Senate Standing Committee on Hawaiian Affairs

Good afternoon. It's 1:00pm on Tuesday, March 11, 2025. We have three hearings scheduled for today. This is the first of the three and it is a joint hearing between committees on Housing and Public Safety and Military Affairs. This meeting is being streamed live on YouTube.

In the unlikely event that we have to abruptly end this hearing due to technical difficulties; the Committees will recon - the Committee will reconvene to discuss any outstanding business at 1pm on Thursday, March 13, 2025, in this room 225 and a public notice will be posted on the Legislature's website. We will have a one-minute protesta time-limit.

If there are temporary technical glitches during your turn to testify via Zoom, we may have to move on to the next person due to time constraints. We appreciate your understanding and remind you that the Committee has written testimony. We have one bill on today's joint agenda with PSM.

It is HB 1096 relating to tenant selection, which repeals the tenant selection preferences for disabled veterans and the spouses of deceased veterans in the state low-income housing program. Our first testifier is HPHA in support. Thank you. Hawaii Civil Rights Commission in support. And Frank Schultz in opposition. Members, are there any questions? Chair Elefante.

Yeah. Question for Mr. Park.

Good afternoon, Chair; Ben Park, Hawaii Public Housing Authority. Yeah.

Thank you. Mr. Park, I know this is an Administration Bill. Can you describe why it's needed? This would repeal statute and is there funding available?

Because the concern I have is if we were to repeal it and give HPHA the flexibility, will you have funding and how sure will you guarantee what is covered in statute now will be done through admin rules?

Sure. Thank you. First of all, if you're talking about funding for the BASH program, I know there was a big article this morning in the paper that I don't know about and I don't have control over, but I think you'd be happy to know that currently in our admin rules we have the same exact preferences.

So even if it takes six to eight months to amend them, if we're going to change it to just homelessness or involuntarily displaced or victims of domestic violence, we could still keep it in there because it's going to take about a year before we change anything and they're already there.

Thank you. Thank you, Chair.

Thank you. I have some follow up questions. So how many veterans currently enter public housing annually due to the statute?

Not due to the statute. We do have veterans that do enter public housing, but they don't specifically cite this preference. I don't think I've seen, or I asked our IT guys to check that for the past five years, no one's claimed the preference of this veteran's preference for state public housing.

So, shouldn't it be incumbent on you then to try to inform eligible veterans that they could apply through this preference program?

Yes, you're absolutely right. But we also have the wait list closed right now, so the next time we open it, we'll be sure to incorporate some kind of publication.

If we're going to take away a preference for, you know, disabled veterans and spouses of deceased veterans, I feel like we need to meet some threshold of public interest. And, you know, I don't think you answered that fully when you responded to Chair Elefante's question.

I mean, can you, can you tell us in one bullet point why it is important to take away this program for veterans and their spouses?

To us, it's really just a housekeeping measure because we already have it in administrative rules. But I think what's important to note is when we do administrative rules, we're making sure that we take care of the local preference needs.

And right now, we have a program with the Federal Government called VASH. That gives them a Section 8 voucher along with services with the VA. So that's why we're asking for this housekeeping measure as an Admin Bill. But it is up to the Legislature.

Yeah. Let me ask a follow up. So, if you were to remove these provisions, you would still have to comply with federal law, is that correct? Federal guidelines.

So, this is a state public housing program. So, it's only with state statute. But the federal VASH program that I was talking about with the VA, that is a federal program, and you'd have to follow federal laws for that.

And then the last follow up I have is do you feel currently what we have in stat statute is too restrictive and that's why this bill is being proposed to repeal current statute, allow you flexibility to do it in rules.

I wouldn't say it's too restrictive, but you know, when it comes to local preferences, we'd like to have flexibility to amend them as needed.

And you feel also being that no one, you said five in the last five years has come forward to qualify under this, you think by switching it over to admin, by repealing this, that perhaps there could be applicants because there would be more flexibility per se.

I think we would have the flexibility and target those other populations, but at the same time we would still accept veterans even if they didn't choose this preference okay.

Thank you, Mr. Park. Thank you, Chair.

Sure. So. So how is this gonna, you know, I understand maybe you guys don't have the volume, but how is this gonna affect actual veterans and moving. Moving forward? Because you guys saying you guys need this to have a little bit flexibility. But what is the flexibility?

Right now, we're really hurting and not having enough programs for the veterans as it is to have the latitude to open up the application process to, I don't say alleviate, or even move from, from the veterans. But is that, is that one of the main reasons.

Not one of the reasons, but one of the reasons why you guys thinking that you guys want to. Because you just said what concerned me when you said the other population. The other population. What other population? Maybe I am not reading it right.

So, with our federal preferences that we're trying to align it to in the future, we could use that to go assist the homelessness, involuntarily displaced, or victims of domestic violence, all of which, they could be veterans as well.

But at the same time, for this specific statute, if we take it away, we already have it in our administrative rules. And lastly, that federal program that we're going and working with the VA right now. I think it's a much better program. It has a much deeper subsidy. It comes with veteran services and a caseworker.

So, and don't get me wrong, I think all of that is really good. But, you know, we get so much, so much. Millions and millions of dollars going into homelessness, and I'm not saying anything to do with you guys, but we don't see a difference.

I understand you want to do it for maybe other parts of the population, but you know, right now, homeless is a big pit hole in Hawaii. We're not working on anything and trying to create a better, safe haven for people on the street. We're just dumping good money to bad money.

So out of everything that you just said there, working with the homeless, unless it's going to be homeless veterans and try to getting them there, or domestic violence veterans try to get them there, right now there's a very small portion - all our lives, my life, maybe not yours, don't know what your age is.

Our veterans got the short end of the stick and only now we're getting one hand up, not a handout. And now we want to help out the other population, which is great. I understand that. But to me, it's complicated because a veteran was forgotten long time, you know, and to have this, I guess, latitude.

I don't know how that is going to be again, telling everybody, thank you for fighting for us, thank you for coming back wounded, damaged, pass up. But we're gonna, you know, how about the other population? That's my biggest concern. I'm sorry, taking too much time, Chair, but that's my biggest concern. Thank you, Chair.

Thank you, Senator.

Thank you.

Thank you. All right, any further questions? All right, if not, should we go straight to this?

So, you know, I, as I just stated earlier, if we're going to take away this preference program for veterans, who I think, as Senator Fevella eloquently mentioned, have been underserved for decades, I feel like we need to come to a pretty high standard of a burden of proof as to why these preferences are no longer needed.

And I just don't feel that the agency has met that standard. So, if you're amenable, Chair, my inclination is to defer this measure. All right, so for the Committee on Housing, we'll be deferring HB 1096.

And same recommendation for the Committee on Public Safety and Military Affairs is to defer.

Thank you very much. And that concludes the Joint Committee of the Committee on Housing and the Committee on Public Safety and Military Affairs.

Welcome back. We are now on the 1:05pm agenda of the Committee on Housing as well as the Committee on Hawaiian Affairs. And the first two bills are Hawaiian Housing.

Okay, thank you, Chair. First measure on the agenda is House Bill 576 House Draft 2. I'd like to remind people that we have a two-minute time limit for our testimony. First testifier, Dean Minakami in person. Dean, are you in room?

Good afternoon, Chair, Vice Chair. Dean Minakami with the Hawaii Housing Finance and Development Corporation. I like to stand with the testimony in support.

Okay, thank you. Next, we have Department of Hawaiian Home Lands. Katie.

On behalf of the Kali Watson, the Department of Hawaiian Home Lands will stands on its written testimony in support.

Okay, thank you. Is there anybody else in the room like to testify on this matter? Right. Seeing none. Questions from any of the senators.

This is the HHFDC?

576.

Yeah. I have a question.

Okay.

HHFDC. So how much monies right now are going to DHHL Developments?

I'm not sure off the top of my head, but they apply for low-income housing tax credit projects. So, they receive rental revolving fund loans, private activity bonds, and barter credits.

You don't know how much.

I can get that information for you.

Okay, so if we're going to remove the restrictions and I apologize for being late, I get stopped along the way, people want to talk to me. So, if we remove the restrictions, are we getting any monies back?

