As a parking crunch in Kapahulu worsens, businesses are trying to fight a plan that would likely convert a parking lot on Kapahulu Avenue into commercial space.

The state Board of Land and Natural Resources will vote tomorrow on whether to put a 65-year lease for an existing parking lot at 548 Kapahulu Ave. up for public auction.

If it is not revised, the lease for the 24,000-square-foot lot would allow for the highest and best use of the property — likely commercial space. The state says a 2006 appraisal showed the annual fair market lease rent for the property was $287,000. For the purposes of the auction, the state is proposing the minimum annual rent be $180,000, with provisions for increases.

"Any revenues generated would go to support activities of the Department of Land and Natural Resources, in such things as removing invasive species," said DLNR spokeswoman Deborah Ward. "There is a higher purpose for putting a commercial lease on this property."

But state Sen. Les Ihara, whose district includes Kapahulu, and several business owners want the state to preserve the existing parking. Ihara tried to persuade the city to manage the lot, but it was not interested, he said.

Parking is free at the site. Kapahulu businesses maintain the space and pay a nominal month-to-month rent for the lot.

Ihara said businesses are willing to compromise and offer paid parking so the DLNR can make more money on the land. The businesses are trying to come up with a plan to get a commercial entity to run the site.

Parking is at a premium in Kapahulu — especially at night — when popular eateries attract outsiders and residents fill up limited on-street parking.

"There's just a huge lack of parking," Ihara said.

And in recent years, as the popularity of the community has grown, parking has worsened along the Kapahulu Avenue corridor.

Kenneth C. Chang, president of the Kapahulu Business and Community Association, said businesses will lose customers if the parking lot is closed. Chang wants the issue to be deferred, so businesses can come up with a proposal to keep the parking.

The property has been in limbo for years, since the former Kapahulu Health Center was demolished at the site in the mid-90s. Residents wanted the space to be used for a community center and parking lot. Later, when those plans never materialized, they tried to urge officials to retain the parking if nothing else.

Chang said he will try to get as many people as possible to the meeting tomorrow to testify in favor of keeping the parking.

He also said he understands why the state wants to make more revenue on the land, but is concerned the community is being left out of the decision-making. A commercial use of the land "is not the best thing to do for the property," Chang said. "There's such a problem of parking in Kapahulu."

Reach Mary Vorsino at mvorsino@honoluluadvertiser.com.