Pofolk Aviation Hawaii, Inc. v. Department of Transportation for State of Hawai'i. , 136 Haw. 1 ( 2015 )

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Electronically Filed
Supreme Court
SCWC-13-0003857
29-JUN-2015
02:46 PM
IN THE SUPREME COURT OF THE STATE OF HAWAI#I
---o0o---
POFOLK AVIATION HAWAII, INC., and HALE O#LELE CORP.,
Petitioners/Plaintiffs-Appellants,
vs.
DEPARTMENT OF TRANSPORTATION FOR THE STATE OF HAWAI#I,
GLENN M. OKIMOTO, FORD FUCHIGAMI, and SIDNEY A. HAYAKAWA,
Respondents/Defendants-Appellees.
SCWC-13-0003857
CERTIORARI TO THE INTERMEDIATE COURT OF APPEALS
(CAAP-13-0003857; CIV. NO. 13-1-0787-03)
JUNE 29, 2015
RECKTENWALD, C.J., NAKAYAMA, McKENNA, POLLACK, AND WILSON, JJ.
OPINION OF THE COURT BY RECKTENWALD, C.J.
This case involves the validity of airport landing fees
imposed by the Department of Transportation Airport Division
(DOT-A). DOT-A leases Dillingham Airfield on the island of O#ahu
(Dillingham Airfield) from the United States Army. Since DOT-A
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began leasing the airfield from the Army, DOT-A has imposed
landing fees on commercial users, including Petitioners/
Plaintiffs-Appellants Pofolk Aviation Hawai#i, Inc., and Hale
O#lele Corp. (collectively “Pofolk”).
In late 2012, DOT-A claimed that Pofolk owed DOT-A a
total of $264,994.99 in unpaid landing fees. Pofolk paid a
portion of this amount under protest. Pofolk also filed a
lawsuit and sought temporary and permanent injunctions preventing
DOT-A from imposing additional fees against Pofolk, and a
declaration that an administrative rule of DOT-A was invalid to
the extent it established the rate of landing fees at the
airfield. Specifically, Pofolk claimed that DOT-A had violated
Hawai#i Revised Statutes (HRS) § 261-12(a), which provided that
“[n]o rule of the director [of transportation] shall apply to
airports . . . owned or operated by the United States.” The
circuit court denied Pofolk’s request for injunctive relief and
entered a final judgment on the merits in favor of DOT-A, and the
Intermediate Court of Appeals (ICA) affirmed. For the reasons
set forth below, the judgment of the ICA is affirmed, as
clarified herein.
I. Background1
A. Dillingham Airfield
Dillingham Airfield is used primarily for commercial
glider, sky diving, and flight training operations. DOT-A has
1
The facts are undisputed except where stated otherwise.
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operated Dillingham Airfield under a lease from the United States
Army (Army Lease) continually since 1983. Clause 32 of the Army
Lease, titled “Additional Site Conditions,” provides, in relevant
parts:
b. That the lessee’s use of Dillingham Airfield shall
be limited to the construction, operation, repair, and
maintenance of a public airport facility . . . .
c. That the use of Dillingham Airfield is subject to
the following operational provisions:
(I) That the primary purpose of the land and
improvements within the leased area is for the
operation of a joint-use-airport.
. . . .
DOT-A imposes fees on users of Dillingham Airfield,
including Pofolk.
Two statutes at the heart of this dispute, HRS §§ 261-
12(a) and 261-7(e), set forth the scope of DOT-A’s authority to
impose such fees.
At all times pertinent to the instant dispute, HRS
§ 261-12(a) (2007) provided:
Powers to adopt. The director of transportation may
perform such acts, issue and amend such orders, adopt
such reasonable general or special rules and
procedures, . . . as the director deems necessary to
carry out this chapter and to perform the duties
assigned thereunder, all commensurate with and for the
purpose of protecting and insuring the general public
interest and safety, the safety of persons operating,
using, or traveling in aircraft, and the safety of
persons and property on land or water, and developing
and promoting aeronautics in the State. No rule of
the director shall apply to airports or air navigation
facilities owned or operated by the United States.