I mean, my understanding the reason for the HHFDC monies is because the Legislator has determined that we need some affordable housing monies and we have given Hawaiian homeland 600 million two years ago.

Well, really that year was almost a billion dollars because we also gave money for stadium Bowl-o-Drome and we also settled that wait list for over $300 million.

So, I'm concerned that if that the developers who go into HHFDC and we remove those restrictions, they see it as a loophole to get around the restrictions and we're only going to be benefiting, I hate to say it, the beneficiaries of Hawaiian Homelands and not what the Legislator wants the rest of the people.

I understand your concern, but DHHL, under developers must still pay back HHFDC any funds that were borrowed that they're required to. So, this exemption is only for basically for sale projects or DHHL. They have rent to own. Yeah. So, they have rent to own projects.

Where in a for sale project, when a buyer sells a unit within 10 years, they have to receive HHFDC's consent, and they also have to sell it to another qualified buyer that meets HHFDC's terms. So instead of -

If we remove the restrictions, they don't have to qualify to reach to resell it for HHSDC firms.

Then they have to meet DHHL's terms for resale of a unit within 10 years.

But then, so, then they can get around it and basically hike up the price because all of a sudden you don't have those restrictions anymore.

Well, DHHL could set their own restrictions on how they manage subsequent resale properties.

Why can't, I mean, I'm super concerned that we gave the HHL, like I said, almost $1.0 billion. Not necessarily HHL; 600 million, over 300 million to settle the funds, plus monies for the stadium Bowl-o-Drome. And we have these other monies for the rest of the people.

And now we're moving it over to Hawaiian Home Lands without the affordable housing restrictions. So, in essence, we've actually increased the grants to Hawaiian Home Lands and decreased affordable housing monies. Especially since you can't even tell me how much money we're gonna exempt from HHFDC.

Okay.

I mean that's, that's what this bill is saying, right? It's that we are going to remove monies from HHFDC, remove the restrictions for affordability and all those other restrictions and it becomes a loophole then.

This is only applicable for sale projects. So, for a project like Hal Moiliili, that's a rental project and it was not approved as a rent to own project. So that project would not be affected by this bill, just for clarification.

But all the other HHSDC monies are, and we have a huge affordable housing problem which is not limited to Hawaiian Home Lands, but the rest of the state. Okay, I have problems with this. Thank you.

Okay, thank you. Is there anybody else? Okay, hearing none. Any other questions from any of the senators? Okay, moving on to House Bill 606 House Draft 1 testifiers. First up is Hawaiian Homes. Okay, thank you. Moving on. Next person registered to testify, Phillip Shane Pale.

I won't take up too much of your time. Just- aloha Chairs, Aloha members. I just wanted to just say that, you know, the bill isn't why it's important to us and a lot of Hawaiians in the community. You know, we do have a diaspora problem that has been with us for at least 20 or so years.

This is something we've been watching the trends throughout the whole Pacific. And as you know, Hawaiians are now - there's more Hawaiians being outside of Hawaii.

I think the diaspora in terms of Hawaii's economy and looking at the two things that actually funded the economy, which is Hawaiian land with the militarization of Hawaii as well as Hawaiian identity with the tourist industry. I think I kind of liken it to back in the 90s.

I think there was this term that was called - a buzz term that was called where they didn't want people to leave Hawaii, the brain drain. So, I think if you can understand it in terms of a cultural drain and the culture is in relation to Hawaii's economy, is that important?

I think that what I do want to say is that Hawaiian culture collectively is owned by Hawaiians, the Hawaiian people, the La Hui. It is a collective right that Hawaiians do own the culture.

So, I think that in terms of what the state has gotten off of Hawaiian culture, the exploitation, the commodification of everything Hawaiian in order to lure tourists to Hawaii. Just something to consider is what I want to share with you folks a little bit about that.

The other thing is that in terms of the economy, I think that again the diaspora is just really something that hurts. I think every Hawaiian we think about it just how many Hawaiians are forced to leave. I think there's more native Hawaiians leaving than any other group in the state.

So, I think just some things to consider as you're reviewing this bill, and I do think that another looking at the 29,000 on the wait list that there is still need for more money. And that's basically what is what it amounts to as far as the proposal or the ask for 600 million more.

And any obligation that the state does have as a part of statehood is keeping the promise to Hawaiians. I think that is another important point I would hope you folks would consider. That's all I have to show. Thank you.

Okay, thank you. Moving on. We have Antona Ku on Zoom. IT?

Not present on Zoom, Chair.

Okay, thank you. I'll check with you before we wrap up testifying. Patty Kahanamoku-Teruya?

Aloha. My name is Patty Kahanamoku-Teruya, beneficiary of Hawaiian Homestead and a former Department of Hawaiian Homes Commissioner. Sir, from July 19th, 2019, to 2023 you all have my testimonies. I did email you this with attachments and I hope that you had the opportunity to read my testimony with the attachment is very important towards my testimony.

I'm here not supporting Senate Bill HB 606 CD1 keeping the Department for and I wanted to let the Senate Hawaiian Affairs Committee is because the Department - I'm going to summarize because I know I have certain times but are not accountable. And in 2022, I wanted to explain as a commissioner, we worked really diligently with institutional staff that was there for years.

We worked on a Strategic Plan 2022 and implemented under the Act 279 in 2022 and in accordance to Hawaii Revised Statute 9316. And we delivered that to Chair Kouchi and Senate and Senate President House Members, December 6th of 2022.

During that time there are, from 2022 to future, there are so many deviations towards the strategic plan and changes. And this is a red light that you all should take a look at; the deviations of projects that are deleted, projects that are inputted. And this is $600 million as Senator mentioned, and this is truly important. Where is our money going?

Have you had legislative have thick briefing of what projects are going on and what projects were deleted during this time? Please understand during this time of 2022, when some of us left the Commission, you have all new commissioners. They're not familiar with Act 279. You heard that in committee from the appointment of Mr. Kalepa, Commissioner Lasua.

So that is a really red flag to know this. It is so important that we are responsible and accountable for where our money is going and what kind of projects that are done and are completed. There are suggestions that I brought up around the state. Okay, so I just wanted to have you read that.

And Under Senator Ihara's March 16, 2023, he asked the Chairman during his appointment, "This is a trust, it's not a business. And how are you going to navigate our trust?" I also wanted to real quick is apologize to Senator Fevella that you are right. I did support his appointment to the commission appointment.

And now I just wanted to say that I don't because I'm very very concerned how the Department is running. Thank you.

Thank you for your testimony. Okay, moving on. Jermaine Myers. Aloha.

Aloha. Aloha Chairs and members. My name is Jermaine Myers. I'm a Nanakuli Hawaiian homestead lessee. And since 1988 I continue to be an applicant on the Big Island Agriculture wait list. As I stated in my written testimony, I strongly oppose HB 606. I oppose this bill from standing in two different identities.

Number one as an applicant on the waitlist and number two as a taxpayer. For over 40 years prior to Kali Watson becoming the Chair, DHHL was on track to assisting over 2,500 applicants on the wait list with $600 million.

Shockingly, after Chair Watson led a pig in 2023 to make changes to the strategic plan and budget. He decreased the amount of applicants served from over 2,500 down to 1,674 with encumbrance funds totaling 556 million as of fiscal year 24.1353 applicants will remain on the wait list due to his deviations from the original strategic plan and budget.

We all know that DHHL needs as much funds as possible, yet Chair Watson allows the use of our lands at below market value. Recently as December, January, RP's under Chair Watson are paying $1 to $3 per month per acre to occupy and live on thousands of acres of DHHL lands on Oahu.

There are more examples of these types of transactions and for these reasons I strongly oppose HB 606. Ke akua pu. God bless all of you.

Mahalo. Thank you, Jermaine. Moving on. Melinda Healani Sonada-Pale. Aloha.

Okay, Aloha. Chair Chang Richards, Vice Chair Hashimoto, Vice Chair Sam Buenaventura and honorable members of the committee. Kahului, Hawaii strongly supports HB 606 HD1, which extends the 279 special function and ensures continued funding for the Department of Hawaiian Homelands to fulfill its obligation to the indigenous peoples of Hawaii.

