Ka Wai Ola - Office of Hawaiian Affairs, Volume 10, Number 9, 1 September 1993 — The books aren't closed [ARTICLE+ILLUSTRATION]

The books aren't closed

by The Rev. Moses K. Keale, Sr. Trustee, Kaua'i & Ni'ihau On June 4, 1993, the State of Hawai'i delivered to the Office of Hawaiian Affairs a eheek for more than 5129 million. Their agreement to pay this amount was directly related to the eonclusion formulated by audits of Ernst & Young (hired by the state) and Deloitte & Touche (hired by OHA), whose job it was to reconcile the moneys owed to OHA. OHA and the State announced the receipt of this money and some people assumed that the books were closed. On the contrary, the debt is not settled. The bill is not fully paid. The audits identified eight departments of the state whieh controlled or managed ceded lands. Those departments are: • Accounting and General Services • Business, Eeonomie Development and Tourism • Education • Heakh • Land and Natural Resources • Transportation, Airports Division • Transportation, Harbors Di-

vision • University of Hawai'i From that audit it was agreed that the State of Hawai'i owed OHA and the Hawaiian people $129,584,488.85. The audits further went on to point out several

areas of disagreement. These areas of disagreement are: It is my opinion that these are non-negotiable disagreeements. Our position should be to simply request eomplianee with the letter and intent of the law. Negotiations on what constituted compensational revenue were completed in 1989 when a settlement was reached and the laws were amended to reflect this definitive agreement. Between 1990 and the present, all that was left to clarify negoti-

ations and reconciliation was how OHA wanted to receive this settlement. We chose to receive this settlement in cash! Regarding the above dispute, let me put it very simply. The item entitled "interest" consti-

tutes monies earned by the state through investing the dollars it collected from the use of the ceded lands, but witheld in its past payments to OHA. That interest is "revenue" derived directly from asset use. Patient services fees paid to hospitals located on ceded lands also eonstitutes "revenue" from the use of the ceded lands. And finally, Duty Free Shoppers, the largest concession at the Honolulu Airport, from whieh the largest lease collection is obtained, ean-

not exist without the airport, a part of whieh is located on ceded land. The state chose not to include

these sums as revenue because it was not specifically mentioned in the definition of "revenue." However, in the absence of such language, one would naturally default to a definition founded in leeal terms.

Revenue is defined in Black's Law Dictionary as "Return or yield, as of land; profit, as that whieh returns or comes back from an investment ... As applied to the ineome of a government, a broad and general term, including all public moneys whieh the state collects and receives, from whatever source and in whatever manner ... public ineome of whatever kind." Put simply, it is my contention that any money earned from the use of the ceded lands, including interest due to investment policies, penalties from terminations of lease agreements, or services of public facilities who charge fees for services rendered, are

compensable to the Hawaiian people and payable to OHA. The Hawaiian should not be cheated out of his legal entitlement in an

enort to aiieviate tne state's inability to pay its appropriate eompensation. It is OHA's statutory and moral duty to defend this entitlement to the very last penny. The Hawaiian's needs are great and the assets limited. Let us not

diminish our ability to assist our people by lacking the fortitude to pursue the difficult. By being aggressive today, we ean show our resolve to be true to the cause of justice.

Item Amount collected OHA 20% lnterest ineome $ 34,684,802 $ 6,936,960 DOH-Patient Services $73,067,397 $14,613,475 DOT-Duty Free Revenues $205,287,389 $41,057,478 Lease Cancellation Penalty $ 775,000 $ 155,000 DOT-Airport Misc. Fees $ 159.108 $ 31 .822 Total Disputed Amount $313,973,678 $62,794,735

The Hawaiian should not be cheated out of his legal entitlement in an effort to alleviate the state's inability to pay its appropriate compensation.