Raw Deal
Who owns "ceded" lands?

by Joan Conrow

A proposed ceded lands payback agreement signed Jan. 17 between the state and Office of Hawaiian Affairs (OHA) has triggered an impassioned public debate over what lands actually belong to Native Hawaiians and what form their self-government may take.
At the crux of the matter is the rightful ownership of some 1.8 million acres of the Hawaiian Kingdom's public lands-comprising an estimated 40 percent of Hawai'i's total land mass and 95 percent of all acreage under state control-and who should determine how they are used. The agreement, originally called a settlement and now incorporated into House Bill 266, would give OHA $200 million in land and cash as back-due payment from ceded lands income and a to-be-determined share of future revenues.

The state/OHA deal was followed two weeks later by a Hawai'i Supreme Court ruling that bars the state from selling any of the "ceded lands" until the question of their ownership is resolved.
Whether the Hawaiian nation and its territory will be determined through international law, independence or the Akaka Bill (which would establish a nation-within-a-nation under federal jurisdiction on the Native Americans model), is a hot topic. The Akaka Bill has been endorsed by Gov. Linda Lingle, Attorney General Mark Bennett, presidential hopefuls Sen. Barack Obama and Sen. Hillary Clinton, and OHA, itself a state agency.
Raw deal
Groups seeking Hawaiian independence fear that the current proposed agreement is effectively positioning OHA to assume the role of a native governing entity as envisioned by the Akaka bill.
While some OHA trustees and the attorneys who negotiated the deal on the agency's behalf are touting the settlement as a good deal for Hawaiians, independence advocates view the entire process as a sham, saying neither the state nor OHA has legal jurisdiction over the ceded lands.
"It's just perpetuating a fraud," said Dr. Kekuni Blaisdell, a member of the Kanaka Maoli Tribunal Komike, which wants to see Hawai'i returned to the United Nation's list of non-self-governing territories eligible for de-colonization. Hawai'i was placed on the list in 1946 and removed following the vote for statehood-a vote the group believes was conducted illegally because the option of independence was not on the ballot.
"It's giving the fraud some degree of respectability it doesn't deserve," Blaisdell said of the agreement. "What is needed is revelation of the truth."
Ceded, or seized?
The lands in question, while often referred to as "ceded," were actually seized from the Kingdom of Hawai'i during the 1893 overthrow of the monarchy. One hundred years later, the U.S. Congress deemed that action unlawful when it approved the "Apology Resolution."
"Our land was taken at the point of a gun and now the Hawaiians are begging and suing day in and day out to get what is rightfully ours," said Naliko Markel, a minister with the Reinstated Hawaiian Kingdom.
In 1898, the Republic of Hawai'i-led by those who masterminded the coup-"ceded" control of 1.8 million acres of Kingdom lands to the U.S. government and sold the rest to private parties.
"Ceded lands are stolen lands and therefore they have to be returned to their rightful owners," Blaisdell said. "And the rightful owners are not the federal government, the state or OHA. It's the people who are descendants of the subjects of the Hawaiian queen."
1959:
The state's turn
When Congress adopted the 1959 Admissions Act, which brought Hawai'i into the union, it kept 400,000 acres of "ceded lands" for military bases, national parks and other federal uses and put the rest into the Public Land Trust, which was turned over to the newly formed State of Hawai'i.
In the years since statehood, these trust lands have been developed for the Hilo and Honolulu international airports, Maui's Kahului Harbor, Sand Island, hotels, hospitals, affordable housing, golf courses, parks at Kapiolani and Ala Moana, the University of Hawai'i, community colleges and other uses. Additional lands were sold, exchanged, leased or transferred to the counties or other government entities.
The Admissions Act mandated that the state use revenues from the trust to improve conditions for Native Hawaiians, develop farms and home ownership opportunities, and support public education and other public uses. However, revenue from the trust was used primarily for public education up until 1978, when the Constitutional Convention proposed creating OHA specifically to receive and manage trust revenues for the benefit of Hawaiians, according to the agency's Web site.
