Honolulu Lite

by Charles Memminger

Friday, August 15, 1997

Bishop trustees
in estate of siege

HAS the revolution begun? I've always considered Bishop Estate a microcosm of Hawaii state government.

The paternalistic attitude of the trustees toward students, alumni and employees (the way politicians treat voters); the closed loop in which estate business is divvied out to political buddies (state non-bid contracts going to political allies); and the way the estate's beneficiaries and employees have been bullied or cowered into accepting business as usual (Hawaii voters sheepishly keeping politicians in office, based on name recognition instead of their political track record.)

Now, a revolution has begun against the giant land-rich estate which manages Kamehameha Schools.

Ten years ago I did a scathing expose on the estate's operation. Scathing in that I was the one scathed by daring to question how the institution was being run. The richest school in the country spent millions to turn out students with mediocre academic records, even though only one out of seven Hawaiians who applied was accepted. I found curious deals involving the trustees and their political friends, including a house on Bishop Estate land leased by Dan Inouye and a trustee. I found that most students who went through six years of Kamehameha's elementary school were unprepared to enter the school's seventh grade. The estate agreed to tutor students unable to advance into The Kamehameha Schools. Other kids had to have psychological counseling.

I found that the trustees were unaware of flat-line scholastic aptitude test scores and that the estate inflated the number of Kamehameha students going on to college.

For this, I was roundly denounced. The alumni, in particular, resented "an outsider" daring to question how the estate was being run.

All the while, trustee's incomes were streaking upward like a rocket. So much so that in 1987, the trustees just flat decided not to make public how much they were making. KITV reporter Jim Dooley -- then at the Advertiser -- and I separately filed Internal Revenue Service public disclosure forms forcing the release of the salaries.

Every year, the probate court appointed a "master" to review the estate. And usually it was a politically connected attorney who found the estate's business just peachy. The attorney general's office also reviewed the estate's operation every year and told the courts everything was fine.

It wasn't. This multi-billion-dollar operation, hiding behind its charitable tax-exempt status, has conducted business far and wide, mostly in secrecy. We never would have known of an exclusive Virginia golf resort the estate developed had President Bush not stopped by for a round of golf. And only a Texas bankruptcy disclosed that trustees were piggybacking personal investments with estate investments. With trustees that included a former state Supreme Court justice, legislative leaders and other political gorillas, who was going to challenge the estate? A couple of nitpicky reporters were simply brushed off as troublemakers unfairly attacking an illustrious charitable icon.

Now that has changed. The governor has asked the attorney general to investigate -- really investigate -- the estate's operation. Senior U.S. Judge Sam King has called for four trustees to resign. Trustee Oswald Stender has had the guts to challenge his four associates in public. Students and alumni are demanding a change in the iron-fisted micromanagement of their campus.

And I can't help but think that if this assault is happening against the Bishop Estate trustees, can a similar storming of the state's one-party political fortress be far behind?

Charles Memminger, winner of
National Society of Newspaper Columnists
awards in 1994 and 1992, writes "Honolulu Lite"
Monday, Wednesday and Friday.
Write to him at the Honolulu Star-Bulletin,
P.O. Box 3080, Honolulu, 96802

or send E-mail to charley@nomayo.com or

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