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Full Opinion
In the Matter of the WATER USE PERMIT APPLICATIONS, Petitions for Interim Instream Flow Standard Amendments, and Petitions for Water Reservations for the Waihole Ditch Combined Contested Case Hearing.
Supreme Court of Hawai`i.
*420 Gilbert D. Butson of Reinwald O'Connor & Playdon, on the briefs, for Appellee/Cross-Appellant Puu Makakilo.
Stephen K.C. Mau and Cheryl A. Nakamura of Rush, Moore, Craven, Sutton, Morry & Beh, on the briefs, for Appellee/Cross-Appellant The Robinson Estate.
Margery S. Bronster, Attorney General of Hawai`i, Heidi M. Rian, Haunani Burns and Marjorie Lau, Deputy Attorneys General, on the briefs, for Appellees/Cross-Appellants State of Hawai`i Department of Agriculture and Department of Land and Natural Resources.
Benjamin A. Kudo, Wesley M. Fujimoto and Stacy E. Uehara of Dwyer, Imanaka, Schraff, Kudo, Meyer & Fujimoto, on the briefs, for Applicant/Petitioner-Appellant *421 Kamehameha Schools Bernice Pauahi Bishop Estate.
David Z. Arakawa, Corporation Counsel and Mark K. Morita, Randall K. Ishikawa, Duane W.H. Pang and Reid M. Yamashiro, Deputies Corporation Counsel, on the briefs, for Appellants City and County of Honolulu Planning Department and Board of Water Supply.
Michael W. Gibson, Douglas S. Appleton and Keith M. Yonamine of Ashford & Wriston, on the briefs, for Applicant-Appellee/Cross-Appellant The Estate of James Campbell.
Paul H. Achitoff and David L. Henkin of Earthjustice Legal Defense Fund for Petitioners/Appellants Waiāhole-Waikāne Community Association, Hakipu`u `Ohana and Ka Lhui Hawai`i and Alan T. Murakami and Carl C. Christensen of the Native Hawaiian Legal Corporation, on the briefs, for Petitioners/Appellants Waihole-Waikne Community Association and Hakipuu Ohana.
Gino L. Gabrio, Patrick W. Hanifin and Laurie A. Kuribayashi of Cades, Schutte, Fleming & Wright and Orlando R. Davidson and David L. Callies, on the briefs, for Appellee/Cross-Appellant Land Use Research Foundation.
Gary M. Slovin, Margaret Jenkins Leong and Lisa Bail of Goodsill, Anderson, Quinn & Stifel, on the briefs, for Applicant-Appellee/Cross-Appellant Dole Food Company, Inc./Castle & Cooke, Inc.
James T. Paul, Pamela W. Bunn and Jessica Trenholme of Paul, Johnson, Park & Niles for Intervenor/Appellant Hawaii's Thousand Friends.
Frank D. Padgett, on the briefs, for Appellant Commission on Water Resource Management.
James K. Mee of Pacific Legal Foundation and Cary T. Tanaka of Matsumoto, LaFountaine & Chow, on the briefs, for Appellee Hawai`i Farm Bureau.
Jon T. Yamamura and Kevin E. Moore of Carlsmith Ball, on the briefs, for Applicant/Appellee Nihonkai Lease Co., Ltd.
Lois J. Schiffer, Assistant Attorney General, Robert Klarquist and Andrew C. Mergen, Attorneys, Appellate Section Environment & Natural Resources Division, Department of Justice and Cheryl Connett and Paul M. Sullivan, Attorneys, Pacific Division, Naval Facilities Engineering Command, on the briefs, for Appellee United States Department of the Navy.
Alan M. Oshima of Oshima Chun Fong & Chung for Appellee/Cross-Appellant The Estate of James Campbell.
Naomi U. Kuwaye of Dwyer Imanaka Schraff Kudo Meyer and Fujimoto for Applicant/ Petitioner-Appellant Kamehameha Schools Bishop Estate.
MOON, C.J., LEVINSON, NAKAYAMA, RAMIL, JJ. and Circuit Judge IBARRA, in Place of KLEIN, J. Recused.
Opinion of the Court by NAKAYAMA, J.
