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State looks to expand space at Kahului Harbor

Demand at harbor’s cargo storage yard expected to increase

The state Department of Transportation’s Harbors Division is looking to purchase 9.3 acres (Parcel B) to expand the operational area of the Kahului Harbor. State Department of Transportation graphic

The state Department of Transportation is looking to buy and develop 9.3 acres near the Kahului Harbor that would provide additional storage space and a cargo yard for the harbor.

The proposed parcel currently belongs to Alexander & Baldwin and is located on the northwest corner of the intersection of Amala Road and Amala Place. Already on the property are bulk storage tanks and Kahului Trucking and Storage, which would relocate after the state buys the property, according to a final environmental assessment published last week in the Office of Environmental Quality Control’s “The Environmental Notice.”

Demand at the harbor’s cargo storage yard is expected to increase, and Kahului Harbor currently does not have enough cargo and auto storage space to handle the growing demand, the department said.

According to the state’s 2030 forecast, container volumes are expected to double over the 2005 container volume, and vehicle volumes will increase by 33 percent.

Adding more storage yard space to the harbor would help reduce congestion, operational delays and safety concerns, the department said.

One of the lots the state plans to buy, a 7.2-acre section known as Lot 1-A, would be available immediately for development and use. The second 2.1-acre section, known as Lot 1-B, is currently occupied by Kahului Trucking and Storage. The company is looking for a new location and plans on relocating within five years of the state’s purchasing the land, according to the environmental assessment. The state would develop the second lot after Kahului Trucking and Storage and other tenants relocate.

Improvements to the property would include demolition of existing structures, grading, drainage and utility improvements, asphaltic concrete pavement, security lighting, security fencing, access gates and small office structures. Pavement would be designed and constructed to allow for storage of primarily empty containers, empty chassis and automobiles.

Kahului Harbor is the only commercial harbor on Maui; it’s the third busiest in the state based on tonnage, and second largest based on operating revenue, according to the assessment.

The east side of the harbor currently covers about 50 acres and is the primary operational area. It includes three piers that are used to berth vessels. Facilities on land include storage areas, warehouses, harbor offices and tenant buildings.

Currently, PASHA uses the Pier 1 cargo yard and the automobile storage yard at Kaahumanu and Hobron avenues to store cars. (Pier 1 consists of a 1,845-foot-long pier and about 15 acres for cargo handling and storage yard.) Adding more space at the Kahului Harbor would allow empty chassis and containers to be relocated from the Pier 1 cargo yard to the newly acquired space, according to the assessment.

In fiscal year 2017, Kahului Harbor saw 113,724, 20-foot equivalent units (each unit refers to approximately one shipping container) of incoming and outgoing cargo, the highest since the 2009 total of 113,898 before cargo began dropping off during the recession.

Most of the incoming tonnage to Kahului Harbor includes containerized cargo, such as personal effects, food items and building supplies. Outgoing cargo mainly consists of bulk loads and agricultural products, which included sugar and molasses until the closure of Hawaiian Commercial & Sugar Co. in 2016.

Passenger cruise ships also regularly call on Kahului Harbor for one- or two-day stops.

The estimated cost of purchasing the A&B property is to be determined. As part of the acquisition process, the state would hire an appraiser to determine the property’s value, and the final price would be negotiated by the state and A&B.

The department’s Harbors Division would dip into its Special Funds to purchase the property. The majority of those funds comes from fees and charges for profiles, dockage, demurrage and the rental of land and wharf space at the state’s commercial harbors, according to the department’s website.

In negotiations that have been ongoing since 2012, both parties have been discussing the purchase price as well as the amount of environmental cleanup that A&B would have to perform, including, potentially, demolition of the tanks.

During negotiations, the state and A&B also revised the size of the parcel, which was originally 10.5 acres until an area known as Lot 1-C was removed from the potential purchase area. It includes the Hale Nanea complex as well as Maui Electric Co.’s informal access way and water suppression line easement.

The department said it planned to complete the purchase by the end of this year; development of the lots will depend on funding availability.

* Colleen Uechi can be reached at cuechi@mauinews.com.

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