SB 3128

THE SENATE
S.B. NO.
3128
THIRTY-THIRD LEGISLATURE, 2026
STATE OF HAWAII
A BILL FOR AN ACT
RELATING TO THE HAWAIIAN
HOMES COMMISSION ACT, 1920.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
���� SECTION 1.�
Section 208 of the Hawaiian Homes Commission Act, 1920, is
amended to read as follows:
���� "�208.� Conditions
of leases.� Each lease made under the authority granted the department by
section 207 of this Act, and the tract in respect to which the lease is made,
shall be deemed subject to the following conditions, whether or not stipulated
in the lease:
���� (1)� The original lessee shall be a native Hawaiian, not less than
eighteen years of age.� In case two
lessees either original or in succession marry, they shall choose the lease to
be retained, and the remaining lease shall be transferred, quitclaimed, or
canceled in accordance with the provisions of succeeding sections.
���� (2)� The lessee shall pay a rental of $1 a year for the tract and the
lease shall be for a term of ninety-nine years; except that the department may
extend the term of any lease; provided that the approval of any extension shall
be subject to the condition that the aggregate of the initial ninety-nine year
term and any extension granted shall not be for more than one hundred
ninety-nine years.
���� (3)� The lessee may be required to occupy and commence to use or
cultivate the tract as the lessee's home or farm or occupy and commence to use
the tract for aquaculture purposes, as the case may be, within one year after
the commencement of the term of the lease.
���� (4)� The lessee thereafter, for at least such part of each year as the
department shall prescribe by rules, shall occupy and use or cultivate the
tract on the lessee's own behalf.
���� (5)� The lessee shall not in any manner transfer to, or otherwise hold
for the benefit of, any other person or group of persons or organizations of
any kind, except a native Hawaiian or Hawaiians, and then only upon the
approval of the department, or agree so to transfer, or otherwise hold, the
lessee's interest in the tract; except that the lessee, with the approval of
the department, also may transfer the lessee's interest in the tract to the
following qualified relatives of the lessee who are at least one-quarter
Hawaiian: husband, wife, child, [[or]] grandchild[[.]], niece, or
nephew.� A lessee who is at least
one-quarter Hawaiian who has received an interest in the tract through
succession or transfer may, with the approval of the department, transfer the
lessee's leasehold interest to a brother or sister who is at least one-quarter
Hawaiian.� Such interest shall not,
except in pursuance of such a transfer to or holding for or agreement with a
native Hawaiian or Hawaiians or qualified relative who is at least one-quarter
Hawaiian approved of by the department or for any indebtedness due the
department or for taxes or for any other indebtedness the payment of which has
been assured by the department, including loans from other agencies where such
loans have been approved by the department, be subject to attachment, levy, or
sale upon court process.� The lessee
shall not sublet the lessee's interest in the tract or improvements thereon;
provided that a lessee may be permitted, with the approval of the department,
to rent to a native Hawaiian or Hawaiians, lodging either within the lessee's
existing home or in a separate residential dwelling unit constructed on the
premises.
���� (6)� Notwithstanding the provisions of paragraph (5), the lessee, with
the consent and approval of the commission, may mortgage or pledge the lessee's
interest in the tract or improvements thereon to a recognized lending
institution authorized to do business as a lending institution in either the
State or elsewhere in the United States; provided the loan secured by a
mortgage on the lessee's leasehold interest is insured or guaranteed by the
Federal Housing Administration, Department of Veterans Affairs, or any other
federal agency and their respective successors and assigns, which are
authorized to insure or guarantee such loans, or any acceptable private
mortgage insurance as approved by the commission.� The mortgagee's interest in any such mortgage
shall be freely assignable.� Such
mortgages, to be effective, must be consented to and approved by the commission
and recorded with the department.
������ ������� Further, notwithstanding the authorized purposes of loan limitations
imposed under section 214 of this Act and the authorized loan amount
limitations imposed under section 215 of this Act, loans made by lending
institutions as provided in this paragraph, insured or guaranteed by the
Federal Housing Administration, Department of Veterans Affairs, or any other
federal agency and their respective successors and assigns, or any acceptable
private mortgage insurance, may be for such purposes and in such amounts, not
to exceed the maximum insurable limits, together with such assistance payments
and other fees, as established under section 421 of the Housing and Urban Rural
Recovery Act of 1983 which amended Title II of the National Housing Act of 1934
by adding section 247, and its implementing regulations, to permit the
Secretary of Housing and Urban Development to insure loans secured by a
mortgage executed by the homestead lessee covering a homestead lease issued
under section 207(a) of this Act and upon which there is located a one to four
family single family residence.
���� (7)� The lessee shall pay all taxes assessed upon the tract and
improvements thereon.� The department may
pay such taxes and have a lien therefor as provided by section 216 of this Act.
