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Probate judge A state judge today approved a $20.1 million settlement between the attorney general's office and the five former trustees of the Kamehameha Schools.
OKs settlement
between state,
ex-Bishop trustees
The agreement still needs
Strategic plan finished
approval from the Internal
Revenue ServiceBy Rick Daysog
Star-BulletinProbate Judge Kevin Chang said the settlement is in "the best interest" of the $6 billion charitable trust, which has been wracked by controversy during the past three years.
"This puts the things behind us and allows the new board of trustees that will be coming in soon to focus on what truly is the purpose of the Kamehameha Schools, which is the education of children," added retired Adm. Robert Kihune, chairman of the interim board of trustees.
Under the plan, the Kamehameha Schools will receive about $14 million to cover alleged mismanagement of trust assets by former board members Henry Peters, Richard "Dickie" Wong, Lokelani Lindsey, Oswald Stender and Gerard Jervis.
The state will receive about $1.3 million to cover their litigation costs while $4 million of the former trustees' legal fees will be picked up by the settlement.
The five former trustees will pay no out of pocket expenses, since the settlement will be covered by the estate's $25 million insurance policy with Federal Insurance Co.
The deal is contingent upon approval from the Internal Revenue Service.
The attorney general's office had been seeking millions of dollars in surcharges against the former trustees, saying that the ex-board members took excessive compensation, mismanaged the estate's educational programs and incurred more than $200 million in investment losses.
The suit had been scheduled to go to trial on Sept. 18 but was canceled after the settlement was reached.
Clyde Matsui, the court-appointed discovery master and mediator in the case, said the settlement avoids a lengthy, costly and complex trial.
Today's hearing was attended by interim trustees Kihune, Constance Lau and Ronald Libkuman and former trustee Henry Peters. Peters was unapologetic about his tenure at the trust.
"I'm very very proud of my record at the Kamehameha Schools Bishop Estate," Peters said.
"I leave the institution far more wealthy and far more liquid than it's ever been in its history."
The Kamehameha Schools has completed its blueprint for educating native Hawaiians in the next two decades. Kamehameha finishes
strategic planStar-Bulletin staff
The much-anticipated strategic plan -- unveiled during a news conference at the estate's Kapalama Heights campus yesterday -- aims to greatly expand the reach of the $6 billion charitable trust.
"The strategic planning process is more than merely plotting a course. It is about building relationships and integrating our individual efforts," the report said.
The intensive self-study -- which included input from 1,200 local participants and more than 43 community meetings spread out over the last several months -- is in response to the three-year campus controversy.
Some educational goals listed in the plan include increasing outreach programs to native Hawaiians, strengthening literacy and reading programs, and increasing vocational education. On the financial front, the trust wants to diversify its investments and implement a spending policy that's more in line with the expansion of its educational spending.
The trust, which will submit its strategic plan to the probate court in October, will spend the next several months implementing the plan system-wide.
Kamehameha Schools archive