1978: OHA's turn
Hawai'i voters ratified that plan in 1978, and two years later the state Legislature passed Act 273, which directed 20 percent of all "funds" from trust lands to OHA, while failing to define just what the term "funds" encompassed. Blaisdell contends that the payment issue has been further complicated because OHA was supposed to conduct a full inventory of "ceded lands," but never did.
Since OHA's inception, it has been in litigation with the state over both the source and definition of these funds, most notably revenues from Hilo Hospital, state affordable housing and the Honolulu Airport's duty free shops.
In fact, according to former OHA trustee Moanikeala Akaka, "Until 1990, we were only receiving 1 1/2 percent, instead of the 20 percent we were supposed to be receiving."
Akaka told HIJ that she was part of the negotiating team that reached an agreement in 1990 that the state would pay OHA $138 million in arrears and an annual income stream of $12-15 million. Unresolved issues caused a judge in 1990 to push that settlement up to a total of about $1.2 billion: that judgement was reversed by the Hawai'i State Supreme Court in 2001.
The State Supreme Court said that before OHA could sue on the issue of funds, it had to go back to the Legislature to clarify the claims; this prompted the negotiations leading to the proposed settlement agreement, according to Jonathan Likeke Scheuer, OHA's land management director.
Disputed terms
The agreement, which must be ratified by the state Legislature, seeks to settle those long-contested revenue claims by awarding OHA commercial and industrial properties on O'ahu and the Big Island with an assessed value of $187 million and $13 million in cash. The properties include Hilo Kahua, an 80-acre resort area and golf course better known as the Banyan Drive resort area, as well as two O'ahu properties: a portion of Kaka'ako Makai, including Kewalo Basin waterfront and the site of the John Dominis Restaurant; and Kalaeloa Makai, site of the former Campbell feedlot, which has the highest solar energy potential on O'ahu. The agreement also called for the state to pay OHA $15.1 million annually from here on as its share of revenues from trust lands. However, after complaints were aired in public hearings, held throughout February, inflation was not addressed-that figure has been dropped from the House's version of the settlement bill. Instead, the bill proposes a method for doing a yearly assessment of the revenues collected from "ceded lands" income, and giving OHA an unspecified percentage of the total.
Jon Van Dyke, a University of Hawai'i Law School professor and author of Who Owns the Crown Lands of Hawai'i (2008, University of Hawai'i), acknowledged the concerns, but said "one answer" is that the commercial and industrial lands to be turned over to OHA "will increase in value."
But some local Hawaiians wonder whether the properties in question were fairly appraised to start with, and even speculate that the state is unloading properties with built-in liabilities. Without substantial investments in capital improvements, for instance, the aging Banyan Drive properties in Hilo could actually lose value. At a Hilo public hearing held on Monday, February 24, former OHA Trustee Mililani Trask got into an angry exchange with Attorney General and current OHA Trustee Robert Lindsey over the valuation of the properties, especially the Banyan Drive acreage. Lindsey finally admitted that state and OHA had never gotten an appraisal of the properties, which drew still more angry responses from the crowd.
Lindsey said the valuation in the agreement was based on tax assessments, which are generally lower than the actual value of land. However, Ken Fujiyama, who holds a 65-year lease on the golf course and the land under Hawaii Naniloa Hotel on the property in question, thought the estimates of the property's value was too high. Based on assessments he got when applying for loans, he told the panel at the hearing that he thought the six Banyan Drive parcels were worth a total of about $10 million dollars, not the $34 million the state and OHA had agreed upon.
But Keaukaha Community Association head Patrick Kahawaiola'a acknowledged afterward that Fujiyama himself could be one of the problems the state was unloading on the Hawaiians. Fujiyama has already run afoul of the state for starting improvements without state approval and failing to post required bonds. (See "Naniloa Renovations But No Permits," HIJ, Oct 6-12, 2007). Kahawaiola'a criticized Fujiyama's management not only of the Naniloa, but also of Nani Mau Gardens and Volcano House, to other properties he controls, which Kahawaiola'a believes have become seriously degraded.
