Ka Wai Ola - Office of Hawaiian Affairs, Volume 8, Number 5, 1 May 1991 — An open letter to the State Legislature from OHA: [ARTICLE]

An open letter to the State Legislature from OHA:

In the course of the current legislative session, the Office of Hawaiian Affairs has provided the testimony on a number of bills, some that it has sponsored, some initiated by others. In watching the flow of legislation, we have noticed a slowly evolving inclination to look to OHA for funding assistance out of the special funds that OHA receives as a result of its 20 percent share of revenues from the ceded land trust. We believe there are several reasons for the tendency to view OHA as a funding source: 1. The gloomy outlook on general revenues as a result of the recession and as exacerbated by the Persian Gulf War; 2. A feeling that OHA may be "flush with money" as a result of the clarification of OHA trust revenues and the formula for calculating the OHA entitlement, including the past due amount; and 3. A less than full appreciation, or perhaps a misunderstanding, of the limitations that govern the use of money derived from the ceded land trust. The third of the foregoing reasons is the one we believe needs to be dealt with. A fuller appreciation of how OHA special funds ean be used and the effect of funding restrictions would be helpful in curbing an exaggerated sense of OHA's financial wellbeing. The money OHA derives from the ceded land trust is, as we have noted in testimony,

to be used for the betterment of the native Hawaiian who possesses at least 50 percent Hawaiian blood. Our ability to serve Hawaiians of less than 50 percent blood quantum, and there are more of them than there are native Hawaiians, depends entirely on the general funds appropriated to OHA by the Legislature. In acting on OHA budgets, the Legislature has followed the practice of exacting an even dollar match of special funds to the general funds that it approves. Thus OHA's budget and its expenditures have eome to be regarded as a 50/50 match. What concerns us as we notice the increasing tendency to seek funding assistance through OHA's special funds, is that OHA won't necessarily be able to participate on an equal sharing basis. A program like the Department of Education's Hawaiian Language Immersion Project is a case in point. For discussion purposes, say that the project requires funding for $600,000 and it is proposed that OHA provide $300,000 of that amount from its special trust money. There are, at the outset, two restricting conditions. In this instance, the immersion project, though attended predominantly by students of Hawaiian ancestry, is not restricted to Hawaiians only. Secondly, there is a mix among the Hawaiian students between those who are 50 percent or more Hawaiian blood and those who are less. OHA special

trust funds are to be spent for the betterment of the former only. Taking the example a step further, we may need help to establish a pro rata share, based upon the number of eligible beneficiaries of the trust money. Assume there are 400 students in the program, 80 oh whom are at least one-half Hawaiian. There would be serious question as to whether the special trust money ean be spent on more than the 80 native Hawaiian students. Consequently, it is possible that OHA may not be able to spend more than $60,000 on behalf of the project. Where the required program funding is $600,000, the actual funding (with OHA as a source) may not amount to more than $360,000. The final consideration is one that may, at first blush, seem self-serving, and that is the fiduciary responsibility ascribed to the trustees and their responsibility for deciding the use of the special funds entrusted to their management. These are responsibilities for whieh trustees are accountable and should be reserved for the exercise of their judgements. The Office appreciates very mueh the efforts of the Legislature in giving it the ability to serve those of less than 50 percent native b!ood. Until we are successful in creating an entitlement for this group of Hawaiian beneficiaries, we are obliged to assure that the trust obIigation to the native Hawaiian is not breached. 4»