Source: https://www.capitol.hawaii.gov/session2008/bills/HB266_HD1_.htm
Timestamp: 2019-11-17 09:22:42
Document Index: 590722215

Matched Legal Cases: ['§7', '§ 10', '§10', '§10', '§206', '§206', '§206', '§10']

HB266 HD1
Public trust; Conveyance of real property and cash to OHA
Conveys certain parcels of real property and transfers cash to the Office of Hawaiian Affairs as part of the State's obligations to native Hawaiians under Article XII, sections 4 and 6, of the Hawaii Constitution. (HB266 HD1)
SECTION 1. In 1978, the Hawaii Constitution was amended to include article XII, sections 4, 5, and 6, which, among other things, established the office of Hawaiian affairs and its board of trustees.
Sections 4, 5, and 6 of article XII of the Hawaii Constitution provide:
"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.
Section 5. There is hereby established an Office of Hawaiian Affairs. The Office of Hawaiian Affairs shall hold title to all the real and personal property now or hereafter set aside or conveyed to it which shall be held in trust for native Hawaiians and Hawaiians. There shall be a board of trustees for the Office of Hawaiian Affairs elected by qualified voters who are Hawaiians, as provided by law. The board members shall be Hawaiians. There shall be not less than nine members of the board of trustees; provided that each of the following Islands have one representative: Oahu, Kauai, Maui, Molokai and Hawaii. The board shall select a chairperson from its members.
Section 6. The board of trustees of the Office of Hawaiian Affairs shall exercise power as provided by law: to manage and administer the proceeds from the sale or other disposition of the lands, natural resources, minerals and income derived from whatever sources for native Hawaiians and Hawaiians, including all income and proceeds from that pro rata portion of the trust referred to in section 4 of this article for native Hawaiians; to formulate policy relating to affairs of native Hawaiians and Hawaiians; and to exercise control over real and personal property set aside by state, federal or private sources and transferred to the board for native Hawaiians and Hawaiians. The board shall have the power to exercise control over the Office of Hawaiian Affairs through its executive officer, the administrator of the Office of Hawaiian Affairs, who shall be appointed by the board."
In 1980, the legislature determined that the pro rata portion of the income and proceeds from the lands in the public trust referred to in article XII, section 4, of the Hawaii Constitution to be managed and administered by the office of Hawaiian affairs should be set at twenty per cent. This seemingly simple legislative directive has led to a series of lawsuits concerning the practical application of the twenty per cent standard adopted by the legislature.
In Trustees of the Office of Hawaiian Affairs v. Yamasaki, 69 Haw. 154, 737 P.2d 446 (1987), the Hawaii supreme court concluded that the issue of how the pro rata portion is formulated is a political question for the legislature to determine.
In response to the Yamasaki decision, the legislature enacted Act 304, Session Laws of Hawaii 1990, to clarify the extent and scope of the twenty per cent portion.
On September 12, 2001, the Hawaii supreme court ruled in Office of Hawaiian Affairs v. State of Hawaii, 96 Haw. 388, 31 P.3d 901 (2001), that Act 304 was effectively repealed by its own terms, so that once again, it was necessary for the legislature to specify the pro rata portion to be managed and administered by the office of Hawaiian affairs.
In its decision, the Hawaii supreme court affirmed Yamasaki, observing:
"[T]he 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 gives effect to the right of native Hawaiians to benefit from the ceded lands trust. See Haw. Const. art. XVI, §7.
. . . 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."
Office of Hawaiian Affairs v. State of Hawaii, 96 Haw. at 401, 31 P.3d at 914 (citations omitted).
The legislature finds that reviewing for each fiscal biennium the pro rata portion of all income and proceeds under article XII, sections 4 and 6, of the Hawaii Constitution that will be managed and administered by the office of Hawaiian affairs is reasonable and prudent in light of changing populations, changing needs, and changing revenues.
Furthermore, in reviewing the entire history of the issue, the legislature finds that--in addition to the amounts paid to the office of Hawaiian affairs in the past--further resources should be provided to the office of Hawaiian affairs that represent a re-examination by the legislature for the period between November 7, 1978, and July 1, 2008, with regard to revenue from the lands in the public trust referred to in article XII, section 4, of the Hawaii Constitution. The legislature notes that the governor and the office of Hawaiian affairs have recommended to the legislature, following intense discussions and after both the governor and the office have re-evaluated the 1978-2008 period, a transfer of land and cash to the office of Hawaiian affairs.