There were potential liabilities with the O'ahu properties as well. Kahawaiola'a noted that one of them was located next to an oil refinery and could require hazardous waste cleanup-yet the state was requiring OHA to spend the beneficiaries' money to perform an environmental "due diligence" survey of the property.
"You [the state] had it for 30 years. Why didn't you do the due diligence?" Kahawaiola'a demanded.
Res Judicata
Another source of contention is a provision that establishes res judicata, which requires OHA and other parties to give up their right to sue the state to claim any other Trust income payments for the past 30 years. OHA also is barred from suing for additional payments in the future, unless the state fails to pay it at least $15.1 million annually.
Because the House bill deletes those provisions, it has garnered cautious support from some independence advocates. But participants at the Hilo hearing learned that the res judicata proviso might be restored to the House Bill as well.
"They felt that our future generations are being sold down the drain by this settlement," said Akaka after the meeting.
"I believe the settlement may be good for OHA but it's not good for the native Hawaiians, in that the waiver in the settlement waives my rights and my children's rights," said Kahawaiola'a, who is already involved in one lawsuit against OHA over benefits from ceded lands being used for persons of less than 50 percent Hawaiian ancestry.
Against the process
Others have criticized the way OHA and the state negotiated and signed the settlement agreement without seeking input from its beneficiaries, the Native Hawaiian community. OHA com-munications director Crystal Kua said the agency was already making plans to solicit comments from beneficiaries when the Legislature directed it to do so. OHA is currently conducting these meetings around the state, but drew fire at a Hilo hearing for doing too little, too late. Kahawaiola'a lamented to HIJ that some of the public hearings were scheduled to go on after the Senate and House had already held their last committee votes on the measure. He noted that at the Hilo hearing on February 24, which started at around 6 p.m. and was attended by approximately 75-90 people, Attorney General Mark Bennett had to leave to catch a plane at 8 p.m.
"Even if they gave everybody there three minutes, the attorney general was going to miss his flight," observed Kahawaiola'a.
"I reject the process by which this was done, behind closed doors," declared Puanani Rogers at a Feb. 20 session on Kaua'i.
William Meheula, a private attorney who represented OHA through the three and a half years of negotiations that resulted in the settlement agreement, responded that he recommended the discussions "be kept confidential until a deal is reached. You don't do these kinds of negotiations out in the public," he said. "They're never done that way."
Meanwhile, Rep. Hermina Morita, chair of the House Committee on Water, Land, Ocean Resources & Hawaiian Affairs, expressed doubt that the Legislature would pass the bill this session.
"It's always the budget that drives these kinds of things and the budget isn't looking good," she said, noting that "if anything, the Legislature would be a little more cautious" in adopting such a bill in light of the Jan. 31 state Supreme Court ruling.
The Supremes weigh in
The Court's decision allows OHA to seek an injunction barring the state from selling or transferring any Trust lands "until the claims of native Hawaiians to the ceded lands have been resolved."
The ruling stemmed from a 1995 lawsuit filed by OHA and four individual plaintiffs to prevent the state from transferring 1,500 acres of Trust lands on Maui and the Big Island to the Housing and Community Development Corp. of Hawai'i. They argued that the state had no power to sell Trust lands, and that such transfers would "erode the ceded lands trust."
The Justices agreed with the plaintiffs, and cited as the basis for their decision the federal "Apology Resolution"-Public Law 103-150. The resolution states in part that the Kingdom's lands were seized "without the consent of or compensation to the Native Hawaiian people of Hawai'i or their sovereign government."
It also apologizes for the overthrow and the deprivation of Native Hawaiians' right to self-determination and calls for "a proper process of reconciliation between the United States and the native Hawaiian people."
"The Apology Resolution clearly states that the overthrow of the monarchy in which the U.S. played a key role was a violation of treaties and international law," Blaisdell said. "This is crucial because our position is that treaties and international law have to be invoked, not ignored."
