OHA still awaits Haunani Apoliona sees the "hustling and bustling" DFS-Hawaii store in Waikiki, where tourists from Japan buy duty-free goods to take home, and wonders why native Hawaiians aren't benefiting from those sales.
land payoff
The issue of the longstanding
dispute over revenues from
ceded lands resurfacesBy Ron Staton
Associated Press
That is a key issue in a long-standing dispute between the state and native Hawaiians. The agency Apoliona heads is charged with distributing benefits to Hawaiians and already has turned down a settlement of more than $250 million and 360,000 acres.
More than 20 years after a state law promised funds to help Hawaiians, the Office of Hawaiian Affairs is still battling for those funds in a dispute that goes back to the overthrow of Queen Liliuokalani on Jan. 17, 1893.
The issue is ceded land revenues.
Ceded lands are crown or public lands that were ceded to the new Republic of Hawaii after the overthrow of the monarchy, and then to the Territory of Hawaii after U.S. annexation of the islands in 1898 and to the new state of Hawaii in 1959.
Ceded lands make up about 1.4 million acres, or 95 percent of state-owned lands.
"We're not being greedy, but just asking for what we are statutorily entitled to," said OHA chairwoman Apoliona.
The 1959 Statehood Admissions Act provides that lands granted to the state be held in trust for public education, health, housing, farming and conservation and betterment of Hawaiians.
A 1980 state law provides that each of the five areas would get 20 percent of the "funds derived from the public land trust," and that the portion for Hawaiians goes to OHA, a state-supported agency created by a 1978 constitutional amendment as a public trust with a mandate to better the conditions of Hawaiians. The office, established in 1980, was to be funded with the share of revenues from ceded lands.
However, the state and OHA failed to reach agreement on what constituted "funds derived from the public land trust," and OHA sued the state in 1983.
In 1987, the Hawaii Supreme Court said it could not decide the case because the law did not provide the courts with a way to measure and calculate the amount due to OHA.
ASSOCIATED PRESS
More than 20 years after being promised money to help native Hawaiians, the Office of Hawaiian Affairs is still battling for revenues from ceded lands. The list of disputed sites includes the DFS Galleria in Waikiki.
In response, the Legislature in 1990 passed Act 304 to provide a more detailed mechanism for measuring and calculating the amount due OHA.
"The question is 20 percent of what? Act 304 tried to define that," said Ernest Kimoto, an OHA staff attorney.
In 1993, the state, as partial settlement of its obligation, gave OHA $135 million, which formed the basis of the OHA trust fund, Kimoto said. That amount covered what the state should have paid between 1980 and 1991, according to Apoliona.
Wise investment increased that fund to about $400 million by the late 1990s, former OHA chairman Clayton Hee said, but it was hit hard by post-Sept. 11, 2001, stock market losses and now stands at about $268 million.
During negotiations to settle the issue, the state and OHA signed a memorandum listing four areas of disagreement. The money in dispute is from community hospitals, the duty-free shops, public housing, and interest accrued by the state during the 1980-91 period it did not make quarterly payments.
In 1997, the Federal Aviation Administration entered the ceded lands dispute, saying federal money for Honolulu International Airport, one-third of which sits on ceded lands, would be withheld unless the state recovered $28.2 million in airport revenues paid to OHA for non-airport purposes.
Federal statute requires that landing fees and related revenues go back into airport maintenance and construction, Kimoto said.
The "Forgiveness Act" passed by Congress in 1998 effectively allowed OHA to keep the $28.2 million, but prohibited further use of any airport funds to pay claims related to ceded lands.
The Hawaii Supreme Court in 2001 held that the state's plan for paying OHA was invalid because it conflicts with the Forgiveness Act.
In its ruling, the Supreme Court reaffirmed the state's obligation to Hawaiians and their right to benefit from the ceded lands trust.
Former Gov. Ben Cayetano said the ruling effectively reversed a ruling by Circuit Judge Daniel Heely in 1966 that allowed OHA to sue to recover ceded land revenue from hospitals, duty-free shops, public housing and the interest earned by the state.
OHA insists that Heely's ruling on revenue from the four areas still stands.
The University of Hawaii main campus in Manoa also sits on ceded lands, and OHA is at odds with the state on whether it should share in such revenues as parking and dormitory fees, Kimoto said.
Because of the Supreme Court ruling, Cayetano ordered state departments to withhold payments to OHA. Shortly after Gov. Linda Lingle took office on Dec. 2, OHA made a request for payment of $10.3 million in undisputed payments.
Another quarter has passed, and the payments now total $12.3 million, according to Kimoto and Apoliona.
Lingle has pledged to make the back payments, but said she first wants the state attorney general to work out a way to continue the payments without the chance of a court challenge.
"We must make absolutely sure that we do not inadvertently drive a wedge between Hawaiian and non-Hawaiian communities," Lingle said in her Jan. 21 State of-the-State address.
Apoliona said she hopes the quarterly payments will resume "so that our revenue stream will continue until we can get a new Act 304." A bill revising the payment plan has been introduced in the state Legislature. OHA also is proposing an interim revenue bill, Apoliona said.
Cayetano in 1999 offered OHA $251 million and 360,000 acres of ceded lands to settle the issue, Hee said. However, Cayetano insisted it be a "global" settlement that would relieve the state of any future OHA claims.
The OHA board declined to accept the proposed settlement, voting 5-3 with one trustee absent to terminate the negotiations.
"If OHA had settled, it wouldn't be in the position it is in now," said Hee, who was chairman at the time. "I don't expect there will be another opportunity for a quarter-billion dollars and land the size of Kauai."
Cayetano said the OHA trustees went to great lengths to argue for a larger settlement.
"They got greedy and demanded more," he said, insisting that the state's offer was motivated "by a genuine desire to seek a permanent settlement of the ceded land dispute."
Circuit Judge Sabrina McKenna ruled Dec. 5 that the state has the legal authority and sovereign immunity to sell ceded lands. OHA has appealed that ruling.
Office of Hawaiian Affairs