TABLE OF CONTENTS
I. BACKGROUND ..................................................... 423
A. INTRODUCTION ................................................... 423
B. PROCEDURAL HISTORY ............................................. 423
C. FINAL DECISION ................................................. 425
II. STANDARD OF REVIEW ............................................ 430
III. DISCUSSION.................................................... 431
A. PROCEDURAL DUE PROCESS.......................................... 431
1. Dual Status of the Commission Chairperson.............................. 432
2. Improper Influence by the Attorney General and Governor................ 435
B. PUBLIC TRUST DOCTRINE........................................... 439
1. History and Development................................................ 439
2. Relationship to the State Water Code................................... 442
3. State Water Resources Trust............................................ 445
a. Scope of the Trust................................................... 445
b. Substance of the Trust............................................... 447
i. Purposes of the Trust.............................................. 448
ii. Powers and Duties of the State Under the Trust.................... 450
c. Standard of Review under the Trust................................... 455
*422
C. INTERPRETATION OF THE STATE WATER CODE.......................... 456
1. Basic Principles of Statutory Construction............................. 456
2. Water Code Declaration of Policy....................................... 457
D. INSTREAM FLOW STANDARDS......................................... 458
1. Overview of the Statutory Framework for Instream Use Protection........ 459
2. Procedural Objections to the WIIFS Amendment........................... 462
3. Substantive Objections to Instream Allocations......................... 464
4. Interim Standard for Waikne Stream.................................... 469
E. INTERIM BALANCING OF INSTREAM AND OFFSTREAM USES................ 470
F. WATER USE PERMITS............................................... 472
1. Permit Applicants' Burden of Proof..................................... 472
2. Diversified Agriculture, Generally, and the Allocation of 2,500 Gallons
per Acre per Day....................................................... 474
3. Campbell Estate's Permits.............................................. 476
a. Field Nos. 146, 166 (ICI Seeds)...................................... 476
b. Field Nos. 115, 116, 145, 161 (Gentry/Cozzens)....................... 476
c. Alternative Ground Water Sources..................................... 476
4. PMI's Permit........................................................... 477
a. "Existing Use"....................................................... 477
b. "Agricultural Use"................................................... 479
c. Distinctive Treatment of "Nonagricultural Uses"...................... 480
d. Application of the Commission's Standards............................ 483
5. 12-Month Moving Average................................................ 483
G. USE OF KAHANA SURFACE WATER TO COMPENSATE FOR
DITCH "SYSTEM LOSSES"............................................... 484
H. KSBE'S POINTS OF ERROR.......................................... 485
1. Zoning Requirement..................................................... 485
2. Unified Regulation of the Ditch System................................. 486
3. "Ali`i Rights"......................................................... 487
4. Correlative Rights..................................................... 488
5. KSBE's Takings Claim................................................... 492
6. Ankersmit's Testimony.................................................. 495
I. REQUIREMENT TO FUND STUDIES..................................... 495
J. DOA/DLNR'S MISCELLANEOUS OBJECTIONS............................. 498
K. THE CITY'S MISCELLANEOUS OBJECTIONS............................. 499
IV. CONCLUSION..................................................... 501
The present appeal arises from an extended dispute over the water distributed by the Waihole Ditch System, a major irrigation infrastructure on the island of O`ahu supplying the island's leeward side with water diverted from its windward side. In 1995, this dispute culminated in a contested case hearing of heretofore unprecedented size, duration, and complexity before appellee Commission on Water Resource Management (the Commission). At the hearing, the Commission considered petitions to amend the interim instream flow standards for windward streams affected by the ditch, water use permit applications for various leeward offstream purposes, and water reservation petitions for both instream and offstream uses. The Commission issued its final findings of fact (FOFs), conclusions of law (COLs), decision and order (D & O) (collectively, final decision or decision) on December 24, 1997.
Parties on appeal include: the Commission; appellee/cross-appellant Estate of James Campbell (Campbell Estate); appellants City and County of Honolulu Planning Department and Board of Water Supply (collectively, the City); appellees/cross-appellants Department of Agriculture (DOA) and Department of Land and Natural Resources (DLNR), State of Hawai`i (collectively, DOA/DLNR); appellee/cross-appellant Dole Food Company, Inc./Castle & Cooke, Inc. (Castle); appellee Hawaii Farm Bureau (HFB); appellant Hawaii's Thousand Friends (HTF); appellant Kamehameha Schools Bernice Pauahi Bishop Estate (KSBE); appellee/cross appellant Land Use Research Foundation (LURF); appellee Nihonkai Lease Co., Inc. (Nihonkai); appellee/cross-appellant Pu`u Makakilo, Inc. (PMI); appellee/cross-appellant Robinson Estate (Robinson); appellants Waihole-Waikne Community Association, Hakipu`u `Ohana, and Ka Lhui Hawai`i (collectively, WWCA); and appellee United *423 States Department of the Navy (USN). We have carefully reviewed their arguments in light of the entire breadth of this state's legal mandates and practical demands. For the reasons fully explained below, we affirm in part and vacate in part the Commission's decision and remand for further proceedings consistent with this opinion.
