Operators of Kayak, Outrigger Canoe, Spear Fishing, Scuba Diving and Related Shoreline-Based Commercial Activities, Beware!
You Are Now Likely Subject to DLNR’s Commercial Permitting Rules!
Over the past few years, the Department of Land and Natural Resources (“DLNR”) has been fielding more and more complaints from people on the beach that they can’t access the best spots due to too many commercial operators being in the area. Certainly we’ve all been to a beach where you have to step over and around 15 kayaks laid out on the beach or 20 people from the Smith Family who are all going to learn how to snorkel in the very best, calmest waters on a Saturday, the only day you have to enjoy a snorkel adventure of your own. But is regulation by DLNR the right answer?
As a result of the complaints, and very likely as a result of a desire to create another revenue source, the DLNR promulgated rules during the spring and summer of 2014 which allowed them to regulate commercial activities not just from a state operated boat ramp or harbor, but for any activities occurring on the state ocean waters, regardless of where they launched from. DLNR states that “this new permitting scheme serve the important dual purpose of monitoring commercial activity levels on state waters as well as protecting public safety by ensuring that operators are carrying sufficient liability insurance and adhering to State standards”. So, despite almost no one being aware of the hearings regarding these rules (they were publicized in the local newspapers in accordance with the law), the rules were put vote and were effective as of September 25, 2014.
Well, “Do the rules apply to me?” you might ask.
Here are the basics:
Who do the rules apply to?
Anyone who operates a commercial vessel, watercraft and watersports equipment. See HAR§ 13-250-5.
The definition includes among other things boats (including paddled, sail or power), outrigger canoes, any ocean recreation activity offered for a fee, kayaks, paipo boards, surfboards, sail boards, SUP, SCUBA, prone paddle boards, snorkel equipment (“contrivances”) , and water bikes.
Where are the rules enforced?
Any State ocean waters (which means any ocean waters within three miles of the shoreline).
When do the rules apply?
Any time of the day, any time of the week, and any time of the year.
What should I do?
Get a permit. You have to apply through the local DOBOR office for a commercial permit or go to the website www.dlnr.hawaii.gov/dobor/commercial-use-permit-qa/ and fill out the Commercial Use Questionnaire.
You will be obligated to provide to DOBOR the following items: GET license; commercial insurance naming the State of Hawaii as an additional insured (see HAR § 13-231-65 for specifics); certificate of compliance from Hawaii Compliance Express (or DLNR’s alternative list of items); articles of incorporation or the operating agreement for the entity; PUC for vehicles being used by the entity; Certificate of Documentation or Certificate of Inspection for vessels; permits or letters of permission which show you can gain access to the ocean waters from the shoreline.
What does it cost?
There is no initial permit application fee however the fee structure depends on what you are doing. There is already requirement that surfboards and similar items be registered with the DLNR Registration fees vary from $1.00 per surfboard to $5.00 per canoe. See HAR §13-253-1
Once you are granted a permit, if you are operating from state land, you have the obligation to pay either $200.00 per month of your gross receipts or 3% of your gross receipts, whichever is greater. The definition of gross receipts is broad so cross-selling of merchandise and/or equipment may fall within the definition.
If you are operating from private land and/or a County land/facility, you have to pay $200.00 a month. For those of you with CORA permits, you now have to pay both County and State fees for your operation.
If you already have a commercial use permit for streams or ocean waters or catamarans, you can append the new use to the existing permit and will not be responsible for an additional 3% of your gross revenue though the reported gross under the existing permit has to reflect the revenue from the new activity.
After reading this you might ask whether you really need to deal with this new set of DLNR rules. The answer is yes. The DOCARE division of DLNR is warning people right now and advising of the need to obtain permits but at some point will likely start sending out warning letters. We do not know if they will exercise their rights to simply ticket violators (which has criminal implications as DLNR violations are misdemeanors) or if they will move toward confiscation of equipment. Either way, you as a commercial operator don’t want to be on that particular radar screen!