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(Emphasis added).2
HRS § 261-7(e) (Supp. 2013) provides, in relevant
parts:
The department may fix and regulate, from time to
time, reasonable landing fees for aircraft, including
the imposition of landing surcharges or differential
landing fees, and other reasonable charges for the use
and enjoyment of the airports and the services and
facilities furnished by the department in connection
therewith, including the establishment of a statewide
system of airports landing fees . . . for the purpose
of meeting the expenditures of the statewide system of
airports . . . .
. . .
If the director has not entered into contracts,
leases, licenses, and other agreements with any or
fewer than all of the aeronautical users of the
statewide system of airports prior to the expiration
of an existing contract, lease, license, or agreement,
the director shall set and impose rates, rentals,
fees, and charges pursuant to this subsection without
regard to the requirements of chapter 91; provided
that a public informational hearing shall be held on
the rates, rentals, fees, and charges. . . .
The director shall develop rates, rentals, fees, and
charges in accordance with a residual methodology so
that the statewide system of airports shall be, and
always remain, self sustaining. . . .
(Emphasis added).
DOT-A imposes fees on users of Dillingham Airfield
through DOT-A Procedure 4.5.04 § E, which provides, in relevant
part:
2
On July 1, 2015, an amendment to HRS § 261-12(a) will take effect.
The amendment repeals the last sentence, which states, “[n]o rule of the
director shall apply to airports or air navigation facilities owned or
operated by the United States.” Act 024 (May 4, 2015). However, we apply the
2007 version of the statute to the instant dispute.
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Any aircraft operator who is not a party to an
Airport-Airline Lease, landing at a state airport
shall pay airports system fees and charges as
established by Hawai#i Administrative Rules of the
Department of Transportation.
Although this procedure directs airport users to pay
fees for landing, the rates of such fees are specified in HAR
§ 19-16.1-3, which has been adopted pursuant to chapter 91:
There shall be imposed an airports system landing fee
under this chapter for the purpose of recovering costs
attributable to the airfield activity center; this fee
shall be based on landings at an airport in the
airports system. The airports system landing fee for
an overseas landing at an airport in the airports
system shall be $2.980 per one thousand pounds of
approved maximum landed weight. The airports system
landing fee for an interisland landing at an airport
in the airports system shall be $0.954 per one
thousand pounds of approved maximum landed weight.
B. Pofolk’s Unpaid Landing Fees
Pofolk is a Hawai#i corporation whose commercial sky
diving and parachuting operations are based out of Dillingham
Airfield. Pofolk is a “non-signatory carrier,” i.e., it is not
party to an Airport-Airline Lease that specifies rates and fees
for its activities at Dillingham Airfield. In late 2012, a
dispute arose between DOT-A and Pofolk over Pofolk’s unpaid
landing fees.
By letter dated December 17, 2012, Pofolk, through
counsel, agreed to file all required reports and pay all past and
future landing fees that were lawfully owed subject to an
agreement that the fees would be paid under protest. Pofolk also
stated that if DOT-A would resolve Pofolk’s outstanding permit
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issues, allow it to construct a hangar at Dillingham Airfield,
and allow it to use Hana Airport, Pofolk would continue paying
the landing fees and not pursue litigation.
In a letter dated February 20, 2013, DOT-A claimed that
Pofolk had not reported any landings since the end of November
2012. DOT-A also informed Pofolk that it owed DOT-A a total of
$264,994.99, and demanded payment for the full amount owed.
On February 28, 2013, Pofolk sent $50,837.99 “as
partial payment for the disputed landing fees.” Pofolk stated
that the payment was being made “under protest and without
prejudice to [Pofolk’s] contentions that [it] is exempt and
should not be required to pay any amount of landing fees.”
C. Circuit Court Proceedings
On March 14, 2013, Pofolk filed a complaint in the
Circuit Court of the First Circuit of Hawai#i (circuit court)
against DOT-A.3 Pofolk prayed for the following relief: (1) the
return of landing fees of $50,837.99 paid under protest, and
interest on that sum; (2) a declaration that HAR § 19-16.1-3 is
invalid to the extent that DOT-A seeks to impose landing fees for
flights landing at Dillingham Airfield, because such fees
conflict with DOT-A’s limited statutory authority in HRS § 261-
12(a) to promulgate and enact rules, and that Pofolk has been and
3
Pofolk named as defendants in their official capacities Glenn M.