I. BACKGROUND
A. INTRODUCTION
The Waihole Ditch System collects fresh surface water and dike-impounded ground water[1] from the Ko`olau mountain range on the windward side of the island of O`ahu and delivers it to the island's central plain. Beginning in Kahana Valley, the collection portion of the system proceeds along the windward side of the Ko`olaus, then passes under the Ko`olau crest to the leeward side at the North Portal. The section of the system known as the Waihole Main Bore or Tunnel extends from the North Portal to the Tunnel's leeward exit, South Portal Adit 8 (Adit 8). The delivery portion of the system begins at Adit 8 and winds through the plain of Central O`ahu. Measured at Adit 8, the system develops approximately 27 million gallons a day (mgd).
The ditch system was built in significant part from 1913 to 1916 to irrigate a sugar plantation owned and operated by Oahu Sugar Company, Ltd. (OSCo). Until the plantation ceased operations in 1995, OSCo used much of the ditch's flow, in addition to a substantial supply of ground water pumped from the Pearl Harbor aquifer. At the time of this appeal, various leeward parties still retained, but were not using, well permits to pump approximately 53 mgd of leeward ground water.
Diversions by the ditch system reduced the flows in several windward streams, specifically, Waihole, Waianu, Waikne, and Kahana streams, affecting the natural environment and human communities dependent upon them. Diminished flows impaired native stream life and may have contributed to the decline in the greater Kneohe Bay ecosystem, including the offshore fisheries. The impacts of stream diversion, however, went largely unacknowledged until, in the early 1990s, the sugar industry on O`ahu came to a close.
B. PROCEDURAL HISTORY
On July 15, 1992, the Commission designated the five aquifer systems of Windward O`ahu as ground water management areas, effectively requiring existing users of Waihole Ditch water to apply for water use permits within one year of that date.[2] In June 1993, the Waihole Irrigation Company (WIC), the operator of the ditch system, filed a combined water use permit application for the existing users of ditch water. In August 1993, OSCo announced that it would end its sugar operations, signaling the imminent availability of the ditch water used by OSCo and raising the question of its future allocation.
Conflict ensued. On November 4, 1993, DOA filed a petition to reserve[3] the ditch *424 flow for agricultural uses. The Office of Hawaiian Affairs (OHA), WWCA, KSBE, and the Department of Hawaiian Homelands also filed petitions to reserve water. On December 7, 1993, WWCA petitioned to amend upward the interim instream flow standards for the Windward O`ahu streams affected by the ditch (WIIFS);[4] OHA filed a similar petition on February 28, 1995. KSBE and Castle also filed separate water use permit applications specifically requesting water drawn by the ditch system from lands they owned. The petitions to amend the WIIFS and the permit applications collectively exceeded the entire flow of the ditch.
In May 1994, the Commission received complaints that, with the close of OSCo's sugar operations, WIC was discharging unused ditch water into Central O`ahu gulches. After holding an investigation and several meetings and considering an order to show cause regarding WIC's continuing waste of water, the Commission requested the parties involved to enter into mediation. The mediation agreement and the Commission's subsequent order dated December 19, 1994 provided that WIC would continue to supply 8 mgd to the ditch, as measured at the North Portal, and release the surplus into the windward streams.
The interim restoration of windward stream flows had an immediate apparent positive effect on the stream ecology. The higher flows flushed out exotic fish species that were harming native species by carrying parasites and disease, competing for food and space, and interfering with spawning rituals. Experts saw excellent potential for the repopulation of native stream life such as `o`opu *425 (goby), opae (shrimp), and hhwai (snail).[5]
On January 25, 1995, the Commission ordered a combined contested case hearing on the permit applications, reservation petitions, and petitions to amend the WIIFS. At a public hearing on April 18, 1995, the Commission received public testimony and requests to participate in the consolidated hearing. The Commission admitted a final total of twenty-five parties.
On July 14, 1995, the Commission's staff submitted a proposed order to bifurcate the contested case hearing. The proposed order recommended that the Commission decide in a separate proceeding the allocation of ground water drawn from KSBE's Waiawa lands in the Pearl Harbor aquifer sector on the leeward side of the Ko`olaus. On August 7, 1995, the Commission issued an order denying the proposed bifurcation order on the grounds that the interrelated nature of the applications for Waihole Ditch water favored the consolidated process.