This bill is a critical step towards addressing Hawaii's housing crisis and fulfilling the promises of the Hawaiian Homes Commission Act and the Hawaii State Constitution. The ongoing housing crisis has forced thousands of Kanaka Maoli to leave their homeland. Due to the high cost of living and lack of affordable housing. The DHHL has been underfunded for decades.

It's over 100 years old and it's never been fully funded. And meanwhile, the Hawaiian diaspora continues to grow, cutting families from their aina for generations. There are currently 29,000 Hawaiians on the Hawaiian Homeless - DHHL wait list. The estimated cost to eliminate the wait list is over $6 billion, requiring sustained legislative action.

The average native Hawaiian household has 4.1 individuals, meaning that funding for the house for housing for 29,000 applicants on that list, you times that by four and what you're really serving is 118,900 people. And let me just inform you, Hawaiians don't just marry Hawaiians, okay? When you're housing a Hawaiian family, this is not a zero-sum game.

This is not either Hawaiians get it or someone else gets it. Hawaiians intermarry. So, it's not just about Hawaiians. It's about Hawaii in general. Hawaiians make up more than 40% of the houseless population here in Hawaii. We are overrepresented in that area.

And also, I want to just point out that the two people in opposition to this bill are two people that already got their leases. So, which is to me very dishonest like you. They already got their homes but they're against funding for building more homes for the people on the wait list.

50 people are added to the wait list every month. 50 applicants. That list will not go down. And what's good for Hawaiians is good for everyone in Hawaii.

Thank you. Next testifier we have Shelby Pikachu Billionaire, on Zoom.

Aloha everyone. Great to see everyone here. Good to see you all. So, I had trouble with the testimony. I sent you guys the wrong one. But you guys have great staff members. So, my bad about that. But they swapped it. I ran it through AI and the math points out to corruption.

Because we're from Waianae, we got the largest, you know, Waianae Homestead in the entire world. But we're not getting the representation because I don't see the money coming down to the people in Nanakuli Shopping Plaza. That's commercial loans, Kamakanaalii. That's triple net leases. They're paying commercial rent, and we should be getting a benefit back.

But I don't see anything. And you got two agents as chair. I'm agent too. Show me the financial statement. I learned from Robert Kiyosaki. Show me the balance sheet. I don't trust any of the corruption. How they're going to go through the Act 279; he already leaked how he spent the money.

Senator Buenaventura with Gene Ward last year we filmed it with Naysana inside the building. He spent the $600 million acquiring already 30 type projects all over the State of Hawaii. And it's going to develop in four phases. He's asking for like $4 billion. He's asking for more money. He's short.

They're going to launder the money to spend it on infrastructure, HECO, and the water. And Big Island knows the dirty truth because it's rough. But they should just be giving materials or giving the land. And we can build our own houses. I can go to Home Depot and buy a shack. It's like $2,000. We can start there.

But growing up on Big Island, you can just cut the tree down and make your own holly. You can build your own house. You don't need a permit. Be all natural. As long as it's your own land. I like all the way all natural. So, I support you guys.

But definitely check their balance sheets and their books because I don't trust them. I looked in the Kali Watson eyes and all I see is a snake. So, I don't trust them at all. Thank you very much. I know you guys will make decision all on your own. Mahalo nui loa.

Thank you. IT did Mr. Aku come on?

Still not present on Zoom chair.

Okay, thank you. That's all the registered testifiers I have in person. Anybody else would like to speak on this measure? Come up, Angela, please. You have two minutes.

Angela Melody Young testifying on behalf of CARES. So, I'm in support of this act because it will be extending the $600, not the - $600 million. So, I think what it's saying is extending the Act 279 funds, which had an appropriation of $600 million so that it can be spent wisely with more time.

So, this is not money coming from the Hawaiian Homes beneficiaries. This is money coming from the state.

There is a pot of money from the state, $600 million that they need more time, which this legislation will enact to help with acquiring more properties and to have more time working with developers for acquisition and to be able to build more effectively for the Hawaiian community.

So, with this legislation, it will help come up with a planning strategy to accommodate wait list beneficiaries for Hawaiian homes. And so, in alignment with the last legislation we went over with the transfer of lands exemption, why create exemptions for Hawaiian homes? Why extend this act? Right.

It's so that the inequity, the unjust economic need of the Hawaiian communities can be met. Right. To help them; them get what's owed to them. Because we're on Hawaiian land and we need to restore Hawaii. So, there are urgent needs.

And so, if people have attended the Act 279 workgroup, which I have, you all know what the work is being done in the group and what's being focused on for DHHL in the Hawaiian community and what the process is like.

They have to work with developers, they have to send RFPs, they have to work with the counties and plan for infrastructure. So, it's a process. So, I'm in support of it because, summarize, I hope my husband will be Hawaiian so I can have Hawaiian babies. So, I can live on Hawaii homelands.

Okay, is there anybody else who'd like to testify?

My name is Kuilan Souza Atua Leva. I'm also a lessee resident of Nanakuli Hawaiian Homestead. I'm here today to express my strong opposition to providing an additional 600 million in funding to the Department of Hawaii Home Lands. Before allocating more funding, we must demand greater accountability from the DHHL.

The Department should be required to provide a clear plan, while these funds will be used to directly benefit those on wait list, along with measurable goals and timelines. Additionally, there must be mechanisms in place to ensure that funds are not mismanaged or diverted away from their intended purpose. The Hawaiian community deserves better.

We deserve a Department that prioritizes the needs of its people and operates with integrity and efficiency. Until DHHL can prove that is capable of responsible managing its resources and addressing the concerns of those it serves, I cannot support providing additional funding. Mahalo for the opportunity to testify.

Anyone else.

Aloha Committee. My name is Maisona Eldeger and I'm a waitlister since 1985. And I just want to. I'm in a position of this bill and I just thank the people behind me that speaks on my behalf on every single DHHL meeting, every opportunity they can to protect people like me who they didn't realize they had a voice.

You know, I represent. I have 89 siblings and they're all on the wait list and we all still waiting. So I just pray that zero, that this. This situation with housing for the Hawaiians. Just give them their land, allow them. To build their own if it's such a problem with the money.

All we want is our property, our land. With that. Thank you for letting me share.

Thank you. Last call case seeing none. One check with it. Did Mr. Aku show up?

Still not present on Zoom Chair.

Okay, thank you. Now, Senators, open up for questions. DHHL. Senator DeCorte.

Yeah, Katie, thank you so much for being here. This bill has blanked out appropriations. How much is the department asking for?

The original bill suggested another 600 million. That was a number that actually came from, as I understand it, I apologize if I'm wrong, but I believe that bill was actually came from the community and introduced by the bill introducer as basically a number because we had been.

DHHL had been able to show that it could meet the first test, which was the initial $600 million. Now, if you're asking me how much do we actually need to insert into the bill that I cannot answer here.

You know, if we need to talk about a lower amount or a more quote, unquote realistic amount, especially with everything else going on in the budgeting season. I think the point remains though, that DHHL has proven that it can meet really, really amazing goals with the first 600 million.

And in order to keep up that momentum of what Chair Watson has been doing, if we, if there is the ability to give us more to continue the work that we started, we would appreciate that.

Okay, so since you brought up the first 600 million, how many Hawaiians were awarded leases from the first 600 million? Not projected. Not. Hopefully not visions or goals. How many Hawaiians were awarded leases with the first $600 million that was appropriate in 2022? You folks have had three years. How many Hawaiians were awarded leases?

If I'm not mistaken, the number that we provided in the annual report to the Legislature, which is attached to our testimony indicated that there were 185 wait list applicants who were awarded leases.

Yeah, well, thank you for bringing that up. Also. So in fiscal year 20, you're reporting. That was not filed, but it was submitted in your Testimony, states that $363 million, which was encumbered and expenditures equates to 185 projected applicants on the wait list.

Therefore, the year prior fiscal year 23, $193 million of encumbrances and expenditures equated to 1489 lessees. So according to your reports, you're saying that with a combination of $600 million, your projection is that 1600 Hawaiians will be awarded leases. So out of this is according to your report. Is this your report?

