Note 9 - Commitments and Contingencies

3 Months Ended

Mar. 31, 2025

Notes to Financial Statements

Commitments and Contingencies Disclosure [Text Block]

9. COMMITMENTS AND CONTINGENCIES

On December 31, 2018, the State of Hawaii Department of Health (“DOH”) issued a Notice and Finding of Violation and Order (“Order”) for alleged wastewater effluent violations related to the Company’s Upcountry Maui wastewater treatment facility. The facility was built in the 1960s to serve approximately 200 single-family homes developed for workers in the Company’s former agricultural operations. The facility is comprised of two 1.5-acre wastewater stabilization ponds and surrounding disposal leach fields. The Order includes, among other requirements, payment of a $230,000 administrative penalty and development of a new wastewater treatment plant, which become final and binding unless a hearing is requested to contest the alleged violations and penalties.

The construction of additional leach fields and installation of a surface aerator, sludge removal system, and natural pond cover using water plants were completed in 2023. Test results from wastewater monitoring indicate effluent concentration amounts within allowable ranges. A feasibility study was prepared for and submitted to the Company on January 15, 2024, identifying various technical solutions that could be implemented to resolve the Order. The DOH agreed to defer the Order on February 15, 2024, as the Company continues to work to resolve and remediate the facility’s wastewater effluent issues through an approved corrective action plan. The Company submitted a plan (the Plan) and proposed solution to resolve the Order on March 14, 2024. The Plan included the installation of an additional pond that will be lined and installed with aerators. One of the existing ponds will be lined and renovated as necessary and the other pond will be taken offline and used as a backup pond if needed. The Company continues to work with the DOH to coordinate the timing and approval of the Plan to implement the technical solution to resolve the Order. Meetings continue to be scheduled to provide status updates and progress being made towards resolution.

In addition, from time to time, the Company is the subject of various other claims, complaints and other legal actions which arise in the normal and ordinary course of the Company’s business activities. The Company believes the resolution of these other matters, in the aggregate, is not likely to have a material adverse effect on the Company’s consolidated financial position or operations.