Okimoto, the Director of DOT, Ford Fuchigami, the Deputy Director of DOT-A,
and Sidney A. Hayakawa, the Staff Services Branch Administrative Officer for
DOT-A.
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is exempt from all such landing fees; and (3) injunctive relief
preventing and prohibiting DOT-A from imposing any further
landing fees against Pofolk and/or taking further actions to
coerce Pofolk to pay these fees, including, but not limited to,
evicting Pofolk from Dillingham Airfield.
On April 8, 2013, DOT-A filed an answer and
counterclaim, alleging that the imposition of landing fees is
lawful and authorized by DOT-A procedure, and Pofolk’s landing
fees are immediately due. Also on April 8, 2013, Pofolk moved
for a preliminary and permanent injunction to prevent DOT-A from
imposing “illegal and unauthorized” landing fees for landings at
Dillingham Airfield and/or taking any actions to collect,
enforce, or otherwise execute upon any such purportedly
outstanding fees.
On May 9, 2013, at the conclusion of a hearing on
Pofolk’s motion for preliminary and permanent injunctions, the
circuit court4 orally concluded that Pofolk had not shown any
irreparable injury because it could be compensated financially
(i.e., it could cover the fees through charging customers to
their commercial sky diving operation, or recover them later from
DOT-A), and that the public interest weighed in favor of not
granting an injunction because the public would be better served
by having the airfield available, and taxpayers would be burdened
if DOT-A could not collect landing fees.
4
The Honorable Edwin C. Nacino presided.
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On August 1, 2013, the circuit court entered an order
denying Pofolk’s motion. The circuit court concluded that
pursuant to HRS § 261-7(e), which authorizes DOT-A to impose fees
“without regard to the requirements of chapter 91,” DOT-A is not
required to establish landing fees through the HAR rule-making
process. The circuit court also concluded that DOT-A’s
“requirement for aeronautical users . . . to pay landing fees at
Dillingham Airfield is established by . . . DOT-A’s procedures,”
and as such, although the rates of the fee are determined by
reference to the HAR, DOT-A has the power to impose landing fees
through its procedures.
Pursuant to a stipulation and order of the parties
approved by the trial court on September 20, 2013, the trial
court entered an order on September 23, 2013: (1) ruling that
the hearing already held shall be considered a hearing on the
merits of Pofolk’s cause of action for a permanent injunction,
and based on the reasoning of the August 1, 2013 Order, Pofolk’s
claim for a permanent injunction was denied; and (2) dismissing
all other claims, counterclaims, and defenses of the parties
without prejudice.5 Accordingly, on September 23, 2013, the
trial court entered judgment for DOT-A denying Pofolk’s claims
for relief.
5
Because the trial court entered final judgment on the merits based
on stipulation of the parties that the circuit court’s hearing would be
considered a consolidated trial on the merits, on certiorari, we do not
address Pofolk’s claim for temporary injunctive relief; rather, we decide this
case on the merits.
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D. ICA Proceedings
On October 24, 2014, the ICA affirmed the circuit
court’s denial of Pofolk’s motion for temporary and permanent
injunctions. Pofolk Aviation Hawai#i, Inc. v. Dep’t of Transp.
for the State of Hawai#i, 134 Hawai#i 255, 339 P.3d 1056 (App.
2014). The ICA relied almost exclusively on DOT-A’s construction
of HRS § 261-12(a):
In the instant case, the DOT’s employee, Hayakawa,
declared HRS § 261–12(a) empowered the DOT to “adopt
such reasonable general or special rules and
procedures . . . as the director deems necessary to
carry out this chapter and to perform duties assigned
thereunder[.]” Hayakawa represented that at
Dillingham Airfield, revenues generated from landing
fees and other charges from aircraft operators,
pursuant to the DOT procedures, are part of a
calculation of rates and fees in compliance “with the
statutory mandate that the statewide system of
airports be financially self-sustaining.”[]
The DOT interpreted the limitation of HRS § 261–12(a)
(2007 Repl.) on the DOT’s authority to apply its rules
to a federally owned airport as inapposite to DOT’s
authority to impose landing fees at Dillingham
Airfield pursuant to the DOT procedures. Hayakawa
declared the DOT had established its written
procedures “[s]eparate and apart from creating rules
pursuant to [HRS] Chapter 91” and HRS § 261–12 “has
never been interpreted by [the DOT] as prohibiting
[the DOT] from operating it as a state airport
facility, collecting fees, charges and rents imposed
by its Procedures. . . .”
