorandum of Understanding violated 
the Sunshine Law and in fact in a way this is the only 
meeting that we've had that's even been fairly open to 
this agreement.  So I would also like anybody here on 
the waterboard who has friends, family, inlaws, or 
pets associated with any kind of contracts, water 
money, soda money, drywall, paint, anything, where you 
guys all make money, your friends can make money, your 
family can make money, you know, you can't vote.  It's 
a violation of the public trust. 
 So I would just like to say that I completely 
disagree with the way that the waterboard has been 
going and I hope that things can change in the future 
and I hope and trust that the streams and nature and 
taro farming and a quiet way of life that's not 
dependent upon golf courses and swimming pools and 
blasting lava in order to build.  And obviously since 
the highway is going to stop, are you going to go all 
the way up to Ulupalakua and just develop from Wailea 
up to Ulupalakua.  You are not the planning board.  
You are not the land use board.  You are the 
waterboard.  You are supposed to provide water to the 
people who live here now and you're not doing that.  
So why don't we just start from there and shelve this 
agreement so that we all don't have to spend our money 
suing each one of you.  Thank you very much. 

CHAIRMAN CRAVALHO:  Thank you. 

MS. NAGO:  Lucienne deNaie.

MS. DeNAIE:  Aloha all.  Thank you for the 
opportunity to get testify today.  I'm very happy to 
hear that this complex issue has been deferred because 
25 years is a long time to promise anything.  We've 
already been through one 25-year agreement and it has 
generated controversy and I think that if we enter 
into another one that it should be with very, very due 
consideration.
 First of all, I agree with those who have 
spoken before that our knowledge of Maui's water 
resources is extremely incomplete.  So in essence, we 
are spend from an account that we don't really know 
the balance of.  There is rumors that we have fabulous 
amounts of water.  There is dire predictions that our 
saline levels are rising in some aquifers, that even 
in East Maui which is known for its abundant water and 
its watersheds that produce huge amounts of stream 
flow, that the effects of weather patterns and long 
term climate change may leave us 10, 15 years from now 
in a very, very different water situation. 
 So I feel that any kind of agreements that we 
enter into really, really need to be based on an 
understanding of natural principles and many other 
speakers have brought that up so I won't go into it.  
But I think it's an important point that you're 
hearing from the public here today. 
 I also agree with those who say that it's very 
questionable that there is any more water owed.  The 
agreement which I read through is not very clear for 
the reasons that Masako cited very well.  There is no 
clear indication where water would come from, there is 
no clear indication about how that area would be 
extended and what uses would be covered under it from 
the current Joint Venture partners.  It is not in the 
public trust to enter into agreements that are unclear 
and it's my understanding that the original joint 
venture agreement had similar unclarities and that has 
led to problems all the way along the line.  So we 
don't want to repeat the mistakes of the past. 
 When an agreement is not clear, it more or 
less is just giving a blank check to the partners that 
are operating because they're wealthy corporations, 
they have the power to sue, they have the power to 
employ the best to get the highest return for whatever 
promises they have the appearance of having in their 
hands on that piece of paper.  And there is a lot of 
appearances here.  I have to say that, first of all, 
it's like there is an appearance of favoritism is 
present here, that large corporations have the ear of 
a public body far more than the needs of the 
individual people.  There is an appearance of behind 
the scenes dealing, that the public is not well 
informed about what's going on and that when an 
agreement is reached that it's not really clear what 
resources are going to be apportioned and where. 
 There is an appearance of promising a public 
resource without clear and accurate information about 
the availability of that resource, current demand on 
that resource, and future sustainability of that 
resource.  So I think that the very, very clear 
message here is that public trust needs to be based on 
research, on conservation, on restoration of resources 
that have been depleted like our streams in both East 
and West Maui.  East Maui streams have been the 
popular subject, but the West Maui streams will also 
extremely depleted.  Only Makamakaole is a 
free-running stream.  And as a person who hikes these 
streams, let me tell you there is not a lot of native 
stream life in them.  And we also need to, when we do 
use our water resources and apportion them, do it 
extremely carefully and not just be bullied by 
pressure applied by large interests even though they 
do have a lot of swing here.  Let's be realists, a 
large corporation has a lot more influence in a 
community than an individual homeowner like myself.  
But if we listen only to that side of things, we are 
basing our public trust doctrine on exploitation of 
public resources and that is not the intention of the 
public trust doctrine in this state. 
 I would like to also mention that the kind of 
renewing of an expired agreement and the questionable 
legal basis of that appears to be based on ensuring a 
long-term resaleability or bankability for the 
property in question.  As a landowner, I know that if 
I was going to sell my property and I couldn't tell 
someone that they were going to have water with it, 
that value really goes down.  So when I project to a 
major land owner that has thousands and thousands of 
acres, of course they would want to know before they 
offer those acres on the market -- either developing 
them themselves or selling them to other firms to 
develop -- that they could guarantee that there is 
going to be water in place for those lands, otherwise 
the value is greatly diminished.  So I think being 
realistic, it appears to me as just a private citizen 
that that would be one of the largest factors 
motivating this hurried and sort of incomplete and 
vague agreement, as well as the Memorandum of 
Understanding that was discussed earlier in the year 
between the County and A&B. 
 So I would just like to close with a little 
bit of information that was gained through surveying 
the public.  Now, we have 40 or 50 people who have 
come in here to give their testimony, taken time off 
of work.  Obviously they're the tip of the iceberg.  
But I had the occasion at the County Fair this October 
to pass a small survey out and 500 people at random 
were willing to complete this survey.  I might mention 
that 35 percent of the people completing this survey 
live in Central Maui, live either in Kahului or 
Wailuku, and about 30 percent lived assorted upcountry 
locations and about 30 percent between Kihei and 
Lahaina.  So it's a good cross-section of the 
population. 
 More than half of the people filling out this 
survey were property owners in Maui County, about 58 
percent.  Almost 90 percent were registered voters.  
So these are people that have a little stake in our 
future.  They were willing to take a few minutes of 
their time. 
 One of the questions they were asked is if 
they would support a plan to drill wells in East Maui 
and construct a million dollar pipeline funded by tax 
dollars to supply water owed to A&B and other South 
Maui developments through past agreements.  Only 6 
percent of those people surveyed said that they would 
actually support that being done.  Sixty-three and a 
half percent said that they strongly did not support, 
and 20 percent said they just didn't have enough 
information about it because they hadn't heard of any 
such plan. 
 So I think it's pretty clear people are not 
really thinking that this is the direction that this 
board or the county should go.  And you may say, well, 
the water is not coming from East Maui, therefore the 
question is not germane, but we have no guarantee that 
it isn't and I think people would feel the same way 
about wells being drilled at public expense to provide 
this supposedly owed amount wherever those wells were. 
 So I just leave you with that little survey of 
public opinion.  Thank you very much.