It is. And if I'm not mistaken, that is reflective of what we had done up to a certain point if and because you had asked me to not project.

So if we're actually projecting into this year 2025, and I apologize for not having the exact numbers, but we are about to offer lease awards in the Kapolei area, and that is going to be 700 leases. We are also going out to basically have a rolling schedule of leases.

And my understanding is that in 2025, calendar year 2025, we are going to be in the area of approximately. I might be getting it backwards, 500. And then in 2026, 3,000.

Okay, so which brings me back to my original questions. How many leases has the Department awarded with the first allocation of $600 million appropriated by the Legislature in 2022, how many actual leases were given to Hawaiians.

At this point? It would be what is reflected in our reports. It would be because we are these reports.

Yes. So 1600 leases were awarded, were physically awarded to Hawaiians to receive their leases. 1600. These are your reports? These are your reports? Yes, they are. So are you telling me that these reports which were filed. One was filed, one was not. But you submitted it for testimony.

So these are DHHL reports reporting that out of the $600 million, 1600 leases were awarded to Hawaiians?

Not. It would be.

Is it higher? Is it lower?

It would be a portion of the 600 million. Because we're still. We're still not. So it's not the full 600 million.

That's fine. But my question is, how many leases were awarded?

If I could ask, and I apologize for having to do this. If I could ask Kalani Fronda to clarify the question.

Sure. And please come with a number. How many leases were awarded to Hawaiians?

Hang on a second. Sir, please introduce yourself.

Aloha. My name is Kalani Fronda, Acting Administrator for the Land Development Division. Please note that the monies that were encumbered are used for infrastructure. We are now going through fit tests. Now we're in the process of actually issuing leases. As deputy had mentioned 2500 we will be going out this year across the Paina.

Every island is going to be issued leases. We have within our 5662 leases based on the 600 million that was appropriated. 5421 will go towards residential wait list. 28% of it would achieve and reduce the Hawaii wait list. County of Hawaii 31% will be redo, will cover Maui wait list. 11% for Oahu, 75% for Kauai.

And then we also have lots that we're developing in for agricultural wait lists and that's about 241 lots across the paella.

Okay, I just want to bring it back to my point that I'm trying to make because you folks are asking for another 600 million and I'm trying to hold on to some kind of proof that for the first allocation of $600 million you were actually able to produce real life leases to Hawaiians to get onto their homes.

So again, what you're planning on doing with the next allocation is not my Kuleana. What you have done is based off of what was the first allocation. Because according to this bill you are asking or the Department is stating that they are going to need $6 billion to clear the wait list.

You're talking about 6 billion tax paying dollars to clear the wait list. And if what you're telling me is out of the first allocation of the $600 million you were only able to award 1600 leases. The math is not mathing, this is.

Please know that we haven't spent all of the 600 million yet. And so that's why we are going through and we're working with the governor's office as well as budget. How much have you to get it released? We have, we spent 335 million.

Okay, okay. So my point being is that the Department, according to your reportings, these are your reports. Now the Department has not proven themselves to be fiscally responsible to do the job of Act 279 which is to create a multi prong approach of eliminating its wait list.

That is the whole purpose of the bill is to eliminate its wait list.

Now according to this bill you're asking taxpayers for $6 billion over the course of how many years to believe and trust that Department is going to clear the wait list and to Be honest, I'm getting flashbacks of the rail that originally started off at $3 billion and now we're here today at $12 billion.

So I don't know if the Department is just going off of the honor system, but I've been trying to ask these numbers. I asked the chair back in January at an info briefing. I still have not gotten these numbers. You guys are here today and you still don't have these numbers.

So you are asking us to just blindly trust the Department. Okay, we're going to get another $600 million and this is what we are planning on doing. I need proof on what you guys have already done.

And so the point that I am making is that the Department has not proven itself to be credible, reliable and responsible of taxpayer money to give Hawaiians their leases so that they can afford to stay here in Hawaii and live on the land. So that's the point that I wanted to make. Chair, thank you very much.

It doesn't sound like you guys have answers and I'm very disappointed to see that your chair is not here, considering this is the largest bill of the Department and I would assume the most important. And the fact that he is not here in person just goes to show that maybe he's not taking this seriously. Thank you, Chair.

Thank you, Senator Hashimoto. All right, so I guess I'm a little bit confused. So, so what is this? What is the 363 million?

So we had encumbered monis to do to be able to start on some of our development agreements. We have another 129.1 million that is in that lapse fixed category. And we are planning to encumber the remainder of it. As I had mentioned, part of the monies that we encumbered at the back.

All right, so you said that. Okay, why is the 363 so low? Because if you're saying it's 363 plus 129, that doesn't add up to 600.

So it's rough. It's roughly about 554 million that we spent on projects. And then we have programs that we've been using it for. Some of it is for revolving loan funds, some of it is for loans that will go to made for our beneficiaries. And that's about, roughly about 45 mil.

So if you total everything, it should be about 554 million specifically for projects that will develop lots as well as have developers doing the verticals. Okay.

And that's fine. I think the 45 sounds about right. So where are you with the 129? Because that, in theory is what we got to be focusing on right now because that is going to lapse at the end of this fiscal year. I think when I saw you in Wham in the info briefing, there was.

You said you had projects in mind. But where are we? Because the bottom line is we need to understand do we actually need to extend 279 or not? Because if it's, if you feel like you're going to encompass the 129, we can kill the bill today. Right. Because you're going to use the money.

And if we don't need, we don't need to give you any more money through the 279.

So I know that you had extended it to fiscal year 26.

That's right.

And we are looking to expend it. We have some monies that need to be spent in fiscal year 26. I believe roughly about 770. I think it was 79 million, 79 million that we were going to spend in 26. But for the remainder of it, we're getting.

Why is it in 26?

There are some technicalities that we needed to push out from a budget standpoint. But as far as everything else, because.

I know you guys are trying to play around with the money. You're trying to, you know, you're trying to take projects on Maui and move it around. And so I don't know if that's factoring into it.

No, it's not.

It is because that was your strategic plan that you presented to us that you are changing now. And I think that's what's bothering me as well. I've expressed this to the chair that he should not move that money because he's moving it into areas that it shouldn't be going into because it's harder projects.

So when you tell me that you can't figure out how to encumber the rest of 129, I get very concerned because you shouldn't be. If there's a strategic plan, we should be following the strategic plan and you should be able to encumber the 129 expeditiously.

So if you need more time, that's a little bit concerning on the 129. And we shouldn't even be talking about the next 600 million if you can't even figure out what to do with the remaining 129.

We, we just. There are some technicalities in regards to the special Fund.

Okay, well, you Better figure that out and get me a good explanation because I've been tracking this the whole time, so I know where you guys are at. So we have. And things aren't adding up.

We have all of our Maui projects that we were. We are going to complete. And so based upon what we've noted, we have about. Hold on real quick.

Okay, so I'm going to go back to. If you cannot figure out what to do with the 129, that is very concerning. There is no. We know exactly what we're going to do with it. Okay, so exactly what is it? Okay, you have 76 or 79 that you have to wait for for 26.

Where is the rest going then?

So the rest is going to go towards Kona and Laopua. It's going to go towards Leali and Maui.

We have projects getting those under contract, those who would.

So that the RFQ has been awarded already. We're just working on the release of funds with budget and Fund finance and then we will do that before the fiscal year is over.

Okay, so so you don't need this bill then?

We do need it. Why? Because we will finish approximately, based on the 600 million, we will be completing roughly about 50% of the projects that we identified with Act 279.

Okay.

Like fully completed.

So you're, you're. So you're talking about more than the 129 now, or are you talking about just the 129?

Just the 129.

Okay. So you.

So with the 129 and what we've encumbered already, majority of our projects in Maui is going to be completed. And then we have a number, another area of Oahu that we're working on, both in Kapolei as well as in East Oahu. And then we have quite a bit that's happening on West Hawaii.

Okay, so if you're talking about just the 129. So this is supposed to sunset June 30, 2026. Correct. So you have.

We're going to spend it before one more year. Yeah.