In assessing the DOT’s construction of HRS §
261–12(a), we note that “[a]lthough not controlling,
the uniform practical construction of a statute by
those charged with carrying out the statute is
entitled to much weight.” Chun v. Employees’ Ret.
Sys., 61 Haw. 596, 602, 607 P.2d 415, 419 (1980)
(citing Keller v. Thompson, 56 Haw. 183, 532 P.2d 664
(1975); Territory v. Honolulu Rapid Transit & Land
Co., 23 Haw. 387 (1916)); see also Fratinardo v.
Employees’ Ret. Sys. of State of Hawai#i, 129 Hawai#i
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107, 115–16, 295 P.3d 977, 985–86 (App. 2013).
Our assessment of the DOT’s practices is further
informed by Hayakawa’s declarations that the DOT “has
always exercised control” over Dillingham Airfield
operations, users, and tenants; its users “regularly
paid the assessed landing fees[;]” and “[t]his
litigation is the first time Plaintiffs, or anyone
else has claimed that they are not obligated to pay
such fees because the Airfield is owned by the federal
government.” Hayakawa’s declaration constituted
evidence of the DOT’s consistent and generally
unchallenged practice of assessing landing fees and
charges against users of Dillingham Airfield. Hawai#i
courts will not overturn administrative agency
practices that have been
consistent and generally unchallenged
. . . except for very cogent reasons if
the scope of the command is indefinite and
doubtful. . . . The practice has peculiar
weight when it involves a contemporaneous
construction of a statute by the men
charged with the responsibility of setting
its machinery in motion, of making the
parts work efficiently and smoothly while
they are yet untried and new.
Treloar v. Swinerton & Walberg Co., 65 Haw. 415, 424,
653 P.2d 420, 426 (1982) (quoting Norwegian Nitrogen
Products Co. v. U.S., 288 U.S. 294, 315, 53 S. Ct. 350,
77 L. Ed. 796 (1933)).
According much weight to the DOT’s construction of HRS
§ 261–12(a) and in light of their consistent practice
of assessing landing fees at Dillingham Airfield, we
conclude Plaintiffs’ contention does not establish the
DOT’s interpretation was palpably erroneous and the
circuit court did not err by determining that the
DOT’s assessment of landing fees at Dillingham
Airfield against Plaintiffs did not constitute a
violation of HRS § 261–12(a)’s prohibition against
applying the DOT “rules” to federally owned or
operated airports.
134 Hawai#i at 262-63, 339 P.3d at 1063-64 (footnote omitted
noting DOT-A’s reference to and quoting HRS § 261-7(e)).
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II. Standard of Review
Hawai#i appellate courts
generally review[] questions of statutory interpretation de
novo, but, in the case of ambiguous statutory language, the
applicable standard of review regarding an agency’s
interpretation of its own governing statute requires this
court to defer to the agency’s expertise and to follow the
agency’s construction of the statute unless that
construction is palpably erroneous.
Gillan v. Gov’t Emps. Ins. Co., 119 Hawai#i 109, 114, 194 P.3d
1071, 1076 (2008) (internal quotations and citation marks
omitted).
When interpreting two different statutes that relate to
the same subject matter, this court has adopted the following
standards:
First, legislative enactments are presumptively valid
and should be interpreted in such a manner as to give
them effect. Second, laws in pari materia, or upon
the same subject matter, shall be construed with
reference to each other. What is clear in one statute
may be called in aid to explain what is doubtful in
another. Third, where there is a plainly
irreconcilable conflict between a general and a
specific statute concerning the same subject matter,
the specific will be favored. However, where the
statutes simply overlap in their application, effect
will be given to both if possible, as repeal by
implication is disfavored.
Id. (alterations, quotation marks, and citations omitted).