CHAIRMAN CRAVALHO:  Thank you very much. 

MS. NAGO:  Kekoa Enomoto.

MS. ENOMOTO:  Members of the Board of Water 
Supply for the County of Maui, I'm Kekoa Enemoto and 
I'm testifying on behalf of the 71 lessees of the 
Keokea Hawaiian Homes Farmers Association for which I 
serve as secretary, and also on behalf of the newly 
formed 10 member Hui Wai.  It's an ad hoc committee 
for water delivery to the Keokea and Waiohuli 
homesteads.  These homesteads represent more than one 
thousand native Hawaiians who will settle on 389 
homesteads in upcountry Maui by the end of next year.  
On behalf of them and also in deference to my brothers 
and sisters on the Kahikinui Hawaiian Homestead on the 
arid southern slope of Haleakala, I respectfully 
oppose the County of Maui ratifying this 25-year 
contract extension proposal with the Central Maui 
Source Joint Venture.  Such a ratification would be 
un-pono for three reasons which I will label one, two, 
and three in the Hawaiian language:  Ekahi, elua,  
ekolu. 
 Ekahi, or one, represents the Joint Venture's 
attempt to be number one in the line for access to the 
water while Hawaiian homesteaders and others already 
are standing in line.  I understand that the State of 
Hawaii partially funded a water treatment facility for 
Maui and in exchange, the County of Maui agreed to 
provide adequate water for native Hawaiian 
homesteaders.  Moreover, it is my understanding -- and 
correct me if I am wrong, Mr. Craddick -- that water 
department director David Craddick agreed in the 1990s 
that 2,000 water meters are to be provided for 
Hawaiian homesteaders on the 6,000 acres of upcountry 
Hawaiian homesteads. 
 Furthermore, the $25 million construction 
project for the Waiahuli Hawaiian Homestead 
infrastructure included water system enhancements that 
will benefit upcountry farmers and residents.  
Therefore, it is un-pono for the Board of Water Supply 
to make such a huge commitment of the County's 
precious limited water to the Joint Venture which has 
enjoyed water access for a quarter century but now 
should move to the back of the line after many others 
waiting for those rights. 
 Elua, or two, represents the two passes that 
the Joint Venture wants to receive about after paying 
for only one ticket to the water.  Ratification of a 
25-year contract extension with a Joint Venturer would 
be like someone going to the movies, paying for one 
ticket, watching the film, then expecting to see 
another movie with the same ticket or a cheaper 
icket.  If anything, the water is much more expensive 
and much more scarce than it was 25 years ago.  The 
Joint Venturer saw its movie on an expired ticket and 
now the current ticket holders want access to the 
water sources. 
 Finally, ekolu, or three, represents three 
native Hawaiian homesteads at Keokea, Waiahuli, and 
Kahikinui, representing hundreds of water meters 
servicing thousands of native Hawaiians.  Remember, 
Water Director Craddick agreed to provide 2,000 water 
meters to home upcountry homesteaders.  The County 
agreed to provide adequate water for native Hawaiian 
homesteaders in exchange for state funding of a water 
treatment facility.  And the $25 million Waiahuli 
Homestead infrastructure installation included water 
system enhancements benefiting the upcountry community. 
 It is time for the Board of Water Supply to 
come on board with agreements made by the water 
department, the county, and the state.  Indeed, it 
appears that it is time for the right hand to know 
what the left hand is doing and for the Board of Water 
Supply to enter into a 21st century holistic paradigm 
of planning that is more integrated with and more 
accountable to the planning commission and all the 
people of Maui County, not to four or five private 
developers that appear to want to keep the County and 
the Board of Water Supply shackled to a plantation 
mentality of planning. 
 In conclusion, please remember, ekahi, the 
Joint Venture does not deserve to be number one in 
line but must go to the back of the line of those 
waiting for water meters; elua, the Joint Venture does 
not deserve two passes to the water after paying for 
only one; and ekolu, three native Hawaiian homesteads 
at Keokea, Waiahuli, and Kahikinui, must, by prior 
commitment and by law, be configured with high 
priority standing in the total picture for future 
water meters.  Thank you. 

