Public Land Trust working group backs independent audit of PLTIS, seeks budget request

The Public Land Trust Working Group on Oct. 14, 2024 agreed to seek funding for an independent third-party review of the state's Public Land Trust Information System (PLTIS) and for an audit of agencies' revenue reporting, recommending both legislative appropriation and an executive-branch budget request to start the work.

The recommendation grew out of months of disagreement between Office of Hawaiian Affairs trustees and state representatives over whether the interim report to the Legislature should include OHA's detailed claims about historic undercounting of ceded and government lands and omitted revenues. Sherry Broder, Trustee, said OHA will submit its own addendum if the joint report omits those positions.

The working group's interim-report discussion focused on two items the members said they can agree on now: (1) an independent audit or inventory of PLTIS to establish a single, verifiable accounting of ceded and government lands, and (2) an audit of how state agencies report income, proceeds and revenues from those lands. The group directed staff and the state-side members to seek a budget appropriation to pay for the work and to ask that the governor include a parallel request in the executive budget.

"We should ask for monies for this inventory for once and for all," Trustee Sherry Broder said, urging the working group to present a clear request to both the Legislature and the governor. Broder said OHA does not want the Legislature to redefine revenue definitions but wants a reliable accounting and reporting of revenues that OHA contends are owed.

State representative Don Chang (referred to in the meeting as "Chair Chang") and other state-side members said they removed several paragraphs from an earlier OHA draft because those items represent OHA's positions and are in some cases legislative questions or contested interpretations. "It's either gonna say it's accurate or it's not accurate," Chang said of the proposed independent inventory; he and other state members said an independent review would provide a definitive baseline for future action.

Several speakers proposed dual tracks to advance the audit: request an appropriation through the working group's interim report, and also include the request in the governor's budget so the administration and legislators see both executive and working-group support. Stacy Ferreira, administrative support, and other members said submitting both routes would strengthen the request.

Estimates for the cost of a third-party review varied in the meeting. Participants recalled an earlier PLTIS development contract measured in the low millions; one participant said $500,000 had been discussed in prior drafts, another suggested $1 million, and a state representative said a $5 million figure sounded realistic for a comprehensive inventory. Meeting participants emphasized those numbers are preliminary estimates and asked DLNR staff and state representatives to provide a more concrete cost estimate before the next meeting.

On timing, staff said procurement and contracting would take months: if funds are appropriated in the next budget cycle, procurement could take roughly nine months plus several additional months to begin substantive audit work. Several members said the review likely would not be completed by the next legislative session and that the work could take multiple years in practice.

The working group agreed to draft an interim report that emphasizes the agreed items (audit of PLTIS and audit of revenue reporting), to circulate a proposed budget request, to have OHA prepare any separate addendum it wishes to submit, and to brief legislative leadership orally in addition to the written interim report. The group set a next meeting for Nov. 20, 2024 at 3:30 p.m.

Procedural votes at the Oct. 14 meeting included approval of the Aug. 12, 2024 meeting summary and a routine motion to adjourn; both motions passed by roll call.

Background: participants referenced prior state actions and litigation, citing a 1982 Hawaii Supreme Court decision (Yamashiro) that earlier courts characterized as a political question, and earlier legislative acts and agreements such as the 1990 agreement often referenced as Act 304. Members repeatedly said the absence of an accepted, independent inventory has stalled resolution.

The working group asked DLNR and state representatives to return with a scope and cost estimate for a third-party procurement, and to circulate a revised interim-report draft that incorporates the agreed language and a placeholder for a budget ask. Next meeting: Nov. 20, 2024, 3:30 p.m.