III. Discussion
On certiorari, Pofolk presents the following question:
Whether the ICA erred in stretching HRS § 261-12(a)
beyond its plain meaning in concluding that the
DOT-A’s setting and imposition of landing fees at
Dillingham Airfield, which is owned by the United
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States, does not constitute a violation of HRS § 261-
12(a).
(Emphasis in original).
Thus, we must determine whether the last sentence of
HRS § 261-12(a), which states, “[n]o rule of the director shall
apply to airports or air navigation facilities owned or operated
by the United States,” precludes DOT-A from setting and imposing
landing fees at Dillingham Airfield through a DOT-A procedure
that references the HAR for the landing fee rates. We conclude
that DOT-A’s authority to impose landing fees by reference to HAR
§ 19-16.1-3 does not conflict with HRS § 261-12(a).
Pofolk explicitly acknowledges that DOT-A has the
authority to impose landing fees at Dillingham Airfield. Based
on HRS §§ 261-12(a) and 261-7(e), we agree. HRS § 261-12(a)
provides:
The director of transportation may perform such acts,
issue and amend such orders, adopt such reasonable
general or special rules and procedures, and establish
such minimum standards, consistent with this chapter,
as the director deems necessary to carry out this
chapter and to perform the duties assigned thereunder,
all commensurate with and for the purpose of
protecting and insuring the general public interest
and safety, the safety of persons operating, using, or
traveling in aircraft, and the safety of persons and
property on land or water, and developing and
promoting aeronautics in the State. No rule of the
director shall apply to airports or air navigation
facilities owned or operated by the United States.
(Emphasis added).
HRS § 261-7(e) (Supp. 2013) provides, “the director
shall set and impose rates, rentals, fees, and charges pursuant
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to this subsection without regard to the requirements of chapter
91.” Thus, HRS § 261-7(e) grants DOT-A the authority to impose
landing fees without following the rule-making requirements of
HRS chapter 91.
Pofolk argues that the reference in DOT-A Procedure
4.5.04 § E to “fees and charges as established by Hawai#i
Administrative Rules of [DOT-A]” constitutes an application of a
‘rule of the director’ to an airport ‘owned or operated by the
United States,’ in violation of the last sentence of HRS § 261-
12(a). Pofolk argues that DOT-A must impose the landing fees
“without reference to rules adopted by the DOT pursuant to
chapter 91.”
Pofolk further argues that HRS § 261-7(e) and HRS
§ 261-12(a), as laws on the same subject matter, should be
construed together, and that because there is a “plainly
irreconcilable conflict,” the more specific statute, HRS § 261-
7(e), should be favored over the more general statute, HRS § 261-
12(a). Thus, according to Pofolk, when considered in pari
materia, HRS § 261-7(e) and HRS § 261-12(a) authorize and require
DOT-A to establish landing fees, and further require DOT-A to do
so “without reference to rules” adopted pursuant to chapter 91.
However, HRS § 261-7(e) does not provide that DOT-A
shall impose landing fees “without reference to rules” adopted by
DOT-A pursuant to chapter 91; rather, the statute provides that
DOT shall impose landing fees “without regard to the requirements
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of chapter 91.” (Emphasis added). Thus, DOT-A does not need to
satisfy the rule-making requirements in chapter 91 when imposing
landing fees.
Nevertheless, Pofolk’s claim does reveal an ambiguity.
The reference to “rules” in HRS § 261-12(a) is ambiguous because
a DOT-A procedure that requires aircraft operators to pay the
fees does not directly set forth the landing fee rates; rather,
it refers to a rule which sets forth the rates. Thus, it is
unclear whether a DOT-A procedure incorporating by reference a
rule setting landing fee rates equates to a “rule” under HRS
§ 261-12(a).
“Statutory analysis begins by examining the plain
language of the statute at issue.” Chung Mi Ahn v. Libery Mut.
Fire Ins. Co., 126 Hawai#i 1, 11, 265 P.3d 470, 480 (2011)
(citations omitted). “When there is doubt, doubleness of
meaning, or indistinctiveness or uncertainty of an expression
used in a statute, an ambiguity exists.” Gillan, 119 Hawai#i at
117, 194 P.3d at 1079 (quotation marks and citations omitted).