MS. NAGO:  Isaac Hall.

MR. HALL:  Good morning, Mr. Chairperson, 
members of the Board of Water Supply.  I represent 
Maui Tomorrow and Mark Sheehan in the Sunshine Act 
lawsuit that's been filed against the board and all 
the nine members.  I won't talk about that lawsuit 
because we'll deal with that in court, except for to 
say that no matter how much testimony you listen to 
today, it won't obviate the violation which has 
already occurred that will void the agreement that you 
entered into. 
 A few comments on the new agreement.  If I 
were the public attorney that had drafted that 
agreement, I would be sued for gross malpractice.  
That agreement is against public policy and violates 
the public trust for the many, many reasons that have 
already been given to you.  But I want to talk about 
three which haven't been talked about enough. 
The Joint Venturers aren't entitled to any 
further water resources under any theory, under any 
fact.  There has been no report presented to you 
showing you why they're entitled to any further water.  
Has anything been presented to you showing to you why 
they're entitled to any further water?  Any document 
that shows why 8.9 million gallons a day they're 
entitled to? 
 Just in my survey of the facts, my 
investigation that I've conducted, I found out Wailea  
Development Corporation doesn't -- is not entitled to 
any more water.  If anything, they owe you water.  And 
all of you know this.  Look at your heads.  You're all 
agreeing with me.  You all know this.  You all know 
this already.  Isn't that interesting?  And A&B isn't 
entitled to any more water.  And you're all going to 
shake your heads, you all know that already, don't 
you?  Don't you?  You know that.  No, you're not going 
to do that any more.  And Hawaiiana Investment, 
whoever they are now, they're not entitled to any more 
water anymore, are they?  You all know that.  They're 
not entitled to any more water.  And so the only 
entity that might be entitled to some more water might 
be is Seibu out there, Roy Figueiroa.  Might be.  
Might be.  Maybe.  Maybe. 
 We're not talking about 8.9 million gallons 
anymore, are we?  All of a sudden, poof, all the air 
came out, we're down to maybe maybe maybe .5 million 
gallons a day, maybe.  Maybe.  Poof, balloon went out, 
poof, pop, down to .5.  And all of you know this.  Why 
don't you just say this and get it all over with so we 
all know, we're not about to give away 8.9 million 
gallons a way.  We're really only talking about maybe .5. 
 I hereby request a contested case in front of 
this board on how much water is owed to these joint 
venturers.  I hereby offer as a matter of proof Wailea 
Development Corporation is owed zero.  As a matter of 
fact, I hereby ask you, Mr. Chairperson, to -- where 
did he go?  He's outside there, isn't he?  Clyde.  
Clyde, come on back in here.  You tell him he owes you 
water instead, okay?  We don't owe him water; he owes 
us water.  Okay?  So let's quit joking around with 
Wailea Development Corporation.  They don't -- we 
don't owe them water.  Let's get them out of the 
picture.  And he gives us some water back instead, 
okay?  So we'll get them with the plus side instead of 
a negative side. 
 And then we'll get A&B out of the picture 
right away.  We don't owe them water, so let's get 
them out of here.  And Hawaiiana, whoever they are 
now, we don't owe them water either.  So Seibu -- Roy, 
come on in here, Roy.  It's you we're talking about.  
So let's have a contested case, you schedule it, 
Mr. Chair, with Seibu, they put their documents on the 
table, we'll have our contested case, see if we even 
owe them .5 and quit fooling around with this thing.  
Okay?  We're going to have one? 

