Report Title:

Office of Hawaiian Affairs

Description:

Clarifies the lands comprising, and the revenues derived from, the public land trust under the state Constitution.

HOUSE OF REPRESENTATIVES

H.B. NO.

1299

TWENTY-SECOND LEGISLATURE, 2003

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

RELATING TO THE OFFICE OF HAWAIIAN AFFAIRS.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. Prior to 1893, Hawai`i was recognized as an independent and sovereign indigenous nation, governed by a constitutional monarchy. See S. J. Res. 19, 103rd Cong., 1st Sess. (1993) (apologizing to native Hawaiians on behalf of the people of the United States for the overthrow of the Kingdom of Hawai`i). In January of 1893, however, the duly appointed government of the Kingdom of Hawai`i was illegally overthrown by a committee of non-native residents with the assistance of the United States minister to Hawai`i and the threat of the American armed forces. The usurpers then proclaimed the establishment of the Republic of Hawai`i.

In 1898, approximately five years following the overthrow, Hawai`i was annexed to the United States. See J. Res. 55, 30 Stat. 750 (1898) (Joint Resolution to Provide for Annexing the Hawaiian Islands to the United States). In addition to surrendering its sovereignty, the Republic "ceded and transferred to the United States the absolute fee and ownership of all public, government, or crown lands belonging to the government of the Hawaiian Islands together with every right and appurtenance thereunto appertaining." Trustees of the Office of Hawaiian Affairs vs. Yamasaki, 69 Haw. at 159, 737 P.2d at 449. Following annexation and until 1959, governmental authority in Hawai`i was vested in a territorial government. See Organic Act §3, Act of April 30, 1900, c. 339, 31 Stat. 141 (1900) (establishing the government of the territory of Hawaii).

In 1959, Hawaii became a state. As a condition of its admission into the union, the State of Hawai`i was obligated to accept from the United States title to certain lands formerly owned by the government and monarch of the Kingdom of Hawai`i. Congress mandated that these lands were to be held as a public land trust for five designated purposes [hereinafter, the ceded lands or the public land trust]. See Admission Act of March 18, 1959, Pub. L. No. 86-3, §5, 73 Stat. 4 (1959).

Section 5(f) of the Admission Act delineated the purposes for which the ceded lands were to be used:

The lands granted to the State of Hawaii by subsection (b) of this section and public lands retained by the United States under subsections (c) and (d) and later conveyed to the State under subsection (e), together with the proceeds from the sale or other disposition of any such lands and the income therefrom, shall be held by said State as a public trust [1] for the support of the public schools and other public educational institutions, [2] for the betterment of the conditions of native Hawaiians, as defined in the Hawaiian Homes Commission Act, 1920, as amended, [3] for the development of farm and home ownership on as widespread a basis as possible [4] for the making of public improvements, and [5] for the provision of lands for public use. Such lands, proceeds, and income shall be managed and disposed of for one or more of the foregoing purposes in such manner as the constitution and laws of said State may provide, and their use for any other object shall constitute a breach of trust for which suit may be brought by the United States.

In the absence of more specific guiding mandates, "public education became the primary beneficiary of the trust." Trustees of the Office of Hawaiian Affairs vs. Yamasaki, 69 Haw. at 161-62, 737 P.2d at 451. In 1978, however, the State held a constitutional convention, at which time the State's trust obligation to Hawaiians was clarified in article XII, entitled "Hawaiian Affairs." Article XII, section 4, of the Hawai`i constitution provides:

"Public Trust

Section 4. The lands granted to the State of Hawaii by Section 5(b) of the Admission Act and pursuant to article XVI, Section 7, of the State Constitution, excluding therefrom lands defined as "available lands" by Section 203 of the Hawaiian Homes Commission Act, 1920, as amended, shall be held by the State as a public trust for native Hawaiians and the general public." Haw. Const. Art. XII, §4.

Article XVI, section 7, provides:

"Compliance With Trust

Section 7. Any trust provisions which the Congress shall impose, upon the admission of this State, in respect of the lands patented to the State by the United States or the proceeds and income therefrom, shall be complied with by appropriate legislation. Such legislation shall not diminish or limit the benefits of native Hawaiians under Section 4 of Article XII."