So why do you need this bill?

We need it because we're moving forward. Good question. So we have, we identified about.

So I'm just talking about if we give you no more money in the 129, why do you need this bill? Because you should have enough. You said you're going to incumbent FY26. It's going to Sunset June 30, 2026.

So we have other projects that we've been looking at both. In Lalamilo, we had an issue with the UXO, so we're looking at finishing that area. We're also looking at finishing Pihonua, which we've done some regional planning on.

Okay, wait, wait. So this is in addition to the 129?

No, this. Yes, it is. This is. These are projects that we've started back.

So why should we give you a blank check, though? If you want that, we should give you a direct appropriation so at least you can appropriate all those specifically so we know where the projects are going. So really. So you're talking about you want additional projects to give you a blank check to do whatever you want.

We have identified projects.

Yes or no, Is that what you want out of this bill?

It's not a blank check.

It is a blank check because we have no check. And every time we look at what you're trying to do, you change it on us. So it is a blank check. So in other words, if we just want to expend the 129, you're good. That's what I want to know.

We are good with, as I mentioned.

Talking about Act 279. If we give you the 129. Let it. Let it go. And you can expend the rest of the money through June 30, 2026 you should be good, right? You'll expend 129 without us having to extend and do anything. Correct. Okay. And then if you want any additional monies, that's a whole different conversation.

And I don't think that should be even the topic of this discussion in this bill, because we need to vet out what are those projects that you exactly want?

Because my fear is that you're going to continue going down this path of starting projects that aren't fully thought out and fully funded, and then we're going to be on the hook into the future, which is, you know, I think that's fine.

But I think what you need to prove to us is that you can get these projects done. The 24 plus projects that you already have on the books. We need to see people move in, get those completed, and show us that you can get these done. Because how can you do 24 projects at once? That is crazy.

We have quite a bit of developers. We have quite a bit of developers that are partnering with us across the PI, Iowa.

HHFDC can't even do 24 projects at once. So I want to make sure that you can at least get These milestones done. I'm your biggest supporter. I want you to succeed. But it has to make sense in my mind. Right. You have to deliver.

And we'll make sure that. And we'll make sure that you're also invited to our awards that are happening. And we have, as mentioned, we have orientation that's happening this Saturday in Cornell. We're looking at about 360 leases that we're going to be.

I understand you do good work. It's just I get worried that you have to make sure that you have a handle on all the projects moving forward. And then the way that you're moving forward, it's, it's a little scary because I think it's a certain point you got to have control over the project.

Yes.

Right. And so I think, I think, you know, Chair, I think after this line of questioning, I'm not sure we actually need this bill. I think they have. Their big Milestone is until June 30, 2026 to expend $129 million. And that's their milestone.

If they can do that, then we know that there's the next phase of money that we potentially should look at. But until you spend that 129, I'm very, very uncomfortable to even consider giving you more money. Anyway, thank you, Chair. Okay, thank you.

Other Senators, any questions?

Sure, go ahead. Senator, is this bill just for the extension of the first 600 million? Is this the extension to you guys use the funds?

My understanding is that this is kind of like a part two. So I think what was happening, and I could be misunderstanding it, but I thought it was there would be the 600 million, the 100, basically the balance was put into the special Fund that was created under Act125.

And so now this bill would give us an additional amount. And so that's why when the question was being asked about the original 600 million, when we're taught and we're being asked to just say what we've already done, there's a difference between the original 600 million.

That needs to account for the fact of the awards that are coming up in 25, because that's part of the initial 600 million.

My understanding of this bill is that we would, then there's there, it would encapsulate what we've done up to a point, and then there's additional money for additional projects that are outside of what the Department has presented, basically in the housing working group groups and in the House. Wan. Is that correct? Correct. Yes.

Just, just A follow up with everything being said. And I really, I, Senator from Maui. I understand the frustration of the community and and how the money keep diverting in the area. That was one of the reasons why I didn't support both of the DHHL's appointment.

And I told Kali this on the trust factor that we got to have in this building. We don't. And that's the reason why I went the way I went.

But what, what's so, so concerning for me is that we're having right now in this room that hurts my feelings and hurt my heart to see Hawaiians going against Hawaiians. I have Hawaiians and I have not Hawaiians. This was never a bill to have that division shouldn't have come to that should not have been here today.

That's not porno. Because regardless if somebody has and the other person have not doesn't mean it shouldn't happen or should happen. It should because the beneficiaries deserve it. Our people should not.

And you guys all know in the square building I never was for leases to just give them the land, let them build like our good friend Pikachu talk about because that's the point of way to do it. Let them build their own but still put parameters. Parameters still hit the hundred year. You cannot sell them.

You can't give them away or they still got to follow the rules. What Prince Kuhil wanted for us. But again what hurt me the most is just listening to the testimony.

And you guys know I can give it as just as much as I can take it today I was just disappointed because the only people that losing right now is the Hawaiians. Thank you, Chair.

Thank you. Senators, any other questions? Hearing None. Thank you. Thank you. Thank you. Okay, moving on. I'm going to turn the meeting over to Chair Chang for the third measure on this agenda.

All right. Our third and final measure today is HB 1408 HD1 relating to the Department of Hawaiian Homelands and allows DHHL to utilize the Dwelling Unit revolving Fund as collateral when the Department acts as an eligible borrower for a loan agreement under Section 184a of the Housing and Community Development act of 1992 is amended in appropriate response.

Our first testifier is HHFDC in support. Send my first thank you followed by DHHL with comments on behalf of the.

Department of Hawaiian Homelands.

Thank you. And then we have the Ohana Unity Party and Kingdom of Hawaiian Islands in support.

That's me. I'm here. Pikachu is back. So I sent you guys the wrong Testimony on this one. Again, I ran through the bill, I emailed you guys while I was talking to you on the last bill.

And so when I ran it through the AI, it actually says to give ironclad caution because they're worried about corruption with the DURF and all the other fancy terms they use. You definitely get it in your guys's email.

But like you guys all said with Senator, the courts and everyone's testimonial, I don't trust them from the beginning because if you don't audit them like I would summon DOGE Elon Musk to audit the list and DHHL because according to some of the people that keeping Patty Toria in the room, they, their parents are still on the waiting list and they went to heaven already.

So you got dead people on the list and DHL is still using those federal numbers because it goes up to like 29,000. Last year was 28,000. The number is getting bigger and we're not getting the results down. For 336 million you only took 185 people. That's terrible. I can build a 185 houses with 336 million.

That's pretty easy with container homes or doing some things. So to me it doesn't make sense and I definitely don't trust the numbers or their math and they're all moving around with their hands trying to answer your questions like they're all squirrely. So I trust your guys judgment.

You will do the right decision because I don't trust the DHHL. I trust they're supposed to have trust in the trust, but I don't trust them at all. So thank you. Mahalo.

Thank you. Is there anything anyone else wishing to testify on House Bill 1408? Okay, Members, are there any questions? Yes, Senator.

Dean, I don't understand this. Why does DHHL need the DIRF funds as collateral? Why can't they just use the lands that they already have as collateral like every other mortgagee?

Yeah, this is the requirement of the HUD program. So. Good question. They want to use the same financing structure as Halemuiliili where they are able to secure a lower interest rate to finance the project by using the HUD program. But the HUD program requires collateral for their loans.

So in the Halemuili case they use a rental housing revolving Fund loan as collateral. So they are trying. They would like to use DERF as basically a line of credit to use for these for collateral for future HUD loans for their projects.

So they're already using Rental housing, revolving funds, money as collateral.

So now you want to allow them to use their money as collateral?

Yes.

They were using the same funds that they were going to use for construction, but instead they used the HUD program and used the RHRF loans as collateral instead. So they already had an award for rhrf. They just change the financing structure to get the lower interest rate.

So the DIRF funds that you're gonna allow for collateral are funds that's gonna be awarded to Hawaiian homelands anyway or developers are gonna use for Hawaiian homelands.

My understanding is that the Legislature would appropriate funds into DIRF specifically for this purpose.

Have we already done that?

No, no, that's what this bill is for.

If we don't do that and this bill passes, then they're going to be able to use their funds that's there even though it's not allocated to them.