���� (8)� The lessee shall perform such other conditions, not in conflict
with any provision of this Act, as the department may stipulate in the lease;
provided that an original lessee shall be exempt from all taxes for the first
seven years after commencement of the term of the lease."
���� SECTION 2.� Section 209 of the Hawaiian Homes
Commission Act, 1920, is amended by amending subsection (a) to read as follows:
���� "(a) �Upon the death of
the lessee, the lessee's interest in the tract or tracts and the improvements
thereon, including growing crops and aquacultural stock (either on the tract or
in any collective contract or program to which the lessee is a party by virtue
of the lessee's interest in the tract or tracts), shall vest in the relatives
of the decedent as provided in this paragraph. �From the following relatives of the lessee who
are (1) at least one-quarter Hawaiian, husband, wife, children, grandchildren,
brothers, [[or]] sisters, nieces, or nephews, or (2) native
Hawaiian, father and mother, widows or widowers of the children, or
widows or widowers of the brothers and sisters[[, or nieces and nephews,]]��the
lessee shall designate the person or persons to whom the lessee directs the
lessee's interest in the tract or tracts to vest upon the lessee's death. �The Hawaiian blood requirements shall not
apply to the descendants of those who are not native Hawaiians but who were
entitled to the leased lands under section 3 of the Act of May 16, 1934 (48
Stat. 777, 779), as amended, or under section 3 of the Act of July 9, 1952 (66
Stat. 511, 513). �In all cases that
person or persons need not be eighteen years of age. �The designation shall be in writing, may be
specified at the time of execution of the lease with a right in the lessee in
similar manner to change the beneficiary at any time and shall be filed with
the department and approved by the department in order to be effective to vest
the interests in the successor or successors so named.
���� In case of the death of any
lessee, except as hereinabove provided, who has failed to specify a successor
or successors as approved by the department, the department may select from
only the following qualified relatives of the decedent:
���� (1)� Husband or wife; or
���� (2)� If there is no husband or
wife, then the children; or
���� (3)� If there is no husband,
wife, or child, then the grandchildren; or
���� (4)� If there is no husband, wife, child, or grandchild, then brothers or
sisters; or
���� (5)� If there is no husband,
wife, child, grandchild, brother, or sister, then nieces or nephews; or
��� [[(5)]] (6)� If there is no
husband, wife, child, grandchild, brother, [[or]] sister, niece, or
nephew, then from the following relatives of the lessee who are native
Hawaiian: father and mother, widows or widowers of the children, or widows
or widowers of the brothers and sisters[[, or nieces and nephews]].
The rights to the use and occupancy of the tract or tracts may
be made effective as of the date of the death of the lessee.
���� In the case of the death of
a lessee leaving no designated successor or successors, husband, wife,
children, grandchildren, or relative qualified to be a lessee of Hawaiian home
lands, the land subject to the lease shall resume its status as unleased Hawaiian
home lands and the department is authorized to lease the land to a native
Hawaiian as provided in this Act.
���� Upon the death of a lessee
who has not designated a successor and who leaves a spouse not qualified to
succeed to the lease or children not qualified to succeed to the lease, or upon
the death of a lessee leaving no relative qualified to be a lessee of Hawaiian
home lands, or the cancellation of a lease by the department, or the surrender
of a lease by the lessee, the department shall appraise the value of all the
improvements and growing crops or improvements and aquacultural stock, as the
case may be, and shall pay to the nonqualified spouse or the nonqualified
children as the lessee shall have designated prior to the lessee's death, or to
the legal representative of the deceased lessee, or to the previous lessee, as
the case may be, the value thereof, less any indebtedness to the department, or
for taxes, or for any other indebtedness the payment of which has been assured
by the department, owed by the deceased lessee or the previous lessee. �These payments shall be made out of the
Hawaiian home loan fund and shall be considered an advance therefrom and shall
be repaid by the successor or successors to the tract involved. �If available cash in the Hawaiian home loan
fund is insufficient to make these payments, payments may be advanced from the
Hawaiian home general loan fund and shall be repaid by the successor or
successors to the tract involved; provided that any repayment for advances made
from the Hawaiian home general loan fund shall be at the interest rate
established by the department for loans made from the Hawaiian home general
loan fund. �The successor or successors
may be required by the commission to obtain private financing in accordance
with section 208(6) to pay off the amount advanced from the Hawaiian home loan
fund or Hawaiian home general loan fund."