Haw. Const. art. XVI, § 7.

On September 12, 2001, the Hawai`i supreme court sought to clarify the obligation of the State with respect to the public land trust. In Office of Hawaiian Affairs vs. State of Hawai`i, 96 Haw. 388, 31 P.3d 901 (2001), the Court stated:

Given our disposition of this case, and the context of its complexity, we would do a disservice to all parties involved if we did not acknowledge that the State's obligation to native Hawaiians is firmly established in our constitution. How the State satisfies that constitutional obligation requires policy decisions that are primarily within the authority and expertise of the legislative branch As such, it is incumbent upon the legislature to enact legislation that qives effect to the right of native Hawaiians to benefit from the ceded lands trust. See Haw. Const. art. XVI, §7.

. . . [A]s we continue to struggle with giving effect to that enactment, we trust that the legislature will re-examine the State's constitutional obligation to native Hawaiians and the purpose of HRS §10-13.5 and enact legislation that most effectively and responsibly meets those obligations.

[excerpts from Office of Hawaiian Affairs vs. State of Hawai`i, 96 Haw. 388, 31 P.3d 901 (2001); emphasis added].

The legislature acknowledges that the State's obligation to native Hawaiians is firmly established in our constitution. This Act furthers the State's constitutional obligation as stated above. It gives effect to the right of native Hawaiians to benefit from the public land trust. The legislature finds that the injustice and wrongfulness of historical events surrounding the annexation of Hawai`i and the marginalization of its indigenous people remain deeply felt by native Hawaiians, the original sovereign people of the State, as well as other members of the public.

The legislature recognizes that there is broad acknowledgement among all the people of Hawai`i that the State should effect a lasting reconciliation with native Hawaiians which (1) gives proper acknowledgment to past events, (2) reaffirms the State's special trust relationship with the native Hawaiian people, and (3) moves Hawai`i forward toward the resolution of those issues.

The legislature finds that there are many complex issues requiring consideration and resolution relating to the State's trust obligations to native Hawaiians. The legislature also finds, however, that the mandate of the supreme court in Office of Hawaiian Affairs vs. State of Hawai`i, 96 Haw. 388, 31 P.3d 901 (2001), compels it to enact this Act in order to give immediate effect to the purposes of article XII, sections 4 through 6, and article XVI, section 7, of the state constitution, so that the legislature may foster the State's trust relationship with and begin satisfying its obligation to native Hawaiians.

The legislature finds that Act 304, Session Laws of Hawaii 1990, was a legislative effort to clarify the extent and scope of the State’s obligation to transfer revenues derived from the public land trust to the office of Hawaiian affairs in accordance with the constitutional and statutory mandate to dedicate twenty per cent of all revenue derived from the public land trust, as described above, for the betterment of the conditions of native Hawaiians. In Office of Hawaiian Affairs vs. State of Hawai`i, 96 Haw. 388, 31 P.3d 901 (2001), the Hawai`i supreme court ruled that Act 304 as applied to revenue derived from the Honolulu International Airport conflicted with federal legislation, and by its own terms was effectively repealed. In the absence of Act 304, the legislature finds that the Hawaii supreme court ruled that there is a lack of judicially discoverable or manageable standards adequate to permit a judicial determination of whether the office of Hawaiian affairs was entitled to the specific revenues in its claim, and recommended legislative clarification to fulfill the state’s constitutional trust obligation to native Hawaiians.

As was appropriate at the time of the passage of Act 304, Session Laws of Hawaii 1990, the legislature finds it incumbent to enact legislation that gives effect to and recognizes the right of native Hawaiians to benefit from the ceded lands trust. The legislature further finds it necessary to provide legislative clarification to resolve facial statutory inconsistencies, to establish the continued funding of the office of Hawaiian affairs under chapter 10, and fulfill the mandate of Hawaii state constitution articles XII, sections 4, 5, and 6.