CHAIRMAN CRAVALHO:  If it's before March 31st, 
because my term expires March 31st.

MR. HALL:  Okay.  Let's have one with Seibu.  
Because then we quit fooling around.  Because maybe we 
don't owe them anything.  We don't owe any of these 
people anything and we can quit -- and then this game 
will be over with. 
 Then next point I want to make, move on with 
this thing.  Mr. Chairperson, I think I have been in 
here with you and your legacy, the agreement gives -- 
vaults these people ahead again.  Here we go again.  
And I thought your legacy was we're going to be doing 
that anymore.

CHAIRMAN CRAVALHO:  Mr. --

MR. HALL:  I'm not done.

CHAIRMAN CRAVALHO:  The Chair really 
appreciates what you're saying and the Chair 
appreciates the authority that you're imbuding to the 
Chair.

MR. HALL:  Okay, I won't do it then.

CHAIRMAN CRAVALHO:  Please don't.  Because 
none of us should be facetious on such an important question.

MR. HALL:  I know.  But here we go again, the 
agreement puts A&B, Seibu, whoever Hawaiiana is now, 
whatever their current thing is; Wailea, Seibu, up at 
the top again, over the Kula farmers, over all the 
people on the waiting list for meters.  Over Hawaiian 
Homesteaders.  Here we go again, you guys are about to 
sign another agreement that's going to vault them, the 
developer guys, the big corporations, up on to the 
top.  I thought we're stopping that.  I thought I 
heard all you guys say we're not going to do that 
anymore.  Bob, I thought you told me we weren't going 
to do that anymore and yet you brought another 
agreement, yet another agreement you brought back to 
the board and recommended that they sign that vaults 
the big corporations up to the top and gives them top 
priority again, when I thought we were done with that 
in this modern day and age. 
 Third point:  Where is this water coming from?  
Where is this water coming from?  We've got one well 
that the board is going to dig out there in North 
Waihee and we have a memo now from USGS saying maybe 
there is no more water out there.  So where are we 
going now, guys?  East Maui.  That's the only other 
place it's coming from.  East Maui. 
 So, what is this?  If we're vaulting these 
guys out into the front, what are they going to get?  
They are going to get all of the developed water 
resources and all the reasonably likely developed 
water resources that you had.  You're about to hand 
over to A&B, Wailea Development Corp., Seibu, all of 
the water resources that you guys have and are likely 
to have in the near future.  You're going to get out 
your pens today, you were about to get your pens out 
today and say here, A&B, here, Wailea Development 
Corp., here, Seibu, I'm going to give you our well 
over there in North Waihee that we're about to stick 
in the ground, I'm going to give you our two wells in 
Hamakuapoko, and the first how many wells you want out 
there in East Maui.  You want the first four wells 
we're going to dig?  All right.  Here, you can have 
them.  And let's see, the public, well, you can't have 
that well out in North Waihee.  And the Hamakuapoko 
wells, no, sorry, you can't have them.  And the first 
four wells or the first eight wells in East Maui, no, 
sorry, you can't have them, we already gave them away.  
So maybe in the year 2010 or the year 2020 when we get 
around to digging some more wells or find some water 
somewhere else, we'll get around to giving you some 
wells.  So you farmers up there that we supposedly 
care about, we'll get you some water in 2020.  You 
people that have been waiting around for water meters, 
ah, 2020, 2050, we'll get you some water.  But for 
now, we're just going to give it to Roy out there, my 
friend Roy Figueiroa, so he can build his two new 
hotels and whatever out there, and Seibu, and we're 
going to do that. 
 But let's not do that.  Why don't we first 
have our little contested case hearing here and see 
who's entitled to any water at all.  And then let's 
have this before you leave.

CHAIRMAN CRAVALHO:  That's a physical impossibility.

MR. HALL:  Well, let's get it started before you leave. 

CHAIRMAN CRAVALHO:  We'll take it up Thursday.