Legacy
Independence groups have long contended that neither the state nor OHA has the right to determine the use of "ceded lands" because they still belong to the deposed nation. They see the court decision as both solidifying this stance and exposing the state and OHA's negotiations as fraudulent.
"The question is, do we still have rightful claims to the land, and the answer is yes," says Henry Noa, prime minister of the Reinstated Hawaiian Kingdom.
"What this and the rest of the Apology says is that the so-called Republic of Hawai'i had no authority to cede or transfer these lands in the first place," writes Scott Crawford, director of electronic communications for the pro-independence Nation of Hawai'i, in the group's blog (www.hawaiiankingdom.info).
Crawford is far from alone in his assessment. Indeed, at the Feb. 20 public meeting on Kaua'i, deputy attorney general Charlene Aina acknowledged, "I know there is no formalized document" authorizing the transfer of lands from the Kingdom to the U.S. government.
Many of those who have spoken against the agreement fear that OHA is positioning itself to negotiate a settlement for the larger claims involving ownership of all acreage in the "ceded lands" trust. OHA officials, however, have dismissed that concern.
"OHA does not believe it is the entity that can negotiate and settle those claims because we're [an agency of] the State of Hawai'i," Scheuer said. "The [OHA] Trustees are very clear about this."
Scheuer also emphasized that the proposed settlement deals solely with the issue of revenues from trust lands and does not preempt any land ownership claims stemming from the overthrow of the monarchy.
Akaka Bill tie-in?
At the Kaua'i meeting, Anahola resident Hale Mawae asked whether OHA would use money from the settlement to continue its support for Kau Inoa, a Native Hawaiian voter registration drive that currently has 80,000 registrants, according to OHA's Web site.
Many sovereignty activists believe that Kau Inoa is linked to the Akaka Bill, which would recognize Native Hawaiians as indigenous to the U.S., place them under the control of the Bureau of Indian Affairs and extinguish all claims to independence.
Through its support for Kau Inoa, many fear that OHA is positioning itself to become the governing entity for the Hawaiian Nation outlined in the Akaka Bill.
Scheuer acknowledged that some of the settlement funds very well could be used for Kau Inoa, but said OHA also has funded other independence initiatives.
Van Dyke said he hopes the state Supreme Court decision "will energize the process of resolving these (ceded lands ownership) claims. The Akaka Bill is one method for that because it would creative a Native Hawaiian entity and facilitate negotiations with the United States."
He said the court's decision "makes it clear action has to take place because it freezes land and prevents the state from doing what it might want."
He noted that similar situations occurred prior to settlement of land claims with Alaska Natives, the Maori in New Zealand and Pueblo Indians in the American Southwest.
Blaisdell thinks the matter should be resolved through the internationally recognized process of self-determination for persons of occupied nations-a process he contends was wrongfully denied Hawaiians during the statehood vote.
Blaisdell said he and others plan to ask legislators to return Hawai'i to the United Nations list of non-self-governing nations, which would allow Hawaiians to decide whether they want to be incorporated within the U.S., be independent or be "freely associated with another country, such as Palau or the Federated States of Micronesia." During the statehood vote, only the first option was offered.
Hawaians opposed
Other Hawaiians feel the time is ripe to push for independence.
"I think our kanaka people should realize we have an opportunity to reclaim it all if they support the Reinstated Hawaiian Nation process, rather than just a portion of it," Noa said.
"We're coming for our land," Ka'iulani Huff, a pro-independence Kaua'i resident told OHA representatives at the meeting on her home island. "You're gonna settle for the pennies. We're gonna get it all."
But whatever their opinions about sovereignty, the Hawaiians at the Hilo meeting and a subsequent Kona-side meeting were virtually unanimous in their dislike of the proposed OHA settlement. Moanikeala Akaka called the current bill "theft."
"We raise our children with the values of fairness and justice, and there's a great deal of concern about this in the Hawaiian community, to say the least," she said afterward.
Kahawaiola'a was even more vehement.
"Kill it. Kill the bill," he said. "We waited 30 years. Why rush?"
Additional Reporting by Alan D. McNarie

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