DHHL gets its funding; now it must deliver

The Department of Hawaiian Home Lands (DHHL) will receive more than double its current level of funding to cover administrative costs in the next fiscal year — all the more reason for taxpayers to demand more accountability from the embattled agency.

Lawmakers passed the state budget last week that allocates DHHL $23.9 million for the year starting July 1, up from the $9.6 million that had initially been allotted.

The amount falls short of the $28.4 million a Circuit Court judge recently deemed a sufficient amount to run the department, but if used wisely, DHHL is in a solid position to better serve its Native Hawaiian beneficiaries.

Also, lawmakers gave DHHL $7.5 million more for this fiscal year, for a $17.1 million total.

The department, which historically has been underfunded, has long struggled with efficiencies and best-practices use of its resources. But the onus now falls on a better-funded DHHL to ratchet up operations.

Among the chronic problems: DHHL has been slow to house its beneficiaries, slow to expend millions of federal dollars and, as a recent state auditor’s report found, slow to improve its administration of loans to beneficiaries — those who are at least 50 percent Native Hawaiian — for housing on department land they lease for residential, ranching or farming homesteads.

That report by acting state Auditor Jan Yamane noted DHHL has implemented only five of 20 recommendations the auditor’s office made in 2013 to address gaps discovered when the department’s lending programs were examined.

The 2013 auditor’s report found that DHHL’s failure to adequately address a growing delinquency problem posed a solvency risk to the agency, yet DHHL has only acted on a quarter of its recommendations.

About $83 million of more than $588 million in loans, including those made by DHHL directly to beneficiaries and those issued by other institutions but backed by the agency, were delinquent as of June 2012, the report found.

As of November, DHHL had nearly 5,000 loans totaling more than $611 million in value in its portfolio, but the report did not provide the current delinquency rate. It would be difficult to determine whether DHHL has made any notable headway in administering its loans without the current delinquency rate.

There is no shortage of examples highlighting DHHL’s dysfunction.The Honolulu Star-Advertiser has documented the department’s lack of land-use expertise, fairness and oversight for its controversial revocable permitting system.

Critics also have pointed out DHHL’s shortcomings in managing its assets, evidenced by the department’s perpetual waiting list of beneficiaries.

Last November, DHHL came under fire by lawmakers for its backlog of more than $55 million in unspent federal housing funds for Native Hawaiians, which caused the feds to lower the annual allotment, then cut it entirely.

The department has since made some headway in drawing down those funds.

The Hawaii Constitution stipulates that the state must fund DHHL’s operating and admini- strative costs in a sufficient manner, a requirement that has triggered years of court battles over adequate state funding.

The funding initiated by Gov. David Ige and just approved by lawmakers appears to fulfill that mandate.

With this $23.9 million show of commitment by the state, it’s now up to DHHL to make sound operational decisions and land-use investments to fulfill its responsi- bilities to its beneficiaries, many of whom have been waitlisted for far too long.