HOUSE OF REPRESENTATIVES

H.C.R. NO.

40

TWENTY-THIRD LEGISLATURE, 2006

 

STATE OF HAWAII

 
   


HOUSE CONCURRENT

RESOLUTION

 

REQUESTING THE DEPARTMENT OF TRANSPORTATION TO CONTINUE TO COLLABORATE WITH THE HAWAII HARBOR USERS GROUP TO IMPLEMENT PLANNED IMPROVEMENTS AND CONSTRUCTION TO IMPROVE CARGO TERMINAL AND CONTAINER FACILITIES AT HONOLULU HARBOR, KAHULUI HARBOR, AND HILO HARBOR, and commending and congratulating the department of transportation and the hawaii harbor users group for their fine work in completing the HAWAII HARBORS USER GROUP'S REPORT.

 

WHEREAS, the Department of Transportation has jurisdiction over the State's commercial harbors, as provided under section 266-2, Hawaii Revised Statutes, which reads in pertinent part:

The Department of Transportation shall:

Have and exercise all the powers and shall perform all the duties which may lawfully be exercised by or under the State relative to the control and management of commercial harbors, commercial harbor and waterfront improvements, ports, docks, wharves, piers, quays, bulkheads, and landings belonging to or controlled by the State, and the shipping using the same;

and

WHEREAS, the mission of the Department of Transportation is to provide a safe, efficient, accessible, and inter-modal transportation system that ensures the mobility of people and goods, and enhances and preserves economic prosperity and the quality of life; and

 

WHEREAS, the Oahu Commercial Harbors 2020 Master Plan (2020 Master Plan) prepared by the Department of Transportation in 1997 states in pertinent part:

Hawaii depends almost entirely on the ocean shipping industry to import its essential commodities (food, clothing, fuel, building materials, automobiles, etc.) and export local products (pineapple, sugar, molasses, livestock, diversified agriculture, etc.) to and from the neighbor islands, the mainland, and various foreign countries. Developed island economies are typically dependent on ocean shipping for their sustenance.

The importance of cargo shipping to our State cannot be overstated. This Master Plan therefore begins with the facilities and services required by the overseas cargo carriers. While the economic value of commercial fishing, ocean mining, passenger cruises, excursions and ferries, etc. cannot be denied, commercial harbor planning must first address Hawaii's life-sustaining cargo operations. The requirements of the ocean cargo carriers must be given priority.

and;

 

WHEREAS, the 2020 Master Plan further states:

The inter-island system of cargo distribution is the principal means by which neighbor island communities receive and export their cargo. This system has Honolulu Harbor as its hub or point of distribution and consolidation;

and

WHEREAS, the 2020 Master Plan estimates that eighty percent of everything used or consumed in the State is imported and that over ninety-eight percent of these imported goods are shipped by sea entering the State through our commercial harbors; and

WHEREAS, Hawaii’s economic sustainability depends on the effectiveness and efficiency of berth and terminal resources throughout the State’s harbor system, as well as the availability of sufficient cargo and container facilities; and

 

WHEREAS, the Economic Momentum Commission, which was formed by Governor Linda Lingle on June 7, 2005 to develop an action plan to sustain the State’s current economic momentum over the longer term made the following findings in its report dated November 1, 2005:

Hawaii’s port system is of primary importance to this island state and to its visitors. Not only does the vast majority of everything that Hawaii consumes come to us via our ports, the harbors are also experiencing increased use by the passenger cruise industry.

Ensuring adequate, efficient, and safe harbor facilities is essential to the health and future of Hawaii’s economy. At present, Hawaii’s harbors are at capacity, and there are not adequate plans to address the imminent overcrowding that will occur with the advent of new users, expansion of the cruise industry, and increasing cargo volumes resulting from a growing economy. It is projected that Honolulu Harbor will run out of space for international cargo this year and for domestic cargo in 2010. Further, the last Harbor Master Plan for Oahu was prepared in 1997 and the needed harbor improvements have yet to be implemented despite cargo volumes considerably exceeding the projections in that plan. Master plans for most of the neighbor island harbors do not exist;

and

WHEREAS, the Economic Momentum Commission made the following recommendations:

The Commission recommends a public/private partnership to pursue the immediate update and implementation of a master plan that addresses all of Hawaii’s commercial harbors. The plan should incorporate the views of the harbor users, the community, and government. It should accurately forecast the future needs of all our harbor users, identify appropriate harbor and port improvements, and identify funding priorities and funding mechanisms that assess users equitably. Lastly, the plan should have specific deadlines to hold the state Department of Transportation accountable for results;

and

WHEREAS, the Hawaii Harbor Users Group was formed by commercial harbor users to work with the Department of Transportation and the legislature to improve the operations and capacity of the State's commercial harbors; and