The Commission also held hearings to determine the "existing uses" as of July 15, 1992, the date of the designation of Windward O`ahu as a ground water management area, that would be allowed to continue pending a decision on the permit applications, see supra note 2. On August 15, 1995, the Commission issued "Order Number 8," identifying the existing uses and their respective interim allocations. "Order Number 10," dated October 16, 1995, amended and clarified Order Number 8, allowing 9.3698 mgd, as measured at the North Portal, to flow into the ditch until further order of the Commission.
The contested case hearing commenced on November 9, 1995. Opening statements and presentation of evidence continued until August 21, 1996, spanning fifty-two hearing days and four evening sessions. The Commission received written testimony from 161 witnesses, 140 of whom also testified orally, and admitted 567 exhibits into evidence. The parties presented closing arguments from September 18 to 20, 1996.
On July 15, 1997, the Commission released its proposed decision, to which the parties submitted written and oral exceptions. While the Commission was considering its final decision, the state governor and attorney general publicly criticized the proposed decision as inadequately providing for leeward interests. At about the same time, the deputy attorney general representing the Commission was summarily dismissed. The Commission issued its final decision on December 24, 1997. The final decision differed from the proposed decision in various respects, most notably in its increasing the amount of water allocated to leeward permittees by 3.79 mgd.
C. THE FINAL DECISION
The Commission's final decision consisted of 1,109 FOFs, an extensive legal discussion section styled as COLs, and a D & O explaining at length the Commission's disposition. The following summary highlights the prominent elements of the Commission's analysis and decision; specifically contested FOFs and COLs appear in the relevant discussion sections of this opinion.
In its COLs, the Commission surveyed the law of water in Hawai`i, as established in the Hawai`i Constitution, State Water Code (the Code), and common law, focusing particularly on the "public trust doctrine." As a preface to its determination of the WIIFS, the Commission concluded that:
Under the State Constitution and the public trust doctrine, the State's first duty is to protect the fresh water resources (surface and ground) which are part of the public trust res. Haw. Const. Art. XI, ง 7; Robinson v. Ariyoshi, 65 Haw. [641,] 674[, 658 P.2d 287, 310 (1982) ]. The duty to protect public water resources is a categorical imperative and the precondition to all subsequent considerations, for without such underlying protection the natural environment could, at some point, be irrevocably harmed and the "duty to maintain the purity and flow of our waters for future generations and to assure that the waters of our land are put to reasonable and beneficial uses" could be endangered. Id. However, the duty to protect does not *426 necessarily or in every case mean that all offstream uses must cease, that no new offstream uses may be made, or that all waters must be returned to a state of nature before even the first Hawaiians arrived in these islands and diverted stream water to grow taro. The particular level of protection may vary with circumstances and from time to time; but the primary duty itself remains.
COLs at 11. The Commission identified Windward O`ahu ground water and streams and Kneohe Bay as "part of the public trust res . . . subject to review under the State's public trust responsibility as expressed in the State Water Code." Id. at 31.
The Commission acknowledged its duty under the Code to establish instream flow standards in instituting a program for instream use protection, see supra note 4. The Commission found that the interim restoration of windward stream flows had a "positive effect," FOFs at 17-18, and that "generally, the higher the volume of instream flow and closer the stream flow approaches its natural pre-diversion levels, the greater the support for biological processes in the stream and its ecosystem," COLs at 32. Thus, according to the Commission, "in general, it is expected that additional flows to the streams would increase the native biota habitat." FOFs at 17.
A more conclusive determination of the necessary instream flows, however, remained elusive. The Commission explained:
The Commission has found it difficult to quantify an instream flow that corresponds to a biological condition for a given flora or fauna. As a result, the methods used on the continental United States to determine an appropriate instream flow have proven unsuitable in Hawaii.
The Water Code provides for the establishment and modification of both interim and permanent instream flow standards on the assumption that scientific data will eventually provide firm knowledge about streams upon which to reach some permanent solution. Haw.Rev.Stat. ง 174C-71. Unfortunately, such firm knowledge will require considerably more work and is years away. Until that scientific knowledge is available, stream management decisions will require a methodology that recognizes the preliminary and incomplete nature of existing evidence.
Given the long term work needed to define an ecologically necessary flow in a particular stream, the Commission will need to amend "interim" instream flow standards periodically until permanent standards can be adopted . . . .