They would. They could apply similar to Halemuili, leave for rental housing, revolving Fund. That would probably be the better route to go rather than durf.

Okay, so shouldn't we wait until we allocate some monies first before we allow them to use it as collateral?

Well, I mean this. This was a DHHL Bill, so it's. It wasn't our request.

Okay. Because I think it's premature. So thank you.

So Dean, just to make clear then, so this, does this take away from other projects then if we do this?

That's what I'm concerned about.

To the extent that the funds could go to other uses, then yes, it would. Thank you.

Any further questions?

Sorry. So what this Senator just said earlier, taking away from other funds do probably can answer this question because maybe I gotta bring the DHHL. Is this gonna leverage anything for them to expedite putting more homesteaders on the land and getting on property?

Generally it provides a lower cost financing for DHHL. So it would allow them to use their funds to go further. They would have fewer financing costs.

Okay, thank you, Chair.

Further questions, Members. Okay, so that brings us to the end of the agenda. We'll take a recess before going into decision making.

Okay, thanks, everybody. We are back in session for decision making. But to that end, first of all, on House Bill 576, it's the recommendation of the chair that we are going to defer decision making until next Tuesday, 3/18 at 1:00 pm in room 224.

And for the Committee on Housing, we'll be deferring decision making until Tuesday, March 18th at 1:00pm in this room 225.

Okay, moving on to House Bill 606. Again, same decision or deferred decision making to next Tuesday, 3/18 at 1:00 pm in room 224.

And for the Committee on Housing, we'll be deferring decision making until Tuesday, March 18th at 1pm in this room 225. And for the Committee on Housing. And for the final bill, HB 1408. For the Committee on Housing, we'll be deferring decision making until Tuesday, March 18, 1:00 pm in this room 225.

And for Committee on Hawaiian affairs, same will be deferring decision making till next Tuesday, 3/18 at 1:00 pm in room 224. And just as a quick comment, appreciate the engagement of everybody here. The talk story is very important and you can see what we were talking about going forward. It stimulated a lot of conversation.

We as Senators appreciate the interaction with us. So thank you, Senator, thank you so much.

There being no further business on the Joint Committee on Housing and Hawaiian Affairs 105 agenda, it is now. Good afternoon and welcome to the 1:10 pm agenda of the Committee on Housing. The last of our three agendas for this time slot this afternoon. We really appreciate your patience.

Our first Bill today is HB 1093 relating to HPHA and it clarifies HPHA's authority relating to powers relating to housing projects. Our first and only testifier is HPHA and support. Thank you. Is there anyone else wishing to testify on HB 1093? Okay, any questions, Members?

Okay, we'll move forward to HB 432 relating to the Rental Housing Revolving Fund. It establishes the Mixed Income sub account within the Rental Housing Revolving Fund that targets workforce rental housing projects for persons and families with incomes at or below 140% of AMI.

It authorizes Director of Finance to transfer funds from RHRF into the Mixed Income Sub Account. It appropriates funds into and out of the Mixed Income sub account of the Rental Housing Involvement Fund. Our first testifier is HHFP and support. Thank you.

Our next testifier is Budget and Finance with comments followed by Office of Housing, City and County of Honolulu in support Hawaii YIMBY in support Hawaii Children's Action Network Speaks in support Hawaii Appleseed Center for Law and Economic justice in support.

Hawaii Community Appleseed.

Hello, Susan Le with Hawaii Appleseed Center for Law and Economic Justice. Just wanted to stand on our written testimony and just highlight a couple things from our testimony.

So just the fact that our current housing finance system has us subsidizing programs for low income households making below 60% am AMI whereas our market rate development is serving high income households at a luxury rate. So it leaves a massive gap to the 60 and 140% AMI.

This separate sub account is desperately needed to really address that gap in housing. Especially when you look at the current median income required for a median price home, which double the actual median income for a household here it really highlights the the disparity of our market rate housing and our local workforce.

So again, just in support of this bill and wanted to highlight those things. Thank you.

Thank you very much. Hawaii Community foundation and support. Good afternoon Chair.

Thank you.

Hollomua Collaborative in support.

Chair Vice Chair Joshua Collaborative Will scatter.

Thank you. Title Guarantee Hawaii in support. Save Medicaid Hawaii in support. Maui Chamber of Commerce in support. Will Caron and Thomas Brandon support. Is there anyone else wishing to testify in House Bill 432? Okay. If not Members, do we have any questions? Okay, I just. Chairs a question for HHFTC. Yes, Chair.

So the Chair is inclined to prioritize units priced at the minimum level to be revenue neutral. Do you believe the definition of revenue neutral should be in the rules or in this statute?

It would prefer to have it in administrative rules.

Okay, so if we gave you that authority through this bill, then you'd be able to. Yes. Thank you. Any further questions? We'll move on to our next bill. HB529 relating to state finances authorizes HHFTC to secure revenue bonds as a line of credit or other instrument of indebtedness for the bond volume cap recycling program.

Our only testifier is HHFTC in support. Thank you. Anyone else wishing to testify on HB 529? If not, our next bill is HB 1411 relating to housing preference allows HHFTC to allow projects to grant preferences in the sale of or lease of housing units to applicants who live or work within 5 miles of the project.

Our only testifier is HHFTC in support. Is there anyone else wishing to testify on HB 1411? Any questions, Members? Our next bill is HB 740 relating to housing.

It establishes the Accessory Dwelling Unit Financing and Deed Restriction Program to allocate funds to the counties to provide grants to eligible homeowners or buyers to finance construction costs, development costs and non reoccurring closing costs associated with construction of an accessory dwelling unit and purchase deed restrictions on such property.

Our first testifier is HHFDC in support followed by Office of Hawaiian Affairs and Support Department of Taxation with comments Maui County Council and Support Office of Housing City and County of Honolulu and support County of Hawaii Office of Housing and Community Development and Support Appleseed Center for Law and Economic justice and Support.

Hello. Hi there. Susan Le again with Hawaii Appleseed. Just wanted to stand on our written testimony in support and again highlight a couple things from our testimony. Again, this program is especially needed because it's dedicating a housing supply for our local workers and it protects these houses from our current housing market with the rising property values.

And just again to highlight, only 20% of residents here can afford to purchase a median home. And again, the median income required to afford such home is double the median income.

Again, a lot of this is protecting our current housing stock and the development of ADUs where people who buy from outside Hawaii have tend to have higher incomes and bid higher prices and drive up competition. Where we've seen 46.6% higher than purchases that are higher than the average local purchase.

So that's just driving the increase in our housing market.

Our next testifier, Hawaii Yimby in support Housing Hawaii's Future in support thank you. Hawaii Children's Action Network Speaks in support.

Thank you Maui Chamber of Commerce and support. Catholic Charities Hawaii in support. Council for Native Hawaiian Advancement and Support. SAVE Medicaid Hawaii in support. Hawaii Community foundation in support. Chamber of Commerce of Hawaii in support. Hawaii Realtors with comments. Palumu Collaborative with comments.

Thank you Chair. Chair, Vice Chair, Committee Members. Josh Wish, with Hula Moon Collaborative I'll be brief. We included this as part of our 2025 policy agenda because like next bill the Combina Homes program, we think deed restrictions like this can be a good part of the solution.

We recognize though that at this point in session, it's entirely possible you'd only advance one of the bills. And so that's why we submitted comments on this noting that if you choose one vehicle to advance, we think that the next bill on the agenda, 739 would actually be the one we would recommend.

It still allows for construction of ADUs. In fact, with amendments we submitted, we'd even prioritize them with that I will stand on my comments for 740 and I'll say more on 739. Thank you very much. Chair. Thank you. Tax foundation of Hawaii with comments.

Thank you, Chair. Vice Chairman of the Committee, Tom Yamachika for Tax Foundation. We'll stand our written comments and be available for questions.

Thank you. And several individuals. Glenn Kagamida, Ellen Godby, Carson, Will Caron, Thomas Brandt, Leigh Fisher, Mai hall, all in support. Is there anyone else wishing to testify on HB740?

