 and welcome back to another talk story with John Wahey. And I'd like to use this phrase as usual, but this is, as usual, we have a great guest with us tonight, but today it is especially, especially favorable. I mean, I don't know how else to put it. We have with us the chair of the finance committee of the House of Representatives, Representative Soviet Luke. And I begin by telling everybody that for years, she was my representative in the state legislature. I can still remember when she came by and solicited our votes. And we, every year that I lived in Nguyenu, we voted, every election we voted for her. And so I am so proud that I finally get to, talk to her about a major issue in the state of Hawaii, and which is really the proposal officially from the House of Representatives. But insiders have told me that it really belongs to the chair of the finance committee. That is the proposal to fund the Department of Hawaiian Homeland, and the number that was mentioned was $600 million, which is mind-blowing and exciting. So I want to welcome chair, chair Luke with us this afternoon. And before we get into the details, tell us a little bit about yourself. Like, you know, a little bit about your district, a little bit about what you do, and so that people who don't have the privilege of having you as their representative, get to know a little bit about you. Aloha, governor, thank you for inviting me. I always enjoy speaking to the governor. He's been my mentor, and I was really sad when he moved out of our district only because I would come by unannounced sometimes, and knock on his door, and we talk story, and I really enjoy this relationship. But Aloha to everyone, I'm Sylvia Luke, and I've been a state representative since 1998, and I first got elected in 1998 when I was just 30 years old, and I think you had just finished your term as governor. And you're still very young, you know, right? All these years, fantastic. And for that... How long have you been a finance chair? Yeah, so for the last 10 years, I've been the chair of the finance committee, and as you know, as finance committee, and you've been in the legislature too, finance committee allows me to see basically all parts of government and the struggles that state government endures, and just in the last two years, it was really hard, right? Every part of government service was challenged between UI office and Medicaid, and especially the schools, but I think coming out of the last two years and gaining this economic recovery has taught us so much, and we have an opportunity to build from what we learn and we also have a new opportunity because of the... Because of kind of the unforeseen revenue pictures that we're seeing this year. Yeah, you know, chair, just a little bit about that, because I don't know if the average person quite gets how important the statements you just made are, and that is that doing this two year period, doing this pandemic, the revenues or projections, revenue projections just went way down as well as actual collections. So as a result of that, the state had to prioritize a lot of programs and efforts, I'm assuming. That's absolutely correct. And it's a huge change because just two years ago, governor, we were looking at a basically a $3 billion deficit and when we're dealing with just a general funds portion our budget is about $7 billion, $7 to $8 billion. For the entire state budget, it's about $16 billion. So can you imagine a $3 billion impact on our budget? And just last year, social service programs including sex assault services, HIV services, other major homeless and elderly services were on the chopping block because of the revenue picture. And then we come back in session and it is 180 degrees and it is mind blowing the type of revenue picture that we're faced with now. Yeah, you know, I think when you say $3 billion, people don't realize that's more, that's almost, what's like 40% of the budget, 40% of the general fund budget had to be cut, you know? And I know every governor at one point in their tenure has always bemoaned the fact that they don't have a lot of money coming in. It's always like this shortfall, but when they're talking about it, it usually has to do with expectations not being funded. You guys went through a period of two years where real money had to be cut. And it wasn't expect. Now all of a sudden things have turned around. Correct. And I think part of it is because we have been responsible the last two years and we are not even the last two years in my tenure as finance chair, thanks to the help of my colleagues, we didn't just add to programs and increase government spending and we were responsible. So when we came to a position where we had to deal with the COVID and budget cuts, the losses weren't as significant. And of course we had a lot of help from the federal government which really eased the transition. Well, that's fantastic. So let's get to your exciting idea. I mean, you know, here we are and you're facing going through these historic times. And you know, all of a sudden there's a proposal coming from the House of Representatives to solve some of the major problems associated with the department of Hawaii Homeland, which as you know has been a continuous concern really since statehood. And some legislators have paid more attention to solving that concern than others. But you guys just went front and center and said, we're gonna really do something about it. So tell us what you have