A governor’s task force has recommended sweeping changes to the Department of Hawaiian Home Lands’ controversial month-to-month land leasing program, addressing flaws that the Honolulu Star-Advertiser exposed in a series of articles last year.

The proposed reforms to the agency’s so-called revocable permit system, which was loosely run and had no administrative rules to ensure uniformity, would make it more transparent and fair, and eliminate questionable practices that have been in place for years.

Among other things, the advisory group set up by Gov. Neil Abercrombie recommended that DHHL:

» Do away with the "first come, first serve" process for awarding permits and instead implement a competitive bid-type system for making such awards.

» Establish a proper method for determining appropriate rents.

» Allocate staff to conduct annual compliance reviews to ensure the tenants are abiding by permit terms and to expeditiously act when violations are found.

» Adopt administrative rules to implement the new program.

» Stop renewing permits automatically each year but conduct reviews to determine whether to continue them.

» Create a manual of internal procedures for DHHL staff to follow regarding issuance, compliance checks and enforcement of permits.

"I think this is absolutely fantastic," said Curtis Crabbe, a DHHL beneficiary from Molokai who has been critical of the way the program has been run.

The recommendations were developed by Attorney General David Louie, Department of Land and Natural Resources Director William Aila and Department of Budget and Finance Director Kalbert Young and were presented to the Hawaiian Homes Commission earlier this month.

Abercrombie formed the advisory group following a Star-Advertiser series in May 2013 that identified numerous problems with the revocable permit program, including selective enforcement and lax oversight.

The newspaper, for instance, revealed that DHHL had failed to enforce permit terms for a former agency commissioner who had built an unauthorized home on more than 300 acres of pastoral property he was leasing through the program. Residential use is not permitted on revocable permit land.

Only after the series came out did the agency order Stuart Hanchett, who served as a DHHL commissioner for six years beginning in 2005, to remove the home.

Adoption of the recommendations will ensure the new permit system "provides greater transparency and fairness to DHHL’s beneficiaries and the public," the advisory group wrote in a memo to the commission. "More importantly, it will improve efforts to ensure the safe and appropriate use of Hawaiian Home Lands and increase the income stream generated therefrom. In short, the foregoing recommendations will strengthen DHHL’s ability to carry out its mission in service to its Native Hawaiian beneficiaries."

In response to the Star-Advertiser’s findings last year, DHHL imposed a moratorium on the issuing of new permits, inspected the roughly 180 existing permit sites statewide and ordered tenants found to be in violation, such as Hanchett, to correct the infractions or face losing the land.

The permit program was established decades ago as a way for DHHL to raise revenue for its main homesteading mission while having the tenants take over maintenance of the largely raw land, which was not deemed ready for homesteading development in the near future.

In 2012, the 178 permits covering nearly 33,000 acres statewide generated more than $2.6 million for the agency.

Rents were deeply discounted to reflect the month-to-month nature of the agreements. But instead of short-term deals, many in effect became long-term agreements, renewed each year automatically, with some in place for more than two to three decades.

The advisory group recommended that only DHHL land envisioned for development in less than 20 years be made available for the month-to-month leasing program.

Land not pegged for development within 20 years should be offered for rent through leases or licenses, which are designed to be more long-term in nature, instead of revocable permits, according to the group.

While lauding the proposed changes, Crabbe, the Molokai beneficiary, said he views them as only a small part of the widespread reforms needed in the management of the 203,000-acre land trust that DHHL oversees. "This is just a Band-Aid measure," he said.

The only way to achieve widespread reforms, Crabbe added, is for the federal government to take oversight of the trust.

The land trust was established by the federal government nearly a century ago for the benefit of those who are at least 50 percent Native Hawaiian. The main mission of DHHL is to offer 99-year leases, at $1 annually, to beneficiaries for residential, ranching or farming homesteads.

Punialoha Chee, a DHHL spokesman, said in written responses to Star-Advertiser questions that the agency already has implemented several of the advisory group’s recommendations, including ceasing the issuing of new permits, reviewing existing ones for compliance and converting the agreements to so-called rights of entry while the new permit program is developed.

He said the commission is expected to take action on the proposed recommendations at its September meeting.

Pending commission approval of the revamped program, DHHL will hold informational meetings statewide to get feedback from beneficiaries and the public, according to Chee.

The proposals may be revised based on that feedback, and a final recommendation will be presented to the commission for approval and implementation, he added.

"Revisions to the RP program are intended to maximize the revenue generating potential of non-homesteading lands as a means of financing our mission of placing more Native Hawaiian beneficiaries on the land," Chee wrote.

KipuKai Kuali’i, a Kauai beneficiary, said the revised program should give beneficiaries who are on homesteading waitlists preference over non-beneficiaries.

The Star-Advertiser series noted only about a third of the tenants on the nearly 33,000 acres of permit land are Hawaiian.

Kuali’i also said DHHL needs to "do more as far as outreach and education" so beneficiaries know about the month-to-month leasing program.

Renwick "Uncle Joe" Tassill, one of the nine Hawaiian Homes commissioners, said the proposed reforms are long overdue.

But consulting with beneficiaries before making any changes is critical, Tassill added.

"We need to sit and talk about how we address these proposed changes," he told the Star-Advertiser.  "We need to talk about how we apply the new rules to help better the situations of beneficiaries."