We'd just like to offer the comment that if you pass this bill, you're giving a lot of money away. Oh, sorry, my name is Makana with Limby Hawaii.

We're just offering comments that, that if you pass this bill as written, you're giving away an awful lot of funds and just basically crossing your fingers and hoping that you get affordability in return. So we'd recommend language that either moderates the rents or sets some sort of income limits on the renters or some such.

Thank you very much.

Thank you. Is there anyone else wishing to testify on HB740? Okay. If not, do we have any questions, Members? If not, we'll move next to HB739 relating to housing. Establishes the Kamaina Homes Program to provide funding to the counties to purchase voluntary deed restrictions from eligible homeowners or home buyers. First testifier.

And I'll just be reading the, those who have signed up to testify either in person or on zoom to save time. HHFDC in support. State Council on Developmental Disabilities in support. Department of Taxation with comments. AARP Hawaii in support. Appleseed Center for Law and Economic Justice in support.

Hi, Susan Le again with Hawaii Appleseed. Just wanted to say we support this Bill and stand on our written testimony with everything I had mentioned for the previous Bill on HB740.

We believe HB739 is again another solution for housing, especially considering that this Bill really preserves our current housing stock and that's incredibly important for areas especially that have restricted infrastructure expansion. So the need to protect our current stock is important.

And as well, like what Josh Wisch from Holomua Collective said, this Bill also prioritizes ADU construction and that is especially needed because it provides a versatile, versatile housing options for our families, including smaller, affordable starter homes, nearby residences for kupuna and independent spaces for family that are struggling with overcrowding. Thank you.

Hawaii Community Foundation in support.

Thank you, Chair, Vice Chair, Members. Matt Elliott again from Hawaii Community Foundation. We're in support of this Bill and Just wanted to explain briefly why we think this has so much value. This is our preferred Bill on the deed restriction concept. We've been working on the House Maui Initiative for a while now.

And our thought process here is that if we can do the things that House Maui Initiative is focused on, which is bring homes to market at a lower price because we prioritized infrastructure and work to focus on some deregulations that will drive down those costs and, and at the same time, we can educate and empower families to be ready to enter the housing market and make these purchases.

Then what we have to do is make sure that it's a level playing field and give local families the best possible chance to be able to get into these homes. And we believe a deed restriction program can do that by increasing the inventory in perpetuity. That's what's really important about this Bill.

In perpetuity, those new homes come to market and they have a chance to land in local families homes because they have a better chance to use that money for down payment or in some other way to keep that cost at a point where we're not getting outside investors or second homes, people buying these second homes.

So that's why we support this Bill and we're happy to answer questions. Thank you.

Hawaii Children's Action Network speaks in support. Alumua Collaborative in support. Oh, sorry, go ahead.

Aloha, Chair, Vice Chair, Members of the Committee. I'm Chevelle Davis with Hawaii Children's Action Network and I just want to share that Native Hawaiians and Pacific Islanders are overrepresented in the houseless population, including our Keiki.

And you know, for kids to thrive and be healthy and to be able to learn, they need to have adequate, stable and secure housing. Also to previous comments from the previous hearings with the Joint Hearing. You know, there are a lot of Kanaka here that don't meet the blood quantum, myself included, my family included.

I'm the oldest of six children. We all don't meet one quantum, so we're not, we can't get housing. Two of my siblings have left because they don't see a way forward on how to, how they can possibly afford to raise a family here.

And so, you know, it's just, it's really difficult when more and more of our families are moving away and our families are separated because of the lack of affordable housing. So I just really want to express my support for this Bill. Mahalo.

Thank you. Holomua Collaborative in support.

Hello again Chair, Vice Chair, Committee Members. Josh Wisch with Holomua Collaborative, just note briefly why this is our preferred mechanism at this point. They're both deed restriction bills, but we are recommending that you would move this one for a few reasons. One, it's a constitutional way to protect housing for local families.

It would help stabilize the local housing group as we are trying to also build more housing. I'd also note that it's also not just the government granting money giving away money.

Rather, the government is actually buying a contractual asset in the form of a deed restriction that has value, appreciates over time and can be sold in the future if needed.

And it's an efficient use of government funds because the money compounds over time the longer the homes are in the program, whether that's for building an ADU, cesspool conversion or something else. I'll just briefly note we do have a few recommended amendments in the Bill to provide some guidelines.

One is for the counties to not provide more than 5% of the assessed value of the home unless you're using it to build an ADU, in which case you get 8%, which prioritizes the ADUs, which would also be subject to the deed restriction.

And we'd also further recommend that if the county sells the deed restriction, the money would come back to the state unless it recirculates it within about 12 months. Thanks very much. I'm here for any questions.

Housing Hawaii's Future in support. Thank you, Hawaii State Association of Counties in support. Limby Hawaii with comments.

Hello everyone, My name is Makana speaking on behalf of Limby Hawaii. We support the principle of deed jurisdictions and the purchase of such on existing property as a means to secure affordable housing in perpetuity. However, we believe this Bill has substantial defects in achieving its stated aim.

So this Bill preamble states that it takes as example from Vail Indeed and that the Vail InDEED program has, I quote, "Since 2018, resulted in the establishment of over 1,000 deed restricted residences for local working residents." End quote. This is false and we think emblematic of the level of research and thought that went into crafting this Bill.

While Vail does have over 1,000 deed restricted units, only 165 of those are from the Vail InDEED program. The vast majority, 700 of those units, are brought in via inclusionary zoning and public housing projects between 2000 and 2017 and have far more stringent requirements than this Bill outlines.

Fundamentally, this Bill fails what we call the does what it says on the 10 test. This claims to be about supporting Kamaaina with affordable housing, but marrying in Vail's InDEED program is not a great way to get there.

So nearly half of title property owners no longer in the Vail Indeed program no longer live in Vail or own multiple residents in Vail. Only 30% of Vail indeed units are owner occupied.

And in surveyed rental units, prices were as much as 50% higher than the common median for one bedroom, 38% higher for two bedrooms, and 55% higher for three bedrooms. In light of these facts, we believe the Bill should be retitled to Bailing out Local Owners Airbnb or local Airbnb owners.

Now that you are, your units are a legal act. Senator Chang, I know you are tired of Hawaii spending millions on affordable housing and getting little in return for our LIHT and RF programs.

This okay, sorry, Tax foundation of Hawaii with comments.

Thank you, Chair, Vice Chair, Members of the Committee, Tom Yamachika from Tax Foundation. We'll stand on our written testimony. Thank you.

Hawaii Realtors with comments. Sam Dorios in support. And that's it among the testifiers who have signed up to testify either in person or on Zoom.

Yep.

Oh, we do have you.

Yeah, we do have. Yeah, sorry I'm not able to be there in person and sorry, I forgot my Pikachu sunglasses. I'm very much in support of this Bill as laid out in my testimony, which I stand by. I just wanted to reiterate and highlight how broadly this affects folks in Hawaii. I mean, housing.

So for my work, I do some called systems mapping where I help professionals map issues so that they can focus their efforts to help change the system for better. So I've done things like education, maps on education, Alice population, health, you name it.

I've been doing this for nine years in Hawaii and I've made so many maps and housing's always in there. Even if it's something like education, housing finds a way to be in there. It has such a huge impact on people's lives. People are stressed out about it, the cost of housing.

You know, you talk about affordable housing, but it's impossible. It's impossible to afford. And we're not just talking about for Alice or, you know, we're also talking about professionals who have good paying jobs, are struggling to stay here and it's a big brain drain and something needs to be done about it. I hope that you do this.

This Bill is doing something at least. It might not be enough. It's doing something. And I also wanted to say that I also support the amendment that Josh put forth.

Thank you. Do we have any other testifiers for HB 739? If not, Members do you have any questions on HB 739.

If not, we'll move to our last bill on the agenda, which is HB 367 relating to building permits, which allows for county permit exemptions for certain kinds of activities, including maintenance activities, installing group use structures and interior remodeling work when located outside a special management area.

Our first testifier is County of Hawaii, Department of Public Works in support, followed by city and county of Honolulu, Department of Planning and Permitting in opposition. Hawaii Farm Bureau in support. Grassroots Institute of Hawaii in support. Jennifer M. Kamiko in support. And Gregory Misakian in opposition. Is there anyone else wishing to testify on HB 367? If not.

