Along with Hawaii’s statehood in 1959 came the responsibility to make available for lease 200,000 acres of land, for $1 yearly per lease, that had been ceded to the United States for Native Hawaiians unable to afford home purchases in the regular market.

The state auditor found 20 years ago that the Department of Hawaiian Home Lands (DHHL) had failed to perform responsibly in carrying out that function, and, sadly, a new audit this week concludes that not much has changed.

DHHL’s unique role is no excuse for failing to meet professional standards, and its shoddy handling of millions of dollars is shameful.

The department’s Hawaiian Homes Commission provides loans to people having at least 50 percent Hawaiian blood for homesteading. By the end of 2011, the commission has provided about 9,200 homestead leases over the decades while more than 26,000 applicants were in the waiting line.

Of the active Hawaiian homesteading accounts, nearly 260 were delinquent at least one year. Of those, 56 were five to 10 years behind and an additional 57 were even more delinquent, according to an audit released by acting state Auditor Jan K. Yamane.

The audit found that $83 million of more than $588 million in homestead loans were delinquent as of June 2012.

DHHL rules state that providing credit to those who cannot afford other financing options is meant "to preserve DHHL resources for those families most in need," Jobie Masagatani, head of the department and commission, wrote in response to the audit. However, that does not mean providing over-the-top leniency for delinquent homesteaders while others wait in line.

"By failing to identify and mitigate loan risk, and by allowing lessees to remain chronically delinquent," the audit points out, "the commission ties up both loan and land resources that could be provided to other beneficiaries and creates a solvency risk for the Hawaiian Home Lands trust fund."

It would be one thing if the commission had been cognizant of the mounting loan risk exposure and 30-day delinquencies that more than doubled from 2009 to 2011. However, the audit "found no evidence of the review of this significant increase in delinquencies." When an auditor noted that documents from a 2009 loan were not in a secured filing area, a commission specialist responded, "I know it’s been years, but out of sight, out of mind."

Indeed, the department’s fiscal management officer admitted to auditors that no detailed analysis had been made to determine whether the direct loan program was profitable or not.

"In fact," the audit said, "the department found few written documents to support and guide commissioners in setting policies and overseeing the department’s programs and the trust."

Further, lending policies were rarely reassessed, the report found, such as the agency’s 6 percent loan interest rate that hadn’t been reviewed since 1995 — a mind-boggling 18 years ago.

Among other things, the audit emphasizes the need for written policies, as it did in the 1993 audit of the department. Masagatani responded that the change of the commission’s leadership a year ago has led to improved efforts, including training of staff and commission members on loans.

In the best interests of all concerned — not least of all, the 26,000 Hawaiian applicants on the waiting list for a precious homestead — those in charge must undertake a vigorous shoring up of loan practices. As it is, DHHL is largely failing the very ones it is supposed to help — Native Hawaiians.