in mind. I mean, it's exciting. It is historic and it is very exciting. And with the increased amount of revenues we didn't foresee, we believe that this is a year where we laid the groundwork to fulfill long standing obligation that we have not been able to fulfill because of lack of funds. Every year we talk about if we had money then we should do this. And one of them has been about fulfilling our obligation to put native Hawaiians on land. And that is the mission of DHHL. This year- So what is the problem? I mean, what's the, you know, there's some statistics or something. How large is this problem? So as you know, currently there are about 28,000 people on the wait list, the waiting to have either a place they call home or to be placed an egg lot or to be placed a pastoral lot. Most of the individuals on the wait list, they want to live in a home. Out of the 28,000 when we looked at it closer about half of the population on that list already have a home or own a home outside the DHHL inventory. So one of the things that we took a look at and there might be criticism about this approach but I think what we need to do is at least put our priority and concentrate on those individuals who don't own a home because that's the individual that who could never qualify when the DHHL lots were available, they might not have financial resources or they're dependent on family members and that's the population we want to concentrate. Incidentally, the other thing that was very interesting is that when you look at the wage analysis, about half the percent, 50% of the population on the wait list is about 100% AMI or less. That means it's a family of four making $100,000 or less. That is really the population that we want to assist. And so unlike in the past where the DHHL and the state continue to build out homes that people on the wait list simply cannot afford because as you know, the median home price in Hawaii is just skyrocketing and people are not gonna be able to afford $600,000 or $700,000 home. So this is really not just about investing a large amount. This is changing the mindset of what state government can do to put native Hawaiians and provide them with a home. Yeah, this is the beneficiaries. You know, I heard someplace recently that for a family of four, if you don't have an income of at least $85,000 a year, you're sort of in the poverty range. Is that about? You're absolutely true, right? And you know, yeah, that's a travesty. So one of the things we would like to do is the difficulty that DHHL has is out of the 200,000 acres that they own, about 60,000 or close to 60,000 of that 200,000 acres is preservation and special district. So it's not fair that the federal government gave DHHL all this land that they will never be able to develop. So it's almost very unfair, right? So one of the things that we are looking at is trading those undevelopable land and take it out of the possession of DHHL and not give them that additional duty to manage undevelopable special district or conservation district because it's not right and provide them lands that they can develop, lands that they already have infrastructure. We spent so much money trying to put infrastructure just on junk land. Instead, we need to give them lands that they can develop. So we are looking at an inventory of perhaps state lands that we can trade or different lands that we can buy for use by DHHL. So that will significantly cut down the cost. The other thing is we are looking at mortgage assistance or down payment assistance, which is a different approach as opposed to what has been done in the past. We are going to come right back. We're going to take a short break right now about a minute break. I did want to ask, I think it's fantastic your idea about making getting better lands, especially to Department of Hawaiian Homes. I mean, it just makes good sense that really those are the kind of lands that government needs to be protecting and treating as part of the land trust, it seems to be, but we'll be right back in a minute to hear more about the process and some of the details where we go from here. All right, so we will be right back with chair, Sylvia Luke. Two major crises have descended upon humanity. Climate change and the coronavirus, they may seem independent of each other. In fact, they are very closely linked. The emergence of COVID-19 on top of climate change is a spiraling crisis and it's just the beginning. Aloha, my name is Mark Shlove. I am the host of Think Tech Hawaii's law across the sea program. My program comes on every other Monday, one o'clock, and we talk about a lot of different subjects, all of them law-related in some way, either life or practice. And I try to have a diversity of guests that can talk about different topics of interest. So please join us, Think Tech Hawaii, law across the sea program every other Monday, one o'clock in the afternoon, aloha. Welcome back to Talk Story with John Laihei and our very special guest, the chair of the House of Representatives so that we get very clear finance committee, representatives Sylvia Luke. And we were just talking about this extremely exciting proposal to allocate a... I thought I'd heard some of the number was $600 million to resolving some of the long-standing programs at the Department of Hawaiian Homeland. You know, representative, if you were just talking about the need to maybe exchange lands with the department and the like, seems to me that the types of