A 40-year lease extension sought by Prince Kuhio Plaza is in a legal quagmire between the state and federal governments, and most who testified last week at the Hawaiian Homes Commission’s monthly meeting opposed extending the lease for almost 39 acres of homestead land.
The lease extension request was the only agenda item slated for an executive session discussion amongst commissioners and the state’s Office of Attorney General during the Oct. 17 meeting at the Grand Naniloa Resort’s Crown Room in Hilo.
The reason for the three-hour private session, closed to the media and public, was Act 236, a state law passed in 2021.
Commissioners in favor of extending the mall’s lease from its current end date of Sept. 30, 2042, to Sept. 30, 2082, are using Act 236 to justify doing so.
The law authorizes the Board of Land and Natural Resources to extend certain leases for public lands for commercial, industrial, resort, mixed-use or government use for no more than 40 years, upon approval of a proposed development agreement to make substantial improvements to the property.
The Department of Hawaiian Home Lands needs the revenue from commercial leases to provide homestead land to approximately 28,000 Native Hawaiians on its wait list.
In an Oct. 13 letter to state Attorney General Holly Shikada, U.S. Department of the Interior Solicitor Robert T. Anderson said the feds have “significant concerns that any actions by the Hawaiian Homes Commission to grant extensions of commercial leases of Hawaiian home lands pursuant to Hawaii Act 236 … violate federal law and constitute a breach of trust by the state.”
“Paramount to the limitations imposed on the state’s management of the Hawaiian home lands is the prohibition against increasing encumbrances on Hawaiian home lands without congressional approval,” Anderson’s letter states. “Act 236, as the state acknowledges, would have the effect of authorizing DHHL and the commission to increase encumbrances on Hawaiian home lands. Accordingly, Act 236 must be reviewed by the (Interior) secretary and approved by Congress.”
U.S. Rep. Kai Kahele, in an Oct. 14 letter to Gov. David Ige, expressed his “deep concern that DHHL intends to circumvent the DOI and not comply with the requirements by the United States for all substantive changes by applying Act 236 with DHHL commercial lease extensions.”
“To avoid legal action by the United States against the state of Hawaii, I am requesting your intervention to address this issue with DHHL,” Kahele wrote.
Testifying against the lease extension for the mall, Nako‘olani Warrington — a DHHL beneficiary from Panaewa representing Kupuna for the Mo‘opuna — described House Bill 499 from the 2021 legislative session, which became Act 236, as “controversial.”
The bill was introduced by Big Island Reps. David Tarnas, Chris Todd, Mark Nakashima and Greggor Ilagan, among others.
“It sailed through that session when we were in the midst of the pandemic and the capitol was closed off to in-person testimony. It became law … without the governor’s signature,” she said. “It was not pono.”
Warrington’s group submitted written testimony in opposition to HB 499, as did the Office of Hawaiian Affairs, Ka Lahui Hawai‘i Kalai‘aina and the Hawaiian Affairs Caucus of the Democratic Party of Hawaii. Testifying in support were the Department of Land and Natural Resources, Hawaii Island Economic Development Board, Prince Kuhio Plaza and real estate developer Stanford Carr.
“Violations during the pandemic, these things are so atrocious,” said an unidentified testifier at Monday’s meeting. “Who and how much of you guys conspired with this done deal here to go ahead and try to weasel this one, this executive session one? HB 499 is the true essence of how you guys are known in the kupuna community.”
Chairman William Aila interjected that DHHL didn’t submit testimony about the bill.
“You guys take our resources,” the testifier replied. “You don’t give money, none of the things that’s mandated back to us. You guys just love pimping our nation.”
Daniel Kea, general manager of Prince Kuhio Plaza, was the only testifier Monday in favor of the extension. He said he wants “to remind everyone of the importance of Prince Kuhio Plaza in the community.”
“We are truly a gathering place. We are a community place,” he said. We hold a lot of events, being that we’re the only closed mall on Hawaii. … We had our cancer awareness on Saturday. Next week, Monday, we’ll have trick-or-treating. We’re doing a food drive.”
“Is there a community benefit package that you provide within the homestead on the Big Island?” Oahu Commissioner Patty Kahanamoku-Teruya asked Kea.
“There was an estimated cost of about $100,000 … towards community events and specific considerations for Native Hawaiian events, as well as try to help small businesses, Native Hawaiian businesses, get their foothold and get their start … and help them grow their business,” Kea replied.
“So, my question back to you, is do you provide any benefit package to Native Hawaiian associations, homesteads?” Kahanamoku-Teruya inquired.
“Currently, no, we do not,” Kea answered.
“So, just to community events, then?” Kahanamoku-Teruya queried.
“Community events and Native Hawaiian businesses,” Kea said.
During a Sept. 19 commission meeting on Maui, Kea testified that the extension is important so the mall’s parent company, Brookfield Properties, can “do more investment on the property.”
Kaui Almeida, president of the Panaewa Hawaiian Home Lands Community Association, thanked Kahanamoku-Teruya for her question and recommended the matter “be tabled pending consultation with the beneficiaries, especially of our community.”
Keaukaha Community Association President Pat Kahawaiola‘a said if the commission goes ahead without congressional approval, it “will eventually end up in the courts.”
“I would ask you defer whatever you need to do. You’re the outgoing administration in this case, Mr. Aila, unless the new governor chooses you to come back,” he said. “… We’re not casting aspersions upon Prince Kuhio Plaza, except the process that was used is wrong. The process that was used is absolutely wrong.“
David Kauila Kopper, litigation director for the Native Hawaiian Legal Corporation, urged the commission to not extend the lease.
“It would violate the law,” he said. “The DOI sent two letters to the state about this extension and the Act. The first was back in May of this year. The second was this past Friday. … Those letters made very clear that the federal government and their attorneys determined that (Act 236) cannot apply to DHHL leases at this time.”
Email John Burnett at jburnett@hawaiitribune-herald.com.
