DHHL: Ewa 'drum'–Verona Village land exchange stalled by DOI beneficiary consultation, environmental testing

The Department of Hawaiian Home Lands told the Hawaiian Homes Commission on Dec. 17 that the proposed exchange of two Ewa “drum” parcels for two parcels at Verona Village remains unfinished because of federal review and environmental issues.

Russell Kaul, speaking for DHHL staff, traced the exchange’s history to a 2010 memorandum of agreement with the City and County of Honolulu. The drum parcels — so called from historical storage of industrial drums — came into DHHL title in 2006 as part of a federal transfer under the Hawaiian Homes Commission Act. The MOA anticipates an exchange that would give DHHL the Verona parcels near the Kamakanaʻaliʻi shopping center in return for the Ewa parcels that host the Honolulu rail maintenance facility.

Kaul said the exchange has been negotiated over multiple administrations and was amended and restated in 2022 after the city council approved appraisal numbers and an equalization payment. ‘‘The property that we put in . . . was appraised to be $330,000 more valuable than the Verona Village properties,’’ Kaul said, noting an equalization payment mechanism to account for differences.

But two major issues remain, Kaul told commissioners: federal beneficiary consultation and environmental remediation. Kaul said the U.S. Department of the Interior (DOI) requires DHHL to certify that Verona 1 and Verona 2 are intended for residential use; DOI’s position, staff said, is that such a certification preserves a NEPA exemption and avoids a more extensive environmental review process. DOI also wants to conduct beneficiary consultation about the approved appraisals and equalization payment; Kaul said DOI’s new administration staff has asked to schedule that consultation in mid‑2025 to allow the federal office time to onboard new appointees.

On the environmental front, Kaul said a Phase II assessment found elevated contaminant levels in a location adjacent to the shopping center on Verona 1. Kaul said the environmental consultant cautioned that if DHHL proceeds with residential use the agency will likely need remediation that could extend beyond the specific hot spot, potentially requiring broader cleanup to satisfy state standards for residential development. Kaul said the MOA documents the exchange as an ‘‘as‑is’’ deal and that the city and DHHL have used interim license agreements to allow each party to use the properties while the exchange remains pending.

Commissioners asked whether remediation costs would affect valuations. Kaul said appraisals did attempt to account for known conditions, but the Phase II data came after the appraisals; reopening the appraisal process is not currently planned. Commissioner Neves pressed for a magnitude estimate of remediation costs; Kaul agreed to request a projection from the environmental consultant.

Public testifiers — including beneficiaries and community leaders — raised access and cultural concerns. Testifiers urged DHHL and DOI to ensure beneficiaries have continued access to ʻāina and requested that the DOI‑led consultation be coordinated with DHHL and beneficiary representatives. Community members also recalled prior planning discussions that envisioned Kupuna housing, a place of worship and burial or memorial elements as potential future uses for parts of the Verona parcels.

Kaul recommended DHHL continue working with DOI and the city and said DHHL staff expect to finish the federal steps and close the exchange in 2025 if DOI proceeds with beneficiary consultation and approvals.