WHEREAS, Hawaii Harbor Users Group members include Matson Navigation Company, Inc. (Matson); Horizon Lines, LLC; NCL America Inc.; Young Brothers, Limited/Moana Pa’akai, Inc., dba Hawaiian Tug & Barge; Sause Bros., Inc.; Aloha Cargo Transport; McCabe, Hamilton & Renny Company, Limited; Hawaii Stevedores, Inc.; Hawaii Superferry, Inc.; Tesoro Hawaii Corporation; The Gas Company, LLC; and Ameron; and

WHEREAS, harbor users and members of Hawaii Harbor Users Group are well aware of the growing unavailability of berth and terminal resources throughout the State’s harbor system; and

WHEREAS, Hawaii Harbor Users Group retained Mercator Transport Group (Mercator) to review and evaluate facility requirements of the State’s harbor system as part of the efforts of the Hawaii Harbor Users Group and its members to work with and assist the Department of Transportation with planning and development of port facilities; and

WHEREAS, Mercator is a consulting firm that provides advisory services to companies involved in international freight transportation and logistics, as well as to entities developing, operating, or financing transportation/logistics infrastructure and, in addition, assists government agencies and trade associations regarding transportation regulation and policy issues; and

WHEREAS, following a collaborative effort involving the Hawaii Harbor Users Group members, Department of Transportation, and Mercator, the Hawaii Harbor Users Group set forth its findings and recommendations in its report, Harbor Facility Development To Serve The State of Hawaii (the HHUG Report, 2006); and

WHEREAS, the Hawaii Harbor Users Group report included the following statewide findings and recommendations:

(1) There are increasing demands being placed on the harbor system by new business activity and growth among current users; and

(2) There is a looming shortage of port facilities on many islands, brought about by rapid growth of cruise traffic, the introduction of inter-island ferry service and the continued growth in the transportation of core commodities and consumer goods; and

(3) Increased cargo and cruise traffic will soon consume most of the reserve capacity of the existing facilities, and thereby reduce the ability of ports and port users to efficiently serve the existing market, respond to new service requirements, or recover quickly from the natural and man-made service disruptions that invariably occur;

and

 

WHEREAS, for Honolulu Harbor, among the most critically needed improvements identified in the Hawaii Harbor Users Group Report are improvements needed to increase cargo capacity in this severely congested harbor, and the Hawaii Harbor Users Group made the following findings:

(1) Container traffic has steadily increased, with an average increase of about four per cent per year over the ten years through 2004, but over the last four years, container traffic has increased more sharply and is up more than twenty six per cent versus year 2001 levels;

(2) With respect to international and long-haul domestic container operations, Matson Navigation Company and Horizon Lines, LLC each report that they are incurring excess costs as a result of land constraints at their Sand Island terminals, and both carriers/terminal operators need increased terminal areas as top priorities;

(3) Growth in domestic volumes at Sand Island terminals that are already operating at high utilization levels, combined with growth of international volumes occurring at the Pier 1 facility, will lead to an expected shortfall in total container handling capacity in the coming years;

(4) With respect to inter-island cargo operations: Although container volume of Young Brothers, Limited in 2004 was thirty eight per cent more than in year 2000, its operating area has not increased since it moved into the terminal in 1998 (which even then was four years later than the original planned occupancy date), and Young Brothers, Limited is already now operating at above the State’s own target throughput levels and absorbing the extra costs of doing so;

and

WHEREAS, with respect to Honolulu Harbor, the Hawaii Harbor Users Group report made the following conclusions and recommendations:

(1) To operate effectively and manage growing volumes, it is clear that Young Brothers, Limited needs additional land areas and another barge berth and loading position suitable for the use of heavy lifting equipment;

(2) With respect to international and long-haul domestic container operations of Matson Navigation Company and Horizon Lines, LLC: Develop new container facilities to ensure there will be sufficient capacity to serve growing international and long-haul domestic container volumes. Based on available alternatives, development of the former Kapalama Military Reservation, a 55-acre parcel of land located adjacent to Pier 42, into a container terminal is viewed as the preferred means to meet this requirement; and

(3) With respect to inter-island cargo operations of Young Brothers Limited: Incorporate what is commonly referred to as the "Daishowa property", a 4.2 acre property owned by the State and located adjacent to Piers 39 and 40, into an improved inter-island cargo terminal with a main container gate on Auiki Street to facilitate delivery of containers coming from Sand Island or Kapalama Military Reservation terminals, and reinforce Pier 40E to create an additional barge loading position (to be suitable for using 40-ton lift equipment);

and

 