“[I]n construing an ambiguous statute, the meaning of the
ambiguous words may be sought by examining the context, with
which the ambiguous words, phrases, and sentences may be
compared, in order to ascertain their true meaning.” Kewalo
Ocean Activities v. Ching, 124 Hawai#i 313, 317, 243 P.3d 273,
277 (2010).
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Furthermore, “[d]eparture from the literal construction
of a statute is justified if such a construction yields an absurd
and unjust result obviously inconsistent with the purposes and
policies of the statute.” Schmidt v. HSC, Inc., 131 Hawai#i 497,
508, 379 P.3d 416, 427 (2014) (internal quotation marks and
citation omitted).
According to DOT-A’s interpretation, HRS § 261-12(a)
does not prohibit DOT-A from imposing landing fees at Dillingham
Airfield because fees are imposed through DOT-A procedure, not a
rule. DOT-A argues that HAR § 19-16.1-3, an administrative rule,
merely specifies the landing fee rate, but does not provide the
authority to actually impose the fee.6
The ICA, “[a]ccording much weight to the DOT’s
construction of HRS § 261-12(a) and in light of [DOT-A’s]
consistent practice of assessing landing fees at Dillingham
Airfield,” concluded that DOT-A’s interpretation of HRS § 261-
12(a) is not palpably erroneous. Thus, the ICA concluded that
the statute does not negate DOT-A’s authority to impose fees
under HRS § 261-7(e). In doing so, the ICA quoted Chun v.
Employees’ Retirement System, 61 Haw. 596, 602, 607 P.2d 415, 419
(1980), which states, “[a]lthough not controlling, the uniform
6
DOT-A also argues that the word “or” in the last sentence of HRS
§ 261-12(a) should be read as “and” pursuant to HRS § 1-18. HRS § 1-18
provides that “[e]ach of the terms ‘or’ and ‘and’, has the meaning of the
other or of both.” Under this reading, the last sentence of HRS § 261-12(a)
would read, “[n]o rule of the director shall apply to airports or air
navigation facilities owned and operated by the United States.” (Emphasis
added). However, because this is an alternative argument, we do not address
it here.
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practical construction of a statute by those charged with
carrying out the statute is entitled to much weight.”
While we agree with the ICA that the administrative
agency’s interpretation is entitled to deference when we construe
an ambiguous statute that the agency is charged with
administering, nevertheless, we emphasize that the court must
still independently analyze the ambiguous statute to determine
whether the agency’s interpretation is palpably erroneous. See
Chun, 61 Haw. at 600-02, 607 P.2d at 419 (the court first
analyzes the plain language of the statute, and then notes that
“our reading of the statute is also consistent with past
administrative practice of the” agency) (emphasis added)
(citations omitted).
A comparison of HRS § 261-12(a) and HRS § 261-7(e) and
their apparent underlying policies, as well as a consideration of
the provisions in chapter 261 as a whole, and the legislative
history of HRS § 261-12(a), indicates that the legislature did
not intend for DOT-A to be precluded from setting landing fees at
Dillingham Airfield by referring to the rates set forth in the
HAR.
HRS § 261-12 provides DOT-A with general rule-making
authority. DOT-A may adopt rules “commensurate with and for the
purpose of protecting and insuring the general public interest
and safety, the safety of persons operating, using, or traveling
in aircraft, and the safety of persons and property on land or
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water, and developing and promoting aeronautics in the State.”
HRS § 261-12(a). HRS § 261-12 does not mention rules relating to
imposing or setting the rate of landing fees.
Indeed, there is also no mention whatsoever of “rules”
in HRS § 261-7(e)’s grant of authority for DOT-A to impose
landing fees. There is also no prohibition in HRS § 261-7(e)
against imposing the landing fees at airports owned or operated
by the United States. As the statute itself explains, the
purpose behind granting DOT-A the authority to impose landing
fees and other fees and charges is so that the “statewide system
of airports” is “self-sustaining.” HRS § 261-7(e). Thus, DOT-A
is granted the authority to set fees, and to do so at a rate such
that the fees are “at least sufficient to meet the expenditures
of the statewide system of airports.” Id. This is consistent
with the policy behind chapter 261 and the public interest in
having DOT-A “encourage, foster, and assist in the development of
aeronautics in the State and encourage the establishment of
airports and air navigation facilities.” HRS § 261-2 (2007).
