Report Title:

Land Use; Permissible Use; Agricultural Districts

Description:

Deems certain single-family dwellings as approved uses in agricultural districts; provided that not more than 10% of the project area consists of soils classified as A or B.

HOUSE OF REPRESENTATIVES

H.B. NO.

2525

TWENTY-THIRD LEGISLATURE, 2006

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

RELATING TO PERMISSIBLE USES WITHIN AGRICULTURAL DISTRICTS.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. The purpose of this Act is to end damaging controversy over the legality of thousands of homes and lots located on agricultural lands throughout the State. This Act is necessary to protect the substantial investments of the owners of those homes and lots and to protect the counties and others against legal claims that may be asserted if those investments are devalued or lost.

In Hawaii, a recent trial court decision concerning one project has interpreted chapter 205, Hawaii Revised Statutes, in new ways. The reasoning of the decision, if applied throughout the agricultural district, would invalidate thousands of lots in agricultural subdivisions, forbid the construction of homes on those lots, and make it illegal for people to live in thousands of homes already built. According to the decision, homes may be constructed on lots subdivided in the agricultural district only if the county first determines that the owner will conduct agricultural activities on a scale commensurate with the investment in the home. The trial court decided that a subdivision creating one-acre lots in the agricultural district had to go to the state land use commission for reclassification to urban, although state land use law specifically allows one-acre lots in the agricultural district.

The trial court decision is at odds with practices followed by Hawaii's counties for decades. The counties and private developers have not sought approval from the state land use commission before moving forward with subdivisions in the agricultural district creating lots of the minimum one-acre size or larger, because they did not believe they were expected or required to do so. The counties have allowed construction of many homes in the agricultural district, in many cases with little or no agricultural activity connected with those homes. The trial court decision also brings into question the counties' authority under section 205-5(b), Hawaii Revised Statutes, to define allowable accessory agricultural uses.

This Act is intended to remove any doubt concerning the legality of single-family dwellings and projects containing them, in the state land use agricultural district, on lots created before the effective date of this Act, or within projects approved by county zoning ordinances and at least partially built before the effective date of this Act, as long as they are on soils not primarily classified as A or B.

In 1976, the legislature amended the state land use law to provide that on agricultural district lands in the A and B best soil classification, homes had to be "farm dwellings." The law defined a "farm dwelling" as "a single-family dwelling located on and used in connection with a farm, including clusters of single-family farm dwellings permitted within agricultural parks developed by the State, or where agricultural activity provides income to the family occupying the dwelling." At the same time, the law grandfathered the construction of "single-family dwellings" on existing lots, so that the "farm dwelling" law only applied to lots created by subdivisions on A and B soils after June 4, 1976, the effective date of the act.

Although the statute applied only to A and B soils, the land use commission enacted an administrative rule using the same "farm dwellings" definition to refer to homes on C, D, E, and U soils. The land use commission did not, however, provide any minimum standards for the level of agriculture required for a "farm dwelling" nor make any allowance for the fact that the agricultural district contains lands not suited for agriculture.

Since 1976, the counties have approved the creation of several thousand lots in the agricultural district. Most of them have been purchased by individuals who thought that they could build a single-family home without engaging in substantial agricultural activity. There are many reasons for this. Chapter 205 mentions "farm dwellings" only with respect to A and B soils. Most of the agricultural subdivisions allowed by the counties after 1976 were on marginal agricultural lands; few involved A or B soils to any significant extent. Some county zoning codes expressly allowed single-family dwellings on agricultural lands and did not mention a "farm dwelling" requirement. Given the vagueness of the land use commission rule, the counties did not actively enforce agricultural uses as a prerequisite to building homes in the agricultural district.

The ability of these homeowners and lot purchasers to remain in their homes or build on their lots is at risk if they are required to engage in significant agricultural activity to have a home.

In the case which gave rise to this uncertainty, the project did incorporate agriculture, but the trial court decided that the proposed agricultural activity, consisting of a minimum of twenty per cent of each lot devoted to income-producing agriculture, was not enough to comply with the land use commission's "farm dwelling" rule. Hawaii county estimates that the trial court's standard would make the use of several hundred existing homes illegal and affect over three thousand other lot owners who hope to build on their lots. Kauai county's general plan estimates that ninety per cent of the homes in the agricultural district on the island will not qualify as "farm dwellings."

The trial court decision is on appeal to the state supreme court, but it may be some time before the supreme court is able to rule. In the meantime, the State, the counties, private property owners, lenders, and many others are exposed to unfair and debilitating uncertainty and risk of significant litigation and loss. In order to address and resolve these issues promptly, in the interests of all concerned, it is appropriate that the legislature act now to protect homes and home sites within the state land use agricultural district.

SECTION 2. Section 205-4.5, Hawaii Revised Statutes, is amended by amending subsection (c) to read as follows:

"(c) Within the agricultural district all lands, with soil classified by the land study bureau's detailed land classification as overall (master) productivity rating class C, D, E, or U shall be restricted to [the]:

(1) The uses permitted for agricultural districts as set forth in section 205-5(b)[.]; or

(2) The construction of single-family dwellings on lots:

(A) Existing on the effective date of this Act; or

(B) Created within projects approved by county zoning ordinance where the developer has obtained final subdivision approval for at least a portion of the project, commenced construction of project infrastructure, and sold individual lots, prior to the effective date of this Act. Such projects, including all components thereof, shall be deemed an approved use in the agricultural district; provided that not more than ten per cent of the project area consists of soils classified as A or B."

SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 4. This Act shall take effect upon its approval.

INTRODUCED BY:

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