Thousands of Native Hawaiians who waited decades for homestead leases aimed at guaranteeing them access to ancestral lands may soon get some payment from the state.

The state reached a $328 million settlement agreement with the Hawaiian beneficiaries, who first brought a class-action lawsuit against the Department of Hawaiian Home Lands for mismanaging the public lands trust in the late 1990s.

The settlement agreement, which was unsealed Tuesday afternoon, marked another turn in fortune this year for Native Hawaiians who have long struggled to take advantage of the program meant to ensure they have access to long-term affordable housing. Lawmakers already had plans to set aside $600 million for DHHL housing projects statewide thanks to an unexpected budget windfall.

“We are happy that this long struggle is nearly over and that our class members who have waited decades for a homestead will finally get some compensation,” Leona Kalima, the lead plaintiff in the case, said in a written statement. “This settlement has the potential to change thousands of lives for the better and we’re looking forward to it being resolved, finally.”

OHA Candidate Leone Kalima speaks during forum held at the Windward Community College campus.
Leone Kalima, a lead plaintiff in the DHHL lawsuit, said the settlement announced Tuesday has the chance to “change thousands of lives.” Cory Lum/Civil Beat/2018

More than 2,700 Hawaiian beneficiaries were plaintiffs to the lawsuit. More than 400 Hawaiian beneficiaries already died waiting for a lease to their ancestral lands promised to them by the U.S. Congress in 1921, according to court documents.

The settlements measure, Senate Bill 3041, would still need to clear floor votes in the House and Senate before going to Gov. David Ige for his consideration. It’s likely to clear the Legislature and the governor’s desk. Both lawmakers and Ige applauded the settlement on Tuesday.

The beneficiaries have fought the state for decades in court, going to the Hawaii Supreme Court twice. The high court last weighed in on the fight in 2020, when the justices, siding with the wait listers, said that the case should proceed and the beneficiaries were entitled to damages.

The beneficiaries and their attorneys were gearing up for what appeared to be another elongated legal battle with the state. The announcement on Tuesday was welcome news in the case that has dragged on for 23 years.

A committee of Hawaii lawmakers voted Tuesday to set aside about $328 million to pay for any settlements that arise out of the case. That appropriation was inserted into a measure that typically pays for settlements in lawsuits against the state and its employees.

House Finance Chairwoman Sylvia Luke called the settlement agreement “historic.”

“This has been a long effort,” she said during a hearing on the measure.

She said the settlement agreement was made possible by the state’s unprecedented revenues this fiscal year. Lawmakers are still deliberating on how to spend what could be a $2 billion surplus, which came after concerns last year about potential Covid-19 pandemic-induced shortfalls.

Ige said in a press release that the settlement “fairly compensates the Hawaiian Home Lands beneficiaries and brings this litigation to a close.”

He added that his administration is also still committed to building more homes on DHHL lands.

Attorneys for the beneficiaries were also thankful for reaching the settlement.

“We would like to recognize and thank our class members and their families for their commitment to resolve these long-standing claims,” Tom Grande, one of the lead attorneys, said. “This has been a long struggle and the resolution of this case has only been possible through their collective efforts.”

Hawaii State flags blow in the wind on opening day of the 2021 legislature.
State lawmakers are preparing to finalize a $300 million settlement agreement with Native Hawaiian beneficiaries over breaches of the public land trust. Cory Lum/Civil Beat/2021

Carl Varady, Grande’s co-counsel, said that the claimants’ appreciation is “tempered by the knowledge that nearly a third of the class members will not be with us to witness or celebrate the conclusion.”

In a phone call, Grande said that the courts must still sign off on the settlement if SB 3041 is approved by the governor. The plaintiffs must also still work through a claims process to determine the amount of damages each beneficiary is owed.

Although the settlement agreement was unsealed, it was not readily available on the state’s online records system Tuesday afternoon.

Settlement conferences began March 18 before Judge Gary Chang. Attorneys for the state and the plaintiffs last met for a status conference on April 20. The parties are scheduled for another status conference Wednesday.

State taxpayers will be on the hook for the $300 million settlement. That’s in addition to more than $2 million in other settlement agreements that are already included in SB 3041.

Lawmakers also have announced plans to set aside $600 million for DHHL housing projects in the islands. A Senate draft of the budget would also put some of those funds toward a downpayment and mortgage assistance program for those on the waitlist.

Those funding proposals are still being negotiated between the House and Senate, which could announce a new draft of the state budget bill Wednesday.

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