Consistent with and pursuant to this authority, DOT-A has
established a procedure that imposes landing fees on certain
users, which are not party to an Airport-Airline Lease, including
Pofolk. See DOT-A Procedure 4.5.04 § E.
Furthermore, Pofolk’s literal interpretation would
produce an absurd result that is inconsistent with the purposes
and policies of chapter 261. See Schmidt, 131 Hawai#i at 508,
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379 P.3d at 427. Under Pofolk’s interpretation of HRS §§ 261-
7(e) and 261-12(a), DOT-A is authorized to set landing fees
pursuant to HRS § 261-7(e) without meeting the rule-making
requirements of chapter 91, provided that a public hearing is
held, but if DOT-A follows the more stringent chapter 91
requirements and the landing fees are set forth in the HAR, then
those landing fees are invalid as applied to Dillingham
Airfield.7 It would be nonsensical to interpret the statutes as
stating that the exact same landing fee rates would be valid if
set forth in DOT-A’s procedures, but here they are invalid
because DOT-A provided more notice and a greater opportunity for
public input by setting the rates in accordance with chapter 91.
Pofolk’s interpretation would also be inconsistent with
the policies behind chapter 261. HRS § 261-2 provides, “[t]he
department of transportation shall have general supervision over
aeronautics within the State. It shall encourage, foster, and
assist in the development of aeronautics in the State and
encourage the establishment of airports and air navigation
facilities.” This language indicates a broad intent to allow
DOT-A to have general control over aeronautics.
Moreover, in considering DOT-A’s broad general rule-
making authority under chapter 261, together with the stated
7
Pofolk concedes that the imposition of landing fees would not
violate HRS § 261-12(a) if the language in the HAR establishing the landing
rates had simply been “cut and pasted” into the procedure. See Oral Argument
at 8:10; 14:30, Pofolk Aviation Hawai#i, Inc. v. Dep’t of Transp. of the State
of Hawai#i, No. SCWC-13-0003857, available at
http://state.hi.us/jud/oa/15/SCOA_021915_3857.mp3.
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intent in HRS § 261-2 that DOT-A “encourage, foster, and assist
in the development of aeronautics in the State and encourage the
establishment of airports and air navigation facilities,” it is
apparent that the legislature intended to authorize DOT-A to set
and impose landing fees.
For example, chapter 261 authorizes DOT-A to adopt
rules regarding, among other things, safety, welfare, aircraft
registration, air traffic, airport security, equipment, and motor
vehicles on the premises. HRS § 261-13.5 (2007);8 HRS § 261-15.5
(2007);9 HRS § 261-12(b).10 The autority given to DOT-A in these
8
HRS § 261-13.5(b) provides, in pertinent parts:
To the fullest extent possible within the State’s
authority to act in the area of airport and air
traffic safety, the department of transportation shall
be responsible for promoting safe operating conditions
and alleviating safety hazards due to air traffic
congestion at airports under its control.
. . . .
Pursuant to sections 261-12 and 261-13, the director
shall adopt such rules and standards which may include
the assignment of particular runways for particular
uses, the establishment of the number and types of
aircraft allowed to use each public airport, and the
use of similar measures where such actions may
contribute to the segregation of different types of
aircraft and to the reduction of peak air traffic
usage at airports under state control.
(Emphasis added).
9
HRS § 261-15.5 provides, in pertinent part: “Unless an aircraft
is exempted by this section, no person shall operate or cause or authorize to
be operated any aircraft at an airport owned or controlled by the department,
unless the aircraft has a certificate of registration issued in accordance
with rules adopted by the department.” (Emphasis added).
10
HRS § 261-12(b) provides, in pertinent part: “[N]o tour aircraft
operation shall be permitted in any airport under the State’s control without
having a permit. The director shall adopt rules to regulate tour aircraft
operations by permit . . . .” (Emphasis added).
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statutes to adopt rules at airports under DOT-A’s control assists
in aeronautic development by promoting safety and efficiency.11
Similarly, DOT-A’s authority to impose landing fees also supports
aeronautic development because the landing fees keep the
statewide airport system self-sustaining.