MR. HALL:  And if they're not entitled to any 
water at all, then we don't have to give away all our 
water resources to any of them.  And we can be fair 
and we can go on with our business and allocate water 
in a fair and just manner like we're supposed to be, 
instead of just sitting here and taking Bob's 
recommendation.  As I heard Carl Freedman say, he was 
told by Bob that they were just handed over an 
agreement that was drafted by the developer and he put 
a cover memo on it and gave it to you.  That's no way 
to do business.  Howard I guess never even checked it out. 
 So let's not do business like that.  I think 
the first thing we do, let's do a little factual check 
here first and see whether we even owe them any water.  
And since everybody has already nodded -- at least I 
got you on the first one.  Everybody -- everybody 
agreed Wailea Development Corp. is not entitled to 
water.  I couldn't get you to keep going on the rest 
of them.  But let's do a little fact check and see if 
anybody is owed any water.  If nobody is owed any 
water, we're all off the hook.  Let's do that first.  
That should be the first thing we do.  Thank you very much.

MS. NAGO:  Those are the only ones who signed in.

CHAIRMAN CRAVALHO:  Okay, fine.  The Chair 
wishes to thank all of you for your presence and 
participation here today.  I am sure that within the 
time frames that are before us, we will further 
address these questions and we will further make the 
proper decisions including all aspects and all 
elements of the organizational structure of the state 
including the courts, whatever the case may be.  And 
the initiation of that has already been taken place by 
the lawsuits filed by Mr. Hall and his parties and his 
clients. 
 The Chair wishes to instead its appreciation 
again to all of you and to just casually make mention 
of what appears to be the contrasting nature of the 
Chair.  The Chair can be quite dictatorial, as a 
matter of public record, when it relates to the 
noncompliance and nonfollowing of appropriate 
parliamentary procedure.  The answer is yes, and the 
Chair pleads guilty. 
 Today is an excellent indication of how 
orderly business and presentations can be made by 
following the appropriate parliamentary procedure and 
extending the appropriate level of respect to all 
parties concerned.  And you will find the Chair on the 
complete opposite side of the question in every single 
instance when we depart from that kind of an approach.  
And when any individual, the public or whoever, thinks 
that he is above the Board of Water Supply, the 
appropriate parliamentary procedure, the Chair finds 
it extremely difficult to be silent. 
 The Chair again wishes to thank all of you for 
your presence and for your interest.  And the record I 
believe again will show without any apparent criticism 
or implied criticism to any single individuals in this 
community or the state for that matter, that within 
our lifetime and within our tenure we have provided 
the means for greatly and vastly improved community  
and we are enjoying the fruits of that kind of 
activity.  There are other challenges and other needs 
and other questions that come before a body and a 
community at this time and this is what we are 
embarked on.  The source of wisdom does not belong to 
any individual, the Board or the Chair or any other 
person, but collectively we can.  And if the Chair 
carries with himself again, I make mention of the fact 
that being slightly -- no, not slightly, more than 
slightly dictatorial in nature in a number of 
instances, that could be quite correct.  We have 
rules, we have procedures, and we have a definite 
place to play.  And if we all understand that and we 
all participate at that level, life will continue to 
be really good in this county and really good in this 
island. 
 Recognize our mistakes, but hey, hey, like 
what we see once in a while when we look in the 
mirror.  And I want to thank you very much for being 
here today. 
 Mr. Starr?

MR. STARR:  Mr. Chair, I would just like to 
really compliment the actions of the Chair and the 
members of the board for conducting this in a very 
positive and open way, and thank the public for coming 
out.  And I do have one quick comment which is that I 
do believe that sometimes even groundwater can have 
tides and that perhaps in this matter this tide has 
begun to change. 
 I would like to read a brief quote from the 
Hawaii State Supreme Court from the Waiahole Ditch 
decision of last August and I think it's some 
inspiring and interesting words that we might take 
with us. 
 "Although its purpose has evolved over time, 
the public trust has never been understood to 
safeguard rights of exclusive use for private 
commercial gain.  Such an interpretation indeed 
eviscerates the trust's basic purpose of reserving the 
resource for use and access by the general public 
without preference or restriction.  We thus reject the 
view by some that the public interest is a sum of  
competing private interests and the rhetorical 
distinction between public trust and private gain is a 
false dichotomy.  To the contrary, if the public trust 
is to retain any meaning and effect, it must recognize 
enduring public rights in trust resources separate 
from and superior to the prevailing private interests 
and the resources at any given time."  Thank you, sir.

CHAIRMAN CRAVALHO:  Thank you very much.  And 
again, thank you very much.  The meeting is hereby 
adjourned.  

(WHEREUPON, the meeting was adjourned.)

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