Companion bills that would appropriate $600 million of general revenues to the Department of Hawaiian Home Lands to help Native Hawaiian beneficiaries acquire homes passed unanimously Thursday in the Legislature’s money committees.
The House Finance and Senate Ways and Means committees recommended passage on a third and final floor reading by the full chambers on House Bill 2511 and Senate Bill 3359, respectively. Both measures were passed with amendments.
In both bills, the establishment of a Hawaiian Homelands Special Fund was stricken, and the $600 million would be deposited into the Native Hawaiian Rehabilitation Fund.
As Sen. Donovan Dela Cruz, the Ways and Means chairman, went through a lengthy list of projects to be financed by the $600 million, Sen. Kurt Fevella of Leeward Oahu, the Senate’s lone Republican, dropped a bombshell regarding the wait list for DHHL lots.
Fevella said he’d heard about a DHHL survey asking those on a wait list for a lot “if they’re willing to get off the list for $100,000.”
“Yes, that’s the appropriation of $112 million,” Dela Cruz replied. “It allows those on the list to wait for one of the lots that we mentioned or a future lot after that, or it allows a beneficiary on the waiting list to either get $100,000 for down payment assistance or mortgage assistance. And then, they would take themselves off the list.”
The $100,000 would be for down payments or mortgage assistance on non-DHHL properties.
“This down payment assistance and mortgage payment assistance would fall within the authority allowed through NHRF,” DHHL spokesman Cedric Duarte said Monday.
The $112 million, part of the bill’s $600 million appropriation, could take up to 1,123 beneficiaries off the list — which numbers 28,700 statewide and 10,651 on Hawaii Island — including some who have been waiting for decades.
The Senate amendments also include $487.6 million “for the preparation, planning and development of new lots.” The money would develop 2,910 lots on Hawaiian Homes lands statewide.
On the Big Island, that would include: $70 million for 400 new lots in La‘i‘opua Villages in Kailua-Kona; $40 million for 25 new water system and pasture lots in Ka‘u; and $2 million for 40 new subsistence agriculture lots in Honomu.
“DHHL plans on getting those projects up by 2028. And then, we have the money for down payment or mortgage assistance to lower the numbers on the list, the waiting list,” Dela Cruz said.
The effective date of the bill was also amended to July 1, 2050.
The unanimous vote includes Big Island Sens. Lorraine Inouye and Dru Kanuha.
The House Bill was passed in a form Chairwoman Sylvia Luke described as “incorporating DHHL amendments and technical, nonsubstantive changes.”
The DHHL amendment specified the $600 million is “for the Department of Hawaiian Home Lands to fulfill its fiduciary duties to beneficiaries, specifying the authorized uses of the funds, and requiring the Department of Hawaiian Home Lands to submit an annual report to the Legislature on the use of the funds.”
Two of the aye votes were cast by Big Island Democrats, Rep. Greggor Ilagan of Puna and Rep. Chris Todd of Hilo. While none of the votes came with reservations, one committee member, Rep. Bertrand Kobayashi, expressed some misgivings over making that large of an appropriation to DHHL, based on testimony by the Tax Foundation of Hawaii.
“I agree the DHHL needs money,” Kobayashi said. “But as pointed out by the Tax Foundation, it seems there are some administrative problems within DHHL. … They have federal funds that have not been spent, including having spent only about half of federal funds given to them in 2015. And although they have not spent down all of those federal funds from 2015, they are unable to use subsequent federal funds that amount to at least $10 million.”
Saying it is “fairly obvious that these problems are systemic,” Kobayashi said a possible solution would be to “appropriate $600 million, but give it to them in increments.”
“Certainly, DHHL cannot spend $600 million in one year, or two years or perhaps even three years,” he said.
The Finance Committee heard testimony on the bill on March 1, with DHHL Director and Hawaiian Homes Committee Chair William Aila Jr., under questioning by Kobayashi, disagreeing with the Tax Foundation’s assessment.
“We admit that there were difficulties in spending (federal funds) in the past …,” Aila said. “However, we’ve made changes, and those changes have resulted in the renewed confidence in the department’s ability to spend (the money), which is reflected in the president’s budget and in appropriations that are being proposed via this next budget.”
Regina Peterson — who identified herself as a wait lister — testified at the March 1 hearing the language in the bill “is not for our complete benefit, but it’s a start, and it’s a work in progress.”
“Your government corporation of commerce failed and continues to fail in fulfilling the promise of putting our Hawaiian people on our lands, in homes, which is what these departments and organizations were mandated to do,” she said, tearfully. “My grandmother was not able to even have an opportunity of knowing what having a home on Hawaiian lands would’ve been like.
“This bill, with the language as it states, means that I, too, may die before I’m able to have a home on a Hawaiian homestead.”
The measure, if passed into law in its current form, takes effect on July 1.
Gov. David Ige said Friday he’s “excited about the interest in the Hawaiian homesteading program.”
“I think we all recognize that resources has been a challenge for that program,” Ige said. “And the Legislature wanting to significantly increase funds to the program, I’m excited about. It gives us an opportunity to really move forward in a lot of things that we have wanted to do but have not had the resources to do.”
Email John Burnett at jburnett@hawaiitribune-herald.com.