 Okay, we're back. We're live. I'm Jay Fidel. This is Think Tech Hawaii, if you didn't know. And this is Hawaii, the state of clean energy. This is our, what do you say, Mitch? This is our most important show. Well, this is a show we like best. We have 4pm every single Wednesday, the flagship show on energy. We have several shows on energy. And this is the one, may I say, we like best. And today, aside from Mitch Ewing, we have Megan Blazek. And she's from the Kohala Center in Kohala Surprise. And she's going to talk to us about their efforts in agriculture and renewing Hawaii. Oh, exciting. Megan, welcome to the show. Thank you for having me. I'm excited to be here. Yeah, it's great to see you. So, Mitch, can you, can you, we talked about this a few minutes ago. Can you sort of define the scope of our discussion today? Yeah, we want to talk about how, first of all, how COVID has affected agriculture, both on the big island on the neighbor islands, and what can we do about it? And the other thing is like not just the COVID, but before COVID is, you know, what was the status of agriculture? We talked about land banking, land, land being fallow and all these other things, barriers, you know, speed bumps, you know, what's the government doing or not doing? How can we be more effective? And, you know, what things can we be doing? Yeah, what do you think we should do for the next three minutes? Well, I think that should take about three hours. You know, they talk about before COVID, and I'm devising this kind of system in my mind, historical system. Before COVID, everybody knows before COVID is EC, right? BC. Very clever. So, Megan, why are you here? Why did you come and do this? Are you glutton for punishment or what? Well, I enjoy, you know, helping our farmers and ranchers have successful businesses, helping local people get local food. It's not always easy. Obviously, Hawaii across the board challenged with economies of scale. Overall, our farming population is aging. So, the median age of a farmer in Hawaii is about 60 years old. And so, with every year that goes by, there's usually less and less farms that are around because people are retiring. People's kids and grandkids don't necessarily want to take over the farm. And these are businesses, some of them have been around for decades. They really have their customer base figured out their market position. And there's no one to take the reins. So, what we do at the Kohala Center, we have a range of programs. I work in the rural and cooperative business development services program. And so, I'm a supervisor with that program. And we're essentially the only cooperative development center serving Hawaii. We compete for funding from USDA rural development each year to provide technical assistance and business development services. I think we're probably best known across the state for what we call our capitalization services. So, we provide pro bono consulting and loan packaging assistance. I am a grant writer. So, I specialize in helping farmers get money out of the USDA. And kind of the impetus for why the center started the suite of services in 2011 was because federal money was being left on the table and sent back to DC. And our local farmers and ranchers and our community based nonprofits that are doing food systems work, they were not getting their fair share at all of the taxpayer dollar. So, I get to wake up every day as an English major and write grants to help, you know, grow more food and grow our ag sector here locally. So, I guess in the last nine years, we've secured about $22 million in loan and grant funding for farmers and ranchers that's direct funding for small businesses as well as nonprofits. And again, like what makes our approach unique is that we emphasize working with producer groups, cooperatives, associations of producers because when you have one farmer or rancher, you know, trying to tackle the economies of scale challenge, it's a lot easier to do it together. But on the flip side, the first thing a farmer or rancher will tell you is it's so much easier for me to work alone because you move faster alone, but you go further together. And so, we have a staff of about eight full-time folks that have different specializations, including a co-op developer where her sole job is to help mediate the relationships and the development challenges that come with working with groups. So, that's the gist of what we do at the center. Our services are offered statewide, so, and they're free and confidential. So, if there are any farmers watching, please give us a call. We're here to help you. So, I guess COVID really disrupted our agricultural markets and supply chains. So, what we've seen kind of over the last 10 years or so is the emergence of small-scale, diversified agriculture across the state, folks growing really niche crops to sell to restaurants, resorts, professional chefs. We have so many great events in Hawaii that attract global audiences, so there's a huge market and demand for, you know, Hawaii's abundance. We have so much to offer the world and people come here to try it and like get a literal taste. And so, when COVID, you know, the faucet completely turned off and we actually had an oversupply, this has been the most common experience that I've heard from my beneficiaries, there's an oversupply of food. So, they had crops in the ground, they had cattle on the pasture and now the markets that had been strengthening year over year as tourism grows, you know, as more people