It’s pretty much a done deal: Pasha Hawaii Transport Lines can start shipping cargo between the islands despite protests from fellow shipper Young Brothers Ltd. and some neighbor island businesses.

In a surprise move, the Hawaii Public Utilities Commission told state senators at a committee hearing Thursday that they’d already reaffirmed an earlier decision to temporarily allow Pasha service interisland routes through Dec. 31, 2013.

Legislators had scheduled an informational briefing Thursday morning on the matter since the PUC hadn’t held public hearings on the its decision.

Young Brothers Ltd. — the state’s largest interisland shipper — had asked the PUC reconsider its decision, arguing Pasha’s request would create an uneven playing field because Pasha would not have to service unprofitable routes. Pasha is also selective about its cargo: It will only ship vehicles and equipment, ignoring livestock and fresh produce.

Young Brothers, on the other hand, is obligated under state law to service all ports in the islands, including stops on Molokai and Lanai, which the company says are unprofitable routes.

Thursday’s hearing was held to “shed light on the process and rationale of the commission’s decision, which seems may have been an unusual action on their part,” said Sen. Roz Baker, chairwoman of the Committee on Commerce and Consumer Affairs.

But the day before the Senate hearing, the PUC rejected Young Brother’s motion to reconsider, effectively giving Pasha the green light.

Asked about the timing of the PUC’s decision, PUC Chairman Carlito Caliboso said: “I suppose I could have waited, but I wanted to make our decision clear. We would’ve been ready with or without this hearing.”

Senators were visibly frustrated at the PUC. Sen. Baker said: “I hope the PUC delays, not rushes, the opportunity given to Pasha to move forward … The Legislature will be looking at this very, very carefully.”

The committee also heard testimony from the state Consumer Advocate, executives from Pasha and Young Brothers, and a dozen neighbor-island farmers, ranchers and business groups that rely on interisland shipping. About 50 people squished into a conference room at the Capitol.

In the question-and-answer session that followed testimony, only Caliboso was questioned by the panel, which included Sens. Baker (Maui), Russell Kokubun and Dwight Takamine (Big Island), and Brian Taniguchi, Sam Slom, Clarence Nishihara and Brickwood Galuteria from Oahu.

Caliboso testified that the PUC found no evidence that Pasha’s proposed service would harm other existing carriers, including Young Brothers.

“It’s merely an interim decision, it’s not final,” Caliboso said. “Pasha will be required to submit quarterly and annual financial reports and a summary of its first two years of operation. Rather than basing a decision on theoretical assumptions that may not be reasonable, we believe a better approach is to allow Pasha to operate on an interim basis, which will allow the commission to make a final decision based on actual data. If this causes undue harm to Young Brothers or to the public, the PUC can step in and revoke Pasha’s authorization.”

Young Brothers previously has estimated Pasha’s proposed service will cost it $1.5 million in lost revenue annually, or about 15 percent of its cargo services.

Roy Catalani, Young Brother’s vice president for strategic planning, testified that the PUC’s decision “threatens the viability of Young Brothers” and creates a business model that cannot attract capital and cannot sustain the frequency of service it currently offers.

Young Brothers said shipping cars and equipment — a more profitable service — helps subsidize the cost of shipping produce and livestock between the islands.

The possibility of Young Brothers increasing rates while decreasing the frequency of services was a common concern among businesses that testified in-person Thursday. They included the Hawaii Farm Bureau, Hawaii Cattleman’s Council, Hawaii Food Service Alliance, Hawaii Food Industry Association, Molokai Chamber of Commerce, Haliimaile Pineapple Co., Nalo Farms, and the Maui Hotel & Lodging Association.

Sen. Kokubun asked Caliboso why the PUC denied the opportunity for these concerns to be heard in public hearings.

“We’ve heard it today, we’ve heard it before,” Caliboso responded, noting that the PUC can hold public hearings once Pasha starts service.

Kokubun said those hearings would be useless and “after the fact.”

“Your logic escapes me,” Sen. Baker added.

Kokubun also said the commission’s “Oahu-centric decision-making is very troublesome.”

Takamine asked if the decision to reject Young Brother’s motion could be appealed at the commission level. Caliboso said appealing would be a legal issue and was not sure that the courts have jurisdiction at this point in the process.

Baker concluded the hearing saying: “I’m very concerned. I hope the PUC delays, not rushes, the opportunity given to Pasha to move forward … I encourage the PUC to go back, hold some hearings on the neighbor islands.”

DISUSSION: What’s your take on the PUC’s decision? Share your thoughts in our discussion on Hawaii politics.