MAUNALOA, Molokai — The developers of a proposed luxury subdivision on La'au Point expect to have another environmental impact study ready before the year ends, said John Sabas, Molokai Properties Ltd.'s general manager for community affairs.

But Molokai Ranch - MPL's subsidiary - has told employees in its resort and cattle operations it will need to reduce labor costs by 10 percent and operational overhead by 5 percent, according to a letter to employees by Chief Operating Officer Roy Sugiyama.

The letter says that the cutbacks are a direct result of the failure to win state Land Use Commission approval of the ranch's final environmental impact statement. When it became clear during a hearing held on Moloka'i last month that the commission would not accept the EIS, Molokai Properties asked to withdraw the document, saying it would address concerns raised by the LUC staff and by the Moloka'i community.

Acceptance of the impact statement would be a first step toward Land Use Commission review of Molokai Properties' proposed "Community-Based Master Land Use Plan for Molokai Ranch." As part of the plan, MPL is asking to reclassify 613 acres to rural use on the West Molokai slopes overlooking La'au Point on the island's southwest corner. The plan includes development of 200 lots ranging in size from 1.5 acres to 2 acres for multimillion-dollar homes.

For Moloka'i Hawaiians objecting to the plan, La'au is considered a sacred area with significant cultural sites and important resources for the traditional Native Hawaiian subsistence lifestyle.

Sugiyama said managers would be making recommendations for cutbacks in the coming weeks.

"While we believe there were a number of procedural errors surrounding the hearing, and we know we could have answered many of the claims that the document didn't meet commission criteria, we thought it best to withdraw it and resubmit it at a later date," Sugiyama wrote.

ACCUSATIONS FLY

Walter Ritte Jr., a Native Hawaiian cultural rights advocate and organizer of the Save Laau movement, said they weren't surprised by the letter.

"We felt that they're at the bottom of the barrel, and this is the kind of things you do at the bottom of the barrel," Ritte said Monday. "Making the employees pay for their decisions and mistakes is a pretty bad idea. It's so obvious what they're doing. They are trying to put the blame on all of us who have exposed their bad plans. They are attempting to get people to blame us for cutbacks or losing their jobs."

Sabas denied that the cutbacks are an attempt by the company to bully people into supporting the master plan. MPL is a subsidiary of Singapore-based BIL International Ltd., which is in turn owned by the Hong Kong-based Guoco Group.

Sugiyama wrote that MPL lost $4.5 million in the past year. If there are further delays in adoption of the master plan, he said that the company will be forced to sell land as well as close the Kaluakoi Golf Course and Kaupoa Camp, a resort project operated by the ranch.

MPL's working cattle ranch, golf course and resorts employ about 140 people today, Sabas said.

"We have got a business to run," Sabas said Monday. "If we've been losing money all these years and continue to lose money every month, we need to make some business decisions, and that's exactly what we've been doing.

"We've been working for years to ensure the sustainable future of the ranch. I don't think it is a scare tactic. I think it is just one of those realities of doing business."

PLAN WITHDRAWN

The master plan was completed in late 2005 after two years and nearly 150 public meetings in conjunction with the Molokai Enterprise Community. The final environmental impact statement was presented to the commission for approval in October. During the hearing Nov. 15 and 16, MPL retreated when commissioners Reuben Wong and Duane Kanuha moved to reject the 3,000-page document.

The commissioners said they considered the EIS inadequate on water treatment, water transmission, segmentation of residential lots, electricity issues and potential environmental hazards to Hawaiian monk seals.

A Land Use Commission staff report supported the commissioners' positions.

"We really didn't think that there was anything wrong with the past EIS," Sabas said.

He said MPL contractors have been working on revisions since the hearing's conclusion. He said he expected the final document to be completed by the end of December.

The Land Use Commission hearings drew hundreds of Moloka'i residents, many of whom spoke passionately against the plan and detailed what they said were its flaws.

Ranch owners and their supporters argue that the plan will preserve Moloka'i's rural character and important cultural areas. The proponents say the plan is a worthy tradeoff, since uncontrolled development already is happening.

If the plan is implemented, in exchange for allowing development of La'au, two community organizations will be granted management control over 51,000 acres of Molokai Ranch property protected forever as conservation or agricultural lands.

More than half of the 51,000 acres would be designated a land trust to protect historic and cultural sites, with the remainder under conservation easements allowing current agricultural uses, but barring development.

The plan guarantees that Native Hawaiians will continue to have traditional fishing, gathering and access rights.

When the EIS failed, Ritte and other Save Laau leaders said they'd hoped MPL would return to the bargaining table. Plan opponents want a compromise that does not include development at La'au. "Instead, they are trying to waste more money, money that they apparently don't have," Ritte said.

Make a difference. Donate to The Advertiser Christmas Fund.