move into the state, we also have a very large Department of Defense presence here. You know, all of those kind of contributing factors, those markets, it disappeared at least temporarily. And so, kind of the response, the rapid response to that while the federal government has gotten its ducks in a row and, you know, released some aid, the on-the-ground solutions have really come from industry associations and non-profits such as the Kohala Center that are trying to work in a technical support capacity to help the producers pivot and find alternative markets. And so, kind of coupled with this is the unemployment rate. So, many people, especially on Maui and Oahu and then to some extent in Kailua Kona, significant job losses in the service sector, retail sectors, mandatory shutdowns. And so, folks, you know, trying to get their unemployment, trying to figure out how they're going to feed their families, there is a huge community feeding emergency that needs to be responded to. And so, what we've seen is several different solutions kind of come up off of the ground. The Farm Bureau, there is another group called Chef Hui that's diverting food that otherwise would have gone to retail and restaurant markets. They're diverting it to Aloha Harvest, the food banks, the food basket on Hawaii Island. And we're kind of just helping connect the dots between the producers who have product to sell and the people who need food to eat. And in this case, it's an emergency situation. So, there's increasing demand for food distribution. So, that's just one example of what we've seen in the recent weeks and, you know, it's going to continue. Sure it is. Are there other organizations like yours doing the same thing you do? Yeah, I really want to highlight the Farm Bureau. I think the Farm Bureau has been really responsive and agile. They've been able to organize philanthropic donors, county governments, and then the Farm Bureau itself to provide produce and ranch product purchases for producers in each of the counties. And so, I think the most popular example that got the most coverage was Farm to Car in Honolulu. Overwhelmingly successful, the city and county really stepped up to help fund the cost of doing that kind of program. And it really galvanized the farmers to keep farming, because at least now they have a market and they might not be getting, you know, the premium that they were getting prior to COVID, but at least it's helping with their cash flow. And so, we have a program in Hawaii County. It's called the Bridges program, where they're doing something similar. They're doing wholesale purchasing of farm products and, you know, the Kohala Center has been able to network some producers who, you know, maybe they were very small, maybe had two or three restaurant accounts and, you know, now they have none. And so, it's from that scale all the way up to some of your largest produce operations. I think you've answered a lot of the questions that Mitch described in the scoping the show. But let me go to public policy for a minute. Seems to me that, you know, we used to be entirely agricultural. It was really nothing much going on but agriculture in this state. And we employed thousands and thousands of people and we exported to the world, large landowners developing large facilities and exporting in large amounts. And that's all gone. That's all gone. And, you know, what strikes me is that now in the, you know, the in the time of COVID, where we should be learning, you know, necessity breeds invention, how to feed our people. You know, every governor since statehood has said let's diversify back into agriculture. But we haven't really done that. One of the reasons is the land and if you don't give the land to the farmer, the farmer is though collateral to make a loan so he can't get any money and so forth. So pitch me, pitch me Megan. I either graduated or got close to graduating from University of Hawaii to study agriculture and related subjects. Tell me why I should go into this. Tell me what benefits I would have and what challenges I would pitch me. Okay, so I think Hawaii is growing produce specialty crops, livestock value added products that no other place in the world is growing. And so if even though we're a small state, we don't have a lot of infrastructure in place. We still are like a blue ocean in a red sea. Right. And so there's two things that I think differentiate our local farmers from every other farmer on the planet. And I think it's we can grow what the customer wants and we can do it in the time manner and quality that's desired and we may not be able to produce the most at the cheapest. But that's not really how value is created. And if there's demand for your product that exceeds your supply, you're you're you're going to get a premium, right? So you have to know your customer. It's just like in English, which is what I studied in literature, you need to know your audience. And in business, you need to know your customer. And so I can make money. Yeah, I can make a living wage. Yeah, you can. And I think there's there's this great book called the Lean Farm, and it it kind of adopts Toyota's manufacturing principles for farming. And it if you look at studies, small scale, diversified agriculture is actually more productive in terms of crop yield and ecological benefits and revenues return to producer. Like the more you scale down, the better your margin gets. Oh, wait a minute now, wait a minute, those those big landowners with those