Ka Wai Ola - Office of Hawaiian Affairs, Volume 12, Number 10, 1 October 1995 — OHA portfolio soars [ARTICLE+ILLUSTRATION]

OHA portfolio soars

by Patrick Johnston The Office of Hawaiian Affairs financial portfolio has grown by over $23 million since the beginning of 1995. The portfolio consists of investments made by a group of nine money managers hired by OHA using the agency's share

of ceded land revenues. OHA received most of these monies two years ago as part of a settlement with the state over past-due ceded land revenues. The total market value of OHA's investments stood at $193,344,624.92 as of June 30, up from its 1994 close of $170,226,924.09. The increase is largely the

result of a healthy stock market and sound investments made by a number of OHA's fund managers. "We are making good money this year," says Budget, Finance and Policy Committee Chair Abraham Aiona. "That's why I told the Budget, Finance and Policy committee we need to continue with long-term investments." The large 1995 eamings contrast with those of 1994, when a relatively stagnant market meant a less-than-robust year, not only for OHA investments, but for all funds with investment portfolios. The most immediate and direct beneficiary of increased OHA earnings is the agency's grants and donations programs, both of whieh receive a percentage of OHA portfolio eamings. Down the road, another direct beneficiary of increased portfolio earnings could be Hawaiian students. Aiona believes support for education in the form of scholarships should be something the board adopts as a priority. In the past, he notes,

Kamehameha Schools has provided matching funds for OHA scholarship money and he believes these sorts of arrangements should be continued with other foundations. "These are good because the money ean be used by all Hawaiians, not just those with 50 percent Hawaiian blood," Aiona points out. The use of OHA trust funds is restricted by law to Hawaiians who have at least 50 percent Hawaiian blood. In order to reach all Hawaiians, the agency has traditionally relied on matching funds from government agencies and private groups. Aiona also mentioned vocational training, aquaculture, traditional arts, home loans, and even insurance as some of the areas the board could eonsider for future trust fund use. "There are so many things we need to do," he says. While all of OHA's investments have been in U.S.-based companies, Aiona anticipates they will in the future also include foreign companies, in particular those in the fast-growing Pacific Rim and South Pacific countries. He mentions Belau as an example of a new nation with good future investment possibilities for OHA funds. Aiona adds, however, that foreign investment of trust funds has been restricted in the past in part because of concems over human rights violations in some countries. Any future investments would eome under the same scrutiny. "If the trustees have a eoneem about human rights, I'm sure they would take a close look before investing in the country," Aiona says. The next review of OHA's portfolio by the nine fund managers will take plaee November 16 from 1-6 p.m. at the Budget, Finance and Policy Committee meeting in the OHA board room. The meeting is open to the public.

Abraham Aiona