���� SECTION 3.� Section 209 of the Hawaiian Homes Commission
Act, 1920, as amended by section 2 of Act 80, Session Laws of Hawaii 2017, and
pending consent of the United States Congress, is amended by amending
subsection (a) to read as follows:
���� "(a)� Upon the death of
the lessee, the lessee's interest in the tract or tracts and the improvements
thereon, including growing crops and aquacultural stock (either on the tract or
in any collective contract or program to which the lessee is a party by virtue
of the lessee's interest in the tract or tracts), shall vest in the relatives
of the decedent as provided in this paragraph. �From the following relatives of the lessee who
are (1) at least one thirty-second Hawaiian, spouse, children, grandchildren, brothers,
[[or]] sisters, nieces, or nephews, or (2) native Hawaiian, father
and mother, widows or widowers of the children, or widows or widowers of
the brothers and sisters[[, or nieces and nephews,]]��the lessee shall designate
the person or persons to whom the lessee directs the lessee's interest in the tract or tracts to vest upon the lessee's death. �The Hawaiian
blood requirements shall not apply to the descendants of those who are not
native Hawaiians but who were entitled to the leased lands under section 3 of
the Act of May 16, 1934 (48 Stat. 777, 779), as amended, or under section 3 of
the Act of July 9, 1952 (66 Stat. 511, 513). �In all cases that person or persons need not
be eighteen years of age. �The designation
shall be in writing, may be specified at the time of execution of the lease
with a right in the lessee in similar manner to change the beneficiary at any
time and shall be filed with the department and approved by the department in
order to be effective to vest the interests in the successor or successors so
named.
���� In case of the death of any
lessee, except as hereinabove provided, who has failed to specify a successor
or successors as approved by the department, the department may select from
only the following qualified relatives of the decedent:
���� (1)� Spouse; or
���� (2)� If there is no spouse, then
the children; or
���� (3)� If there is no spouse or
child, then the grandchildren; or
���� (4)� If there is no spouse,
child, or grandchild, then brothers or sisters; or
���� (5)� If there is no spouse,
child, grandchild, brother, or sister, then nieces or nephews; or
 [[(5)]] (6) �If there is no spouse, child, grandchild, brother,
[[or]] sister, niece, or nephew, then from the following relatives
of the lessee who are native Hawaiian: father and mother, widows or widowers of
the children, or widows or widowers of the brothers and sisters[[, or
nieces and nephews]].
The rights to the use and occupancy of the tract or tracts may
be made effective as of the date of the death of the lessee.
���� In the case of the death of
a lessee leaving no designated successor or successors, spouse, children,
grandchildren, or relative qualified to be a lessee of Hawaiian home lands, the
land subject to the lease shall resume its status as unleased Hawaiian home
lands and the department is authorized to lease the land to a native Hawaiian
as provided in this Act.
���� Upon the death of a lessee
who has not designated a successor and who leaves a spouse not qualified to
succeed to the lease or children not qualified to succeed to the lease, or upon
the death of a lessee leaving no relative qualified to be a lessee of Hawaiian
home lands, or the cancellation of a lease by the department, or the surrender
of a lease by the lessee, the department shall appraise the value of all the
improvements and growing crops or improvements and aquacultural stock, as the
case may be, and shall pay to the nonqualified spouse or the nonqualified
children as the lessee shall have designated prior to the lessee's death, or to the legal representative of the deceased
lessee, or to the previous lessee, as the case may be, the value thereof, less
any indebtedness to the department, or for taxes, or for any other indebtedness
the payment of which has been assured by the department, owed by the deceased
lessee or the previous lessee. �These
payments shall be made out of the Hawaiian home loan fund and shall be
considered an advance therefrom and shall be repaid by the successor or
successors to the tract involved. �If
available cash in the Hawaiian home loan fund is insufficient to make these
payments, payments may be advanced from the Hawaiian home general loan fund and
shall be repaid by the successor or successors to the tract involved; provided
that any repayment for advances made from the Hawaiian home general loan fund
shall be at the interest rate established by the department for loans made from
the Hawaiian home general loan fund. �The
successor or successors may be required by the commission to obtain private
financing in accordance with section 208(6) to pay off the amount advanced from
the Hawaiian home loan fund or Hawaiian home general loan fund."
���� SECTION 4. �Statutory material to be repealed is bracketed
and stricken. �New statutory material is
underscored.
���� SECTION 5. �This Act shall take effect upon its
approval pursuant to section 16 of article III of the Constitution of the State
of Hawaii; provided that sections 1, 2, and 3 shall take effect pursuant to
title 43 Code of Federal Regulations part 48 on either:
���� (1)� The
date of the United States Secretary of the Interior's notification letter to
the Congressional Committee Chairpersons that this Act meets none of the
criteria in title 43 Code of Federal Regulations section 48.20; or
���� (2)� The
date that the United States Congress's approval becomes law.
INTRODUCED BY:
_____________________________
BY
  REQUEST
Report Title:
HHCA; Department of Hawaiian Home Lands; Eligible
Transferees and Successors to Homestead Leases
Description:
Amends sections 208 and 209(a) of the Hawaiian Homes
Commission Act, 1920, to include nieces and nephews who are at least
one-quarter Native Hawaiian as qualifying relatives of lessees for the purposes
of lease transfer and lease successorship.
The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.