In a letter to Alan Murakami of the Native Hawaiian Legal Corp., Deputy Attorney General Myra Kaichi said Moloka'i Ranch's use of the irrigation system must be ended "until all environmental effects, if any, are sufficiently and properly addressed."

The state Department of Agriculture, which manages the irrigation system, did not have an immediate response to the attorney general's letter other than to say the department will consult with the attorney general's office on what it needs to do to comply.

A Moloka'i Ranch spokesman, John Sabas, said the company's attorney is awaiting official notice from the state on what the Department of Agriculture will require.

"It raises a lot of questions, for sure," Sabas said. "We're talking it over with our attorney, but we're waiting until we receive formal notification from the Department of Agriculture spelling out in more detail what the attorney general's letter means."

Sabas noted that water coming through the Moloka'i Irrigation System is used both in Maunaloa town as well as within the Kaluakoi Resort properties on the west end of the island.

"We have all these families in Maunaloa that are using the water. There is a far-reaching impact in what the state agency has to do," he said.

But representatives of the Ho'olehua homesteaders said the ranch has other options, including an existing reservoir and ranch irrigation line that runs from central to west Moloka'i. The system was originally installed when Del Monte operated the town for its Moloka'i pineapple plantation.

The dispute dates to when the Kaluakoi Resort was first developed on West Moloka'i and the state agreed to allow the resort developer—– at the time a joint venture involving the ranch and Louisiana Land & Oil Exploration — to use the irrigation system in Ho'olehua to transport water from a well at Kualapuu to a connection with the Kaluakoi water system.

Homesteaders at the time objected that the agreement utilized an irrigation system that was installed with federal funds specifically for use by Hawaiian homestead farmers. The state's rationale was that there was excess capacity in the transmission line running across Hawaiian Homes land in Hoolehua, while the development venture was required to put in 20 percent more water than it took out of the system. In several actions in court, the agreement allowing use of the transmission line was upheld.

But the issue was revived when the agreement expired two years ago and the ranch and the state Department of Agriculture opened discussions on a new 25-year use agreement.

In a letter sent on behalf of the Moloka'i Homestead Farmers' Alliance, on July 9, Murakami said the Department of Agriculture is required to prepare an environmental assessment before it executes any agreement to use the irrigation system.

Murakami's letter noted that an environmental assessment was not required for the previous agreement because it was approved before state law was changed to require environmental assessments on use of state land. But a Hawai'i Supreme Court opinion issued on the appeal of the Moloka'i homesteaders in 1981 said the environmental law would apply if the agreement had not already been in effect.

"We entertain no doubt that the pertinent statutory provisions would mandate the preparation of an EIS if Kaluakoi's application for 'rental of space' in the system's facilities were presented to the board now," the court said.

Since the state is proposing a new agreement with the ranch to allow a lease of space within the transmission line, "it is clear that courts will now require an environmental assessment," Murakami told Agriculture Director Sandra Kunimoto.

In a Sept. 4 letter, Kaichi said the attorney general does not agree with all of his interpretations but did agree that any new pipeline agreement with ranch owner Molokai Properties triggers the environmental law.

"We will be assisting the HDOA in getting Moloka'i Properties off the system as quickly as possible, until all environmental effects, if any, are sufficiently and properly addressed," Kaichi said.

On Moloka'i, agricultural specialist Glenn Teves said homestead farmers are gratified that "after 35 years, justice has been served. . . . This is just a starting point. This is the time to question what it is we want for that line, what we think the Moloka'i Irrigation System should be used for."

Teves, a Cooperative Extension Service agent who works with farmers on Moloka'i, said homestead farmers have been frustrated that they have faced water use restrictions while the ranch freely used the transmission line to support developments on the west end.

"Under that transmission agreement, the system was getting maxed out and the farmers don't know where they are going to find any more water," he said.

A major issue fueling the farmers' concerns involves allegations that the ranch had been taking more water out of the transmission system than it put in. The agreement allowed the ranch to pump water from its Well 17 at Kualapu'u into the Moloka'i Irrigation System. The ranch is permitted to take 1.018 million gallons a day from the well.

But there were at least 299 days over the past three years during which the pump from Well 17 was inoperable, Teves said. He said irrigation system staff said the ranch was taking water from its surface water system on the central Moloka'i mountains, but there is no verification of the amount of ranch water pumped into the irrigation system's Kualapu'u Reservoir.

"They are getting water from the irrigation system," he said.

The irrigation system also is providing water to Monsanto seed corn operations on ranch lands.

"Monsanto is using, like, one-third of the water. It would be great for Moloka'i Ranch if its use didn't tax the Molokai Irrigation System. The system is supposed to be for the homestead farmers," he said.

In his letter to Kunimoto, Murakami noted that other court decisions require that a review of the use of a water system "must incorporate the full environmental and cultural impacts of using the transmission system as if it was for the first time."

In a related case, he said, a judge reviewing water diversions in East Maui "rejected the attempt by state attorneys who argued that any environmental assessment would cover only the minimal impacts of continuing the existing diversions."

An environmental assessment of a use agreement for the Moloka'i Irrigation System needs to include a cultural assessment as well, he said in his letter.

He told The Maui News that an assessment of private use of the public infrastructure needs to consider the impact on the homesteaders who rely on the irrigation system for their farms.

"There needs to be accountability for some of the problems faced by the homesteaders that are very severe," he said.

Since the agreement has expired, he said, the state has no legal obligation to allow the ranch to continue to use the irrigation transmission line.

"A provision in the original agreement said the state could give them two years' notice to cease use. The state has a right to cut it off. It's been like 30 some years, since 1975. They ought to have some alternative plan by now."

Sabas said he could not understand why the ranch cannot continue to use the transmission line since it has been on the system for so long.

"In this case, we have been on this system for years. We don't understand why there should be any difference now," he said.