Tuesday, February 17, 1998

Chairman bows out of hearing trustee compensation bills

Terrance Tom defers to vice
chairman Brian Yamane

By Rick Daysog

House Judiciary Chairman Terrance Tom has recused himself from hearing three bills that would set the annual compensation for trustees of the Bishop Estate and other charitable trusts.

Tom (D, Kaneohe) deferred to House Judiciary Vice Chairman Brian Yamane (D, Kaimuki), who will conduct tonight's hearing on bills setting the compensation schedule.

Legislature '98 Tom, who also is an attorney, has been criticized for his outside legal work for the estate, which has paid him a $4,000-a-month retainer. But Tom has said he's kept his work as a legislator separate from his outside legal practice.

In 1995, Tom deferred to his vice chair when a resolution relating to the Bishop Estate came before the Judiciary Committee.

"I have full faith in all my chairs, including Chair Tom," said House Speaker Joe Souki.

"I trust his judgment in the way in which he conducts his committee."

The three proposals: Repeal the current law setting the compensation schedule for trustees of charities, cap trustees' pay at three times the governor's salary, limit trustees' pay to that of the chief justice of the Hawaii Supreme Court.

Under current law, Bishop Estate trustees can earn up to 2 percent in commissions on all estate income, rents and interest above $205,000.

For its fiscal year ending June 30, 1996, the five trustees of the estimated $10 billion estate earned about $840,000 each.

The estate in the past has opposed changes to the compensation structure.

The committee tonight will not hear an omnibus reform measure proposed by Rep. Ed Case, which Case described as a "glaring omission."

Case (D, Manoa) said he believes the House is focusing on the compensation issue and ignoring others that affect Bishop Estate. His bill, for instance, establishes term limits for trustees that can be renewed every five years.

It also proposes legal standing for beneficiaries of charitable trusts and prohibits the state Supreme Court from selecting trustees. The House has until March 12 to hear the bill.

"If one believes that the operations of the Bishop Estate is of broad public interest," Case said, "then simply discussing the compensation issue is not going to accomplish a long-range solution. It's just taking one aspect of the problem and ignoring other aspects."

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