A combination of a conveyance to the office of Hawaiian affairs of the fee simple interest in certain parcels of real property and a payment to the office of Hawaiian affairs of $13,189,860 to represent this re-examination for the period between November 7, 1978, and July 1, 2008, will allow the State to most effectively and responsibly meet its constitutional obligations to native Hawaiians.
Although the governor and the office of Hawaiian affairs have described the results of these discussions as a "settlement agreement," the use of terms such as "settlement" and "claims" in the context of income and proceeds to be managed and administered by the office of Hawaiian affairs mischaracterizes the situation as adversarial, because, as observed by the Hawaii supreme court, the constitutional obligations to native Hawaiians belong to the State as a whole and are not the proper subject of litigation between state agencies. As a result, the legislature treats the results of these discussions as a joint policy recommendation to the legislature and not as a legal settlement to be approved by the legislature.
The purpose of this Act is to allow the State to most effectively and responsibly meet its constitutional obligations to native Hawaiians by:
(1) Providing $13,189,860 in cash to the office of Hawaiian affairs;
(2) Conveying certain parcels of real property in fee simple to the office of Hawaiian affairs; and
(3) Establishing a method for determining for each fiscal biennium the pro rata portion referred to in article XII, section 6, of the Hawaii Constitution.
SECTION 2. Chapter 10, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:
"§10- Accounting; receipts from lands; pro rata portion. (a) Not later than thirty days before the convening of the regular session of the legislature in an odd-numbered year, the department of land and natural resources, with the cooperation of the department of budget and finance and any other state department or agency that uses or manages public lands, including the office, shall provide an accounting of all receipts from the lands in the public trust referred to in article XII, section 4, of the Hawaii Constitution for the prior two fiscal years. With respect to each receipt, the department of land and natural resources shall identify:
(2) The amount transferred to the office;
(5) The parcel of land in the public trust referred to in article XII, section 4, of the Hawaii Constitution that generated the receipt, whether by tax map key number, department of land and natural resources inventory number, or other recognizable description; and
The accounting shall also indicate whether any parcel of land in the public trust referred to in article XII, section 4, of the Hawaii Constitution was sold or exchanged during the prior two fiscal years and, if so, the amount of consideration that the State received for the respective parcels.
The office shall be consulted by the department of land and natural resources in determining the method in which the accounting shall be conducted.
(b) The accounting provided in subsection (a) is to assist the legislature in determining for each fiscal biennium the dollar amount that will constitute the pro rata portion referred to in article XII, section 6, of the Hawaii Constitution. Payment to the office of such amounts shall be made in equal quarterly increments for each year of the fiscal biennium pursuant to subsection (d).
(c) If the legislature does not set by legislative act the dollar amount constituting the pro rata portion for the fiscal biennium at least thirty days before the first quarterly increment is due, the governor shall determine and pay to the office pursuant to subsection (d) a pro rata portion after taking into consideration the most recent accounting provided by the department of land and natural resources under subsection (a) and the most recent dollar amount pro rata portion set by the legislature.
(d) The departments of agriculture; accounting and general services; business, economic development, and tourism; education; land and natural resources; and transportation (for its harbors division); and any other department or agency that collects receipts from the lands in the public trust referred to in article XII, section 4, of the Hawaii Constitution, shall determine and transfer to the office that portion of their receipts from the use of the lands collected during each fiscal quarter, necessary to ensure that the revenues correspond to the pro rata portion set by the legislature or by the governor under subsection (c) and are transferred to the office, within thirty days of the close of each fiscal quarter.
The governor is expressly authorized to fix the amounts each agency shall transfer to the office in each fiscal quarter by executive order to implement this section."
SECTION 3. 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 derived from the public land trust, described in section 10-3,] The pro rata portion of the income and proceeds from the lands in the public trust referred to in article XII, sections 4 and 6, of the Hawaii Constitution, provided to the office pursuant to section 10- , shall be expended by the office[, as defined in section 10-2,] for the purposes of this chapter."