Members, any questions on HB 367? Okay. If not, that brings us to the end of our agenda. Members, do you want to recess or should we go straight into DM? All right, we'll go straight into DM then.

So for House Bill 1093 relating to HPHA, the chair's recommendation will be to pass this measure with amendments and the amendments will be to further defect the date. Members, any questions or discussion? Okay, so for HB 1093, chair's recommendation is to pass with amendments and chair votes I.

Okay.

Recommendation that chair for HB 1093 is to pass with amendments. Chair votes I. Vice Chair votes I. Senator Aquino is excused. Senator Kanuha, Senator Fevella is excused. Chair, your recommendation is adopted.

Thank you. Our next Bill is HB 432 relating to the rental housing revolving fund. Chair's recommendation will be to pass this measure with amendments. We'll further defect the date. We'll also adopt language from SB 35 to give the corporation the authority to transfer funds into and out of the sub account without legislative approval.

Also to allow for sale housing, not just rental housing, to replace criterion three on page six, line 14 to 16, to give priority to projects requiring the least state funding per unit and the shortest loan term.

We want to allow funds to be used for any type of housing financing, including, but not limited to, loans, equity investments and credit enhancement. Integrate perpetual affordability language from paragraph 2. emergency has been reported in this building.

All right, we're going to go into recess.

All right. Welcome back from our recess. I don't remember exactly where we were. I think we were. Right. Oh, we'll need to go back into recess. Thank you for your patience. We're back from our recess.

I'll continue reading the recommendation for HB 432 so we would allow the funds to be used for any type of housing financing, including but not limited to loans, equity investments and credit enhancement. We would integrate perpetual affordability language from paragraph 2 on page 5 directly into the tier 2 description.

Tier 1 description, section 1 on pages 4 to 5. Remove the 140% AMI income restrictions that require that all housing be exclusively for quality qualified residents as defined by HRS 201H-38. Remove the preference for nonprofit projects over government projects, but prioritize both nonprofit and government projects over for profit projects.

Prioritize units to be priced at the minimum level necessary to be revenue neutral as defined by rules. Delete that are listed in descending order of priority on page 6, lines 8 to 9. Insert on page 7, line 19.

The corporation may adopt rules to prioritize renters or buyers who meet income requirements, Members of the workforce, government employees or other populations as the corporation may deem in the public interest, provided that the units may be offered to all qualified residents as defined in HRS 201H-32 if insufficient renters or buyers from prioritized groups are found after a marketing period to be determined by the corporation. HRS 21H-32, not 38.

Make conforming amendments to the rest of HRS 21H and to insert a blank appropriation for the Mayor Wright redevelopment from the Rental Housing Revolving Fund.

In addition to the committee report, we'll note the funding request of $75 million per year of the biennium for this mixed income sub account and also the funding request of $56 million for the Mayor Wright redevelopment. Members, do we have any questions or discussion?

Out of Tier 1 rate? Mayor Wright.

Out of the Tier 1 rental housing revolving funds. Okay, if there's no further questions or discussion, the chair's recommendation for HB 432 HD1 is to pass with amendments. Chair votes I.

Members, HB 432 HD1. Chair's recommendation is to pass with amendments. Noting the presence of all members with the excusal of Senator Aquino and Fevella for this measure and all others. Anybody? Any members voting with reservations? Any members voting no? Without others voting I, recommendation is adopted.

Thank you very much. Our next bill is HB 529 relating to state finances. Chair's recommendation will be to pass this measure with amendments to further defect the date. Any questions or discussion? Again, for HB 529 chair's recommendation is to pass with amendments. Chair votes I.

Members, HB 529. Chair's recommendation is to pass with amendments. Any members voting with reservations? Any members voting no? Without others voting I, recommendation is adopted.

Thank you. HB 1411 relating to housing preference. Chair's recommendation will be to pass with amendments to further defect the date. Any discussion or questions? Okay, so if not HB 1411. Chair's recommendation is to pass with amendments. Chair votes I.

Members, HB 1411. Chair's recommendation is to pass with amendments. Any members voting with reservations? Any members voting no? Without others voting I, recommendation is adopted.

Thank you. Our next bill is HB 740, relating to housing. So before I get into the recommendation here, I want to first acknowledge the efforts of the proponents of both this measure and the next one, HB 739, in stimulating a vigorous dialogue about the nature of ADU financing programs in the state.

As with the pair of bills that we considered before crossover of the senate bills, the chair is inclined to move forward a bill that focuses only on the construction of new ADUs rather than existing ADUs. The chair also wants to note that this is a real work in progress.

We'll have extensive amendments to this bill and I want to highlight that we need to shift away from a model where the state gives away money and never gets it back. The state needs to act as an investor that realizes a gain an appreciation on the investment of its funds, which are, after all, taxpayer funds.

And so the amendments to this bill are really going to focus on making this bill a good deal for the taxpayers as well. So for HB 740 again, the chair's recommendation will be to pass this measure with amendments. We'll take Department of Taxation's amendment for Section 6 to take effect on January 1, 2026.

The City and County of Honolulu's recommendation to extend immunity provisions to county officers, employees, and agents, ensuring that they receive the same statutory protections as their state counterparts when administering the program. We'll also change the funding source from DIRF to the Rental Housing Revolving Fund.

Will change the program from a grant to a purchase of equity by the state within 15 years or upon 15. However, within 15 years or upon subsequent sale or transfer of the property, whichever is sooner, HHFTC must be repaid for the prorated share of the appraised value of the completed ADU including appreciation. We'll amend 201H-CB on page 8, line 15 to 16 to shall require that each dwelling unit on the property be occupied exclusively by owner, occupants, or tenants who so that all dwelling units, both including in the main house and any and all ADUs or other units are occupied by occupants meeting the requirements of this program.

We'll cap the funding at $2 million per year, cap the amount of funding per ADU at 8% of the appraised value of the property, allow a reasonable percentage of the awarded funds to be used for administrative costs, prioritize government employees, require that property owners own no other real property, sunset the program after five years and require a report and evaluation to the legislature, and further defect the date.

In addition, the committee report will note that counties already have the authority to implement this program, that Maui County already has implemented a similar grant program and the legislature should study that program before committing state funds to such a program.

We'll note the City and County of Honolulu Office of Housing's concerns regarding capacity challenges, lack of positions and staff, potential impacts to real property tax revenues, eligibility criteria, implementation timelines, enforceability and potential liability associated with a bill in its current form.

And finally, we'll note that a loan rather than a grant program or a loan or an investment rather than a grant program would allow the state to recover its investment, enabling it to finance other ADUs in the future.

For example, the DIRF Equity Program enables the state state to share in the capital gain of units receiving state capital. Alternatively, other ways for the state to unlock the value of its investment and enable it to be used for future housing construction should be explored. Members, do we have any discussion or questions?

Okay, if not for HB740, the chair's recommendation will be passed with amendments. Chair votes I.

Members, HB 740. Chair's recommendation is passed with amendments. Chair votes I. Any members voting with reservations? Any members voting no? Without anyone else voting I, recommendation is adopted.

Thank you. For our next bill, HB 739, as I already mentioned, I want to move forward as HB 740 is the vehicle, so we'll be deferring HB 739. And then finally our final bill today is HB 367.

The chair's recommendation will be to pass this measure with amendments to further defect the date to adopt the County of Hawaii Department of Public Works amendment to propose the following revision to paragraph A3, interior remodeling that does not affect building square footage or the number of rooms or bathrooms and does not modify the location of rooms, walls or windows and does not change the use, as well as Honolulu DPP's amendment on page two, line 16 to require submission of plans to the county agency, not just the notice about the type of proposed work.

Members, any discussion or questions? Okay. Seeing none, HB 367. Chair's recommendation is to pass with amendments. Chair votes I.

Members, HB 367. Chair's recommendation is to pass with amendments. Any members voting with reservations? Any members voting no? Without others voting I, recommendation is adopted.

Thank you. There being no further business, this hearing is adjourned.