From the long term vantage point of science, the biological and environmental evidence regarding streams is preliminary. The data collection is just beginning. The conclusions are tentative. In some areas, experts are even hesitant to offer opinions. For the foreseeable future, it will be necessary to manage and protect streams through a system of working presumptions rather than on the basis of firm scientific knowledge.
COLs at 16. The Commission nonetheless maintained:
Where scientific evidence is preliminary and not yet conclusive regarding the management of fresh water resources which are part of the public trust, it is prudent to adopt "precautionary principles" in protecting the resource. That is, where there are present or potential threats of serious damage, lack of full scientific certainty should not be a basis for postponing effective measures to prevent environmental degradation. . . . In addition, where uncertainty exists, a trustee's duty to protect the resource mitigates in favor of choosing presumptions that also protect the resource.
Id. at 33 (emphasis added).
The Commission also reviewed the legal requirements for issuance of water use permits under the Code.[6] Although the various *427 requests for water collectively exceeded the flow of the ditch, the Commission concluded that, "[a]t least for the near term, water quantities in excess of the amended interim instream flow standard and subject to the conditions affecting supplemental flows[7] are available at the present time to satisfy water use permit applicants for those existing and future offstream uses identified in the [D & O] . . . ." Id. at 23. Based on this conclusion, the Commission further ruled that the statutory requirement of "reasonable-beneficial use"[8] could be fulfilled, particularly with respect to agricultural uses, by a "prima facie showing" of reasonableness and consistency with the public interest. Id. at 24-25. The Commission reasoned:
[I]n this case, a variety of management and legal factors postpone the need to fully analyze the affirmative "public interest" tests in the context of deciding "reasonable beneficial use." Among these factors are: 1) the obligation not to waste; 2) the release into windward streams of permitted, but not used, ground water; 3) the release into windward streams of unallocated ground water; 4) the ditch operation and management plan; 5) conservation measures; 6) the availability of alternative sources (ground water and reusable wastewater);[9] 7) the four year non-use provisions of the Code (Haw.Rev.Stat. ง 174C-58);[10] 8) compliance review (Haw.Rev. Stat. ง 174C-58 [sic]);[11] and 9) low near term demand. Thus, careful management may defer the need to consider a higher level of scrutiny in analyzing the "public interest" test until the time when there is inadequate water for competing demands.
Where, finally, there is inadequate supply for competing needs, both the "public interest" test and the examination of "reasonableness" will require more than a prima facie showing. As competition for water resources increases, the analysis of both the public interest and of reasonableness must become both more rigorous and affirmative. The counties will be required to articulate their land use priorities with greater specificity. For example, even at the present time, there is more land zoned for various uses than available water to supply those proposed uses. Thus, it is not sufficient to merely conclude that a particular parcel of land is properly zoned and that the use is "beneficial." That minimal *428 conclusion may be inadequate to resolve situations in which competitive demand exceeds supply. Further analysis of public interest criteria relevant to water (e.g., conservation, alternative uses, comparative public costs and benefits) will be needed.[12]
Id. at 25.
Agricultural uses, the Commission concluded, were "generally" consistent with the public interest "where adequate water [wa]s available." Id. at 26. In times of scarcity and competition, however, "the standard of review [would] be higher." Id. at 26-27. Existing golf course and other nonagricultural uses were "already subject to this higher standard, in light of higher uses for windward surface water, including retaining the water in the streams." Id. at 27. The Commission subjected all permits to "conditions providing for stream restoration if the Commission determines that additional water should be returned to the streams." D & O at 30.
The Commission recognized its statutory duty, when considering competing water use permit applications, to approve the application that "best serves the public interest."[13] In the Commission's view, an inherent conflict existed between the permit applications, reservation petitions, and petitions to amend the WIIFS, but "[a]fter the evidence was weighed and reasonable beneficial uses evaluated, the scope of competition narrowed significantly." COLs at 28. The Commission, however, did indicate certain general priorities between types of uses. For example, because use of brackish water or treated effluent over the `Ewa Plain would not harm the underlying caprock aquifer, and transporting water across the island "further reduces the protection afforded the stream ecosystem by keeping water in its area of origin," use of ditch water over the `Ewa Plain caprock for new nonagricultural uses was "presumptively disfavored." Id. The Commission also stated:
Other non-agricultural uses in leeward Oahu for golf course and landscaping uses which could utilize available ground water or treated effluent also carry a heavy burden to show why stream water should be diverted out of its watershed of origin, even though central Oahu is closer to windward Oahu than the Ewa Plain. In the short term, uncertainty regarding the use of treated effluent over a potable aquifer, existing infrastructure to move Waiahole Ditch system water, and the need to study instream flow needs all mitigate in favor of continuing the use of Waiahole water for 1992 uses.