SECTION 4. Section 206E-3, Hawaii Revised Statutes, is amended by amending subsection (b) to read as follows:
"(b) The authority shall consist of [thirteen] fourteen voting members. The director of finance, the director of business, economic development, and tourism, the comptroller, and the director of transportation, or their respective designated representatives shall serve as ex officio, voting members. One member of the authority shall be appointed by the chairperson of the office of Hawaiian affairs. One member shall be appointed by the governor from a list of not less than three prospective appointees submitted by the president of the senate, and one member shall be appointed by the governor from a list of not less than three prospective appointees submitted by the speaker of the house of representatives. Seven members shall be appointed by the governor for staggered terms pursuant to section 26-34; provided that four members shall be appointed at large and, initially, three members, hereinafter referred to as county members, shall be selected from a list of ten prospective appointees recommended by the local governing body of the county in which the initial designated district is situated; and provided further that when vacancies occur in any of the three positions for which the members were selected from a list of county recommendations, the governor shall fill such vacancies on the basis of one from a list of four recommendations, two from a list of seven recommendations, or three from a list of ten recommendations. The list of recommendations shall be made by the local governing body of the county. If an additional district is designated by the legislature, the total membership of the authority shall be increased as prescribed above by the appointment of three additional members, except as provided for in section 206E-191. Notwithstanding section 92-15, a majority of all members shall constitute a quorum to do business, and the concurrence of a majority of all members shall be necessary to make any action of the authority valid; except that, on any matter relating solely to a specific community development district, the members representing districts other than that specific community development district shall neither vote, nor shall they be counted to constitute a quorum, and concurrence shall be required of a majority of that portion of the authority made up of all ex officio voting members, members at large, and county and district members representing the district for which action is being proposed in order for such action to be valid. All members shall continue in office until their respective successors have been appointed and qualified. Except as herein provided, no member appointed under this subsection shall be an officer or employee of the State or its political subdivisions."
SECTION 5. Section 206E-8, Hawaii Revised Statutes, is amended to read as follows:
"[[]§206E-8[]] Use of public lands; acquisition of state lands. (a) Any provision of chapter 171 to the contrary notwithstanding, the governor may set aside public lands located within community development districts to the authority for its use.
(b) If state lands under the control and management of other public agencies are required by the authority for its purposes, the agency having the control and management of those required lands shall, upon request by the authority and with the approval of the governor, convey, or lease such lands to the authority upon such terms and conditions as may be agreed to by the parties.
(c) Notwithstanding the foregoing, no public lands shall be set aside, conveyed, or leased to the authority as above provided if such setting aside, conveyance, or lease would impair any covenant between the State or any county or any department or board thereof and the holders of bonds issued by the State or such county, department, or board.
(d) This section shall not apply to the land conveyed in fee simple to the office of Hawaiian affairs by Act , Session Laws of Hawaii 2008, except that the authority may acquire by condemnation, pursuant to chapter 101, easements, rights-of-way, rights of entry, or other rights of access in favor of lands adjoining the property conveyed that is under the control and management of public agencies where the office of Hawaiian affairs is paid just compensation for the same."
SECTION 6. Section 206E-10, Hawaii Revised Statutes, is amended to read as follows:
"[[]§206E-10[]] Condemnation of real property. The authority, upon making a finding that it is necessary to acquire any real property for its immediate or future use for the purposes of this chapter, may acquire the property by condemnation pursuant to chapter 101, including property already devoted to a public use. Such property shall not thereafter be taken for any other public use without the consent of the authority. No award of compensation shall be increased by reason of any increase in the value of real property caused by the designation of a community development district or plan adopted pursuant to a designation, or the actual or proposed acquisition, use or disposition of any other real property by the authority. This section shall not apply to the land conveyed in fee simple to the office of Hawaiian affairs by Act , Session Laws of Hawaii 2008; except that the authority may acquire by condemnation, pursuant to chapter 101, easements, rights‑of‑way, rights of entry, or other rights of access in favor of lands adjoining the property conveyed that is under the control and management of public agencies where the office of Hawaiian affairs is paid just compensation for the same."
SECTION 7. Section 206E-34, Hawaii Revised Statutes, is amended to read as follows:
"[[]§206E-34 Cultural public market.[]] (a) There shall be established within the Hawaii community development authority a state cultural public market.
(b) The cultural public market shall be located on state land within the Kakaako Makai area and developed pursuant to sections 206E-31, 206E-32, and 206E-33. A public parking lot shall be included.
