DHHL commissioners approve Nanakuli lease terms and mortgage amendment amid calls for association review

The Hawaiian Homes Commission voted July 22 to approve changes to lease terms for the Nanakuli Village Center and to allow an amendment to a mortgage with American Savings Bank, moving forward despite multiple public speakers who asked the Nanakuli Hawaiian Homestead Association to first hold a community review of its bylaws and finances.

The vote followed a long public discussion in which residents and association leaders described the Nanakuli Village Center and Hale Makana affordable housing as local economic development intended to provide jobs, cultural programming and low‑cost housing, while several beneficiaries said the association had not kept the wider community adequately informed.

Kamaki Kanahhele, identified in testimony as president of the Nanakuli Hawaiian Homestead Association, described the Village Center and Hale Makana as a long‑standing community effort and an economic model. "This Nanakuli Village Center . . . is the only center of its kind statewide on Hawaiian homestead lands," Kanahhele said, and he detailed financing sources used for the project, naming New Market Tax Credits, American Savings Bank, and private guarantees from two individuals that he said were necessary to complete the development.

Kanahhele and other presenters said the development produced both commercial space and 48 rental housing units (primarily three‑bedroom units) funded with an approximately $14.5 million financing package that Kanahhele described as a combination of federal and state low‑income housing tax credits, bonds and a rental housing revolving fund. He said the rental units had average monthly rents of about $350 and that Kamehameha Schools had committed $10 million toward a cultural learning center component.

At the same time several Nanakuli residents told commissioners they were not getting routine communication from the association and raised concerns about governance and financial transparency. Longtime resident Arlene Lucero testified she had asked repeatedly for community meetings and, after reviewing records, believed the homestead association "is not legitimately elected according to my ballots." Lucero and other speakers said they had not seen bylaws or minutes for years and raised specific questions about distribution and accounting of association funds, including a referenced $25,000 amount that a speaker characterized as "invisible." Georgette Myers and other residents said the association needed to be accountable to beneficiaries.

Commissioners said they were sympathetic to both the association's economic arguments and the community's transparency concerns. Commissioner Kaleikini said he was "supportive" of the two items before the commission from a business perspective but urged the association to resolve the governance questions: commissioners asked for bylaws and minutes to be provided so beneficiaries could confirm the association supported the lease and mortgage actions. Commissioner Kalapa and Commissioner Ornelas likewise praised the project's community potential while urging improved outreach and accountability.

Several speakers asked the commission to defer action 30 days so the association could complete an internal review and present the requested documents. Commissioners debated that request; members who spoke said delay risked harming small local businesses that rely on the center's favorable lease terms. After discussion the roll call returned six ayes and the motion carried.

Votes at a glance: - Motion (text as described at the hearing): Approve Nanakuli Hawaiian Homestead Association lease/rent terms (including an initial reduced rent period) and authorize amendment to the mortgage with American Savings Bank. Mover/second: not specified in the record. Vote tally: Commissioner Freitas — yes; Commissioner Kaleikini — yes; Commissioner Colepa — yes; Commissioner Lasua — yes; Commissioner Arnelas — yes; Chair Marfield — yes. Outcome: approved (motion carried, 6 ayes).

Direction and next steps: Commissioners urged the Nanakuli Hawaiian Homestead Association to schedule and conduct a community meeting, provide bylaws and minutes requested by beneficiaries, and work with department staff on financial reporting and oversight. Department staff and association leaders told the commission that funds held at American Savings Bank would remain in place "untouched" until the parties agreed what was best for the community, according to testimony.

Background and financing noted in testimony: presenters said the Village Center project used New Market Tax Credits and bank financing, private guarantees were used to secure the development, and a separate affordable housing component (Hale Makana) leveraged approximately $14.5 million in federal and state low‑income housing tax credits, bonds and rental housing revolving fund resources to produce 48 units intended primarily for larger families. Speakers named Kamehameha Schools, Hawaiian Community Development and American Savings Bank as partners or financing participants.

Community reaction and implementation risk: beneficiaries who testified said they want the economic benefits of the center to remain in the community but also demanded transparent governance, monthly or regular reporting and inclusive, democratically held association elections. Commissioners described implementation risk as medium because financing and the mortgage amendment are in place but community objections and governance disputes may require the association to take additional internal steps to preserve public confidence.

The commission did not resolve the association's internal governance disputes; commissioners and staff said those matters primarily fall to the association and its members but that the department can assist with transparency and accountability as the association implements the approved lease and mortgage terms.