lands that are not desirable for housing are also the kinds of lands that we as a state are to not be developing anyway. I mean, these are watershed areas. These are special locations. You mentioned monarchy, for example. I mean, I'm sure if you think that people don't have a problem with a telescope on monarchy, they would be extremely upset if you try to put a condominium up there or something like that, even if it was for a while. So what plans, I mean, how do you go about doing this? It's making the program more effective and the state more protective of its natural resources. Yeah, absolutely. And out of the 200,000 acres that the HHL own, it will be shocking how much land is actually developable for housing. And they have told me out of 200,000, only 9,500 acres are suitable for homes, which is just crazy. So if you think about that statistics, the right thing to do is help them trade lands and shed lands that it's just kind of an impossible position for them to be in. And even- Yeah, these lands that you're trading with them, you're trading for are really lands that it's not part of their mission. Correct. They're ending up, you know, really, I'm gonna be a little stark here. Reason why those lands are in their inventory is because nobody else could use them back in the 1920s. Exactly. And the HHL always gets criticized that they're sitting on all this land, 200,000 acres of land and why aren't they developing all this land? Well, the truth is they cannot because it's conservation, preservation, and it doesn't have infrastructure. It's along the hillside. And out of 200,000, if everybody knew that only 9,500 is ready to be developed, I think the public would be shocked. In fact, out of the 9,500 acres, only 3.5% of that land base is on Oahu and the population and the need is on Oahu. So it's even more so that we have to step up. So what are you gonna do about that? I mean, I think that in a general, just in general, what you're proposing seems like it has a lot of merits. The problem though, if I remember correctly, was just what you pointed out, which is the fact that most of the demand for housing, is on this island and it's on Oahu that you have the least amount of developable lands. So what's the formula for dealing with that? Yeah, so knowing that fact helps us navigate where we wanna go. So if the land bank on Oahu is limited and the population and the need is on Oahu, we really need to go out and look at available lands that we can trade with DHHL or purchase on behalf of DHHL. The other thing is the concept, and I think Governor, you and I talked about this, putting all native Hawaiians in one area may not be the best thing because it's somewhat similar to the Native American reservation concept. And I don't think that is in the eye. It doesn't seem to work very well in Hawaiians. It's not really right. You know, our original proposal for couple day, which is what we discussed, was that when the state acquired that land, which was formerly sugar lands, and if you follow the state constitution, a third of those, of whatever of those lands needed to be either the revenue from it or something dedicated to Hawaiians. And the idea was to put a third, every third house in the development in their lands and what it does not only makes a better neighborhood I believe myself in the sense that everybody's like Hawaii is anyway, which is all mixed up, but it also lowered the cost of infrastructure for everybody, not for DHHL as well as the non-DHHL housing, which by the way, because we had a lottery system may have included native Hawaiians even on those lands. You see, it's not just visa. So I think it's tremendously exciting, the idea of incorporating some of this effort with just the general housing program. Yeah, placing native Hawaiians on the wait list outside of the native DHHL inventory, I think that in itself is exciting because sometimes it's difficult to look for large plots of land. It might be easier to look at housing inventory and homes, whether it's for clothes or whether it's banking homes in different areas and purchasing those lots and then finding a way to place native Hawaiians on those lots as well. So it opens up a lot more possibilities. You know, there is precedence for doing that and the Princess Kahanu development in Nanakuli was actually a city project, city housing project that never quite got developed if they began and they started bit since first and it was sitting there in Hawaiian homes, purchased it, the state purchased it and gave it to Hawaiian homes. So it's not like there is no precedence for doing this in case you run into any attorney generals that tell you. I just tell you that because you're bringing up some really exciting ideas and unfortunately it's been my experience with government that unless you watch out for it and I know all my fellow attorneys are gonna hate me for saying this, but it's been my experience that every time you bring up something exciting, first people to say, okay, is the lawyer. So just tell them, there's been precedence to do what you suggested. You know, I really think this is fascinating and the idea of doing now, what it seems to me that if you can do what you're proposing whatever the details may be that you also gonna just help the housing situation in Hawaii in general anyway and maybe get some people off the streets who can't afford to get a house list, open up the market for other people that may be just competing now in a tight