(c) The Hawaii community development authority shall:
(1) Designate and develop the state-owned land for the cultural public market;
(2) Accept, for consideration, input regarding the establishment of the cultural public market from the following departments and agencies:
(B) The department of business, economic development, and tourism;
(C) The department of land and natural resources;
(D) The department of labor and industrial relations; and
(E) The Hawaii tourism authority;
(3) Consider and determine the propriety of using public-private partnerships in the development and operation of the cultural public market;
(4) Develop, distribute, and accept requests for proposals from private entities for plans to develop and operate the cultural public market; and
(5) Ensure that the Hawaiian culture is the featured culture in the cultural public market.
(d) Requests for proposals for the cultural public market shall contemplate but not be limited to the inclusion of the following types of facilities and services:
(1) Retail outlets for ethnically diverse products;
(2) Venues for businesses with ethnic themes, including restaurants and other service-related businesses;
(3) Theaters, stages, and arenas designed to showcase cultural performing artists as well as community performing arts;
(4) Exhibition space or museums that showcase artwork created by international and local artists; and
(5) Museums or other educational facilities focusing on the history and cultures of the various ethnic groups within Hawaii, including Hawaiian history.
(e) This section shall not apply to the land conveyed in fee simple to the office of Hawaiian affairs by Act , Session Laws of Hawaii 2008."
SECTION 8. Section 10-13.3, Hawaii Revised Statutes, is repealed.
["[§10-13.3] Interim revenue. Notwithstanding the definition of revenue contained in this chapter and the provisions of section 10-13.5, and notwithstanding any claimed invalidity of Act 304, Session Laws of Hawaii 1990, the income and proceeds from the pro rata portion of the public land trust under article XII, section 6 of the state constitution for expenditure by the office of Hawaiian affairs for the betterment of the conditions of native Hawaiians for each of fiscal year 1997-1998 and fiscal year 1998-1999 shall be $15,100,000."]
SECTION 9. Act 178, Session Laws of Hawaii 2006, is amended by repealing section 3.
["SECTION 3. Notwithstanding the provisions of chapter 10, Hawaii Revised Statutes, or the requirements of Executive Order No. 03-03, beginning in fiscal year 2005-2006, the departments of agriculture, accounting and general services, business, economic development, and tourism, education, land and natural resources, and transportation (for its harbors division), and any other department or agency that collects receipts from the lands within the public land trust, shall determine and transfer to the office of Hawaiian affairs that portion of their receipts from the use of lands within the public land trust collected during each fiscal quarter, necessary to ensure that a total of $3,775,000 of revenues generated by the public land trust is transferred to the office of Hawaiian affairs, within thirty days of the close of each fiscal quarter; provided that for fiscal year 2005-2006, the departments shall have until thirty days after the close of the fiscal year to transfer a total of $15,100,000 from their receipts from the use of lands within the public land trust collected during fiscal year 2005-2006, to the office of Hawaiian affairs whether by the procedures set out in Executive Order No. 03-03 or this Act.
The governor is expressly authorized to fix the amounts each agency shall transfer to the office of Hawaiian affairs in each quarter by executive order to implement the provisions of this section."]
SECTION 10. (a) All right, title, and interest in the following parcels of land with the existing improvements thereon, except for submerged land, accreted land, or any land makai of the shoreline, shall be conveyed in fee simple to the office of Hawaiian affairs to be held in trust and shall be subject to all laws, including section 171-58, Hawaii Revised Statutes:
(1) Kakaako Makai: (Lots 2, 3, 4, 5, and 9 as identified on the final Kakaako park subdivision map dated October 15, 2007, and approved by the city and county of Honolulu department of planning and permitting on November 9, 2007);
(2) Kalaeloa Makai: (TMK: (1)-9-1-31:1); and
(3) Hilo Banyan drive: Bayview Banyan Corp. (TMK: (3)-2-1-5:21); Country Club Condo Hotel (TMK: (3)-2-1-5:20); Hilo Hawaiian Hotel (TMK: (3)-2-1-3:5); Naniloa Hotel and Golf Course (TMK: (3)-2-1-1:12; TMK: (3)-2-1-5:13, 14, 16, 17, 27, 32, 39, 41, 42, 46); Reed's Bay Resort Hotel (TMK: (3)-2-1-5:22); Uncle Billy's Hilo Bay Hotel Inc. (TMK: (3)-2-1-5:9, 12, 33, 34, 35, 45, 47).