WHEREAS, with respect to the site known as the former Kapalama Military Reservation, the Hawaii Harbor Users Group Report made the following findings:

(1) With almost $1,000,000 from the state Legislature, the Department of Transportation in calendar year 2005 sought contractors to inventory existing conditions in the Kapalama area, survey it for significant historical features, and help start the planning and redevelopment process;

(2) Developing Kapalama Military Reservation will increase existing space for container cargo operations by almost fifty per cent, at least temporarily alleviating the need to develop another expensive harbor somewhere in the State;

 

(3) Kapalama Military Reservation is directly across the Kapalama Basin from an existing container yard for Horizon Lines, which could move its entire operation into the new facility, allowing Matson to expand into space vacated by Horizon; and

(4) The 55-acre Kapalama Military Reservation site is considered the ideal location for a container terminal because of its relatively underused space and its proximity to the Young Brothers inter-island shipping terminal, allowing for cargo to be efficiently transshipped to neighbor islands;

and

WHEREAS, with respect to inter-island cargo operations at Honolulu Harbor, the State has acquired what is commonly referred to as the Daishowa property, but has not yet incorporated the added space into an improved inter-island cargo terminal or reinforced Pier 40E to create an additional barge loading position; and

WHEREAS, with respect to neighbor island harbors, the Hawaii Harbor Users Group Report identifies Kahului and Hilo harbors as the facilities in the most critical need of improvements, and recommends improvements to Kahului and Hilo Harbors as being absolutely critical to the timely delivery of essential cargo to the Big Island and Maui communities and to the economic vitality of these communities; and

WHEREAS, with respect to Kahului Harbor, the Hawaii Harbor Users Group Report:

(1) Identifies the demand stresses on the harbor resulting from the growth in Neighbor Island container traffic handled by Matson Navigation Company and Young Brothers, Limited and, in addition, the introduction of inter-island ferry service in 2007;

(2) Makes findings that: (A) the harbor capacity situation on Maui is considered the most critical of all the neighbor islands; (B) the combination of rising cargo volumes and increased passenger activity brings Maui closer and closer to the point at which service breakdowns and delivery disruptions can be expected and; (C) although the time when major disruptions will occur cannot be predicted precisely, small scale negative impacts of congestion involving increased costs and cargo delays at the port are probably already happening;

(3) States that the currently planned location of the Hawaii Superferry will significantly impact the ongoing inter-island cargo operation of Young Brothers, Limited unless a variety of other improvements in facilities and adjustments to operations are made at the Kahului port;

(4) States that Young Brothers Limited's loss of berth availability to the Hawaii Superferry and commingling of ferry and commercial cargo traffic at Pier 2B will disrupt and decrease the efficiency of Young Brothers, Limited's operation and create safety hazards for both Young Brothers, Limited and ferry users;

(5) Concludes that the severity of the problem and the magnitude of the consequences make creation of new port capacity on Maui one of the top strategic priorities for Hawaiian port development; and

(6) Recommends the following as to the Pier 2 landside areas: (A) move the cement tanks out of Pier 2; (B) close Ala Luina street; and (C) acquire and incorporate into an expanded inter-island cargo terminal the four acres of land currently owned by A&B Properties, Inc., already designated by A&B Properties, Inc. for harbor use and sometimes referred to as the "Railroad Building" and "Old Kahului Store" properties; and (D) and clear and harden the property to increase the inter-island container and cargo operational area;

and

 

WHEREAS, even in the absence of the need to replace cargo areas being reallocated to support ferry operations at Pier 2 and cruise operations at Pier 1, more space is needed to accommodate expanding container and cargo operations at Kahului Harbor; and

WHEREAS, with respect to Hilo Harbor, the Hawaii Harbor Users Group Report:

(1) Identifies demand stresses on the harbor including the demand stress resulting from commingling of cruise vessel and cargo operations;

(2) Recognizes that the "growth of the NCL’s United States-flag cruise business of NCL America, Inc. is remarkable" and that cruise vessel berth hours will more than double at Hilo;

(3) Concludes that the presence of cruise vessels in the midst of cargo operations results in frequent inter-mixing of cruise passenger arrival and departure traffic with both on-terminal tractors and lifting equipment, and road trucks that are making pickups and deliveries to the port at Hilo Harbor, with a recommendation from a safety and security perspective for these types of activities to be separated as much as possible;

(4) Identifies the deteriorating strength of the paved surface in the inter-island container yard at the Hilo Harbor on the Big Island as a major safety consideration;

