Ka Wai Ola - Office of Hawaiian Affairs, Volume 19, Number 10, 1 October 2002 — Decline and actions [ARTICLE+ILLUSTRATION]

Decline and actions

Ev eryone is aware of the eeonomy and tend to explain it away by various scenarios. OHA is no different because it is into the system of investing in ihe market. And this investing has helped in ihe past to grow ihe portfolio. The recent bear or down market have seen a noticeable drop in value of investments in ihe market including those of OHA. An example is that in the last quarter of 2001 ihe value of ihe OHA portfolio3 as estimated by ihe presentconsultant was some $307 million. In ihe first quarter of 2002 ihe portfolio value had declined to some $277 million and by ihe second quarter ending June 30, 2002 Ihe portfolio value had further declined to $261 million. It is apparent that there is little control over ihe market or until there is an upturn and a bull market eventually returns to reverse ihe decline. This decline has meant that OHA is having difficulty properly fund-

ing ihe needs of the agency and its beneficiaries. f/Iy concerns as stated to ihe Board has been since we can't eontrol ihe market, to fund our basic $15 million budget, do we now prepare to sell bonds or stocks? Or we plan to carefully cut ihe budget now to engage in long-term planning? These questions are vital, in making decisions that only ihe OHA Board ean make, because historically bonds are less volatile ihan equities in reducing risk. At present OHA is exposed to less risk, having some 50% of its portfolio in bonds, but this allocation in pursuing diversity may have to be reconfigured to acquire a more desirable balance. Small eap growth stocks are now quite volatile but maybe later an acceptable risk for long term investment or even international investment. In this same connection of ineome sources, ihe Legislature did not or has not turned over to OHA

any ceded lands funds since July 2001 and only made partial distributions before that based on ihe 1898 annexation terms andthe following 1959 Statehood terms. This delinquency is serious and impaim ihe work of OHA to carry out its mandate.

The OHA Strategic Plan calls for interaction wilh the Legislature and OHA to design a resolution to ihe ceded land issue. OHA hosted ihe September gubernatorial forum

wilh a well-attended event, of numbering inthe hundreds, toa successful culmination of ideas and offerings. The outcome of ihe forum demonstrated that ihe candidates are now mueh more aware of ihe Hawaiian peoples needs and necessitates addressing ihem now that they have been made fully aware. At least eaeh candidate spoke positively and assured those present about addressing ihe Hawaiian issues long delayed, and resting on the table awaiting positive action. Our community must speak wilh one voice, that we are organized to pumue this issue of restored funding to OHA based on the commitments made in ihe past and now being ignored. We also advise we will vote wilh our ballots for ihe best qualified candidates who clearly recognize ihe past commitments and wishto validate and support our programs that carry out ihe betterment ofcondition ns for Hawaiians in their homeland. ■

The OHA Strategic Plan calls for interac - tion with the Legislature anel OHA to design a resolution to the eeāeā land issue.

Charles Ota 2 rustee, Maui