Plans to spend $600 million allocated to the state Department of Hawaiian Home Lands could change under newly appointed director Ikaika Anderson, who told state lawmakers Tuesday that he will solicit other ideas from the Hawaiian Homes Commission at its next meeting.

Possibilities include setting aside funds for building rental housing and providing down payment assistance for some of the 28,000 people on the DHHL waitlist. The current plan to spend that $600 million approved by the commission last year is expected to generate more than 3,100 lots that could be used for housing.

“We are having discussions with the administration over a possible departure,” Anderson told a joint hearing of the Senate Ways and Means and Hawaiian Affairs committees.

A joint Senate panel grilled new DHHL Chairman Ikaika Anderson on plans to spend $600 million to benefit Hawaiians. Screenshot/Hawaii Senate/2023

Details on what changes could be in store weren’t available yet because Anderson said he has not had time to speak with the nine-member Hawaiian Homes Commission, which is responsible for overseeing DHHL’s finances and the more than 200,000 acres of trust lands under its purview.

The $600 million homestead package approved last year was hailed by many as a long-overdue effort to put sufficient funds behind efforts to whittle down the waitlist and provide more Hawaiians with land set aside under the federal Hawaiian Homes Commission Act of 1920.

While rentals may not necessarily reduce the waitlist, Anderson said they could be an option for beneficiaries who are not ready to finance their own home or who can’t afford to. He pointed to redevelopment of the old Stadium Bowl-O-Drome site in Moiliili as one example. The project is expected to yield more than 270 units. There are also plans underway to develop two smaller apartments in Moiliili and build some rental units in East Kapolei, which are expected to provide affordable housing units or those for kupuna.

“We need to do more rentals on a larger scale, especially on the neighbor islands,” Anderson said.

Last year, lawmakers discussed the possibility of offering those on the waitlist $100,000 in down payment assistance in exchange for removing themselves from the waitlist.

Deputy DHHL Director Katie Lambert Ducatt said the department is asking the state Attorney General for advice on that idea after concerns were raised over whether the state can spend DHHL money on lands not under the control of the department.

A separate plan submitted to Gov. Josh  Green’s administration by a group of advocacy organizations took a more robust approach, allocating the money to various programs, buying land, and using funds available to leverage private investments in homebuilding.

Anderson described his discussions with the Green administration as preliminary.

“We are in discussion for additional ideas and policies this administration might have,” Anderson said. “I have not had the opportunity to talk to the commission about that.”

Lawmakers expressed frustration over the lack of details on the current spending plan as well as ideas for the future. Anderson and his staff appeared unprepared to discuss their plans for the $600 million and at times struggled to find answers to the senators’ questions while shuffling through paperwork.

“We’re sitting here having this discussion on $600 million given last year. We have people dying on the list, and people won’t get their homes because we’re sitting here doing this crap,” Senate Vice President Michelle Kidani said. “It’s very irritating sitting here not having the information we need to get homes to our kupuna. I don’t know how you guys feel but I am so pissed off.”

Concerns also were raised over what a departure from the currently approved plan could mean for the funds, which must be spent in the next two years. If the department doesn’t spend the money in that time, it could lose out on the historic level of funding.

Under Act 279, the funding bill, DHHL has until June 2025 to spend the $600 million the Legislature appropriated in 2022. Under the current plan, the department would encumber $172 million by the end of the current fiscal year on June 30, and $367 million the year after.

Any departure from the current plan would require approval of the commission. The current DHHL spending plan mirrored a Senate proposal from last year that focused on shovel-ready projects.

Sen. Jarrett Keohokalole said the Senate identified projects “that can be done as quickly as possible.”

“It sounds like you need more time to come up with concrete alternatives to the plan submitted,” Keohokalole said.

Complicating matters is a federal requirement under the American Rescue Plan act that requires the state to maintain proportional funding to public education programs, which could limit the amount of money DHHL actually spends until ARPA funds are depleted.

Anderson said he’s confident the department will be able to encumber all of its funds before the 2025 deadline. But the uncertainty over the ARPA requirements and the direction the department would take left senators with more questions.

“Some of the questions, you can’t answer today,” Sen. Gil Keith-Agaran said. “It might make more sense to come back.”

The committee recessed until later in January to allow time for Anderson to meet with the Hawaiian Homes Commission. A commission meeting is scheduled for next Tuesday, but the agenda was not posted as of Tuesday afternoon.

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