huge plantations, they made tons of money, gave tons of jobs, tons of export product. It was extraordinary. Although I asked you this question, why can't we go back to that? A lot of these big plantation owners still own the land. It's been lying fallow in many places in the state without, you know, any productivity for decades and decades. Why can't we incentivize them somehow to go back and grow crops on large areas and feed our people so we don't have to bring it in on questionable supply lines, because our supply lines are getting questionable. Why can't we do that? And furthermore, why can't me and Mitch invest our resources in buying some of that land somehow and developing not a diversified agriculture truck farm, but a big farm a farm that produces a lot of agricultural products? Why can't there be bigger facilities? Doesn't that work too? Don't you get some economies of scale there, Megan? Yeah, but you also have climate change to deal with. So if you're just growing one crop and it's on thousands of acres and your whole crop gets wiped out, that's not a good, that's not a good triple bottom line business model. And I think as far as the large land holdings in Hawaii, you know, there's like seven or eight, you know, trusts or, you know, private entities that hold the majority of the agricultural land governments aside. And, you know, I think a few of them are warming up to the idea, you know, the idea of carbon markets, we need energy solutions, we're going to have rising tides. So we're going to need to move things inland, which is where a lot of these lands are. And also looking at traditional uses of the land. So if you look at like the Ewa Plain, I mean, that was one of the most abundant productive areas in the entire island chain historically. And so the soil profile there is great for agriculture. Yeah, but you make a lot more money building condos. Yeah. So to that point, I really think the solution with developing our agricultural infrastructure is not, it's not the how we know how to do it. It's not a mystery how to build things. If developers didn't know how to build things, they wouldn't be here developing real estate. So they hold the solution and the knowledge and the expertise. And so I'm a big proponent of, you know, nonprofit and community based finance solutions. And so cooperatives are an example of collectively owned businesses where everyone can pool resources and access, you know, non-commercial financing in order to, you know, carry out some of the infrastructure or building or facility needs that are necessary to create the supply chains to help the farmer bring whatever it is they're growing to market. And so it would be nice to see the private sector maybe, you know, do some pro bono work and consult with some of our community development financial institutions to find solutions because we know how to build it. But if there isn't a big profit margin tacked onto it, like no one wants to do it. And so that's why to your point, why can't we return to the plantation model, you know, it's an extractive model and the ownership of those businesses was not local to Hawaii, you know, for the most part, the labor was shipped in. A lot of the capital came from off islands in some cases from international sources. And so I was going to ask you, both Mitch and I had a few bucks and we wanted to invest it in a cooperative bank, for example, a bank that was dedicated to agriculture that would that would make loans on good terms to, you know, starting starting up farmers. Could we do that? Should we do that? Is it happening? Is it not happening? Should it happen? Well, I think the fact that on average, we secure between $2 and $4 million a year for about 50 beneficiaries goes to show that access to money isn't the issue. It's teeing up the projects and teeing up the applicants and the technical assistance that goes along with planning a project to ensure it's successful. What about labor? What about labor? So I have my degree out of Sitar at the university. I know a lot of technical things about farming. I know I got all my training, but I really don't like hard work. I'm sorry. I don't like to get dirt under my fingernails. I don't like to work in the field until the sunset. I don't like to do what my grandparents did on the plantation and suffer through that kind of physical labor for their whole lives. I don't want to do that. What do you say to me? How do you get me back on the farm? Because the farm needs labor. There's no alternative to labor. I guess machines help, but there's no alternative to labor. Yeah, I think controlled environment agriculture. That's the first thing that comes to mind. I'm thinking of one farm in particular that does vertical farming indoors in a warehouse, in an urban area, in our state, and controlled environment agriculture. It totally mitigates, not totally, but it really reduces your risk with climate change. It removes the need to do expensive life. Is this happening? I know people who know how to do that and want to do that. In fact, I know one guy who's doing it, but how about feeding the state? Yeah. Again, if you look at the studies, indoor hydroponic systems are way more productive than large-track farms. You also have way less food waste. You have less crop loss due to insects. So how do you incentivize people to do that? Can you, Megan, incentivize them to do that? Is there anybody incentivizing? Is our legislature, for example, who should be in this conversation? Is the legislature