The purposes of this Act are to:

(1) Clarify the lands comprising the public land trust under chapter 10, Hawaii Revised Statutes; and

(2) Clarify the revenues derived from the public land trust which shall be considered to establish the amount of funding to the office of Hawaiian affairs for the purpose of the betterment of the conditions of native Hawaiians. This Act is not intended to replace or affect the claims of native Hawaiians and Hawaiians with regard to reparations from the federal government.

SECTION 2. Section 10-2, Hawaii Revised Statutes, is amended by adding two new definitions to be appropriately inserted and to read as follows:

""Public land trust" means those lands:

(1) Which were ceded to the United States by the Republic of Hawaii under the joint resolution of annexation, approved July 7, 1898 (30 Stat. 750), or acquired in exchange for lands so ceded, and which were conveyed to the State of Hawaii by virtue of section 5(b) of the Act of March 18, 1959 (73 Stat. 4, the Admission Act), excluding therefrom lands and all proceeds and income from the sale, lease, or disposition of lands defined as "available lands" by section 203 of the Hawaiian Homes Commission Act, 1920, as amended;

(2) Retained by the United States under section 5(c) and 5(d) of the Act of March 18, 1959, and later conveyed to the State under section 5(e) of the Act of March 18, 1959; and

(3) Which were ceded to and retained by the United States under section 5(c) and 5(d) of the Act of March 18, 1959, and later conveyed to the State pursuant to the Act of December 23, 1963 (Public Law 88-233, 77 Stat. 472).

"Revenue" means all proceeds, fees, charges, rents, or other income, or any portion thereof, derived from any sale, lease, license, permit, or other similar proprietary disposition, permitted use, or activity that is situated upon and results from the actual use of lands comprising the public land trust, and including any penalties or levies exacted as a result of a violation of the terms of any proprietary disposition, but excluding any income, proceeds, fees, charges, or other moneys derived through the exercise of sovereign functions and powers including:

(1) Taxes;

(2) Regulatory or licensing fees;

(3) Fines, penalties, or levies;

(4) Registration fees;

(5) Moneys received by any public educational institution, including the University of Hawaii and the community college system, from its educational programs and ancillary services, such as tuition, registration fees, meals, books, grants, or scholarships;

(6) Interagency and intra-agency administrative fees or assessments;

(7) Moneys derived from or provided in support of penal institutions and programs;

(8) Grants, carry-overs, and pass-throughs;

(9) Federal moneys, including federal-aid, grants, subsidies, and contracts;

(10) Moneys collected from the sale or dissemination of government publications;

(11) Department of defense proceeds on state-improved lands; and

(12) Moneys derived from the development of housing projects as defined under section 201G-1 and 201G-112 after the conveyance of the public land trust to the housing and community development corporation of Hawaii except as provided under section 10-13.6."

SECTION 3. Section 10-3, Hawaii Revised Statutes, is amended to read as follows:

"§10-3 Purpose of the office. The purposes of the office of Hawaiian affairs include:

(1) The betterment of conditions of native Hawaiians. [A pro rata portion of a1l funds derived from the public land trust shall be funded in an amount to be determined by the legislature for this purpose, and shall be held and used solely as a public trust for the betterment of the conditions of native Hawaiians. For the purpose of this chapter, the public land trust shall be all proceeds and income from the sale, lease, or other disposition of lands ceded to the United States by the Republic of Hawaii under the joint resolution of annexation, approved July 7, 1898 (30 Stat. 750), or acquired in exchange for lands so ceded, and conveyed to the State of Hawaii by virtue of section 5(b) of the Act of March 18, 1959 (73 Stat. 4, the Admissions Act), (excluding therefrom lands and all proceeds and income from the sale, lease, or disposition of lands defined as "available lands" by section 203 of the Hawaiian Homes Commission Act, 1920, as amended), and all proceeds and income from the sale, lease, or other disposition of lands retained by the United States under sections 5(c) and 5(d) of the Act of March 18, 1959, later conveyed to the State under section 5(e)];

(2) The betterment of conditions of Hawaiians;

(3) Serving as the principal public agency in this State responsible for the performance, development, and coordination of programs and activities relating to native Hawaiians and Hawaiians; except that the Hawaiian Homes Commission Act, 1920, as amended, shall be administered by the Hawaiian homes commission;

(4) Assessing the policies and practices of other agencies impacting on native Hawaiians and Hawaiians, and conducting advocacy efforts for native Hawaiians and Hawaiians;

(5) Applying for, receiving, and disbursing grants and donations from all sources for native Hawaiian and Hawaiian programs and services; and

(6) Serving as a receptacle for reparations."