(5) Recognizes that projects slated for Hilo Harbor in the 2020 Master Plan include the development of a new Pier 4 for inter-island cargo, which includes dredging, construction of Pier 4 and inter-island cargo yard improvements, and that planning for these improvements is ongoing but that construction of these Department of Transportation-recommended harbor improvements has not yet commenced; and

(6) Recommends completing as soon as possible the planned Pier 4 cargo facility in order to meet the transportation needs of the State, as part of the needed solution of separating cargo and passenger operations and developing adequate and safe inter-island cargo operation facilities;

now, therefore,

BE IT RESOLVED by the House of Representatives of the Twenty-third Legislature of the State of Hawaii, Regular Session of 2006, the Senate concurring, that the Legislature commends and congratulates the Department of Transportation and Hawaii Harbor Users Group for their work, coordination and cooperation in completing the Hawaii Harbor Users Group Report; and

 

BE IT FURTHER RESOLVED that the Department of Transportation is requested to implement the recommendations of the Hawaii Harbor Users Group Report that require action by the department, giving priority to the development priorities for the new planned Pier 4 at Hilo Harbor, the improvements to inter-island cargo facilities at Kahului Harbor; and the development of Kapalama Military Reservation at Honolulu Harbor; and

BE IT FURTHER RESOLVED that, in particular, the Department of Transportation is requested to do the following:

(1) With respect to Kapalama Military Reservation at Honolulu Harbor: (A) complete plans to redevelop the Kapalama Military Reservation site as a container terminal, expand pier space in the area, dredge nearby harbor space, and create the infrastructure necessary to support major container cargo operations; (B) commence necessary construction by 2010; and (C) keep current tenants apprised of the development schedule so that the tenants may timely find new space (collectively, the "Kapalama Military Reservation Redevelopment");

(2) With respect to inter-island cargo facilities at Honolulu Harbor, incorporate what is commonly referred to as the Daishowa property into an improved inter-island cargo terminal and reinforce Pier 40E to create an additional barge loading position to be suitable for using 40-ton lift equipment (collectively, "the Honolulu Harbor Pier 40 Improvements");

(3) With respect to Kahului Harbor, repair, improve, and develop Kahului Harbor facilities, including by taking the following measures:

(A) Relocate cement storage silos presently located within the inter-island cargo operational area, in order to prevent safety risks and increase cargo operation efficiency;

(B) Expand landside space to accommodate increasing volume of container and cargo operations; replace landside space lost to provide security zones and access routes to cruise ships and pier and landside space to be lost to the Hawaii Superferry and, in particular, to close and harden Ala Luina Street to incorporate it into the inter-island cargo yard; to acquire approximately four acres of land owned by A&B Properties, Inc., already designated by A&B Properties, Inc. for harbor use and sometimes referred to as the "Railroad Building" and "Old Kahului Store" properties, and to clear and harden the property to increase the inter-island container and cargo operational area (collectively, the "Kahului Harbor Pier 2 Improvements"); and

(4) With respect to Hilo Harbor, complete the planned construction of the new Pier 4 inter-island cargo terminal facility at Hilo Harbor, including required dredging by or before December 2007, construction of the new Pier 4 by or before April 2008, and construction of new cargo yard improvements by or before October 2009 (collectively, the "Hilo Harbor Pier 4 Improvements");

and

BE IT FURTHER RESOLVED that the Department of Transportation is requested to continue to work with the Hawaii Harbor Users Group towards the timely completion of:

(1) Planning and construction of the Kapalama Military Reservation Redevelopment;

(2) Honolulu Harbor Pier 40 Improvements;

(3) Kahului Harbor Pier 2 Improvements; and

(4) Hilo Harbor Pier 4 Improvements, including required dredging by or before December 2007, construction of new Pier 4 by or before April 2008 and construction of new cargo yard improvements by or before October 2009;

and

BE IT FURTHER RESOLVED that the Department of Transportation conduct legislative briefings before the House and Senate committees with jurisdiction over transportation at each Regular Session of the Legislature, to include the status of the Kapalama Military Reservation Redevelopment at Honolulu Harbor and the Honolulu Harbor Pier 40 Improvements, the Kahului Harbor Pier 2 Improvements, the Hilo Harbor Pier 4 Improvements, respectively, until these improvements are completed and fully operational; and

BE IT FURTHER RESOLVED BE IT FURTHER RESOLVED that certified copies of this Concurrent Resolution be transmitted to the Governor, the Director of Transportation, and the Hawaii Harbor Users's Group.

 

 

 

OFFERED BY:

_____________________________

Report Title:

Statewide Harbor Improvements; Harbor User Group