incentivizing to do that? Because if they knew what you were saying, maybe they would do it. Yeah, I mean, it's a balance. Taxpayer dollars, I think the law is that the taxpayer dollar shouldn't be used to advance the profiteering interest of an individual business. So it's all in striking the balance. I think, for example, the Department of Agriculture just spent $1.5 million to do an engineering plan for a mobile slaughter unit. And I'm 100% sure that that's been done several times in the last 10 years. And so I think, again, we have the resources to do it, but wise investments and distribution of the funds and stewardship of funds. The number one thing that I hear from farmers and ranchers is like, we need more grant money. There's plenty of loans out there for us. A lot of farmers and ranchers are already overleveraged with emergency loans. I know a lot of papaya farmers on Hawaii Island from Hurricane Izel and then the lava. They're like, I cannot take another loan. And so at the same time, grants are not intended to make you whole. And so I think we need some creative solutions. We definitely need nonprofit organizations as an intermediary. So is the legislature talking to you, Megan? Are they talking to you? You get a call in January and say, Megan, you got to come down. Tell us what to do. You get that? I don't personally, but the Kohala Center does sit on the local food coalition. And so they support, they usually have a legislative package that supports the initiatives and the Farm Bureau and Farmers Union too. We've got to keep the pressure on you know, otherwise it'd be down the priority list. So Mitch, I'm sorry, you had many questions which we have not answered. Why don't you try to get answers from Megan? Yeah, so we talked earlier in the conversation about all these USDA dollars sitting on the, you know, not being utilized. How are we doing now with that? I mean, are we still capturing all the dollars we can or are there still opportunities out there? There's definitely still opportunities. I mean, I pretty much secure a grant for every program and so there's only so many winners and it gets to that point where it's like, it's better if we all work together and go for an award than trying to, everyone put in their own thing because we're such a small state. And so the Kohala Center, we really try to foster collaboration and try to, you know, help folks design their projects and it might, it might take a year, it might take two years, but you know, we'll get there and then when your readiness level is where it needs to be, like we're going to get the, not we, but the agency is going to say yes because your proposal is strong. And so the one program that I really want to highlight is the USDA Rural Energy for America program. This is a program that I know dollars were returned to DC for Hawaii for this last fiscal year. So there is money on the table. This program is open to any small business in a rural area in the state. So anyone outside of Honolulu, you don't have to be an ag business and it'll provide you a 25% reimbursement for the cost of installing a renewable energy system or for doing energy efficiency improvements. And so if you're interested, if you're a business farmer or otherwise, please contact the Kohala Center and I'll help figure out if that program is the right fit for you. What's the website? What's the website address that I can find you? Kohalacenter.org. Okay, sorry Mitch. Yeah, so I know a guy's he's converting his farm over to run on hydrogen. So I should put him in contact with you to see what kind of, you know, you can do so far as funding it all out of his own hip pocket. One of the things on your website is you talked about workforce development for jobs coming in the future. So what kind of jobs do you see coming in the future? You talked about vertical ag. That's very high tech stuff. I did a vertical ag project once with a group of guys. One of the big features of that was that you could do a organic farming, you know, where you certified organics because like you said, you control the environment. Is that something you're doing? I mean, I've heard about this guy, I think he's over on the Maui as he's doing the controlled environment thing. You know, that's a lot of high tech involved in that kind of an operation. So is this part of your program? What do you see the future of ag that, you know, Kohala is like helping our young adults and people to get into ag? Yeah, thanks for the question. We have several different pathways educational pathways, targeting youth. I mostly work with our adult beneficiaries, but we do have a program called Oh, haha, agriculture in capital. You're kidding. Oh, haha. Yeah. Oh, haha, agriculture, sustainable agriculture, high school program and Kamehameha schools as a partner in that. And so we do immersive hands on experiences with local students. That's on Hawaii Island. And then we also kind of have like a conservation leadership pathway. And so through that vein, we're taking Kiki and older youth out into the field into the forest. They're doing INA based STEM education. And a lot of these kids come from families that have intimate knowledge and familiarity with the land. And for them, it's like, it's so natural for them to be in that element. And they don't necessarily realize that they can turn that into a career. And as you said earlier, you know, a lot of people are passionate about ag, but like ag is really hard work. So a lot of ag grads end up being extension agents