Likewise, the continued use of Waiahole Ditch water through the existing ditch system to preserve agriculture in central Oahu on lands in sugar production in 1992 ("footprint" lands) as well as on other lands in central Oahu suitable for agriculture has important value. If and until treated effluent or ground water is available, the State has a strong interest in retaining agriculture on these lands. Where instream flow values may be protected and offstream agricultural uses maintained, both "uses" are accommodated in the manner promoted by Haw.Rev.Stat. ง 174C-54.
Id. at 28-29.
Having discussed the legal grounds for its decision, the Commission apportioned the Waihole Ditch water as follows. The Commission granted in part and denied in part WWCA's and OHA's petitions to amend the WIIFS, deeming it "practicable" to restore a total of 6.0 mgd to windward streams, id. at *429 19, "more than 25% of the average total Waiahole Ditch flow measured at the North Portal (23.3 mgd)," id. at 33. Specifically, the Commission added 4.0 mgd to the 3.9 mgd "Q90 base flow"[14] of Waihole Stream and 2.0 mgd to the 0.5 mgd Q90 base flow of Waianu Stream, a tributary of Waihole Stream. D & O at 3. The Commission thus increased the combined base flow of Waihole and Waianu Streams to 10.4 mgd. Id. The Commission neither mentioned, nor made any provision for, the instream flow of Waikne Stream.
The Commission set aside a total of 13.51 mgd for leeward offstream uses: 12.22 mgd for "agricultural" uses and 1.29 for "other" uses. Id. at 6-7, 22. Leeward water uses would be measured according to average use over a twelve-month period, or the "twelve month moving average" (12-MAV). Id. at 12. The 12-MAV, the Commission elaborated, "allows for seasonal fluctuation, and is generally used for all water use reporting requirements by the Commission." Id.
In calculating the 12.22 mgd "agricultural allowance," the Commission preliminarily found that "2,500 gallons per acre per day (gad) is a reasonable duty of water for diversified agriculture." Id. at 6. The Commission left the gad figure open to future evaluation and adjustment, noting that it tended towards "the lower end of the range of estimates" due to the incipient state of diversified agriculture operations and "a lack of data on actual uses." Id. "There was evidence for both higher and lower quantities," the Commission stated, but "the flexibility in operational requirements and the duty not to waste should provide the appropriate safeguards in either direction." COLs at 25.
The 12.22 mgd agricultural allowance consisted of 10.0 mgd for former OSCo sugarcane lands currently used for diversified agriculture (approximately 4,000 acres supplied at 2,500 gad), and 2.22 mgd for Castle's agricultural lands (approximately 1,552 acres supplied at the lesser of 2,500 gad or the amount requested). D & O at 6-7. Of the 12.22 mgd total, the Commission allocated 10.64 mgd in water use permits, calculated by multiplying the 4,915 acres in "existing use" under Orders Number 8 and 10 by the lesser of 2,500 gad or the amount requested. Id. at 7. The remaining 1.58 mgd was designated a "proposed agricultural reserve," which would become available for agricultural use permits if confirmed through the requisite rulemaking procedures, see supra note 3. D & O at 7. The Commission expressly prohibited unauthorized "double counting" of water allocations, or the use of Pearl Harbor ground water on the same lands to which permits to use Waihole Ditch water applied, and noted that it could suspend or revoke permits for ground water from the Waipahu-Waiawa aquifer system after four years of partial or total nonuse, see supra note 10. D & O at 8.
Nonagricultural or "other" uses, including uses by a state prison, a cemetery, and two golf courses, PMI and Mililani Golf Club, received 1.29 mgd in permit allocations. The Commission, however, granted PMI's use of 0.75 mgd "subject to special requirements including a duty to seek alternative sources where they are reasonably available in the near future." COLs at 25. The Commission likewise imposed on Mililani Golf Course the duty to use alternative sources when they became reasonably available. Id.
The Commission also created a "non-permitted ground water buffer" of 5.39 mgd, intended for initial release in the windward streams, but available for offstream uses as a secondary source after the 1.58 mgd proposed reserve. Id. at 33-34. Applicants for the buffer water would not be required to petition to amend the WIIFS. D & O at 11. The Commission, however, would take a "`hard look' at the best available scientific and stream flow data and decide whether an amendment to the [WIIFS] is needed" before approving any application and would issue all permits subject to "conditions providing for stream restoration if the Commission determines *430 that additional water should be returned to the stream." COLs at 34.