As Pofolk acknowledges, the authority granted by HRS
§ 261-7(e) to impose landing fees to make the statewide system of
airports self-sustaining includes imposing landing fees at
Dillingham Airfield. Pofolk’s interpretation of HRS § 261-12(a),
however, would restrain options for making the statewide system
of airports self-sustaining, and is inconsistent with state
aeronautic development, a goal of DOT-A in HRS § 261-2.
Furthermore, one apparent rationale of the last
sentence of HRS § 261-12(a) is to prevent state operational rules
from interfering with federal aeronautic operations. The final
sentence in HRS § 261-12(a) originates in Section 13 of Act 32,
“An Act Relating to Aeronautics . . .” (Act 32), which was
enacted in 1947 by the Legislature of the Territory of Hawai#i.12
11
We note also that Pofolk’s literal interpretation of the last
sentence of HRS § 261-12(a) would create a clear conflict between HRS § 261-
12(a) and (b). Subsection (a) provides that “[n]o rule of the director shall
apply to airports or air navigation facilities owned or operated by the United
States,” but subsection (b) grants authority to DOT-A to “adopt rules to
regulate tour aircraft operations by permit” “in any airport under the State’s
control.” (Emphases added).
12
Act 32 provided, in pertinent part:
The commission may perform such acts, issue and amend
such orders, make promulgate, and amend such
reasonable general or special rules, regulations and
procedures and establish such minimum standards,
(continued...)
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The act expressly declared that “all territorial airports and air
navigation facilities except those under military jurisdiction
and control” fell under the jurisdiction and control of the newly
created territorial aeronautics commission. 1947 Haw. Sess. Laws
Act 32 § 2 at 166 (emphasis added). Act 32 further stated that
“by purchase, gift, devise, lease, [or] condemnation[,] . . .
[t]he commission is authorized to acquire rights and interests in
airports owned or controlled by others, for the purpose of
meeting a civilian need,” and “may fix and regulate . . .
reasonable landing fees . . . for the use and enjoyment of the
airports and the services and facilities furnished by the
commission . . . .” Id. § 6(a) at 170; id. § 8(c) at 172
(emphasis added).
Thus, through Act 32, the legislature intended to make
users of an airport leased to and operated by the commission–-but
owned by the United States–-subject to reasonable landing fees
“fix[ed] and regulate[d]” by the commission. Moreover, because
Dillingham Airfield is leased to DOT-A under a lease that allows
12
(...continued)
consistent with the provisions of this chapter, as it
shall deem necessary to carry out the provisions of
this chapter and to perform its duties hereunder: all
commensurate with and for the purpose of protecting
and insuring the general public interest and safety,
the safety of persons operating, using or traveling in
aircraft, and the safety of persons and property on
land or water, and developing and promoting
aeronautics in the Territory. No rule or regulation
of the commission shall apply to airports or air
navigation facilities owned or operated by the United
States.
1947 Haw. Sess. Laws Act 32, § 13(a) at 174.
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DOT-A to control and operate Dillingham Airfield as a public
airfield for commercial skydiving and parachuting activities, and
DOT-A is not attempting to impose its rules or fees on any
federal operations, any concern about state operational rules
interfering with federal operations is not implicated here.
In sum, as Pofolk acknowledges, DOT-A has the authority
to impose and set landing fees at Dillingham Airfield. HRS
§ 261-12(a) does not preclude DOT-A from doing so through its
procedures, which DOT-A may adopt through less stringent
requirements than rules under chapter 91. It would be
inconsistent with the policy behind HRS § 261-7(e) to permit
DOT-A to impose landing fees at Dillingham Airfield pursuant to a
procedure and yet invalidate the procedure just because it refers
to the HAR for a method of calculating the fee. Accordingly, it
is not reasonable to presume that the legislature intended for
DOT-A to be precluded from referring to the HAR for the specific
rates of the landing fees.
IV. Conclusion
The ICA’s November 21, 2014 judgment on appeal is
affirmed, as clarified by this opinion.
Eric A. Seitz /s/ Mark E. Recktenwald
for petitioners
/s/ Paula A. Nakayama
Jack A. Rosenzweig
for respondents /s/ Sabrina S. McKenna
/s/ Richard W. Pollack
/s/ Michael D. Wilson
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