or their professors or researchers, which is totally fine, you know, there's so many pathways in agriculture and conservation. And I think the key because farming and ranching is only going to get harder in this state with climate change and all of the challenges that we're facing the cost of labor, we really need passionate people that are invested in serving their community and serving the land here, because farmers get into farming for money, but they do it because it's like in their heart and part of their lifestyle. And so we need people who are going to stick it out through the challenges. And when you have like corporate farms from the mainland that come in and make 1000 jobs, and then when the going gets tough, they're gone, like I would rather have 10 farms that make 10 jobs that are going to be here for 50 years, because you can actually grow something through that and succeed businesses and really grow them to be healthy and viable. So we do training and we partner with other service providers that do youth training. And then the GoFarm Hawaii program is an active partner of ours too, and they have a great program. Go ahead, bitch, go ahead. I was just going to say, what's do you have a relationship with CTAR because, you know, they have a pretty, an excellent program. So how do you leverage the CTAR capabilities at the University of Hawaii? Yeah, I love the extension service. If I could write grants for the extension service, I would. I think our extension service and our land grant institution is the key, one of the keys to the success of agriculture moving forward. And so we've done some, like last year, we did Food Safety Modernization Act trainings. We got producer certified on the produce safety rule. You know, I'm always monitoring what all of the extension agents are doing. I know some folks on Oahu are working on small equipment demos, cultivar trials, like it's so critical that our farmers are growing varieties that are going to thrive in our tropical and subtropical growing environments. And our extension agents are so passionate and so knowledgeable. So we mostly just pull them in, you know, if we have a farmer rancher that's having some challenges with production, you know, usually we know who to point them to. And then obviously, CTAR just has so many publications that we're actively promoting through our newsletters and through our workshops and outreach with producers. So Megan, you know, a few years ago, there was a big hub about GMOs. And there were those who opposed any kind of GMO. This was especially pertinent in the case of papaya, but in other crops too. Are those objections still in the conversation? Do we have GMOs being grown in the state of Hawaii? Yeah, so that's a big topic. We've got like a minute left. But I guess I'll say, you know, yeah, I mean, we do have genetically engineered crops growing in Hawaii, but it's very, very limited. So the papaya is pretty much the only crop that is consumed by humans. That's genetically engineered. The vast majority of everything else that's genetically engineered that's growing in our state is for seed corn. And it's not for human consumption. It's not sold locally. It gets exported to other countries in the mainland. So it's kind of a skewed question because by and large, our producers are growing like heirloom varieties or hybrid varieties like genetic engineering really doesn't touch the vast majority of specialty crops and commodity crops that we grow in the state. You know, Mitch, we're just about out of time. I don't know what we're going to do with the rest of our six hours talk show here. We'll have to revisit with Megan at a later time. So Megan, you're only a fraction finished in this conversation. I'm sorry. So Mitch, can you, as you always do, try to summarize and make sense of a takeaway on this? Well, my major takeaways are A, we're obviously in a bad time, but we have a really great resource in the state with the Kahala Center who have a vibrant, aggressive program that seems to be very successful, helping farmers both on the technical side and on the funding side. We have a very enthusiastic business development person who's an expert in writing grants and anybody who doesn't tie in and take advantage of these assets is dumb. So I think that's what I got out of it is like there's a lot of energy with Megan and the Kahala Center. I'm so glad to see it. I mean, they produce beautiful reports and they're doing something that's really worthwhile and I think the future of ag is in good hands with the Kahala Center. Yeah, wow. We heard that. That was a public statement. So Megan, you want to do any rebuttal on that? No, not at all. Thank you for having me and I'm happy to come back and answer your questions again. Okay, I only want to add one thing. For me, we need diversification and COVID has shown us how badly we need it. I worry about food sources. I worry about supply lines and supply chains. I worry about shipping from here to the mainland and back. And for me, it's not moving fast enough. So my only suggestion here is that whatever we can do to move it faster, whatever we can do to get everybody involved and appreciate how badly we need to focus on this, I'd like to see that happen. Megan Blazac, thank you so much for coming down. And I agree with everything Mitch said about the Kahala Center. And Mitch, thank you so much for co-hosting this show. Until next week, we'll see you again next Wednesday on Hawaii, the state of clean energy. Aloha, you guys.