Preliminarily, therefore, the Commission released into windward streams, in addition to the 6.0 mgd added to the WIIFS, a "supplemental flow" of 6.97 mgd or more, consisting of the 5.39 mgd buffer, the 1.58 mgd proposed reserve, and any water authorized for use in water use permits but not actually used, which the Commission mandated would remain in windward streams "to avoid unlawful waste." Id. The Commission explained that "[t]hese supplemental flows will provide a field test to monitor and scientifically study the streams. As these supplemental flows may be permitted for offstream uses and the actual stream flow reduced from present levels, scientific studies will be conducted to examine the impact of reducing stream flows." Id.
The Commission announced its plan to establish technical advisory committees, representing a cross-section of interests, to undertake tasks such as assessing the implementation of the final decision, determining the feasibility of using treated wastewater over potable aquifers, and recommending studies, conservation measures, and monitoring plans. D & O 4-5. Parties receiving permits to use Waihole Ditch water on their lands would be required to "prepare, or contract for, a portion of the studies and monitoring activities resulting from this order," contributing funds on a pro rata basis according to the amount of water used. Id. at 10. The Commission would establish a committee "to recommend a reasonable amount for the funding and coordinate and set up the mechanism for the collection, accounting, and distribution of the funds." Id.
Several of the Commission's denials of water use requests are relevant to the present appeal. The Commission rejected DOA's 0.75 mgd permit application for a planned agricultural park "without prejudice to [reapplication] when DOA can demonstrate that actual use will commence within a reasonable time frame." Id. The Commission denied KSBE's requested allocation for golf-course and landscaping uses in connection with its planned Waiawa by Gentry residential development, stating that "[KSBE] may apply for additional water ... [upon receiving] the proper land use classification, development plan approvals, and zoning changes and [demonstrating] that actual use of water will commence within a reasonable time frame for a proposed project." COLs at 27.
The Commission also declined to grant WIC's request for 2.0 mgd to compensate for the "operational losses" of the ditch system due to factors such as evaporation and leakage. D & O at 11. The Commission nonetheless observed that, until it designated the Kahana watershed as a surface water management area, the 2.1 mgd of "non-regulated" Kahana surface water drawn by the ditch would approximately cover such losses. Id. at 12. The Commission proffered that, after designating Kahana as a surface water management area and receiving water use permit applications for the water, it "may consider deducting the operational losses from the non-permitted ground water." Id.
In all, of the 27 mgd total flow of the ditch, as measured at Adit 8, the Commission assigned 14.03 mgd to permitted leeward agricultural and nonagricultural uses and "system losses." For the near term, the Commission released 12.97 mgd in windward streams. However, 6.97 mgd of this 12.97 mgd remained available for offstream leeward uses as a "proposed agricultural reserve" or "non-permitted ground water buffer." The present appeal followed.
II. STANDARD OF REVIEW
Hawai`i Revised Statutes (HRS) ง 174C-12 (1993) provides: "Judicial review of rules and orders of the commission under this chapter shall be governed by [HRS] chapter 91 [the Hawai`i Administrative Procedures Act, or HAPA]. Trial de novo is not allowed on review of commission actions under this chapter." Regarding appeals from agency decisions generally, this court has stated:
This court's review is ... qualified by the principle that the agency's decision carries a presumption of validity and appellant has the heavy burden of making a convincing showing that the decision is invalid because it is unjust and *431 unreasonable in its consequences. Konno v. County of Hawai`i, 85 Hawai`i 61, 77, 937 P.2d 397, 413 (1997) (citations omitted).
HRS ง 91-14(g) (1993) enumerates the standards of review applicable to an agency appeal and provides: Upon review of the record the court may affirm the decision of the agency or remand the case with instructions for further proceedings; or it may reverse or modify the decision and order if the substantial rights of the petitioners may have been prejudiced because the administrative findings, conclusions, decisions, or orders are:
(1) In violation of constitutional or statutory provisions; or
(2) In excess of the statutory authority or jurisdiction of the agency; or
(3) Made upon unlawful procedure; or
(4) Affected by other error of law; or
(5) Clearly erroneous in view of the reliable, probative, and substantial evidence on the whole record; or
(6) Arbitrary, or capricious, or characterized by abuse of discretion or clearly unwarranted exercise of discretion.
GATRI v. Blane, 88 Hawai`i 108, 112, 962 P.2d 367, 371 (1998) (citing Poe v. Hawai`i Labor Relations Board, 87 Hawai`i 191, 194-95, 953 P.2d 569, 572-73 (1998)).