SECTION 4. Section 10-5, Hawaii Revised Statutes, is amended to read as follows:

"§10-5 Board of trustees; powers and duties. The board shall have the power in accordance with law to:

(1) Manage, invest, and administer the proceeds from the sale or other disposition of lands, natural resources, minerals, and income derived from whatever sources for native Hawaiians and Hawaiians, including all [income and proceeds from] moneys received by the office equivalent to that pro rata portion of the [trust] revenue derived from the public land trust referred to in section [10-3;] 10-2;

(2) Exercise control over real and personal property set aside to the office by the State of Hawaii, the United States of America, or any private sources, and transferred to the office for native Hawaiians and Hawaiians;

(3) Collect, receive, deposit, withdraw, and invest money and property on behalf of the office;

(4) Formulate policy relating to the affairs of native Hawaiians and Hawaiians[,]; provided that such policy shall not diminish or limit the benefits of native Hawaiians under article XII, section 4, of the state Constitution;

(5) Otherwise act as a trustee as provided by law;

(6) Delegate to the administrator, its officers, and employees such powers and duties as may be proper for the performance of the powers and duties vested in the board;

(7) Provide grants to individuals[,] and public or private organizations to better the conditions of native Hawaiians and Hawaiians consistent with the standards set forth in section 10-17;

(8) Make available technical and financial assistance and advisory services to any agency or private organization for native Hawaiian and Hawaiian programs, and for other functions pertinent to the purposes of the office of Hawaiian affairs. Financial assistance may be rendered through contractual arrangements as may be agreed upon by the board and any such agency or organization; and

(9) Adopt and use a common seal by which all official acts shall be authenticated."

SECTION 5. Section 10-13, Hawaii Revised Statutes, is amended to read as follows:

"§10-13 Appropriations; accounts; reports. (a) Moneys appropriated by the legislature for the office shall be payable by the director of finance, upon vouchers approved by the board, or by any officer elected or appointed by the board and authorized by the board to approve [such] the vouchers on behalf of the board. All moneys received by or on behalf of the board shall be deposited with the director of finance and kept separate from moneys in the state treasury; except that any moneys received from the federal government or from private contributions shall be deposited and accounted for in accordance with conditions established by the agencies or persons from whom the moneys are received; and except that with the concurrence of the director of finance, moneys received from the federal government for research, training, and other related purposes of a transitory nature, and moneys in trust or revolving funds administered by the office, shall be deposited in depositories other than the state treasury and shall be reported on to the state comptroller under section 40-81, and rules prescribed thereunder.

(b) Income derived from the sale of goods or services and [income from lands and property as described in section 10-3,] all moneys received by the office equivalent to that pro rata portion of the revenue derived from the public land trust described in section 10-2 shall be credited to special or other funds; provided that upon the recommendation of the office, the comptroller shall establish such other separate accounts or special funds for other designated revenues as may be directed by the board or its authorized representative."

SECTION 6. Section 10-13.5, Hawaii Revised Statutes, is amended to read as follows:

"§10-13.5 Use of public land trust proceeds. Twenty per cent of all [funds] revenue derived from the public land trust[, described in section 10-3,] shall be expended by the office[, as defined in section 10-2,] for the [purposes of this chapter.] betterment of the conditions of native Hawaiians."

SECTION 7. Statutory material to be repealed is bracketed. New statutory material is underscored.

SECTION 8. This Act shall take effect upon its approval.

INTRODUCED BY:

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By Request