Ka Wai Ola - Office of Hawaiian Affairs, Volume 8, Number 3, 1 March 1991 — Summary: controversies recommended actions [ARTICLE]

Summary: controversies recommended actions

A. Federal inventory of ceded lands While most federally-controlled lands are accounted for, there are frequent inconsistencies in reports by both federal and state agencies. • Create a complete inventory of federally-con-trolled lands in the state, to include information on whether the parcel is ceded, leased, or fee (through condemnation or outright purchases), as well as who the user is and the use.

• An audit of federally-controlled lands should be conducted by the General Services Administration (GSA) to include an interagency reconciliation, the establishment of policies and procedures for reporting acquisitions and releases, as well as conducting title searches and land surveys. An audit should be conducted every five years, and the results reported to Congress. The State should also receive the report and have access to the inventory of federally-controlled lands. • Conduct a review to identify surplus lands whieh could be returned under Public Law 88-233. B. Strengths and weaknesses of Public Law 88-233 Public Law 88-233 (PL-88-233) was intended to return surplus lands to the state, but instead the federal government has used it to maintain land control.

• 1 he state needs to seek a way to initiate the review process by the administrator of General Services Administration, possibly by amending or invoking PL-88-233- • The Hawai'i state Legislature should pass a concurrent resolution requesting action by Congress. C. Identification and return of federallycontrolled ceded lands to the state • Because project FRESH and MILPRO are outdated, the U.S. Department of Defense should conduct a.similar study to identify current military land requirements. • A similar study to determine the land use requirements for existing federal properties eontrolled by other federal agencies should also be made at this time.

• The state also needs to identify lands whose return would increase the State's ability to benefit the general public, and the Hawaiian Home Lands trust. D. Questions of whether the state is entitled to lease revenues from federally-controlled ceded lands • The State should verify whether the federal government has conveyed any revenue, as required under the Organic Act and Hawai'i Omnibus Act, to the state. • Request from the federal government a list of past and existing lease agreements. • Work with the Hawai'i delegation to Congress to pursue legislation whieh would lift the deadline in Section 42 of the Hawai'i Omnibus Act. This

would require the federal governments to convey to the state treasury, all revenues from leases, rents, and revocable permits, from federaliy-con-trolled ceded lands. • Additional language included to require that such revenues be deposited in the account for the public land trust. As revenues derived from the lease of ceded lands, OHA would be entitled to 20 percent of the amount. E. Laek of complete state inventory of ceded lands

A problem whieh inhibits further development of a comprehensive ceded lands inventory has been the inaccuracy of surveying methods used in the past to define parcels belonging to the public land trust. • Permanent land agent position to do the necessary research to perfect the inventory. • Consultant to recommend software, hardware, and personnel requirement for an online computer access system. This system would eontain the entire public land inventory under the eontrol of the state, and be available for use by the appropriate state agencies. • Conduct surveys and title searchers on lands with "muddy" pasts, or prioritized on an "as needed" basis, because of relatively high cost of such actions.

F. Submerged lands There is question as to whieh lands are actually subject to 20 percent revenue provision. If eonsidered as a portion of the Admission Act's 5(b) lands, then the lands are subject to the 5(f) provision. • Case law appears to indicate that submerged lands were part of the lands ceded to the United States at the time of annexation. Consequently, they are subject to the trust provisions of section 5(0. G. The mismanagement and improper allocation of funds generated by the public land trust Since 1979, the Department of Land and Natural Resources (DLNR) has complied with the recommendations of a 1979 audit issued by the Legislative Auditor's office. However, since passage of Act 304, other departments whieh also have ceded lands under their control have been receiving funds attributable to the public land trust fund.

• Department of Budget and Finance (B&F) should coordinate and oversee revenues generated by the ceded lands within the control of all public entities other than DLNR, in order to ensure consistent applieahon and enforcement of ceded land revenue policies. • A report of ceded land revenues should be reported on a biennial basis by the Department of Budget and Finance to the Legislature. H. Controversy over mineral rights There are three mineral rights controversies:

between 1900 and 1954, public land parcels were conveyed to private parties without a mineral reservation clause. There is a question as to the entitlement of mineral royalties owed to the state over lands sold by the territorial government; and the definition of the term "mineral rights" requires legal clarification.

• To ascertain whether or not eaeh of these parcels contain valuable mineral resources rriay prove costly and add no significant benefit to public land trust. • If cases do show significant mineral resources found on parcels with no reservation clauses, they should be adjudicated on a case-by-case basis. • Current statutory definitions are sufficient to determine the revenues subject to the public land trust. . ' .

I. Need to review leases of trust lands Trust advocates believe that an asseessment should be made on all leases of public trust land against its current market value. • The awarding of a lease, whether for public or private use, should be done without discrimination as to whether or not the parcel is ceded. The main criteria should be the merit of the public purpose. • DLNR should continue its efforts to provide a consistent applieahon of determining lease rents within classes of leases. • The state must review and evaluate ceded lands under county control, and ascertain whether or not the parcels are being used for the purpose for whieh they were leased. In addition, the state should develop and implement reservation clauses for the lease agreements, to include provisions that any revenue generated by the pareel is subject to the 20 percent payable to OHA.

J. Land exchanges and conversions to private parties Fresently, there are no clear policies on land exchanges between state agencies, and conversions to private parties, whieh are acceptable to all interested parties. • Any decision on exchanges should be based on policies established on the basis of how such exchanges fulfill a purpose of the public land trust. • DLNR is currently working on a policy proposal whieh would resolve issues brought forward by sales and exchanges of ceded land, and conversions to third parties of ceded lands, for the purpose of developing affordable housing.

• The possibility of compensation taking forms other than cash should be explored, as these alternatives may be of greater benefit to the trusts. • Appraise ceded land parcels that have been previously developed, in order to determine the compensation due retroactively to OHA and DHHL. K. Land exchange between the puhlie land trust and the Hawaiian Home Lands trust A potential controversy may develop over the continued poge 14

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possibility of ceded lands being exchanged with "marginal" Hawaiian home lands, in order to restore the Hawaiian Home Lands trust.

• DHHL should take the initiative to identify lands whieh could be exchanged or obtained for their purposes. These decisions on possible exchanges should be based on the merit of furthering the purposes of the Hawaiian Homes Commission Act, as well as other criteria, such as geographic considerations. • Due to the urgency and complexity of this issue, a task force should be created in order to accelerate this process of identification and inventory.

L. Settlement with OHA regarding revenues from the ceded land trust Resolution attempts have focused on three areas: determining actual amount retroactive!y due to OHA under clarified definitions of lands and revenues established in Act 304; identification by OHA trustees of lands OHA is interested in receiving in lieu of cash and appraisals of those lands; and determining amounts due to OHA under previous exchanges or sales of lands that were subse-

quently developed and sold to private parties. • The Department of Budget and Finance will continue the process of accounting for ceded land revenues due to OHA retroactively. • Lands removed from the. ceded lands inventory through exchange, transfer or sale by Housing Finance and Development Corporation (HFDC), or its predecessor Hawai'i Housing Authority (HHA) should be appraised retroactive to the time of disposition. Twenty percent of the total appraised amount should be added to the total retroactive amount due to OHA.

• OHA and the Ohiee of State Planning (OSP) will continue discussions on identification of land, and the composition of final payment between cash and land. • Until final payment is made in either cash or land, interest will continue to accrue on the retroactive amount due. Articles in this special information supplement were prepared by the OHA Land and Natural Resources division, Linda Delaney land officer, and Lehua Pekelo-Stearns, specialist.