[FOFs] are reviewable under the clearly erroneous standard to determine if the agency decision was clearly erroneous in view of reliable, probative, and substantial evidence on the whole record. Alvarez v. Liberty House, Inc., 85 Hawai`i 275, 277, 942 P.2d 539, 541 (1997); HRS ง 91-14(g)(5).
[COLs] are freely reviewable to determine if the agency's decision was in violation of constitutional or statutory provisions, in excess of statutory authority or jurisdiction of agency, or affected by other error of law. Hardin v. Akiba, 84 Hawai`i 305, 310, 933 P.2d 1339, 1344 (1997) (citations omitted); HRS งง 91-14(g)(1), (2), and (4).
"A COL that presents mixed questions of fact and law is reviewed under the clearly erroneous standard because the conclusion is dependent upon the facts and circumstances of the particular case." Price v. Zoning Bd. of Appeals of City and County of Honolulu, 77 Hawai`i 168, 172, 883 P.2d 629, 633 (1994). When mixed questions of law and fact are presented, an appellate court must give deference to the agency's expertise and experience in the particular field. Dole Hawaii Division-Castle & Cooke, Inc. v. Ramil, 71 Haw. 419, 424, 794 P.2d 1115, 1118 (1990). "[T]he court should not substitute its own judgment for that of the agency." Id. (citing Camara v. Agsalud, 67 Haw. 212, 216, 685 P.2d 794, 797 (1984)).
Poe, 87 Hawai`i at 197, 953 P.2d at 573.
Curtis v. Board of Appeals, 90 Hawai`i 384, 392-93, 978 P.2d 822, 830-31 (1999).
An FOF or a mixed determination of law and fact is clearly erroneous when (1) the record lacks substantial evidence to support the finding or determination, or (2) despite substantial evidence to support the finding or determination, the appellate court is left with the definite and firm conviction that a mistake has been made. See Leslie v. Estate of Tavares, 91 Hawai`i 394, 399, 984 P.2d 1220, 1225 (1999). "We have defined `substantial evidence' as credible evidence which is of sufficient quality and probative value to enable a person of reasonable caution to support a conclusion." Id. (quoting State v. Kotis, 91 Hawai`i 319, 328, 984 P.2d 78, 87 (1999)).
III. DISCUSSION[15]
A. PROCEDURAL DUE PROCESS
As its first point on appeal, WWCA alleges a violation of its constitutional right *432 to procedural due process, specifically, its right to a fair tribunal. In Sussel v. City & County of Honolulu Civil Service Commission, 71 Haw. 101, 107, 784 P.2d 867, 870 (1989), we recognized:
"There are certain fundamentals of just procedure which are the same for every type of tribunal and every type of proceeding." R. Pound, Administrative Law 75 (1942). "Concededly, a `fair trial in a fair tribunal is a basic requirement of due process.' In re Murchison, 349 U.S. 133, 136, 75 S.Ct. 623, 99 L.Ed. 942 (1955). This applies to administrative agencies which adjudicate as well as to courts. Gibson v. Berryhill, 411 U.S. 564, 579, 93 S.Ct. 1689, 36 L.Ed.2d 488 (1973)." Withrow v. Larkin, 421 U.S. 35, 46-47, 95 S.Ct. 1456, 43 L.Ed.2d 712 (1975).
WWCA raises several grounds for its allegation of a denial of due process. We address each in turn.
1. Dual Status of the Commission Chairperson
WWCA accuses the chairperson of the Commission, Michael Wilson (Wilson), of having a "conflict of interest" due to his concurrent status as chairperson of the state Department of Land and Natural Resources (DLNR), an adverse party to WWCA in the instant contested case hearing before the Commission.[16] We note at the outset that the positions of chairperson of the Commission and chairperson of the DLNR are not incompatible per se. The common law doctrine of incompatible offices prohibits an individual from serving in dual capacity "[i]f one office is subordinate to the other or the functions of the offices are inherently inconsistent and repugnant to each other." State v. Villeza, 85 Hawai`i 258, 270, 942 P.2d 522, 534 (1997); see also Woods v. Treadway, 31 Haw. 792, 794 (1931). The legislature may nevertheless override this rule as it deems appropriate or necessary. See Schulman v. O'Reilly-Lando, 226 N.J.Super. 626, 545 A.2d 241, 243 (1988); American Canyon Fire Protection Dist. v. County of Napa, 141 Cal. App.3d 100,