Note 14 - Commitments and Contingencies

6 Months Ended

Jun. 30, 2021

Notes to Financial Statements

Commitments and Contingencies Disclosure [Text Block]

14. 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 1960’s to serve approximately 200 single-family homes developed for workers in the Company’s former agricultural operations. The facility is made up 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 DOH agreed to defer the Order without a hearing date while the Company continues working on a previously approved corrective action plan to resolve and remediate the facility’s wastewater effluent issues. The construction of additional leach fields, installation of a surface aerator, sludge removal system, and natural pond cover using water plants were completed through June 30, 2021. The DOH is currently reviewing the test results of these corrective action plan items.  No hearing date has been set as discussions with the DOH are still ongoing to address any other matters regarding the Order.

The Company is presently unable to estimate the amount, or range of amounts, of any probable liability, if any, related to the Order and no provision has been made in the accompanying unaudited condensed consolidated interim financial statements.

There are various other claims and legal actions pending against the Company. The resolution of these other matters is not expected to have a material adverse effect on the Company’s consolidated financial position or results of operations after consultation with legal counsel.

Quarantine, travel restrictions and other public health measures to reduce the spread of COVID-19 has caused an adverse impact on local economic activity, including business closures, increased unemployment, financial market instability, and reduced tourism. The Company’s future business operations, including the results of operations, cash flows and financial position will be significantly affected should the spread of the COVID-19 pandemic, including its variants, accelerate in future periods.