§171-59  Disposition by negotiation. (a)  A lease of public land may be disposed of through negotiation upon afinding by the board of land and natural resources that the public interestdemands it.  Where the public land is being sought under this section by asugar or pineapple company, and the company is the owner or operator of a millor cannery, then, for the purposes of this section, the economic unit shall bethat acreage of public land which when taken together with the lands alreadyowned or controlled or available to the company, when cultivated is found bythe board to be necessary for the company's optimum mill or cannery operation. In all other cases, public land to be sold under this section shall be aneconomic unit as provided in section 171-33(3).

After a determination is made to negotiate thedisposition of a lease, the board shall:

(1)  Give public notice as in public auction, inaccordance with the procedure set forth in section 171-16(a), of its intentionto lease public land through negotiation setting forth the minimum conditionsthereunder, the use for which the public land will be leased.  Any personinterested in securing the lease shall file an application with the board notlater than forty-five days after the first publication of the notice;

(2)  Establish reasonable criteria for the selectionof the lessee; provided that where the intended use of the land is agriculture,the department of agriculture shall establish the criteria;

(3)  Determine the applicants who meet the criteriafor selection set by the board or the department of agriculture, as the casemay be, and notify all applicants of its determination.  Any applicant mayexamine the basis of the determination, which shall be in writing, to ascertainwhether or not the conditions and criteria established by the board or thedepartment of agriculture were followed; provided that if any applicant doesnot notify the board of the applicant's objections, and the grounds therefor,in writing, within twenty days of the receipt of the notice, the applicantshall be barred from proceeding to seek legal remedy for any alleged failure ofthe board to follow the conditions and criteria.

If only one applicant meets the criteria forselection of the lessee, the board may, after notice as provided in (3), above,dispose of the lease by negotiation.

If two or more applicants meet the criteria forthe selection of the lessee, the board shall select the lessee who submits thehighest offer contained in a sealed bid deposited with the board.

(b)  Disposition of public lands for airline,aircraft, airport-related, agricultural processing, cattle feed production,aquaculture, marine, maritime, and maritime-related operations may benegotiated without regard to the limitations set forth in subsection (a) andsection 171-16(c); provided that:

(1)  The disposition encourages competition within theaeronautical, airport-related, agricultural, aquaculture, maritime, andmaritime-related operations;

(2)  The disposition shall not exceed a maximum termof thirty-five years, except in the case of maritime and maritime-relatedoperations, which may provide for a maximum term of seventy years; and

(3)  The method of disposition of public lands forcattle feed production as set forth in this subsection shall not apply afterDecember 31, 1988.

For the purposes of this subsection:

"Agricultural processing" means theprocessing of agricultural products, including dairying, grown, raised, orproduced in Hawaii.

"Airport-related" means a purpose oractivity that requires air transportation to achieve that purpose or activity.

"Maritime-related" means a purpose oractivity that requires and is directly related to the loading, off-loading,storage, or distribution of goods and services of the maritime industry. [L1962, c 32, pt of §2; Supp, §103A-56; am L 1967, c 189, §6; HRS §171-59; am L1970, c 101, §2; am L 1980, c 48, §1; am L 1984, c 278, §1; gen ch 1985; am L1992, c 283, §2; am L 2001, c 77, §2; am L 2003, c 127, §2; am L 2008, c 200,§2]