market. You know, the whole idea of it's just seems to not only work for native Hawaiians but for the entire community. Right, you're absolutely right. Affordable housing is not just a native Hawaiian issue, it's a statewide issue and if we can try to resolve affordability for a segment of the population, we are tackling affordable housing for the entire state. That's why it's even multi-prong and we're very excited about this approach as well. You know, what's exciting to me is the idea that you may be able to see for a long time, one of the problems that Hawaiian homes have to face was the idea that what is a home step? And so they keep talking about a house a lot, house a lot. And yet as the years develop, especially if you live in an urban area like Hawaii, you know, the idea of developing apartments, the idea about developing for, allowing native Hawaiians who are unfortunately, who have been neglected on the waiting list for years and who no longer say me are the people that originally applied. I mean, it would be great to have something like Kahala Nui for, I mean senior housing, you know, as an alternative. And I know every once in a while, I get notes and all of a sudden, why isn't there any senior housing for native Hawaiians? I think you're opening up a lot of doors representative for a lot of exciting ideas. And then we are also tackling rentals as well. So the Eisenberg property, which was the old Bolotron property, there is already a concept in place to build a rental project. So we are at that point where DHHL were with the DHHL leadership and with the House and the Senate working together, we have real possibility to make big changes to put native Hawaiians on home lots. What's impressing me just as much, in fact, in some respects, more than money representative is your enthusiasm for solving this problem, you know. And I have to tell you that the Eisenberg property, since you've mentioned it, we actually transferred it to wine homes to do precisely that when I was still in office. And I'm an old man, you know. And I'm so glad that somebody like yourself is jumping on there and trying to get it done. So getting it done is the real problem. And that is, where does all of this go from here? I mean, right now we have a great conversation, you're generating a lot of enthusiasm. Where does it go? And what happens now? So clearly $600 million cannot be spent all in one year and we don't have enough housing or inventory for us to go and purchase everything. We look at this as a decade solution and because we need to be methodical, we need to be responsive and responsible and accountable to the public as well. A lot of times when we provide a big amount and there is always skepticism that state government will mess it up. But I think this is something that we are all committed to doing it right and doing it well. And it's going to take time, but we are committed to making this work. Is there any thought to creating at least a part of this as a trust fund like we did for the office of Hawaii Affairs? So that's exactly what we're looking at, yeah. We will be setting up a separate trust fund with specific intent on what we're trying to achieve and have an annual reporting so that we can track its progress with specific benchmarks. And we are engaging many native Hawaiian nonprofits as well. They're very excited and we are really interested and excited about bringing many people and the community together to make this right and make this work. Well, that's fantastic, you know, and what's exciting about it is that not only are you taking care of housing, you're also dealing in a real way, not, you know, not Shibai way, but a real way with the whole constitutional mandate of doing something like this. And I don't know if people out there know, but our obligations to the Department of Hawaiian Homeland was actually a condition of our state. So, you know, we're states supposed to do these things. And it's like terribly exciting to see you taking it so seriously. This is exciting time. And, you know, we expect a lot from this department and we have great things that we have placed upon them. So I think it's upon all of us to hold each other accountable and make sure it gets done and it gets done. Well, let me ask you a question real quick, you know, and you don't need a long answer to this, but where is the Senate and the executive on your whole initiative? I mean, are these at least flowing in the same direction with you? Are they gonna be a problem? Where are they in the scenario? So before we launched this idea, I had a long discussion with both Senator Jared Keohokalole, who is the leader of the Senate Hawaiian Caucus and Chair Dela Cruz, and their vote very excited and supportive. And they do understand that this is an obligation that we have to meet. And we've also been working very closely with Chair Aila and his deputy Tyler Gomes. So I think everyone believed that this can happen and this is the amount that we need to fulfill our legal obligation. Well, Chair, I really wanna thank you. We unfortunately have ran out of time, but I really wanna thank you for joining us this afternoon, but more importantly for, you know, doing something concrete about the state's obligation to the Department of Hawaiian Homeland and not just talking about it. So as usual, I made a right choice when I cast my vote for you many, many years ago. So thank you and it's been a pleasure to have you on the show. Thank you. Aloha.