Because these are conveyances in which the State and its agencies are the only parties, the tax imposed by section 247-1, Hawaii Revised Statutes, shall not apply to them.
The property conveyed shall be and remain subject to all encumbrances, whether or not of record, rights of native tenants, leases, contracts, agreements, permits, easements, profits, licenses, rights-of-way, or other instruments applicable to any land conveyed by this section effective or on going on the effective date of this Act, which shall remain in full force and effect. These encumbrances may be set forth in the instruments conveying the property to the office or set forth in a license or similar agreement, a memorandum of which may be recorded concurrently with the instruments conveying the property to the office. Beginning July 1, 2008, every reference to the current title-holder or the head of the department or agency in each such instrument, if the title-holder is a department or an agency, shall be construed to be a reference to the office of Hawaiian affairs or its board of trustees.
After the conveyances are made, the property shall be subject to all laws, except as otherwise provided in this Act. The office shall administer the property in accordance with its duties under the Hawaii Constitution and as provided by law.
(b) The office of Hawaiian affairs shall cooperate with other state agencies to designate and grant such access rights and easements as may be reasonably necessary for the benefit and use of the State. Each of the instruments creating such access rights or granting such easements shall provide that the office, or any successor owner of the servient property, shall have the right to reasonably relocate any such access areas or easements so granted. The cost of initially identifying such access areas or designating and granting any such easements shall not be the responsibility of the office. The cost of relocating any such access areas or easements shall be paid by the office or any such successor owner, as the case may be. Each of the instruments creating such access rights or granting such easements shall also provide that the office shall only be responsible for a reasonable share of the cost of maintaining any such access areas and easement areas, as the case may be, and that the office, its tenants, licensees, concessionaires, successors, and assigns shall not be liable for injuries or damages arising from the use of such access areas or easement areas by other state agencies or their invitees.
(c) Notwithstanding subsection (b), the office of Hawaiian affairs shall not be required to approve any access rights or grant any access easements to other state agencies that would materially diminish the value of the servient property or that would materially interfere with the use of the servient property by the office or any lessee, tenant, licensee, concessionaire, or other occupant of the property, unless otherwise provided by law.
(d) This section shall not limit the power of the legislature or the legislative bodies of the political subdivisions of the State to enact laws that may affect the parcels conveyed in this section of this Act.
SECTION 11. The real property conveyances made under this Act, and the funds paid under this Act regardless of the means of financing, shall be deemed income and proceeds from the lands in the public trust referred to in article XII, sections 4 and 6, of the Hawaii Constitution, as if they had been paid out of the income and proceeds from such lands pursuant to article XII, sections 4 and 6, of the Hawaii Constitution.
SECTION 12. To the extent that the State has made any waiver of sovereign immunity for a suit, claim, cause of action, or right of action regarding the pro rata portion of the public trust under article XII, sections 4 and 6, of the Hawaii Constitution, that waiver is withdrawn.
SECTION 13. The director of finance is authorized to issue general obligation bonds in the sum of $13,189,860 or so much thereof as may be necessary and the same sum or so much thereof as may be necessary is appropriated for fiscal year 2008-2009 for the purpose of making payment to the office of Hawaiian affairs pursuant to this Act.
The sum appropriated shall be expended by the department of budget and finance by making the required payment under this section to the office of Hawaiian affairs no later than June 30, 2009.
SECTION 14. The legislature finds that the dollar amount of the pro rata portion of the income and proceeds from the lands in the public trust referred to in article XII, sections 4 and 6, of the Hawaii Constitution for fiscal year 2008-2009 is $15,100,000. The sum shall be disbursed to the office of Hawaiian affairs pursuant to section 10- , Hawaii Revised Statutes.
The legislature further finds that the governor, office of Hawaiian affairs, and legislature agree that $15,100,000 per fiscal year ($30,200,000 per fiscal biennium) is a sum that should serve as a floor baseline as future legislatures set the dollar amount of the pro rata portion for the next and future fiscal bienniums. The legislature is committed to supporting this shared, hard-won consensus on how the State can most effectively and responsibly meet its obligation to native Hawaiians in the future and to not falling below that dollar level of support.
SECTION 16. This Act shall take effect on July 1, 2008.